CR 2 M—an approach for capacity control considering long-term effects on the value of a customer for the company

Hans Buhl (), Robert Klein, Johannes Kolb and Andrea Landherr

Metrika: International Journal for Theoretical and Applied Statistics, 2011, vol. 22, issue 2, 187-204

Abstract: In the last years, customer centricity has turned out to be a promising paradigm for maximizing corporate value by increasing value contributions from customers. In this context, the discipline of revenue management provides plenty of methods to optimize (predominantly short-term) cash-inflows from customers. However, the paradigm of a value-oriented management requires the integration of perspectives from revenue management and customer relationship management: When controlling scarce, inflexible capacity, the effects of the acceptance or denial of a customer request on the value of a customer for the enterprise have to be considered. Hence, this paper proposes a model for a customer lifetime value-oriented capacity control by allocating scarce resources to products for different customer segments combining methods from both revenue management and customer relationship management—termed CR 2 M. The model presented in this paper at the same time allows a transparent calculation of opportunity costs caused by a short-term oriented control mechanism. In order to illustrate the applicability of the model, a company of the semiconductor industry serves as example. Copyright Springer Verlag 2011

Keywords: Customer relationship management; Customer value-oriented capacity control; Revenue management; Linear programming (search for similar items in EconPapers)
Date: 2011
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Citations: View citations in EconPapers (2)

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DOI: 10.1007/s00187-011-0133-8

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