Nowadays, an average consumer does not have time to wait. Standing in a line can be a main reason to avoid using a service in the future. To improve serving speed, business owners hire additional staff, buy equipment, etc. However, the clients flow is not persistent, so in most cases equipment and staff does not work that produces inefficient costs. In such situation queuing theory helps marketing specialists in finding a balance between the client’s comfort and costs, in order to maximize the profit. The father of this theory is Agner Krarup Erlang.
Agner Krarup Erlang – scientist from Denmark who studied the telephone networks problem. Erlang applied the probabilities theory to problems of telephone traffic in his "The Theory of Probabilities and Telephone Conversations" in 1909. The scientist proved that distribution of telephone calls is very close to Poisson's one. He calculated the fraction of consumers in need to wait because all of the lines were in use, by studying a village telephone exchange. Erlang's model is a really simple; however the mathematics underlying modern telephone networks is based on his model ("Agner Krarup Erlang (1878 – 1929)").
The key idea lying behind the model is really simple. It is a simulation with parameters (serving time, etc.) giving us an ability to predict expected characteristics of the consumer serving process based on historical data, and then build a profit function. Solving the function gives us results helping in marketing decisions (which strategy will maximize the profit) (Sztrik, János).
After the death of the scientist, his model was applied to the majority of systems where consumers flow exists (supermarkets, internet servers, mobile phone operator support system, road traffic control systems, etc.).
Queuing theory is one of the essential parts of operational research and decision support systems used in marketing.
Works Cited
"Agner Krarup Erlang (1878 - 1929)." plus.maths.org. N.p., n.d. Web. 5 June 2014. <http://plus.maths.org/content/agner-krarup-erlang-1878-1929>.
Sztrik, János . “Basic Queuing Theory.” University of Debrecen, Faculty of Informatics, n.d. Web. 5 June 2014. <http://irh.inf.unideb.hu/~jsztrik/education/16/SOR_Main_Angol.pdf>.
