Why Casinos Need Capacity Planning

In their Capacity Management for hospitality and tourism: a review of current approaches, Pullman and Rodgers acknowledge that many leisure enterprises, such as casinos and massive integrated resorts, require substantial capital investment and expenditure. Pullman and Rodgers contend that, “While capacity management has generally fallen within the domain of operations management, and demand management within the domain of marketing, intersecting methodologies such as yield and revenue management, the partitioning of visitors (by length of stay), and/or the adjustment of visitor participation levels rely on expertise from both of these functional areas to work effectively."

Although capacity management has been referred to as ‘‘demand management’’ by Crandall and Markland and ‘‘managing capacity and demand’’ by Fitzsimmons and Fitzsimmons, capacity and demand management are, in fact, distinct concepts. In his How to match plant with demand: a matrix for marketing for the International Journal of Tourism Management, Taylor believes that demand management attempts to influence when and how many visitors attend or use a service, whereas Klassen and Rohleder contend that capacity management ensures that sufficient capacity exists to meet this demand.

Pullman and Rodgers argue that, capacity strategy is a key operational function for all leisure-related enterprises. “The extent to which capacity satisfies demand has an impact on visitor experience, employee satisfaction, profitability, and long-term sustainability of both the resources and the enterprise itself,” they contend.

In the leisure industry, excess capacity not only underutilizes the workforce and other physical resources, but can also lead to increased waste and demand stimulating and profit reducing price reductions. “Inadequate capacity, on the other hand, can impair the visitor experience through degradation of facilities, overuse of natural resources, crowding, and increased waiting time, warn Pullman and Rodgers. It can also open the door for competitors to enter the market as well as overtax the workforce, leading to employee burnout and increased turnover. “Fortunately, firms can borrow a number of ideas from other industries to facilitate better matching of supply to demand in their particular enterprise,” advise Pullman and Rodgers.
As Pullman and Rodgers argue, capacity "can be separated into two distinct perspectives, the strategic or long-term perspective and the tactical or short-term perspective." Strategic capacity decisions are made during the planning stages for a project as managers consider macro-level responses to existing and potential future demand (Porter, Davis and Heineke, Schroeder). For Pullman and Rodgers, “Such decisions may include the number of hotel rooms an area can or should support; the land space, energy, and water required for a project; the available labour and skills; the anticipated overall size of the enterprise in terms of parking, seating, and production requirements (in food services); and/or the carrying capacity issues for natural resources.”

Later in the planning process, the capacity focus shifts to the set of short-term actions taken to fulfill the planned strategies, often called the “tactics.”viii “Examples of these decisions include the determination of the number of employees needed to meet peak demand during a summer lunch period and the best mix of table configurations to accommodate dinner demand given different party sizes,” say Pullman and Rodgers. As per Figure 1, “Long versus short term decisions are distinctly different, and the methodologies for addressing these problems often involve alternate approaches” (Pullman and Rodgers).

This is as true for the aviation industry as any other industry, perhaps even more so because the product that airlines offer differ little from one airline to another. It's the experience and the emotional sense and perception of that experience that truly counts; this is where CX thrives. Above all else, the ultimate goal of a CX system is to drive customer loyalty. 

Loyalty is so important for an airline because customers become more profitable over time; increased profits can be derived from increased purchases, reduced operating costs, profits from customer referrals, as well as profits from price premiums as long-term customers are more comfortable paying regular prices for services rather than being tempted into using a businesses’ lower profit products and/or services.

Another important element to a strong customer experience solution is a powerful Multichannel Marketing Hub (MMH). Gartner defines the MMH as a technology that orchestrates a company's communications with and offers to customer segments across multiple channels. These include websites, mobile, social, direct mail, call centers, paid media and email. MMH capabilities also may extend to integrating marketing offers/leads with sales for execution in both B2B and B2C environments.

A Campaign Management solution helps an airline to develop and manage personalized customer communications strategies and the timely delivery of offers to its patrons. It allows users to rapidly create, modify and manage multi-channel, multi-wave marketing campaigns that integrate easily with any fulfillment channel, automatically producing outbound (contact) and inbound (response) communication history.

Users can define target segments, prioritize selection rules, prioritize offers across multiple campaigns and channels, select communication channels, schedule and execute campaigns, and perform advanced analyses to predict and evaluate the success of customer communications. Most of today’s solutions provide the capability to represent complex data structures in a format appealing and comprehensible for business users in order for them to make business decisions.

One of the best ways to increase customer loyalty is for airlines to implement CRM systems. CRM is a strategy used to learn more about a customer’s needs and behaviors in order to develop a stronger relationship with them, thereby creating a value exchange on both sides. From a customer perspective, well-implemented CRM systems can offer a unified customer interface that delivers customization and personalization. At each transaction point, such relevant patron data as a customer's personal preferences, as well as his or her overall past history transactions are available to the clerk serving the customer, giving them valuable information about how to interact with the person. In assessing CRM solutions, Intelligencia follows the Forrester and Gartner rankings closely. We understand the current CRM offerings, each vendor's unique strategy and market presence, and we can help our clients find a solution that is tailored to their specific needs.


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Intellligencia is a Hong Kong- and Macau-based software consulting company that works specifically in the hospitality, gaming, fintech, esports, manufacturing, retail, sports betting, and travel industries. Although located in Asia, we work with clients as far away as North America, Mexico, India, Armenia, Australia, and the Philippines.


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