Question at position 36 The optimal capacity utilization for a service organization is 100%TrueFalse

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BlackTom AI · Accepted Answer

Question asks about the statement: The optimal capacity utilization for a service organization is 100%.
Option 1: True. If a service operation runs at 100% capacity, there is no slack or buffer to absorb variability in demand or processing times. In services, fluctuations are common due to unpredictable arrival patterns, walk-ins, and variable service times. Operating at full capacity can lead to longer wait times, stressed employees, reduced quality, and inability to handle unexpected surges. Therefore, 100% utilization is rarely optimal in real-world services because it leaves no room to absorb variability.
Option 2: False. This option aligns with service management principles that emphasize some level of capacity cushion or underutilization to maintain service levels. By not operating at absolute maximum, the organization can accommodate peak demand, reduce customer waiting, maintain service quality, and provide smoother throughput. It also helps in coping with unplanned events, training, maintenance, and breaks, which are all more manageable when there is spare capacity.
In summary, while high utilization is desirable for efficiency, 100% capacity leaves little to no flexibility for variability and can degrade performance, suggesting that 100% utilization is not optimal in most service settings.

Question at position 36 The optimal capacity utilization for a service organization is 100%TrueFalse

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Utilization is calculated as the ratio of maximum capacity to actual output rate, expressed as a percentage.

What is the current Capacity Utilization Rate?

Part 1What is efficiency?Part 2 A. 100% utilization B. percentage of design capacity actually used C. effective capacity divided by design capacity D. percentage of effective capacity actually used

Part 1A plant has an effective capacity of 1,0001,000 units per day and produces 920.0920.0 units per day with its product mix. Part 2The plant efficiency = [input]enter your response here % (enter your response as a percentage rounded to one decimal place).

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Question at position 36 The optimal capacity utilization for a service organization is 100%TrueFalse

View Explanation

Log in for full answers

Similar Questions

Utilization is calculated as the ratio of maximum capacity to actual output rate, expressed as a percentage.

What is the current Capacity Utilization Rate?

Part 1What is​ efficiency?Part 2 A. ​100% utilization B. percentage of design capacity actually used C. effective capacity divided by design capacity D. percentage of effective capacity actually used

Part 1A plant has an effective capacity of 1,0001,000 units per day and produces 920.0920.0 units per day with its product mix. Part 2The plant efficiency​ = [input]enter your response here ​% ​(enter your response as a percentage rounded to one decimal​ place).

More Practical Tools for Students Powered by AI Study Helper

Making Your Study Simpler

Part 1What is efficiency?Part 2 A. 100% utilization B. percentage of design capacity actually used C. effective capacity divided by design capacity D. percentage of effective capacity actually used

Part 1A plant has an effective capacity of 1,0001,000 units per day and produces 920.0920.0 units per day with its product mix. Part 2The plant efficiency = [input]enter your response here % (enter your response as a percentage rounded to one decimal place).