Waiting Line Management

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Questions and Answers

What is the primary goal of waiting line management?

To balance the cost to the customer (time spent waiting) with the cost to the company (money paid to maintain the service system).

What are the three main parts of a waiting line system?

Input source (population of potential customers), Waiting line (area where customers wait), and Service facility (area where service is provided).

What key aspects does queue management involve from a managerial perspective?

Queue management involves optimizing customer flow, deciding on waiting line types, ensuring appropriate employee skills, and managing service facilities (physical or virtual) for maximum efficiency.

Define 'Queue' in the context of waiting line management.

A queue is simply a waiting line. It can be a physical line or a virtual one. Signup and view all the answers

In waiting line terminology, what does 'Channel' refer to?

'Channel' refers to the number of lines available at each step, often corresponding to the number of servers or employees ready to provide service. Signup and view all the answers

What is a 'Phase' in the context of a service process?

A 'phase' represents a single step within a larger service process. Signup and view all the answers

What characterizes a 'Finite population' in a waiting line system?

A finite population means there is a limited number of potential customers. The arrival of one customer changes the probability of another customer arriving. Signup and view all the answers

Define 'Balking' in the context of waiting lines.

Balking occurs when potential customers see a waiting line but decide not to join it, often because they perceive it as too long or too slow. Signup and view all the answers

What is 'Jockeying' in waiting line systems?

Jockeying, or line jumping, occurs when customers initially join one line but then switch to a different line, believing it might be faster. This only happens in multiple-line systems. Signup and view all the answers

What does the Arrival Rate (λ) represent in queuing theory?

The arrival rate (λ) is the average number of customers arriving per unit of time (e.g., customers per hour). Signup and view all the answers

What does the Service Rate (μ) represent in queuing theory?

The service rate (μ) is the average number of customers that can be served per unit of time (e.g., customers served per hour). Signup and view all the answers

How is the Service Utilization Factor (ρ) calculated and what does it represent?

The service utilization factor (ρ) is calculated as the arrival rate (λ) divided by the service rate (μ) ($ρ = λ / μ$). It represents the percentage of time that a server is busy. Signup and view all the answers

Provide the formulas for calculating key performance measures in a basic single-server (M/M/1) queuing model.

Average number of customers in the line (Lq): $L_q = \lambda^2 / [\mu(\mu - \lambda)]$. Average time a customer waits in line (Wq): $W_q = \lambda / [\mu(\mu - \lambda)]$. Average number of customers in the system (Ls): $L_s = \lambda / (\mu - \lambda)$. Average time a customer spends in the system (Ws): $W_s = 1 / (\mu - \lambda)$. Probability of 'n' customers in the system (Pn): $P_n = (1 - \rho)\rho^n$, where $\rho = \lambda / \mu$. Signup and view all the answers

What are some key performance measures typically calculated or looked up for multiple-server queuing models?

Key measures include: Server utilization ($\rho / k$, where k is the number of servers), probability the system is empty (P0), probability a customer is served immediately, average number of customers in line (Lq), average number of customers in the system (Ls), average time a customer waits in line (Wq), and average time a customer spends in the system (Ws). Signup and view all the answers

Define 'Vendor'.

A vendor is a supplier; the company from which another company purchases goods and/or services. Signup and view all the answers

What is a 'Wholesaler'?

Wholesalers are companies that purchase products in large quantities (bulk) directly from manufacturers at discounted prices. They then sell these products in smaller quantities to retailers. Signup and view all the answers

Explain the role of a 'Dropshipper'.

A dropshipper is a business that takes customer orders but does not keep the products it sells in stock. Instead, it relies on a third-party, often a wholesaler or manufacturer, to fulfill and ship the orders directly to the customer. Signup and view all the answers

What is involved in a 'Franchise' agreement?

A franchise involves one party (franchisor) granting another party (franchisee) the rights to use its company name, business model, products, and processes. The franchisor typically provides support but requires the franchisee to adhere strictly to the established rules and systems. Signup and view all the answers

Describe 'Last Mile Logistics'.

Last mile logistics refers to the final and often most critical stage of the delivery process, specifically moving goods from a distribution hub or warehouse to the end consumer's location. It emphasizes speed, flexibility, and customer satisfaction while dealing with challenges like varying order sizes and delivery destinations. Signup and view all the answers

What is a 'Planogram'?

A planogram is a visual diagram or map that details where specific products should be placed on retail shelves or displays. Signup and view all the answers

What is a key characteristic of 'Retail Layouts' across stores of the same chain?

While individual stores may not be identical, retail layouts within a chain typically share significant similarities. This consistency makes it easier for customers to navigate different locations and find products with minimal confusion. Signup and view all the answers

Explain the concept of Vendor Managed Inventory (VMI).

Vendor Managed Inventory (VMI) is a system where the supplier (vendor) takes responsibility for managing the inventory levels of its products at the retailer's location. The vendor uses the retailer's sales data to manage replenishment, stocking, and sometimes even shelf placement. Signup and view all the answers

Define 'Scan-based trading' and list a key advantage and disadvantage.

Scan-based trading is a system where suppliers own inventory in a retailer's store until it's sold. Advantage: Reduced risk and upfront payments for retailers. Disadvantage: Shifts risk to suppliers, who face delayed payments and potential power imbalance. Signup and view all the answers

What does 'Reverse Logistics' encompass?

Reverse logistics includes all operations related to the backward flow of products and materials from their final destination back through the supply chain. This includes returns, repairs, remanufacturing, or recycling. Signup and view all the answers

Describe 'Omni-channel retailing'.

Omni-channel retailing integrates a company's online and offline channels for a seamless customer experience, featuring consistent information, pricing, and promotions. Signup and view all the answers

What are 'Chargebacks' in a retail supply chain context?

Chargebacks are financial penalties retailers impose on suppliers for failing to meet supply chain standards, such as on-time delivery or correct labeling. Signup and view all the answers

What are the three core components of a waiting line system?

Input source (the population of potential customers), waiting line (the queue area where customers wait), and service facility (the area where customers receive service). Signup and view all the answers

What key aspects must managers consider when managing queues?

Optimizing customer flow, deciding on waiting line structures (e.g., single vs. multiple lines), managing employee skills and deployment, and designing efficient service facilities, whether physical or virtual. Signup and view all the answers

What is a queue in the context of waiting line management?

A waiting line. Signup and view all the answers

In a waiting line system, what does the term 'channel' refer to?

A channel refers to one path or line available for customers at a service step. The number of channels often corresponds to the number of servers or employees available to provide the service. Signup and view all the answers

What does 'phase' mean in the context of a service process?

A single step or stage within the overall service process. Signup and view all the answers

What characterizes a finite population in a waiting line context?

A limited, countable number of potential customers. In such cases, the arrival of a customer affects the probability of another customer arriving because the pool of potential customers decreases. Signup and view all the answers

What term describes when a potential customer sees a queue and decides not to join because it appears too long or slow?

Balking. Signup and view all the answers

What term describes when a customer joins a queue but leaves before being served, typically due to frustration with the wait?

Reneging. Signup and view all the answers

What term describes customers switching between lines in a multiple-line system, hoping to find a faster one?

Jockeying (or line jumping). Signup and view all the answers

What does the arrival rate (Lambda, $ \lambda $) represent in queueing theory?

The average number of customers arriving per unit of time (e.g., customers per hour). Signup and view all the answers

What does the service rate (Mu, $ \mu $) represent in queueing theory?

The average number of customers that can be served by a single server per unit of time (e.g., customers served per hour). Signup and view all the answers

How is the service utilization factor (Rho, $ \rho $) calculated for a single server, and what does it represent?

It is calculated as the arrival rate divided by the service rate ($ \rho = \lambda / \mu $) and represents the proportion or percentage of time the server is busy. Signup and view all the answers

Match the single-server queueing metric with its corresponding formula (where $ \lambda $ = arrival rate, $ \mu $ = service rate, $ \rho = \lambda / \mu $). Assume $ \mu > \lambda $.

Average number of customers in the line (Lq or nl) = $ \frac{\lambda^2}{\mu(\mu - \lambda)} $ Average time a customer waits in line (Wq or tl) = $ \frac{\lambda}{\mu(\mu - \lambda)} $ Average number of customers in the system (Ls or ns) = $ \frac{\lambda}{\mu - \lambda} $ Average time a customer spends in the system (Ws or ts) = $ \frac{1}{\mu - \lambda} $ Probability of 'n' customers in the system (Pn) = $ (1 - \rho) \rho^n $ Signup and view all the answers

In a multiple-server queueing system analysis, what does the metric '$ \rho $ / number of servers' typically represent?

The average utilization or percentage of time each individual server is busy, assuming work is distributed evenly. Signup and view all the answers

What is a vendor in a supply chain context?

A supplier; an external company or individual from which a business purchases goods and/or services. Signup and view all the answers

What role does a wholesaler play in the supply chain?

Wholesalers typically buy products in large quantities (bulk) directly from manufacturers at discounted prices and then sell them in smaller quantities to retailers or sometimes other businesses. Signup and view all the answers

What is a dropshipper?

A fulfillment model where a seller (the dropshipper) accepts customer orders but does not keep goods sold in stock. Instead, when a dropshipper sells a product, it purchases the item from a third party (like a wholesaler or manufacturer) and has it shipped directly to the customer. Signup and view all the answers

What is a franchise arrangement?

A business relationship where a franchisor (the owner of a business system and brand) grants a license to a franchisee (an independent operator) to use the franchisor's name, trademarks, products, and business system in exchange for fees and royalties. Signup and view all the answers

What does 'Last Mile logistics' refer to?

The final stage of the delivery process, specifically the movement of goods from a transportation hub or distribution center to the final delivery destination, typically the end consumer's residence or business. Signup and view all the answers

What is a planogram used for in retail?

A visual diagram or map that details the specific placement of products on retail shelves or displays within a store. Signup and view all the answers

Why do retail stores, particularly within the same chain, often use similar layouts?

To create a consistent and familiar shopping experience for customers, making it easier for them to navigate the store and locate products, regardless of which specific branch they visit. Signup and view all the answers

What is Vendor Managed Inventory (VMI)?

An inventory management practice where a supplier (vendor) takes responsibility for maintaining agreed-upon inventory levels of their products at the retailer's location(s). The supplier typically monitors sales data and automatically replenishes stock as needed. Signup and view all the answers

What is scan-based trading?

A trading model, often used in retail, where the supplier retains ownership of the inventory within the retailer's store until it is scanned and sold to the end consumer. The retailer pays the supplier only for the items sold. Signup and view all the answers

What is omni-channel retailing?

A customer-centric approach to sales and marketing that provides a seamless and integrated shopping experience across all of a retailer's channels, such as physical stores, websites, mobile apps, social media, and catalogs. Signup and view all the answers

What are chargebacks in the context of retailer-supplier relationships?

Fees or financial penalties that retailers deduct from payments owed to their suppliers. These are typically levied when suppliers fail to meet agreed-upon operational or logistical requirements. Signup and view all the answers

What are the three fundamental parts of a waiting line system?

Input source, waiting line, and service facility. Signup and view all the answers

What is another term for a waiting line, which can be physical or virtual?

Queue Signup and view all the answers

In the context of waiting lines, what do 'channels' refer to?

The number of parallel service points available at a step in the process (e.g., the number of cashiers open). Signup and view all the answers

What does a 'phase' represent in a service process?

A single step in the overall process. Signup and view all the answers

What is 'balking' in relation to waiting lines?

When a potential customer decides not to join a queue because it appears too long or slow. Signup and view all the answers

What is 'jockeying' (or line jumping) in waiting lines?

When a customer switches from one queue to another in hopes of being served faster. Signup and view all the answers

What do arrival rates (represented by Lambda, $\lambda$) measure in queueing theory?

The average number of customers arriving per unit of time (e.g., customers per hour). Signup and view all the answers

What do service rates (represented by Mu, $\mu$) measure in queueing theory?

The average number of customers that can be served per unit of time by a single server (e.g., customers served per hour). Signup and view all the answers

What is the service utilization factor (Rho, $\rho$), and how is it calculated for a single server?

It represents the percentage of time a server is busy. It is calculated as the arrival rate divided by the service rate: $\rho = \lambda / \mu$. Signup and view all the answers

What is the formula for the average number of customers waiting in line ($n_l$) in a single-server (M/M/1) system?

$n_l = \lambda^2 / [\mu(\mu-\lambda)]$ or $n_l = \rho^2 / (1-\rho)$ where $\rho = \lambda/\mu$ Signup and view all the answers

What is the formula for the average time a customer waits in line ($t_l$) in a single-server (M/M/1) system?

$t_l = \lambda / [\mu(\mu-\lambda)]$ or $t_l = n_l / \lambda$ Signup and view all the answers

What is the formula for the average number of customers in the system ($n_s$) (waiting and being served) in a single-server (M/M/1) system?

$n_s = \lambda / (\mu - \lambda)$ or $n_s = \rho / (1-\rho)$ where $\rho = \lambda/\mu$ Signup and view all the answers

What is the formula for the average time a customer spends in the system ($t_s$) (waiting and being served) in a single-server (M/M/1) system?

$t_s = 1 / (\mu - \lambda)$ or $t_s = n_s / \lambda$ Signup and view all the answers

What is the formula for the probability of having exactly 'N' customers ($P_n$) in a single-server (M/M/1) system?

$P_n = (1 - \rho) \rho^n$, where $\rho = \lambda/\mu$ Signup and view all the answers

What are some key performance metrics evaluated for multiple-server (M/M/k) waiting line systems?

Metrics include individual server utilization, probability the system is empty ($P_0$), probability a customer is served immediately, average number of customers in line ($n_l$ or $L_q$), average number in the system ($n_s$ or $L_s$), average time spent waiting in line ($t_l$ or $W_q$), and average time spent in the system ($t_s$ or $W_s$). Signup and view all the answers

In business terms, what is a vendor?

A supplier; a company from which another company purchases goods and/or services. Signup and view all the answers

What is the role of a wholesaler in a distribution channel?

Wholesalers buy products in large quantities (bulk) from manufacturers at discounted prices and then sell them in smaller quantities to retailers or sometimes directly to consumers. Signup and view all the answers

What is a dropshipper and how do they operate?

A dropshipper is a seller that takes customer orders but does not keep goods in stock. Instead, they rely on a third party (often a wholesaler or manufacturer) to fulfill and ship the order directly to the customer. Signup and view all the answers

What does 'Last Mile logistics' refer to in the supply chain?

The final stage of the delivery process, moving goods from a transportation hub or warehouse to the end consumer's home or business. Signup and view all the answers

What is the purpose of having similar retail layouts across different stores of the same chain?

To make it easier for customers to navigate and find products, creating a consistent and familiar shopping experience regardless of the specific location. Signup and view all the answers

What does VMI stand for and what does it entail?

Vendor Managed Inventory (VMI). It's a system where the supplier/vendor takes responsibility for managing the inventory levels of their products at the retailer's location. Signup and view all the answers

What is reverse logistics concerned with?

All operations related to the reuse of products and materials, involving the movement of goods from their final destination back through the supply chain. Signup and view all the answers

What are chargebacks in the context of retail supply chains?

Financial penalties that retailers impose on their suppliers for failing to meet agreed-upon supply chain standards or requirements. Signup and view all the answers

Flashcards

Goal of waiting line management

Balance customer's time cost with the company's monetary cost for system maintenance.

Parts of a waiting line system

Input source, waiting line, and service facility.