Page 294 - DMGT522_SERVICES MANAGEMENT

Unit 14: Yield Management in Services

Self Assessment Notes

Fill in the blanks:

11. The concept of ....................... (Kotler) suggests a strategy to discourage the customers on a
temporary or permanent basis to achieve synchronization between the demand and supply.
12. Although ....................... would result in better profitability, service managers should not
push it so hard that quality is affected in some or the other way.
13. By training the staff in multiple functions, most ....................... can be engaged in essential
tasks of delivering the service during peak hours and the support tasks are deferred to
slack periods.
14. Another method, which can help in ....................... demand from peak period, is developing
complementary or facilitating services.
15. ....................... suggested some basic strategies to alter demand so as to fit it within the
available capacity.

Case Study Case: Technology as a Tool for Decisive Competitive
Advantage Catch 22 dilemma

BI had embarked 5 years ago on a massive technology plan with the intention of
Scomputerising all its 13,649 branches (from 2,700 in 2002 to all by 2005) and significantly
networking its branches. Today, it has one of the largest networks of 4250 ATMs at 1398
centers. Its plan: 3800 branches by 2005 and later 6800. It has one of the most ambitious
connectivity blueprints in the world – through fiber optic cable and satellite hook-ups
around a central server. Moreover, it is also becoming aggressive in retail businesses like
mortgages and credit cards. However, slow pace of technology adoption and the overhang
of lower spreads, high operating expenses and higher provisioning are expected to impact
the banks near term profitability. Rapid implementation of the proposed technology plan
will hold the key to SBI’s long-term competitiveness.
Para-banking: American Express, MasterCard and then Visa used satellite technology to
track purchases made through cards, and also payments. The credit card technology included
a quick card verification system, magnetic identification documentation (ID), and online
payment systems. The credit verification is done through the Electronic Data Capture
(EDC) machines (Verizon and Verifone are companies that supply EDC machines to India)
which the retailers have as a dedicated telephone line link. The connectivity is courtesy
the card companies leasing it out to the retailers. It has changed the way people shop,
made them carry less cash, and greatly facilitated the conduct of business for banks, card
companies as well as retailers. It has helped the card companies to become global brands.

Education
DIRECWAY - The new experiment in education:
A recent phenomenon in distance and online education system, Direcway used technology
to have a broader catchments area. The partners to the venture are:
Hughes Software Systems, a former subsidiary of General Motors, and a leader in
satellite communication technology provided the technology systems.
Contd...

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