Module 5: Waiting Line Fundamentals

Waiting Line Goals

Finding balance between long lines/unhappy customers vs idle staff/high costs

What are the three parts of a waiting line system?

Input Source, Waiting Line, Service Facility.

Input Source

The population of people that might want service

Waiting Line

The area in which customers wait for service

Service Facility

The area in which customers actually receive service

The cost of waiting for the customer is measured in __________.

TIME.

What is the cost to the company for keeping lines short?

MONEY.

Balking

People who see the line and decide it's not worth waiting.

Reneging

People who join the wait line but leave due to impatience or time constraints.

Jockeying / Line Jumping

When customers switch between different queues, often trying to move to a faster line

What is the difference between channels and phases?

Channels refer to service paths; phases refer to steps in the process.

Channels

Refers to a single service path or line that a customer or item passes through

Phases

Refers to a step in a sequence of processes that customers or items must go through to receive the full service

Name the two types of customer pools in waiting line systems.

FINITE pool and INFINITE pool.

Finite Pool

Few potential customers

Every customer in the store significantly decreases the chance of another customer arriving

Ex. Store that sells jumbo jets for airlines

Infinite Pool

Many potential customers

Odds of new customers barely affected by new arrivals

Ex. McDonald’s

Managerial Queue Considerations

Customer Arrival
Service Rates
Number of Servers
Queue Discipline

Customer Arrival

Managing the rate and timing of customer arrivals to avoid overwhelming the system

Service Rates

Ensuring the speed and efficiency of service delivery is optimized to match customer flow

Number of Servers

Deciding how many service points or personnel are required to handle demand without excessive waiting times

Queue Discipline

Establishing the rules for serving customers (first-come-first-serve, priority for certain customers, etc.)

Queuing Metrics

n —> Customers
t —> Time
l —> Line or Queue
s —> System

Queuing Metrics: n_s

Average number of customers in the system

Queuing Metrics: t_s

Average time spent in the system

Queuing Metrics: n_l

Average length of queue

Queuing Metrics: t_l

Average time spent in queue

Vendor

Responsible for providing the necessary goods, materials, or services that companies need to produce their products or services

What is Vendor Managed Inventory (VMI)?

Inventory planning and replenishment system where supplier (vendor) accepts negotiated responsibilities that typically include monitoring and restocking

What is scan-based trading?

A model where unsold items become the store's responsibility.

Who is a wholesaler?

An intermediary that purchases goods in bulk from manufacturers and sells to retailers.

What is a dropshipper?

An intermediary that does not hold inventory but forwards orders to the manufacturer.

What is a franchise?

A business model where a franchisor grants rights to a franchisee to operate under its brand.

What is the 'last mile' in logistics?

The final step of delivery to the customer’s location.

What is a planogram?

A visual representation used to plan product layout on shelves.

Omni-channel retailing

A strategy that provides a seamless customer experience across multiple sales channels.

Includes physical stores, online websites, and mobile apps

What are chargebacks?

Penalties imposed by retailers on suppliers for not meeting specific terms (late shipments, incorrect labeling, etc.)