IDEAS home Printed from https://ideas.repec.org/
MyIDEAS: Log in (now much improved!) to save this article

Capacity Sizing Under Parameter Uncertainty: Safety Staffing Principles Revisited

  • Achal Bassamboo

    ()

    (Kellogg School of Management, Northwestern University, Evanston, Illinois 60208)

  • Ramandeep S. Randhawa

    ()

    (Marshall School of Business, University of Southern California, Los Angeles, California 90089)

  • Assaf Zeevi

    ()

    (Graduate School of Business, Columbia University, New York, New York 10027)

Registered author(s):

    We study a capacity sizing problem in a service system that is modeled as a single-class queue with multiple servers and where customers may renege while waiting for service. A salient feature of the model is that the mean arrival rate of work is random (in practice this is a typical consequence of forecasting errors). The paper elucidates the impact of uncertainty on the nature of capacity prescriptions, and relates these to well established rules-of-thumb such as the square-root safety staffing principle. We establish a simple and intuitive relationship between the incoming load (measured in Erlangs) and the extent of uncertainty in arrival rates (measured via the coefficient of variation) that characterizes the extent to which uncertainty dominates stochastic variability or vice versa. In the former case it is shown that traditional square-root safety staffing logic is no longer valid, yet simple capacity prescriptions derived via a suitable newsvendor problem are surprisingly accurate.

    If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

    File URL: http://dx.doi.org/10.1287/mnsc.1100.1203
    Download Restriction: no

    Article provided by INFORMS in its journal Management Science.

    Volume (Year): 56 (2010)
    Issue (Month): 10 (October)
    Pages: 1668-1686

    as
    in new window

    Handle: RePEc:inm:ormnsc:v:56:y:2010:i:10:p:1668-1686
    Contact details of provider: Postal:
    7240 Parkway Drive, Suite 300, Hanover, MD 21076 USA

    Phone: +1-443-757-3500
    Fax: 443-757-3515
    Web page: http://www.informs.org/
    Email:


    More information through EDIRC

    References listed on IDEAS
    Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

    as in new window
    1. Lawrence Brown & Noah Gans & Avishai Mandelbaum & Anat Sakov & Haipeng Shen & Sergey Zeltyn & Linda Zhao, 2005. "Statistical Analysis of a Telephone Call Center: A Queueing-Science Perspective," Journal of the American Statistical Association, American Statistical Association, vol. 100, pages 36-50, March.
    2. Athanassios N. Avramidis & Alexandre Deslauriers & Pierre L'Ecuyer, 2004. "Modeling Daily Arrivals to a Telephone Call Center," Management Science, INFORMS, vol. 50(7), pages 896-908, July.
    3. Noah Gans & Ger Koole & Avishai Mandelbaum, 2003. "Telephone Call Centers: Tutorial, Review, and Research Prospects," Manufacturing & Service Operations Management, INFORMS, vol. 5(2), pages 79-141, September.
    4. J. Michael Harrison & Assaf Zeevi, 2005. "A Method for Staffing Large Call Centers Based on Stochastic Fluid Models," Manufacturing & Service Operations Management, INFORMS, vol. 7(1), pages 20-36, September.
    5. Itay Gurvich & Mor Armony & Avishai Mandelbaum, 2008. "Service-Level Differentiation in Call Centers with Fully Flexible Servers," Management Science, INFORMS, vol. 54(2), pages 279-294, February.
    6. Otis B. Jennings & Avishai Mandelbaum & William A. Massey & Ward Whitt, 1996. "Server Staffing to Meet Time-Varying Demand," Management Science, INFORMS, vol. 42(10), pages 1383-1394, October.
    Full references (including those not matched with items on IDEAS)

    This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

    When requesting a correction, please mention this item's handle: RePEc:inm:ormnsc:v:56:y:2010:i:10:p:1668-1686. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Mirko Janc)

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If references are entirely missing, you can add them using this form.

    If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.