The Application of Forecasting in Service Operations Operations Management Assignment Help

The Application of Forecasting in Service Operations

Service managers are recognizing the important distribution that forecasting can make in improving both the efficiency and the level or service in a service operation. Point-of-sale (POS) equipment can now provide! the service manager with historical sales data in time increments that are as small as 15 minutes. The av availability of these data permits accurate forecasting of future sales in similar time increments. thereby permitting the service manager to schedule workers more efficiently. Davis and Berger” point out that. in addition to forecasting sales. such models also can forecast product usage which reduces the spoilage of perishable items that have a short shelf life. Forecasting is also an integral part of yield ensnarement (also known as revenue management). which is discussed in more detail in later hater In brief, yield management attempts to maximize the revenues of those service operations that have high fixed costs and small variable costs. Examples of such service business  include airlines. car rental agencies and hotels. The goal of yield management maximize capacity utilization en if it means offering large price discounts. when to fill available capacity. At the same
time the manager does not want III turn paying customer because the capacity had been previously sold to a discount accomplish the success fully the manage must be able! to forecast demand for different market segments.

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