IDEAS home Printed from https://ideas.repec.org/a/inm/oropre/v65y2018i1p242-265.html
   My bibliography  Save this article

Impact of Delay Announcements in Call Centers: An Empirical Approach

Author

Listed:
  • Zeynep Akşin

    (College of Administrative Sciences and Economics, Koç University, 34450 Sariyer-Istanbul, Turkey)

  • Baris Ata

    (Booth School of Business, University of Chicago, Chicago, Illinois 60637)

  • Seyed Morteza Emadi

    (Kenan-Flagler Business School, University of North Carolina at Chapel Hill, Chapel Hill, North Carolina 27599)

  • Che-Lin Su

    (Formerly at the Booth School of Business, University of Chicago, Chicago, Illinois)

Abstract

We undertake an empirical study of the impact of delay announcements on callers’ abandonment behavior and the performance of a call center with two priority classes. A Cox regression analysis reveals that in this call center, callers’ abandonment behavior is affected by the announcement messages heard. To account for this, we formulate a structural estimation model of callers’ (endogenous) abandonment decisions. In this model, callers are forward-looking utility maximizers and make their abandonment decisions by solving an optimal stopping problem. Each caller receives a reward from service and incurs a linear cost of waiting. The reward and per-period waiting cost constitute the structural parameters that we estimate from the data of callers’ abandonment decisions as well as the announcement messages heard. The call center performance is modeled by a Markovian approximation. The main methodological contribution is the definition of an equilibrium in steady state as one where callers’ expectation of their waiting time, which affects their (rational) abandonment behavior, matches their actual waiting time in the call center, as well as the characterization of such an equilibrium as the solution of a set of nonlinear equations. A counterfactual analysis shows that callers react to longer delay announcements by abandoning earlier, that less patient callers as characterized by their reward and cost parameters react more to delay announcements, and that congestion in the call center at the time of the call affects caller reactions to delay announcements.

Suggested Citation

  • Zeynep Akşin & Baris Ata & Seyed Morteza Emadi & Che-Lin Su, 2017. "Impact of Delay Announcements in Call Centers: An Empirical Approach," Operations Research, INFORMS, vol. 65(1), pages 242-265, February.
    • Handle: RePEc:inm:oropre:v:65:y:2018:i:1:p:242-265
    DOI: 10.287/opre.2016.1542
    as

    Download full text from publisher

    File URL: https://doi.org/10.287/opre.2016.1542
    Download Restriction: no
    File URL: https://libkey.io/10.287/opre.2016.1542?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Ward Whitt, 1999. "Predicting Queueing Delays," Management Science, INFORMS, vol. 45(6), pages 870-888, June.
    2. Kenneth L. Judd, 1998. "Numerical Methods in Economics," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262100711, April.
    3. Zeynep Akşin & Barış Ata & Seyed Morteza Emadi & Che-Lin Su, 2013. "Structural Estimation of Callers' Delay Sensitivity in Call Centers," Management Science, INFORMS, vol. 59(12), pages 2727-2746, December.
    4. Igal Hendel & Aviv Nevo, 2013. "Intertemporal Price Discrimination in Storable Goods Markets," American Economic Review, American Economic Association, vol. 103(7), pages 2722-2751, December.
    5. Yina Lu & Andrés Musalem & Marcelo Olivares & Ariel Schilkrut, 2013. "Measuring the Effect of Queues on Customer Purchases," Management Science, INFORMS, vol. 59(8), pages 1743-1763, August.
    6. Ward Whitt, 2005. "Engineering Solution of a Basic Call-Center Model," Management Science, INFORMS, vol. 51(2), pages 221-235, February.
    7. J.J. Heckman & E.E. Leamer (ed.), 2001. "Handbook of Econometrics," Handbook of Econometrics, Elsevier, edition 1, volume 5, number 5.
    8. Gustavo Vulcano & Garrett van Ryzin & Wassim Chaar, 2010. "OM Practice--Choice-Based Revenue Management: An Empirical Study of Estimation and Optimization," Manufacturing & Service Operations Management, INFORMS, vol. 12(3), pages 371-392, February.
    9. 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.
    10. Oualid Jouini & Yves Dallery & Zeynep Aksin, 2009. "Queueing models for full-flexible multi-class call centers with real-time anticipated delays," Post-Print hal-00565481, HAL.
    11. Harikesh Nair, 2007. "Intertemporal price discrimination with forward-looking consumers: Application to the US market for console video-games," Quantitative Marketing and Economics (QME), Springer, vol. 5(3), pages 239-292, September.
    12. Rouba Ibrahim & Ward Whitt, 2009. "Real-Time Delay Estimation Based on Delay History," Manufacturing & Service Operations Management, INFORMS, vol. 11(3), pages 397-415, May.
    13. Susan H. Xu & Long Gao & Jihong Ou, 2007. "Service Performance Analysis and Improvement for a Ticket Queue with Balking Customers," Management Science, INFORMS, vol. 53(6), pages 971-990, June.
    14. Pengfei Guo & Paul Zipkin, 2007. "Analysis and Comparison of Queues with Different Levels of Delay Information," Management Science, INFORMS, vol. 53(6), pages 962-970, June.
    15. Hassin, Refael, 1986. "Consumer Information in Markets with Random Product Quality: The Case of Queues and Balking," Econometrica, Econometric Society, vol. 54(5), pages 1185-1195, September.
    16. Mor Armony & Nahum Shimkin & Ward Whitt, 2009. "The Impact of Delay Announcements in Many-Server Queues with Abandonment," Operations Research, INFORMS, vol. 57(1), pages 66-81, February.
    17. Joseph Abate & Ward Whitt, 1995. "Numerical Inversion of Laplace Transforms of Probability Distributions," INFORMS Journal on Computing, INFORMS, vol. 7(1), pages 36-43, February.
    18. Oualid Jouini & Zeynep Akşin & Yves Dallery, 2011. "Call Centers with Delay Information: Models and Insights," Manufacturing & Service Operations Management, INFORMS, vol. 13(4), pages 534-548, October.
    19. Jouini, Oualid & Dallery, Yves & Aksin, Zeynep, 2009. "Queueing models for full-flexible multi-class call centers with real-time anticipated delays," International Journal of Production Economics, Elsevier, vol. 120(2), pages 389-399, August.
    20. Ward Whitt, 1999. "Improving Service by Informing Customers About Anticipated Delays," Management Science, INFORMS, vol. 45(2), pages 192-207, February.
    21. Oualid Jouini & Zeynep Aksin & Yves Dallery, 2011. "Call Centers with Delay Information: Models and Insights," Post-Print hal-00680769, HAL.
    22. Jun Li & Nelson Granados & Serguei Netessine, 2014. "Are Consumers Strategic? Structural Estimation from the Air-Travel Industry," Management Science, INFORMS, vol. 60(9), pages 2114-2137, September.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Sandeep Rath & Kumar Rajaram, 2022. "Staff Planning for Hospitals with Implicit Cost Estimation and Stochastic Optimization," Production and Operations Management, Production and Operations Management Society, vol. 31(3), pages 1271-1289, March.
    2. Necati Tereyağoğlu & Peter S. Fader & Senthil Veeraraghavan, 2018. "Multiattribute Loss Aversion and Reference Dependence: Evidence from the Performing Arts Industry," Management Science, INFORMS, vol. 64(1), pages 421-436, January.
    3. Yuan, Xuchuan & Brian Hwarng, H., 2023. "Examining the dynamics of reactive capacity allocation through a chaos lens," European Journal of Operational Research, Elsevier, vol. 308(2), pages 912-928.
    4. Kaan Kuzu & Long Gao & Susan H. Xu, 2019. "To Wait or Not to Wait: The Theory and Practice of Ticket Queues," Manufacturing & Service Operations Management, INFORMS, vol. 21(4), pages 853-874, October.
    5. Barış Balcıog̃lu & Odysseas Kanavetas, 2022. "A dynamic prioritization policy for the callback option in a call center," Flexible Services and Manufacturing Journal, Springer, vol. 34(1), pages 40-64, March.
    6. Rouba Ibrahim & Mor Armony & Achal Bassamboo, 2017. "Does the Past Predict the Future? The Case of Delay Announcements in Service Systems," Management Science, INFORMS, vol. 63(6), pages 1762-1780, June.
    7. Baris Ata & Peter W. Glynn & Xiaoshan Peng, 2017. "An equilibrium analysis of a discrete-time Markovian queue with endogenous abandonments," Queueing Systems: Theory and Applications, Springer, vol. 86(1), pages 141-212, June.
    8. Bolandifar, Ehsan & DeHoratius, Nicole & Olsen, Tava, 2023. "Modeling abandonment behavior among patients," European Journal of Operational Research, Elsevier, vol. 306(1), pages 243-254.
    9. Baris Ata & Xiaoshan Peng, 2018. "An Equilibrium Analysis of a Multiclass Queue with Endogenous Abandonments in Heavy Traffic," Operations Research, INFORMS, vol. 66(1), pages 163-183, January.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Rouba Ibrahim, 2018. "Sharing delay information in service systems: a literature survey," Queueing Systems: Theory and Applications, Springer, vol. 89(1), pages 49-79, June.
    2. Zeynep Akşin & Barış Ata & Seyed Morteza Emadi & Che-Lin Su, 2013. "Structural Estimation of Callers' Delay Sensitivity in Call Centers," Management Science, INFORMS, vol. 59(12), pages 2727-2746, December.
    3. Qiuping Yu & Gad Allon & Achal Bassamboo, 2017. "How Do Delay Announcements Shape Customer Behavior? An Empirical Study," Management Science, INFORMS, vol. 63(1), pages 1-20, January.
    4. Robert J. Batt & Christian Terwiesch, 2015. "Waiting Patiently: An Empirical Study of Queue Abandonment in an Emergency Department," Management Science, INFORMS, vol. 61(1), pages 39-59, January.
    5. Rouba Ibrahim & Ward Whitt, 2011. "Wait-Time Predictors for Customer Service Systems with Time-Varying Demand and Capacity," Operations Research, INFORMS, vol. 59(5), pages 1106-1118, October.
    6. Oualid Jouini & Zeynep Akşin & Yves Dallery, 2011. "Call Centers with Delay Information: Models and Insights," Manufacturing & Service Operations Management, INFORMS, vol. 13(4), pages 534-548, October.
    7. Miao Yu & Yu Zhao & Chunguang Chang & Liangliang Sun, 2023. "Fluid models for customer service web chat systems with interactive automated service," Flexible Services and Manufacturing Journal, Springer, vol. 35(2), pages 572-598, June.
    8. Jamol Pender & Richard Rand & Elizabeth Wesson, 2020. "A Stochastic Analysis of Queues with Customer Choice and Delayed Information," Mathematics of Operations Research, INFORMS, vol. 45(3), pages 1104-1126, August.
    9. Rouba Ibrahim & Ward Whitt, 2009. "Real-Time Delay Estimation in Overloaded Multiserver Queues with Abandonments," Management Science, INFORMS, vol. 55(10), pages 1729-1742, October.
    10. Gad Allon & Achal Bassamboo, 2011. "The Impact of Delaying the Delay Announcements," Operations Research, INFORMS, vol. 59(5), pages 1198-1210, October.
    11. Kaan Kuzu & Long Gao & Susan H. Xu, 2019. "To Wait or Not to Wait: The Theory and Practice of Ticket Queues," Manufacturing & Service Operations Management, INFORMS, vol. 21(4), pages 853-874, October.
    12. Qiuping Yu & Gad Allon & Achal Bassamboo, 2021. "The Reference Effect of Delay Announcements: A Field Experiment," Management Science, INFORMS, vol. 67(12), pages 7417-7437, December.
    13. Lu, Yuwei & Xie, Xiaolan & Jiang, Zhibin, 2018. "Dynamic appointment scheduling with wait-dependent abandonment," European Journal of Operational Research, Elsevier, vol. 265(3), pages 975-984.
    14. Siddharth Prakash Singh & Mohammad Delasay & Alan Scheller‐Wolf, 2023. "Real‐time delay announcement under competition," Production and Operations Management, Production and Operations Management Society, vol. 32(3), pages 863-881, March.
    15. Najiya Fatma & Varun Ramamohan, 2023. "Patient diversion using real-time delay predictions across healthcare facility networks," OR Spectrum: Quantitative Approaches in Management, Springer;Gesellschaft für Operations Research e.V., vol. 45(2), pages 437-476, June.
    16. Guo, Pengfei & Sun, Wei & Wang, Yulan, 2011. "Equilibrium and optimal strategies to join a queue with partial information on service times," European Journal of Operational Research, Elsevier, vol. 214(2), pages 284-297, October.
    17. Zhang, Zhe George & Yin, Xiaoling, 2021. "Information and pricing effects in two-tier public service systems," International Journal of Production Economics, Elsevier, vol. 231(C).
    18. German F. Retana & Chris Forman & D. J. Wu, 2016. "Proactive Customer Education, Customer Retention, and Demand for Technology Support: Evidence from a Field Experiment," Manufacturing & Service Operations Management, INFORMS, vol. 18(1), pages 34-50, February.
    19. Shiliang Cui & Senthil Veeraraghavan, 2016. "Blind Queues: The Impact of Consumer Beliefs on Revenues and Congestion," Management Science, INFORMS, vol. 62(12), pages 3656-3672, December.
    20. Brett A. Hathaway & Seyed M. Emadi & Vinayak Deshpande, 2021. "Don’t Call Us, We’ll Call You: An Empirical Study of Caller Behavior Under a Callback Option," Management Science, INFORMS, vol. 67(3), pages 1508-1526, March.

    More about this item

    Keywords

    242-265;

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:inm:oropre:v:65:y:2018:i:1:p:242-265. See general information about how to correct material in RePEc.

    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 CitEc recognized a bibliographic reference but did not link an item in RePEc 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 RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Chris Asher (email available below). General contact details of provider: https://edirc.repec.org/data/inforea.html .

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

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.