Chase strategies help adjust production and inventory strategies in markets and industries with variable or seasonal output levels.
Adam Hardy
Hello Everyone,
According to Collier and Evans (2019), a chase strategy is “sets the production rate equal to the demand in each time period” (sect. 13.3). Chase strategies help adjust production and inventory strategies in markets and industries with variable or seasonal output levels. A chase strategy for an airline call center would prove favorable. The production level of calls would not equal the workforce employed, resulting in decreased morale, higher overhead costs, and higher employee lag time. During peaks of seasonal operations resulting in higher call volumes, it would be prudent to hire temporary employees rather than full-time employees. Hiring full-time employees incurs much higher wage costs as employees must be provided with year-round benefits instead of seasonal employees who are hired to handle increased demand. The reduction in full-time wages for employees versus temporary wages for seasonal workers reduces the overall wage cost annually.
Another concern for the airline call center is the inadequate equipment requirements for employees to utilize to address the higher call volume for customers. In this instance, it would be prudent to outsource the increased call demand to a Business Process Outsourcing (BPO) company specializing in call service center operations. The employee workload and the equipment could manage at a set rate for the number of months the service is required, resulting in lower operating costs, employee turnover, and increased morale as current employees are not overwhelmed by increased customer demand (Ghodeswar & Vaidyanathan, 2008).
Regards,
Adam Hardy
References
Collier, D. A, Evans, J. R. (2019). Operations and supply chain management. Cengage Learning.
Ghodeswar, B., Vaidyanathan, J. (2008). Business process outsourcing: An approach to gain access to world-class capabilities. Business Process Management Journal. 14(1), 23-38. 10.1108/14637150810849382.
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