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Questions and Answers
What is the volume of goods and services that customers require at a given time?
What is the volume of goods and services that customers require at a given time?
Demand
What is the number of goods or products available for consumption in the market?
What is the number of goods or products available for consumption in the market?
Supply
What is the organization's ability to render or provide services?
What is the organization's ability to render or provide services?
Capacity
What is the ability of an organization to create goods and services efficiently and effectively?
What is the ability of an organization to create goods and services efficiently and effectively?
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Excess demand is a situation where the customer can still be accommodated but the place is already crowded.
Excess demand is a situation where the customer can still be accommodated but the place is already crowded.
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Which of the following is ideal for both organizations and customers?
Which of the following is ideal for both organizations and customers?
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Managing demand is the primary objective of service organizations to maximize productivity.
Managing demand is the primary objective of service organizations to maximize productivity.
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Which of the following is NOT a factor that organizations should understand about demand?
Which of the following is NOT a factor that organizations should understand about demand?
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What does it refer to when there is a periodic increase and decrease of demand levels at a specific time?
What does it refer to when there is a periodic increase and decrease of demand levels at a specific time?
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What refers to the opposite of a predictable cycle, wherein the demand is random?
What refers to the opposite of a predictable cycle, wherein the demand is random?
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Which of the following is NOT a type of demand management approach?
Which of the following is NOT a type of demand management approach?
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The leave demand and take no action approach means that organizations manage and monitor the level of demand for their products and services.
The leave demand and take no action approach means that organizations manage and monitor the level of demand for their products and services.
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Placing higher prices on products and services to increase profits is a strategy to reduce demand during peak periods.
Placing higher prices on products and services to increase profits is a strategy to reduce demand during peak periods.
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The queuing system on inventory demand seeks to keep waiting customers occupied and comfortable while they wait for products and services.
The queuing system on inventory demand seeks to keep waiting customers occupied and comfortable while they wait for products and services.
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A reservation system on inventory demand allows an organization to predict the waiting period accurately before implementing other customer management strategies.
A reservation system on inventory demand allows an organization to predict the waiting period accurately before implementing other customer management strategies.
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What does demand forecasting refer to?
What does demand forecasting refer to?
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What is data from competitor businesses used to identify trends and make business decisions?
What is data from competitor businesses used to identify trends and make business decisions?
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What does economic trends refer to?
What does economic trends refer to?
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What refers to the effort made by a company to increase demand for its products and services?
What refers to the effort made by a company to increase demand for its products and services?
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The productive service capacity refers to the assets and resources organizations use to manufacture goods and provide services.
The productive service capacity refers to the assets and resources organizations use to manufacture goods and provide services.
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What is NOT a factor that organizations need to consider to manage capacity?
What is NOT a factor that organizations need to consider to manage capacity?
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Time in a service-based industry is not as important as labor, equipment, and facilities.
Time in a service-based industry is not as important as labor, equipment, and facilities.
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Labor can contribute to extra costs especially when idle or unneeded labor is incurred.
Labor can contribute to extra costs especially when idle or unneeded labor is incurred.
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Equipment capacity can be a limitation for organizations such as a new airline company.
Equipment capacity can be a limitation for organizations such as a new airline company.
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A limitation on facilities does not affect companies, such as spas, restaurants, and event venues.
A limitation on facilities does not affect companies, such as spas, restaurants, and event venues.
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The condition where the services of an organization are fully utilized but not overused is known as optimal capacity.
The condition where the services of an organization are fully utilized but not overused is known as optimal capacity.
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The condition where the total limit of service is fully utilized, but sometimes results in customer dissatisfaction, is known as optimum capacity.
The condition where the total limit of service is fully utilized, but sometimes results in customer dissatisfaction, is known as optimum capacity.
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Which of the following is NOT a strategy used to modify demand to match existing capacity?
Which of the following is NOT a strategy used to modify demand to match existing capacity?
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Communicating with customers is a form of demand modification that informs guests of the operation's peak period to lower expectations.
Communicating with customers is a form of demand modification that informs guests of the operation's peak period to lower expectations.
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Modifying the timing and location of service delivery is adjusting the period of operation to cater to different market segments and offering online transactions.
Modifying the timing and location of service delivery is adjusting the period of operation to cater to different market segments and offering online transactions.
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Incentive offering during off-peak usage is encouraging customers to use an organization's services during the lean season by offering special discounts, packages, promos, or freebies.
Incentive offering during off-peak usage is encouraging customers to use an organization's services during the lean season by offering special discounts, packages, promos, or freebies.
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Setting priorities is a demand modification strategy that focuses on specific groups, such as regular customers or customers with immediate attention or consideration, while ensuring other customers are also attended to.
Setting priorities is a demand modification strategy that focuses on specific groups, such as regular customers or customers with immediate attention or consideration, while ensuring other customers are also attended to.
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Full charge pricing during peak periods is not as effective as using discount cards and coupons to lower levels of demand.
Full charge pricing during peak periods is not as effective as using discount cards and coupons to lower levels of demand.
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Which of the following strategies is NOT a component of adjusting capacity to meet demand?
Which of the following strategies is NOT a component of adjusting capacity to meet demand?
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Increasing capacity temporarily is a strategy that includes extending operating hours, hiring part-time employees, and renting facilities and equipment.
Increasing capacity temporarily is a strategy that includes extending operating hours, hiring part-time employees, and renting facilities and equipment.
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The chase demand strategy involves adjusting service resources to meet changing demand patterns.
The chase demand strategy involves adjusting service resources to meet changing demand patterns.
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Increasing demand to match capacity involves strategies such as educating customers about advantages of services, modifying service offerings, and price differentiation.
Increasing demand to match capacity involves strategies such as educating customers about advantages of services, modifying service offerings, and price differentiation.
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Full charge pricing is when companies use discount cards and coupons to reduce demand.
Full charge pricing is when companies use discount cards and coupons to reduce demand.
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Waiting (queue) occurs when the number of customers exceeds an organization's ability to process transactions.
Waiting (queue) occurs when the number of customers exceeds an organization's ability to process transactions.
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Waiting lines happen whenever there is an exact match of capacity and demand.
Waiting lines happen whenever there is an exact match of capacity and demand.
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A mismatch of capacity management and demand can lead to increased costs for an organization.
A mismatch of capacity management and demand can lead to increased costs for an organization.
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In the tourism industry, customers seldom encounter queuing systems, and it is not an essential part of managing customer satisfaction.
In the tourism industry, customers seldom encounter queuing systems, and it is not an essential part of managing customer satisfaction.
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The challenge for tourism and hospitality organizations is choosing the right queue type based on their needs and concerns. They categorize customers into different types and choose the best type of queue for their needs
The challenge for tourism and hospitality organizations is choosing the right queue type based on their needs and concerns. They categorize customers into different types and choose the best type of queue for their needs
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Which of the following is NOT a type of queue used by organizations?
Which of the following is NOT a type of queue used by organizations?
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A single sequential line is where customers pass through several serving segments where bottlenecks may happen in any segment that would take longer than the previous segment.
A single sequential line is where customers pass through several serving segments where bottlenecks may happen in any segment that would take longer than the previous segment.
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Parallel lines to multiple servers refer to a system where customers form a single line and are served by the first server available among multiple servers?
Parallel lines to multiple servers refer to a system where customers form a single line and are served by the first server available among multiple servers?
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A single line to multiple servers utilizes a system where customers form a single line and are served by the first server available among multiple servers, such as check-in counters at an airport.
A single line to multiple servers utilizes a system where customers form a single line and are served by the first server available among multiple servers, such as check-in counters at an airport.
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Designated lines refer to a system that segregates lines for different customers based on specific categories, such as restaurants having counters specific for senior citizens or persons with disabilities?
Designated lines refer to a system that segregates lines for different customers based on specific categories, such as restaurants having counters specific for senior citizens or persons with disabilities?
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The numbering system refers to when a number is assigned to customers, and they are serviced by the first server available upon the number being called?
The numbering system refers to when a number is assigned to customers, and they are serviced by the first server available upon the number being called?
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The waiting list is a system where customers are requested to provide their names along with their group size and wait until their names are called.
The waiting list is a system where customers are requested to provide their names along with their group size and wait until their names are called.
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When it comes to the queueing system for a tourism business, choosing the correct system can significantly impact guest satisfaction.
When it comes to the queueing system for a tourism business, choosing the correct system can significantly impact guest satisfaction.
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Which of the following is NOT a strategy that organizations should consider when it comes to dealing with queuing?
Which of the following is NOT a strategy that organizations should consider when it comes to dealing with queuing?
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Auditing the operational processes is when an organization studies the operational process to identify necessary changes to improve efficiency and customer flow?
Auditing the operational processes is when an organization studies the operational process to identify necessary changes to improve efficiency and customer flow?
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A queue configuration is a strategy that considers design and effect to optimize the queue system for a specific location.
A queue configuration is a strategy that considers design and effect to optimize the queue system for a specific location.
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A reservation system is a strategy that can be implemented for guests to choose any time they intend to arrive at a business and can guarantee their arrival.
A reservation system is a strategy that can be implemented for guests to choose any time they intend to arrive at a business and can guarantee their arrival.
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Differentiating waiting customers is when a service organization prioritizes customers based on factors such as how important they are to the business, the urgency of their service, and their willingness to pay a premium price?
Differentiating waiting customers is when a service organization prioritizes customers based on factors such as how important they are to the business, the urgency of their service, and their willingness to pay a premium price?
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Reducing customers' waiting time is not as important in the tourism and hospitality industry since the hospitality industry has a reputation for quick and efficient service.
Reducing customers' waiting time is not as important in the tourism and hospitality industry since the hospitality industry has a reputation for quick and efficient service.
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Long wait times can lead to customer dissatisfaction, which reflects poorly on the overall service quality of the tourism and hospitality industry.
Long wait times can lead to customer dissatisfaction, which reflects poorly on the overall service quality of the tourism and hospitality industry.
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In the tourism and hospitality industry, service organizations have a set of policies on prioritizing customers based on their needs or profiles.
In the tourism and hospitality industry, service organizations have a set of policies on prioritizing customers based on their needs or profiles.
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The "first come, first served" rule is the only rule used when differentiating customers.
The "first come, first served" rule is the only rule used when differentiating customers.
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Customers who spend large amounts of money with the organization are given priority in service.
Customers who spend large amounts of money with the organization are given priority in service.
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Customers requiring more pressing needs, such as medical or security concerns, may be served first. This can be a strategy to show the customer that their needs are a priority.
Customers requiring more pressing needs, such as medical or security concerns, may be served first. This can be a strategy to show the customer that their needs are a priority.
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The time it takes to complete a customer service request can determine whether customers are referred to express lanes for immediate disposal or to a specific service provider.
The time it takes to complete a customer service request can determine whether customers are referred to express lanes for immediate disposal or to a specific service provider.
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Customers with special needs are not given priority in service lanes.
Customers with special needs are not given priority in service lanes.
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Customers who pay a premium price are frequently given special accommodations, such as separate check-in lines, express systems, or VIP lounges?
Customers who pay a premium price are frequently given special accommodations, such as separate check-in lines, express systems, or VIP lounges?
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Long wait times can create an impression that an organization lacks concern for its customers.
Long wait times can create an impression that an organization lacks concern for its customers.
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Study Notes
Balancing Demand and Capacity in Tourism
- Demand refers to the volume of goods and services customers require.
- Capacity is an organization's ability to provide services to customers.
- Productivity is the ability to efficiently create goods and services.
- Excess demand occurs when demand exceeds available capacity, leading to lost profits and disappointed customers.
- Demand exceeding optimum capacity leads to a crowded environment, decreasing service quality.
- Balanced demand and supply at optimum capacity provides best service with neither excess nor shortage.
- Managing demand is crucial for maximizing productivity in service organizations.
- Understanding demand patterns (predictable or random) helps develop tailored service strategies.
- A predictable demand cycle involves recurring increases and decreases in demand, potentially at specific intervals based on factors that need to be analyzed.
- Random fluctuations occur due to factors like the weather, health crises, natural disasters, or acts of terrorism.
- Understanding these factors allows organizations to focus on demand management strategies to address disruptions.
Managing Demand
- Service organizations need to understand factors affecting demand and capacity.
- Market segment demand patterns need to be thoroughly understood to develop effective strategies.
- Organizations can analyze customer profiles to identify demand patterns and tailor services accordingly.
- A predictable cycle of demand can be analyzed to identify why such cycles occur to design effective strategies for each phase.
Managing Capacity
- Productive service capacity pertains to available assets/resources.
- Capacity must match or exceed market needs, or else it falls short.
- Time is a primary constraint in service delivery; efficient employee use is essential.
- Labor costs are relevant when dealing with fluctuating demand.
- Equipment capacity limitations can restrict service capabilities.
- Facility limitations can result in insufficient space for customer services.
Strategies for Modifying Demand to Match Existing Capacity
- Communicate with customers about peak periods and provide alternatives for avoiding overcrowding.
- Modify service delivery timing/location to better accommodate demand shifts.
- Offer incentives during off-peak periods to encourage customer use.
- Prioritize customers with immediate needs or special circumstances.
- Adjust pricing or other service elements as necessary to regulate demand.
Waiting Lines and Queues
- Waiting lines occur when the rate of transactions exceeds the organization's capacity.
- Precise capacity matching and demand are expensive for organizations to maintain.
- Airport queues demonstrate this issue; managing it is important.
- Effective queuing systems are crucial for a good customer experience. Different queue types and their applications are important to consider. Organizations need to analyze their operations to identify issues in waiting lines.
Differentiate Waiting Customers
- Differentiating customers based on needs/profiles (e.g., VIPs, senior citizens) allows for better service.
- Priority may be given based on importance or urgency.
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Description
This quiz explores the critical concepts of demand, capacity, and productivity within the tourism sector. Understand the implications of excess demand, the importance of balanced supply, and how to manage demand effectively for optimal service. Tailor your strategies based on predictable cycles and random fluctuations to enhance service quality.
