Date of Award

12-2013

Degree Name

MS in Industrial Engineering

Department/Program

Industrial and Manufacturing Engineering

Advisor

Lizabether Schlemer

Abstract

The importance of efficiency in the service industry has continued to grow with the increase of services in today’s society. As a result, services must maintain efficient operations in order to achieve positive customer satisfaction and retain their customers. The fear of receiving negative customer satisfaction often results in a firm owner’s reluctance to improve efficiency operations because he or she believes it will hurt sales. This thesis provides a background on restaurant operations efficiency and customer satisfaction and discusses a case study used to explore the effect of efficiency on customer satisfaction. The case study consisted of a time study and customer survey based on a scale called SERVQUAL, which is used as a measure of service quality. The wait times collected during the time study were correlated with the customer survey responses in order to determine strong correlations. Four of the five strong correlations related to the tangibles dimension of service quality, which corresponds to the appearance of the restaurant facilities, equipment, and staff. Due to the determined importance of the tangibles dimension, it can be used as a measure for customer satisfaction. A polynomial regression model was then generated based on the strong correlations. The model indicates that shorter order wait times do not negatively affect customer satisfaction much, but rather, longer order wait times more strongly affect customer satisfaction. Therefore based on the regression model, restaurant owners and managers should focus on reducing the customer order wait time because reducing this time results in higher levels of customer satisfaction. Additionally, these results show that restaurants can choose to increase revenue by improving their efficiency without fear of hurting their customer satisfaction.

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