Chase Strategy Refers To The Concept Of Chasing

Chase Strategy Refers To The Concept That You Are Chasing The Demand S

Chase strategy refers to the concept that you are chasing the demand set by the market. Production is set to match demand and does not carry any leftover products. This is a lean production strategy, saving on costs until the demand (the order) is placed. Inventory costs are low, and the cost of goods for products sold is kept to a minimum and for a shorter length of time. The chase strategy is used in industries that must contend with perishables or with companies that do not have a lot of extra cash on hand to handle the added risks of unsold products.

The production schedule is based on orders and immediate demand. By varying production or services to meet demand, the lean approach of inventory management has lower inventory levels and reduced labor costs. For example, an airline call center experiences varying demand—higher calls during summer months and major holidays. Inaccurate forecasts can cause disruptions in staffing and scheduling. Equipment capacity may also be insufficient during peak demand periods, leading to potential customer service issues or increased operational stress.

Discussion: Adopting a Chase Strategy for a Major Airline Call Center

Deciding whether to adopt a chase strategy for a major airline call center involves weighing its potential benefits against inherent challenges. A chase strategy focuses on matching staffing levels and operational capacity directly to fluctuating demand, which is particularly relevant given the seasonal and unpredictable nature of airline customer inquiries.

On the pro side, employing a chase strategy allows the airline to minimize staffing costs during off-peak times, reducing idle labor and lowering operational expenses. During high-demand periods, additional staff can be scheduled to handle increased call volumes, maintaining service quality and customer satisfaction. A study by Ferrell et al. (2010) emphasizes that flexible staffing models in service operations can lead to enhanced efficiency and improved customer experience, especially when demand is variable. Additionally, a chase approach helps in managing service capacity more effectively, avoiding the costs associated with overstaffing and excess inventory of trained personnel during slow seasons.

However, this approach also presents significant challenges. The unpredictability of demand can lead to staffing shortages during peak periods if demand exceeds forecasts, resulting in long wait times, customer dissatisfaction, and potential damage to reputation. Conversely, overestimating demand can cause unnecessary overtime costs or persistent underutilization of staff. Moreover, training call center agents to handle sudden surges in calls effectively and maintaining operational flexibility requires substantial planning and resources. According to Bowersox, Closs, and Cooper (2018), service organizations that rely heavily on flexible staffing must also consider employee morale and burnout, which can adversely affect service quality and retention if demand surges are unpredictable.

In essence, adopting a chase strategy for a major airline call center is advantageous for controlling costs and aligning resources with demand, but it demands sophisticated demand forecasting and agile workforce management. Companies must evaluate their capacity for flexible scheduling, investment in staff training, and technology support systems. Integrating advanced analytics and real-time demand monitoring can mitigate some risks associated with demand variability, ensuring the strategic benefits of a chase model are maximized. Therefore, in my view, a hybrid approach that combines elements of chase with buffer capacity and flexible staffing policies might serve the airline best, balancing cost efficiency with a high-quality customer service experience.

Conclusion

In conclusion, a chase strategy offers significant advantages for a major airline call center by reducing unnecessary costs and adjusting capacity to demand fluctuations. Nonetheless, the risks associated with demand unpredictability require careful planning, advanced forecasting, and flexible workforce strategies. Implementing a hybrid approach could optimize operational efficiency while maintaining high standards of customer service, making it a pragmatic choice in the dynamic environment of airline customer support.

References

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