Canadian Shield Airlines opened its doors in December 2001 as a commuter service with its headquarters and hub located in Yellowknife. The airline was started and managed by two former pilots, Steve Hobbs and Joseph Magill. It acquired a fleet of 12 used prop-jet planes and the airport gates vacated by a bankrupt regional airline. With business growing quickly, Hobbs turned his attention to Canadian Shield’s “800” reservations system. Between midnight and 6:00 a.m., only one telephone reservations agent had been on duty. The times between incoming calls during this period are distributed as shown in Table 1 . Carefully observing and timing the

Time Between Calls (minutes)           Probability

1 …………………………………………….................  0.11

2 …………………………………………….................. 0.21

3 ………………………………………................…….. 0.22

4 …………………………………………….................. 0.20

5 …………………………………………….................. 0.16

6 …………………………………………….................. 0.10

Table 2

Time to Process Cutomer Inquires (minutes)                 Probability

1 ……………………………………………………….…………….……………. 0.20

2 ……………………………………………………….…………….……………. 0.19

3 ……………………………………………………….…………….……………. 0.18

4 ……………………………………………………….…………….……………. 0.17

5 ……………………………………………………….…………….……………. 0.13

6 ……………………………………………………….…………….……………. 0.10

7 ……………………………………………………….…………….……………. 0.03

agent, Hobbs estimated that the time required to process passenger inquiries is distributed as shown in Table 2 . All customers calling Canadian Shield go “on hold” and are served in the order of the calls received unless the reservations agent is available for immediate service. Hobbs is deciding whether a second agent should be on duty to cope with customer demand. To maintain customer satisfaction, Canadian Shield Air wants a customer to be “on hold” for no more than three to four minutes; it also wants to maintain a “high” operator utilization.
Furthermore, the airline is planning a new TV advertising campaign. As a result, it expects an increase in “800” line phone inquiries. Based on similar campaigns in the past, the incoming call distribution from midnight to 6:00 a.m. is expected to be as shown in Table 3 .

Table 3

Time Between calls                               Probability

1 ………………………………………………………. 0.22

2 ………………………………………………………. 0.25

3 ………………………………………………………. 0.19

4 ………………………………………………………. 0.15

5 ………………………………………………………. 0.12

6 ………………………………………………………. 0.07

Discussion Questions
1. Given the original call distribution, what would you advise Canadian Shield to do for the current reservation system? Create a simulation model to investigate the scenario. Describe the model carefully and justify the duration of the simulation, assumptions, and measures of performance.
2. What are your recommendations regarding operator utilization and customer satisfaction if the airline proceeds with the advertising campaign?