Operator's Customer example essay topic

Operations Management & Tour Operators Aside from the external environmental operational issues faced by the tour operators, which include events like the 9/11 twin towers attacks, the Bali bombing, and the war in Iraq, which saw a booking slump of more than 20% in the months leading up to it, tour operators face many other operational issues. Small companies seem to be flexible, enterprising and customer-focused. However according to Phil Davies, editor of Travel Trade Gazette says, 'the model used by the big companies, with their own travel agents, aircraft and hotel interests, has not changed much over the past 20 years. ' The smaller companies have been able to react to the change in demand because they " re more manageable and not weighed down by their own aircraft or the need to sell in volume. The large operators are also being forced to offer more flexible travel arrangements, more activities and entertainment, and the upgrade of hotel rooms like the smaller independent operators, helping to create a brand loyalty.

Increasingly customers can now book their own flights and create their own packages with hotels and car hire; there these low-cost airlines have shown how the big travel companies need to become more flexible. The small companies that seem to be getting the high-satisfaction results are more exclusive and expensive than the mass branded larger companies. Some are now trying to diversify their existing brands, as the profits seem to be coming from higher-margin specialist holidays. Holiday resorts in Europe, and the notorious 18-30 scene are now under pressure from overcrowding and unruly behaviour. The independents offer better value-for -money, even if they were not associated with rock-bottom prices. The companies generally expected to be good value-for -money often turn out to be worse, however not everybody will turn to the independents even though they seem to be better value-for-money for expense reasons, especially now as everybody seems to be expecting something-for-nothing.

Essentially, the large tour operator's customer is buying a fairly standardised product but will be influenced by the process of the sale which can be customised in the sense that the individual customer's needs are diagnosed and, within the limits of the operation's product range, met. Tour operators relate mainly to customer-processing technology. They have been traditionally seen as 'low-technology', as services rely on people. Process technology is very much in evidence in customer processing. For any booking, for example, there is the reservation technology.

The personal element is undoubtedly important, but as now shown with the developing no-frills airlines offering low-cost flights, customers can book their own flights and create their own packages, it is not essential. Generally the objective of customer-processing is to give an acceptable level of service while significantly reducing costs in the operation. Although service operations do make forecasts of their expected average level of demand, they cannot usually predict exactly when each customer will arrive. Customers arrive according to some probability distribution and wait to be processed once they have reached the front of the queue; they are processed by one of the parallel servers, after which they leave the operation. The capacity planning and control problem here is how many parallel servers to have available at any one time.

Because of the problematic arrival and processing times, rarely will the arrival of customers match the ability of the operation to cope with them. If several customers arrive in succession and require longer processing times, queues will build up in the operation, and then at other times some servers in the system may be idle. So if capacity is set at too low a level, queues will build up to a level where customers become dissatisfied with the time they are having to wait, although the utilisation level of the servers will be high, and vice versa. This is why the capacity planning and control problem for this type of operation is often presented as a trade-off between customer waiting time and system utilisation. It is therefore important to predict both of these factors for a given queueing system in making capacity decisions. Consumers cite accommodation problems as the main cause for complaint.

The second most dissatisfaction came across as problems with the companies' reps. Customers seem the most satisfied with their travel arrangements. Yet the least satisfied of these customers had travelled with the large tour operators. Operations failure detection and analysis involves putting mechanisms into place which sense that some kind of failure has occurred, and then analysing the failure to try to understand its roots and causes.

Detection mechanisms may include, phone surveys, focus groups, complaint cards, feedback sheets and questionnaires. Analysis mechanisms include complaint analysis, failure mode, and effect analysis. Operations can try to recover from failure by the systematic approach to discovering what has happened to cause the failure, find the root cause of the failure, preventing it from taking place again, and planning to avoid it occurring in the future. Quality combines several difference approaches, to define quality as, 'consistence conformance to customers' expectations'. Quality can be modelled as the gap between customers' expectations and their perceptions concerning the service. Control charts can be used to track the performance of one or more quality characteristics in the operation.

Total quality management must also be considered, it means that the customers' needs and expectations are always considered first, making them the forefront of quality decision-making. It also places much emphasis on the ideas of problem-solving and continuous improvement.