Bat Case Report Essay

1204 Words Mar 9th, 2013 5 Pages
Executive Summary
BAT is a technology that sells financial software to individuals and organizations. BAT’s success had attracted a number of competitors. BAT differentiated itself by committing to free tech support for the life of the product. BAT started its call center operations in 1987 with 6 technicians which grew to over a 100 technicians by 2002. However, the call center has been under pressure in terms of long waiting times for customers. Such poor service was beginning to take its toll on the company’s reputation.
We recommend that BAT should implement the Fast Track proposal in order to improve customer service and the company’s bottom line. We understand that free technical support is BAT’s value proposition and central to
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The additional net revenue/loss that can be obtained per year is now not so attractive, ranging from a net loss of $51,675 to a net revenue of $270,300.
Scenario 2 (9 Servers) offers the best revenue opportunities.
Free Service for Fast customers waiting over 1 minute.
We did some simulations to see what happens if BAT offers Fast Track service, charging $2 / minute, but giving the service for free if the customer waits over 1 minute.
According to the “Queuing” macro, with 1 additional server there is a 30.7% chance that any given customer (whether Fast Track or Standard) will wait more than 1 minute. Considering that 10% of these customers are Fast Track individuals, we obtain an arrival rate of 30.7% * 10% * 22.5 customers/hr = 0.69 customers / hr. On the other hand, considering that 40% of customers are Fast Track individuals, we obtain an arrival rate of 30.7% * 40% * 22.5 customers/hr = 2.7 customers / hr
This means that, on average, the number of Fast Track customers who will wait over 1 minute ranges from 0.69 / hr to 2.7 / hr. In other words, roughly anywhere from 1 to 3 Fast Track customers per hour will be waived from the Fast Track fee. As seen on Appendix “xxxxx” (Table 4), this represents a loss of annual revenue ranging between $2,197 and $8,786. However, despite declines in revenue, this fee-waiver option will surely improve customer’s experience and customer loyalty.

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