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Allocating Telecommunications Resources at L. L. Bean, Inc

Author

Listed:
  • Phil Quinn

    (Strategic Planning Department, L. L. Bean, Inc., Casco Street, Freeport, Maine 04033)

  • Bruce Andrews

    (School of Business, Economics, and Management, University of Southern Maine, Portland, Maine 04103)

  • Henry Parsons

    (School of Business, Economics, and Management, University of Southern Maine, Portland, Maine 04103)

Abstract

We developed and implemented a model for optimizing the deployment of telemarketing resources at L.L. Bean, a large telemarketer and mail-order catalog house. The deployment levels obtained with economic optimization were significantly different from those formerly determined by service-level criteria, and the resultant cost savings were estimated as $9 to $10 million per year. To develop the economic-optimization approach, we used queueing theory, devised an expected total-cost objective function, and accounted for retrial behavior and potential caller abandonments through a regression model that related the abandonment rates to customer service levels. Management at L.L. Bean has fully accepted this approach, which now explicitly sets optimal levels for the number of telephone trunks (lines) carrying incoming traffic, the number of agents scheduled, and the maximum number of queue positions allowed for customers waiting for a telephone agent.

Suggested Citation

  • Phil Quinn & Bruce Andrews & Henry Parsons, 1991. "Allocating Telecommunications Resources at L. L. Bean, Inc," Interfaces, INFORMS, vol. 21(1), pages 75-91, February.
    • Handle: RePEc:inm:orinte:v:21:y:1991:i:1:p:75-91
    DOI: 10.1287/inte.21.1.75
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    Citations

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    Cited by:

    1. Peter C. Bell & Chris K. Anderson & Stephen P. Kaiser, 2003. "Strategic Operations Research and the Edelman Prize Finalist Applications 1989--1998," Operations Research, INFORMS, vol. 51(1), pages 17-31, February.
    2. Tolga Çezik & Oktay Günlük & Hanan Luss, 2001. "An integer programming model for the weekly tour scheduling problem," Naval Research Logistics (NRL), John Wiley & Sons, vol. 48(7), pages 607-624, October.
    3. Rust, Roland T. & Metters, Richard, 1996. "Mathematical models of service," European Journal of Operational Research, Elsevier, vol. 91(3), pages 427-439, June.
    4. S Casado & M Laguna & J Pacheco, 2005. "Heuristical labour scheduling to optimize airport passenger flows," Journal of the Operational Research Society, Palgrave Macmillan;The OR Society, vol. 56(6), pages 649-658, June.
    5. Jerome Niyirora & Jamol Pender, 2016. "Optimal staffing in nonstationary service centers with constraints," Naval Research Logistics (NRL), John Wiley & Sons, vol. 63(8), pages 615-630, December.
    6. 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.
    7. Duder, John C. & Rosenwein, Moshe B., 2001. "Towards "zero abandonments" in call center performance," European Journal of Operational Research, Elsevier, vol. 135(1), pages 50-56, November.
    8. Aksin, O. Zeynep & Harker, Patrick T., 2003. "Capacity sizing in the presence of a common shared resource: Dimensioning an inbound call center," European Journal of Operational Research, Elsevier, vol. 147(3), pages 464-483, June.
    9. Peter C. Bell & Chris K. Anderson, 2002. "In Search of Strategic Operations Research/Management Science," Interfaces, INFORMS, vol. 32(2), pages 28-40, April.
    10. Defraeye, Mieke & Van Nieuwenhuyse, Inneke, 2016. "Staffing and scheduling under nonstationary demand for service: A literature review," Omega, Elsevier, vol. 58(C), pages 4-25.
    11. Prakash Mirchandani & G. G. Hegde & Richard E. Wendell, 2001. "Enhancing Competitiveness of the Customer Loan Center at Promistar Financial Corporation," Interfaces, INFORMS, vol. 31(3), pages 28-43, June.

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