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Flashcards for lecture notes on balancing demand and productive capacity for quality service.
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Demand
The amount of need for a product or service at a given time.
Capacity
The organization’s ability to deliver services; depends on available inputs like labor, time, space, and other resources.
Excess Demand
When demand greatly exceeds capacity, leading to services being denied to some customers and missed revenue opportunities.
Productivity
The efficiency of converting inputs into services.
Predictable Demand Cycles
Recurring increases and decreases in demand, such as daily, weekly, monthly, or yearly/seasonal cycles.
Random Demand Fluctuations
Unpredictable variations in demand without clear cycles.
Demand Patterns by Market Segment
Analyzing customer profiles to identify segment-specific demand patterns and tailor services accordingly.
Marketing Mix Elements
Tools used to manage customer demand, including price, product, place, and promotion.
Fixed Capacity
Service capacity that cannot be easily expanded due to limitations like time, labor, equipment, or facilities.
Optimal Capacity
When resources are fully used without being overstretched, maintaining high service quality.
Maximum Capacity
When all resources are used to the limit, often resulting in long wait times and customer dissatisfaction.
Stretching Capacity
Expanding an organization’s ability to meet high demand without making permanent changes.
Manage Demand Side
Using pricing incentives, reservations, or promotions to control customer flow.
Manage Supply Side
Increasing resources during peak periods and reducing operations during low demand.
Productive Capacity
Resources or assets that organizations utilize to manufacture goods and to render services, including Equipment, Facilities, Infrastructure and Labor