Chapter 13
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Questions and Answers

What concept refers to the appearance of effort in service delivery?

  • Yield management
  • Labor illusion (correct)
  • Operational Transparency
  • Duration heuristics

Which strategy involves making the service process visible to customers?

  • Operational Transparency (correct)
  • Good Better Best Pricing
  • Managing price
  • Yield management

What strategy aims to help customers understand and appreciate the value being added?

  • Yield management (correct)
  • Duration heuristics
  • Price mix
  • Good Better Best Pricing

Which concept involves the length of service impacting the perceived value?

<p>Duration heuristics (C)</p> Signup and view all the answers

What does letting customers see operations aim to achieve according to the text?

<p>Increase loyalty (A)</p> Signup and view all the answers

Which service provider is mentioned in the text as an example of operational transparency?

<p>Starbucks (D)</p> Signup and view all the answers

What are the main capacity constraints mentioned in the text?

<p>Time, labour, equipment, and facilities (B)</p> Signup and view all the answers

In yield management strategies, what is balanced among capacity utilization, pricing, market segmentation, and financial return?

<p>Yield (C)</p> Signup and view all the answers

What is one of the key aspects for managing waiting lines mentioned in the text?

<p>Operational Transparency (B)</p> Signup and view all the answers

Which service-related constraints are mentioned in the text under 'Constraints on Capacity'?

<p>Delivery services, telecommunications services, and health clinic services (C)</p> Signup and view all the answers

What is the primary goal of yield management strategies according to the text?

<p>Optimizing revenue by adjusting prices based on demand (B)</p> Signup and view all the answers

What concept does yield management primarily focus on optimizing?

<p>Revenue (A)</p> Signup and view all the answers

What is the goal of Yield Management (revenue management)?

<p>Maximize revenue (yield) (C)</p> Signup and view all the answers

In the context of Yield Management, what does 'yield' refer to?

<p>Actual Revenue / Potential Revenue (C)</p> Signup and view all the answers

What represents the formula for Actual Revenue in Yield Management?

<p>Actual Capacity Used × Average Actual Price (D)</p> Signup and view all the answers

Which quadrant do Airlines, Hotels, Rental Cars, and Cruise Lines fall into when considering price mix in service industries?

<p>Quadrant 2 (D)</p> Signup and view all the answers

What is one strategy for managing the uncertainty of duration in service industries?

<p>Overbooking based on forecasting (A)</p> Signup and view all the answers

How is the potential revenue calculated in Yield Management?

<p>Total Capacity / Maximum Price (C)</p> Signup and view all the answers

What is the formula to calculate yield in Yield Management?

<p>Yield = Actual Revenue / Potential Revenue</p> Signup and view all the answers

How can service providers manage the uncertainty of duration in service industries?

<p>By implementing strategies like overbooking based on forecasting or using deposit, penalties, and no availability guarantee for late arrival.</p> Signup and view all the answers

Which quadrant do Restaurants, Golf Courses, and ISPs fall into when considering price mix in service industries?

<p>Quadrant 3</p> Signup and view all the answers

What is the concept that involves making the service process visible to customers?

<p>Operational Transparency</p> Signup and view all the answers

What is the primary goal of yield management strategies according to the text?

<p>The primary goal is to maximize revenue or yield.</p> Signup and view all the answers

Which strategy aims to help customers understand and appreciate the value being added?

<p>Operational Transparency</p> Signup and view all the answers

What are some key capacity constraints mentioned in the text when it comes to managing demand and supply?

<p>Time, labour, equipment, and facilities</p> Signup and view all the answers

In the context of yield management strategies, what is the main goal of balancing capacity utilization, pricing, market segmentation, and financial return?

<p>Achieving optimal revenue and profit maximization</p> Signup and view all the answers

How can operational transparency be beneficial for service providers according to the text?

<p>Building customer trust and confidence</p> Signup and view all the answers

What concept involves making the service process visible to customers to enhance their experience?

<p>Operational transparency</p> Signup and view all the answers

What is the primary focus of yield management strategies when it comes to optimizing revenue?

<p>Balancing capacity utilization and pricing</p> Signup and view all the answers

How is the term 'yield' calculated theoretically in the context of yield management?

<p>Yield = Actual Revenue / Potential Revenue</p> Signup and view all the answers

How can operational transparency impact customer satisfaction and loyalty?

<p>Operational transparency can lead to more satisfaction, more willingness to pay, and more loyalty.</p> Signup and view all the answers

Explain the concept of duration heuristics and its effect on perceived value in service industries.

<p>Duration heuristics refers to the length of the service impacting the perceived value. Customers tend to associate longer service duration with higher value.</p> Signup and view all the answers

How does the labor illusion play a role in service delivery?

<p>The labor illusion involves creating the appearance of effort in service delivery to make customers value the service more.</p> Signup and view all the answers

What is the main goal of yield management strategies in service industries?

<p>The main goal of yield management strategies is to maximize revenue by balancing capacity utilization, pricing, and market segmentation.</p> Signup and view all the answers

How is 'yield' calculated theoretically in yield management?

<p>Theoretical yield in yield management is calculated by multiplying the total capacity by the average price.</p> Signup and view all the answers

What is one strategy for managing uncertainty of duration in service industries?

<p>One strategy for managing duration uncertainty is to make the service process visible to customers.</p> Signup and view all the answers

Which strategy aims to improve ER wait times by assigning each patient to a specific doctor?

<p>Implementing a dedicated queue (A)</p> Signup and view all the answers

What is a common consideration when managing waiting lines according to the text?

<p>Duration of the service transaction (A)</p> Signup and view all the answers

In the context of managing market demand, which pricing approach involves starting with low prices and gradually increasing them?

<p>Low to High (D)</p> Signup and view all the answers

What is one strategy mentioned in the text to make waiting more tolerable for customers?

<p>Adjust queuing systems (A)</p> Signup and view all the answers

How can ER wait times be shortened according to the text?

<p>Implementing dedicated queues for patients (D)</p> Signup and view all the answers

Which pricing mix strategy involves having different price points for the same service based on added features or benefits?

<p>Good Better Best Pricing (B)</p> Signup and view all the answers

Why is managing the uncertainty of duration crucial in service industries?

<p>To minimize underutilization of capacity due to uncertain duration. (A)</p> Signup and view all the answers

In Yield Management, what does the 'Good Better Best Pricing' strategy aim to achieve?

<p>Balancing revenue across different market segments by offering various price options. (C)</p> Signup and view all the answers

Which quadrant do Hospitals and Continuing Care facilities typically belong to in terms of price mix in service industries?

<p>Quadrant 4 (B)</p> Signup and view all the answers

What is one strategy mentioned in the text for managing waiting lines in service industries?

<p>Using a single waiting line to achieve a fairer system. (C)</p> Signup and view all the answers

How is yield calculated theoretically in Yield Management?

<p>$$ Yield = Actual hinspace Revenue / Potential hinspace Revenue $$ (A)</p> Signup and view all the answers

What is a key advantage of using virtual or electronic waiting lines in service industries?

<p>Increased perceived fairness among customers. (D)</p> Signup and view all the answers

What is the main goal of yield management strategies in service industries?

<p>Optimizing revenue and financial return (C)</p> Signup and view all the answers

How is 'yield' calculated theoretically in the context of yield management?

<p>By taking the ratio of revenue to the maximum potential revenue (A)</p> Signup and view all the answers

What is one strategy for managing uncertainty of duration in service industries?

<p>Implementing dynamic pricing based on demand fluctuations (D)</p> Signup and view all the answers

Which aspect is NOT typically considered in Yield Management strategies?

<p>Customer Satisfaction (B)</p> Signup and view all the answers

What represents a challenge when managing waiting lines at service facilities like hospitals?

<p>Balancing staff workload with demand fluctuations (A)</p> Signup and view all the answers

In the context of managing waiting lines, what is a disadvantage of a single line with multiple servers configuration?

<p>It may lead to longer overall wait times in certain scenarios (B)</p> Signup and view all the answers

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