Operations Improvement Plan

Essay by tiernyUniversity, Master'sA+, April 2006

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The growing service industry creates a competitive atmosphere for businesses in the retail sector to demonstrate which store can attract more customers. One of the biggest problems facing businesses such as these is gaining a competitive edge against common retailers. A factor that determines whether the business will attract more customers and helps the business to acquire the desired competitive edge, is the time spent by customers in their checkout lines. The shorter the time spent waiting in the check out line, the greater to business chances of attracting more customers. In fact, a leading driver of customer loyalty was ranked by the speed of checkout lines, ranking even higher than location convenience (Imber, 2005).

Problem Statement

Team C will evaluate the mitigating issues that can be resolved within a retail business such as Wal-Mart to expedite the customer waiting time in a checkout line.

Measurement Strategy

In theory, it is a simple proposition: Make customers wait longer, and fewer of them will come back.

When new marketing initiatives cause's changes in operational processes this increases customer service times. When waiting lines form, a small increase in service times for each customer magnifies into a significant increase in waiting time for the customer at the end of the line. The increase in waiting times affects different market segments differently, but generally causes a reduction in customer satisfaction, and hence, repurchases. Team C recommends using a simulation model that combines operational process analysis, waiting line simulation, real versus perceived waiting times, and a customer loyalty model.

Operational Process Analysis

Of course, all customers wishing to make a purchase at a grocery store must use the register process. To the uninitiated, this process would seem simple, trivial, and unworthy of study. However, due to the increasing variety of product offerings and...