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Article
Publication date: 1 December 2020

Wentao Zhan, Minghui Jiang and Chengzhang Li

Customer-intensive services refer to the service that a provider needs to invest in customers with high patience and experience. Within a certain rate range, the slower…

Abstract

Purpose

Customer-intensive services refer to the service that a provider needs to invest in customers with high patience and experience. Within a certain rate range, the slower service rate and the longer service time, the higher customer’s utility; however, this may cause queue congestion. And the advertising of service provider will affect the revenue. The purpose of this paper is to investigate the effects of advertising on the optimal price, service rate and the optimal revenue of such service provider at different development stages.

Design/methodology/approach

This paper investigates the service strategies of service provider based on advertising effects. The authors first divide service provider into insufficient customers or sufficient customers according to the development stage, then analyze the impact of advertising at different stages. The authors focus on the formulation of the optimal price, service rate and the optimal revenue of service provider at different stages.

Findings

This paper finds that in the insufficient customers stage, the service provider’s strategy of “small profits but quick turnover” is conducive to quickly accumulating customers. With the development of service provider, the advertising indirectly increases the revenue of service provider by maintaining popularity. The result also shows that with the development of service provider, the initiative of such service market has gradually been mastered by service provider, from “buyer market” to “seller market.”

Originality/value

The finding provides an alternative explanation for the impact of advertising on service provider’s optimal strategies; it also solves the settings of service price and rate of customer-intensive service provider at different development stages. This study is essential to create the optimal revenue and solve supply–demand conflicts (such as doctor–patient conflict) between service provider and customers.

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Article
Publication date: 12 September 2016

Peter BeomCheol Kim and Kevin D. Carlson

The purpose of this paper is to examine whether agreement between frontline employee self-ratings and supervisory ratings of service performance functions as an indicator…

Abstract

Purpose

The purpose of this paper is to examine whether agreement between frontline employee self-ratings and supervisory ratings of service performance functions as an indicator of healthy supervisor-subordination relationships above and beyond what might be indicated simply by either supervisory ratings or self-ratings.

Design/methodology/approach

Research hypotheses were tested using a sample of 220 matched pairs of frontline service workers and their immediate supervisors from nine full service hotels in the USA.

Findings

The results show that higher levels of agreement in service performance ratings between employees and supervisors is associated with higher levels of leader-member exchange (LMX) and organizational commitment.

Practical implications

Senior managers can refer to the level of performance rating agreement between customer service employees and their supervisors in assessing supervisors’ competency to manage their work relationship with their subordinates.

Originality/value

This study examined rating agreement in a service performance context and found rating agreement between subordinates and their supervisor may have a unique effect on service worker effectiveness, producing a unique incremental effect on LMX and organizational commitment. This is important given that few attempts have been made to examine service performance from both subordinates’ and supervisors’ perspectives and the implication that rating agreement may have for improving employee service performance.

Details

Journal of Service Theory and Practice, vol. 26 no. 5
Type: Research Article
ISSN: 2055-6225

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Article
Publication date: 20 April 2018

Chengzhang Li, Minghui Jiang and Xuchuan Yuan

This paper aims to investigate the optimal price and service rate decisions in a customer-intensive service, where customers’ perceived service quality decreases in the…

Abstract

Purpose

This paper aims to investigate the optimal price and service rate decisions in a customer-intensive service, where customers’ perceived service quality decreases in the service speed. Customers are assumed to be forward-looking in purchase decision-making and heterogeneous in their reservation utilities. The purpose of this paper is to study the impact of customers’ forward-looking behavior and the heterogeneity on the operational decisions in a customer-intensive context.

Design/methodology/approach

The service is delivered through an M/M/1 queue system with unobservable queues. Customers are forward-looking in queue joining decisions, where the purchase decisions are made when the expected utility is greater than the reservation utility. The optimal price and service rate decisions are analyzed with both homogeneous and heterogeneous customers, where homogenous customers have the same reservation utility in purchase decision-making, while heterogeneous customers have different reservation utilities, which are captured by a random variable.

Findings

The optimal price and service rate decisions with forward-looking customers depend on the customer intensity, potential market size and customers’ reservation utility distribution. The results suggest that customers’ heterogeneity in terms of their reservation utilities affects the optimal decisions, market coverage and the expected revenue. Service providers need to take customers’ heterogeneity and the forward-looking behavior into operational decision-making.

Originality/value

This paper extends previous studies in customer-intensive service and contribute to the service operations management area by explicitly incorporating customers’ forward-looking behavior and heterogeneity in purchase decision-making. Assuming customers are forward-looking and heterogeneous is more realistic and practical. The results highlight that knowing customers’ behavioral characteristics can better improve decision-making in service operations, which is critical for enhancing customers’ satisfaction and loyalty, thus critical to a firm’s success in the market with intensive competition.

Details

Kybernetes, vol. 47 no. 10
Type: Research Article
ISSN: 0368-492X

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Article
Publication date: 14 May 2018

Rajesh Rajaguru and Najmeh Hassanli

This paper aims to understand how guests’ trip purpose and hotel star rating influence the effects of the value for money perceived at hotels and service quality on guest…

Abstract

Purpose

This paper aims to understand how guests’ trip purpose and hotel star rating influence the effects of the value for money perceived at hotels and service quality on guest satisfaction and word of mouth (WOM) recommendation.

Design/methodology/approach

Using TripAdvisor, 25 Singaporean hotels were randomly selected for the study, which yielded hotel reviews from 2,040 respondents. Hierarchical and logistic regression analysis was conducted to investigate the relationships proposed in the study.

Findings

Results indicate significant differences between leisure and business guests’ perception of value for money and service quality at hotels with various star ratings. While perceived value for money and service quality were found as significant predictors for both leisure and business guests’ satisfaction and WOM, the effects were moderated by the hotel star rating. Despite the significant effect of hotel star rating on guest satisfaction, the study found no significant relationships between hotel star rating and WOM for leisure and business guests.

Practical implications

The findings suggest that managers in the hotel industry should understand the purpose of guests’ trip and offer services based on their expectations. As the star rating of a hotel creates certain expectations for both leisure and business guests, providing an appropriate level of services and assuring value for money in accordance with the hotel rating contributes to guest satisfaction and WOM recommendation.

Originality/value

This study contributes to the hospitality literature by investigating how hotel star rating moderates the relationship of value for money and service quality on leisure and business guests’ satisfaction and WOM recommendation.

Details

International Journal of Contemporary Hospitality Management, vol. 30 no. 5
Type: Research Article
ISSN: 0959-6119

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Article
Publication date: 10 June 2019

Chengzhang Li, Minghui Jiang and Xuchuan Yuan

Consumers are inclined to join longer queues due to social interactions in service consumptions. This purchase behavior brings in operational challenges in terms of…

Abstract

Purpose

Consumers are inclined to join longer queues due to social interactions in service consumptions. This purchase behavior brings in operational challenges in terms of capacity planning, which affects consumers’ demand, leading to an unstable and fluctuated arrival process. This paper aims to investigate the dynamic characteristics of the arrival process of a service system with boundedly rational consumers whose purchase decisions are influenced by the queue length under social interactions.

Design/methodology/approach

Consumers’ bounded rationality is modeled based on the random utility theory. Due to social interactions, the equilibrium queue length and its interaction with the expected waiting time affect consumers’ value perception. The authors first analyze the optimal service capacity decision with or without considering the influence of social interactions in a static setting. They then focus on the dynamic characteristics of the arrival process by a one-dimensional dynamical model in terms of the arrival rate.

Findings

This paper finds that the service system can behave chaotic in terms of arrival rate dynamics under social interactions. The results highlight the dynamical complexity of a simple service system due to consumers’ behavioral factors and the influence of social interactions, which may be the critical drivers leading to fluctuated and uneven demand.

Originality/value

The findings demonstrate that due to consumers’ limited cognitive ability and the influence of social interactions, the demand to a service system can be stable, periodic or even chaotic in terms of the arrival process. This study provides an alternative explanation to the observed demand fluctuations in various service processes under the influence of social interactions, which is important for service providers to effectively manage service capacity to achieve a stable service process and improve operational efficiency.

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Article
Publication date: 1 April 2004

Noel D. Uri and Paul R. Zimmerman

In 1999 the Federal Communications Commission adopted an order granting complete deregulation of the rates for special access service for specific metropolitan statistical…

Abstract

In 1999 the Federal Communications Commission adopted an order granting complete deregulation of the rates for special access service for specific metropolitan statistical areas based on an objective showing that there was potential competition in that market. This was done in an environment where the local exchange carriers (LECs) subject to price caps were earning a rate of return in excess of 22 percent, with the rate of return on an upward trend. By 2002, the average rate of return across all price cap LECs topped 35 percent. The question that is investigated in this paper is whether the price cap LECs have market power in supplying special access service and whether they have taken advantage of this. The data clearly show that this is the case. Given the prevailing situation, there is a clear need to revisit the pricing flexibility order. First, the product market for special access service needs to be more carefully examined. Second, the metrics used to define the potential for competition need to be revamped.

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Article
Publication date: 1 January 1991

Michael J. Showalter and J. Dennis White

Although research attention has been given to the modelling processfor simultaneous demand‐output management in manufacturing systems,little interest has been demonstrated…

Abstract

Although research attention has been given to the modelling process for simultaneous demand‐output management in manufacturing systems, little interest has been demonstrated in service organisations despite the fact that such organisations face unique conditions that further complicate the demand‐output management issue. In response to this lack of emphasis, we review the relevant research from both marketing and operations management and present a cost‐effectiveness model for balancing demand and service output.

Details

International Journal of Operations & Production Management, vol. 11 no. 1
Type: Research Article
ISSN: 0144-3577

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Article
Publication date: 1 August 2019

Sara Jebbor, Abdellatif El Afia and Raddouane Chiheb

This paper aims to propose an approach by human and material resources combination to reduce hospitals crowding. Hospitals crowding is becoming a serious problem. Many…

Abstract

Purpose

This paper aims to propose an approach by human and material resources combination to reduce hospitals crowding. Hospitals crowding is becoming a serious problem. Many research works present several methods and approaches to deal with this problem. However, to the best of the authors’ knowledge – after a deep reading of literature – in all the proposed approaches, human and material resources are studied separately while they must be combined (to a given number of material resources an optimal number of human resources must be assigned and vice versa) to reflect reality and provide better results.

Design/methodology/approach

Hospital inpatient unit is chosen as framework. This unit crowding reduction is carried out by its capacity increasing. Indeed, inpatient unit modeling is performed to find the adequate combinations of human and material resources numbers insuring this unit stability and providing optimal service rates. At first, inpatient unit is modeled using queuing networks and considering only two resources (beds and nurses). Then, the obtained service rate formula is improved by including other resources and parameters using Baskett, Chandy, Muntz and Palecios (BCMP) queuing networks. This work is applied to “Princess Lalla Meryem” hospital inpatient unit.

Findings

Results are patients’ average number reduction by an average (in each block) of three patients, patients’ average waiting time reduction by an average of 9.98 h and non-admitted patients (to inpatient wards) access percentage of 39.26 per cent on average.

Originality/value

Previous works focus their studies on either human resources or material resources. Only a few works study both resources types, but separately. The context of those studies does not meet the real hospital context (where human resources are combined with material resources). Therefore, the provided results are not very reliable. In this paper, an approach by human and material resources combination is proposed to increase inpatient unit care capacity. Indeed, this approach consists of developing inpatient unit service rate formula in terms of human and material resources numbers.

Details

International Journal of Pervasive Computing and Communications, vol. 15 no. 2
Type: Research Article
ISSN: 1742-7371

Keywords

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Article
Publication date: 8 February 2016

Asunur Cezar and Hulisi Ögüt

The aim of this paper is to examine the impact of three main technologies on converting browsers into customers: impact of review rating (location rating and service rating

Abstract

Purpose

The aim of this paper is to examine the impact of three main technologies on converting browsers into customers: impact of review rating (location rating and service rating), recommendation and search listings.

Design/methodology/approach

This paper estimates conversion rate model parameters using a quasi-likelihood method with the Bernoulli log-likelihood function and parametric regression model based on the beta distribution.

Findings

The results show that a high rank in search listings, a high number of recommendations and location rating have a significant and positive impact on conversion rates. However, service rating and star rating do not have a significant effect on conversion rate. Furthermore, room price and hotel size are negatively associated with conversion rate. It was also found that a high rank in search listings, a high number of recommendations and location rating increase online hotel bookings. Furthermore, it was found that a high number of recommendations increase the conversion rate of hotels with low ranks.

Practical implications

The findings show that hotels’ location ratings are more important than both star and service ratings for the conversion of visitors into customers. Thus, hotels that are located in convenient locations can charge higher prices. The results may also help entrepreneurs who are planning to open new hotels to forecast the conversion rates and demand for specific locations. It was found that a high number of recommendations help to increase the conversion rate of hotels with low ranks. This result suggests that a high numbers of recommendations mitigate the adverse effect of a low rank in search listings on the conversion rate.

Originality/value

This paper contributes to the understanding of the drivers of conversion rates in online channels for the successful implementation of hotel marketing.

Details

International Journal of Contemporary Hospitality Management, vol. 28 no. 2
Type: Research Article
ISSN: 0959-6119

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Article
Publication date: 25 January 2019

Laure Jaunaux and Marc Lebourges

According to European Union Open Internet Regulation, commercial practices of internet access service providers (IASP) should not restrict end-users’ choice regarding…

Abstract

Purpose

According to European Union Open Internet Regulation, commercial practices of internet access service providers (IASP) should not restrict end-users’ choice regarding services, applications or contents. This paper aims to analyze the effects of Zero Rating (ZR) on freedom of choice translating this regulatory criterion into a formal expression: providing a ZR offer on a content or application provider (CAP) restricts end-users’ choice if it reduces the volume or provision of others usages.

Design/methodology/approach

The analysis is made in two steps. First, the authors assess the direct effect of introducing zero rating on non-ZR usages, all other things equal. Second, the paper studies the knock-on effect of ZR on IASP offers and the supply of CAP.

Findings

In the short term, zero rating does not restrict end-users’ choice increasing both ZR and non-ZR usages. In the long term, in the case of pure ZR, IASPs may adapt their offer to support ZR costs impacting negatively other usages. However, in practice, these effects are compensated or diluted by competitive forces or if the ZR traffic is small relatively to the data allowance. In the case of SD, the CAP covers the cost which prevents cross-subsidies and protects freedom of choice if SD is open to all CAPs.

Originality/value

The economic literature on zero rating is scarce and assesses this practice from the general economic criterion of social or consumer welfare. This paper is the first one to use economic analysis to analyze whether Zero Rating is compatible with the EU regulatory criterion of freedom of choice.

Details

Digital Policy, Regulation and Governance, vol. 21 no. 2
Type: Research Article
ISSN: 2398-5038

Keywords

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