A Cost-Based Model for Customer Batching in Mass Service Operations

Customers of mass services have similar needs. Therefore, operations managers have options to process customers in batches, rather than individually. While batching in manufacturing may reduce setup time, batching in services may reduce both setup and processing time. Although substantial prior research has been done on batch sizes in the manufacturing context, significant differences in cost structures complicate direct application of these models to services. Of special concern for polices regarding batching in service operations are immediate temporal effects on and preferences of customers. This paper synthesizes and extends previous research to develop and analyze an economic model for determining optimal batch sizes for many mass service scenarios.