Videos
For its first 2 decades of existence, the NBA’s Orlando Magic basketball team set seat prices for its 41-game home
But when Anthony Perez, director of business strategy, finished his MBA at the University of Florida, he developed a valuable database of ticket sales. Analysis of the data led him to build a
Studying individual sales of Magic tickets on the open Stub Hub marketplace during the prior season, Perez determined the additional potential sales revenue the Magic could have made had they charged prices the fans had proven they were willing to pay on Stub Hub. This became his dependent variable, y, in a multiple-regression model.
He also found that three variables would help him build the “true market” seat price for every game. With his model, it was possible that the same seat in the arena would have as many as seven different prices created at season onset—sometimes higher than expected on average and sometimes lower.
The major factors he found to be statistically significant in determining how high the demand for a game ticket, and hence, its price, would be were:
► The day of the week (x1)
► A rating of how popular the opponent was (x2)
► The time of the year (x3)
For the day of the week, Perez found that Mondays were the least-favored game days (and he assigned them a value of 1). The rest of the weekdays increased in popularity, up to a Saturday game, which he rated a 6. Sundays and Fridays received 5 ratings, and holidays a 3 (refer to the footnote in Table 4.2).
Fernado Medina
TABLE 4.2 Data for Last Year’s Magic Ticket Sales Pricing Model
His ratings of opponents, done just before the start of the season, were subjective and range from a low of 0 to a high of 8. A very high-rated team in that particular season may have had one or more superstars on its roster, or have won the NBA finals the prior season, making it a popular fan draw.
Finally, Perez believed that the NBA season could be divided into four periods in popularity:
► Early games (which he assigned 0 scores)
► Games during the Christmas season (assigned a 3)
► Games until the All-Star break (given a 2)
► Games leading into the play-offs (scored with a 3)
The first year Perez built his multiple-regression model, the dependent variable y, which was a “potential premium revenue score,” yielded an R2 =.86 with this equation:
Table 4.2 illustrates, for brevity in this case study, a sample of 12 games that year (out of the total 41 home game regular season), including the potential extra revenue per game (y) to be expected using the variable pricing model.
A leader in NBA variable pricing, the Orlando Magic have learned that regression analysis is indeed a profitable forecasting tool.
1. Use the data in Table 4.2 to build a regression model with day of the week as the only independent variable.
4. What additional independent variables might you suggest to include in Perez’s model?
Want to see the full answer?
Check out a sample textbook solution
Chapter 4 Solutions
Operations Management
- Dietary Management in a Nursing Home. As detailed as possible.arrow_forwardFor dietary management in a nursing home. As detailed as possible.arrow_forwardA small furniture manufacturer produces tables and chairs. Each product must go through three stages of the manufacturing process – assembly, finishing, and inspection. Each table requires 3 hours of assembly, 2 hours of finishing, and 1 hour of inspection. The profit per table is $120 while the profit per chair is $80. Currently, each week there are 200 hours of assembly time available, 180 hours of finishing time, and 40 hours of inspection time. Linear programming is to be used to develop a production schedule. Define the variables as follows: T = number of tables produced each week C= number of chairs produced each week According to the above information, what would the objective function be? (a) Maximize T+C (b) Maximize 120T + 80C (c) Maximize 200T+200C (d) Minimize 6T+5C (e) none of the above According to the information provided in Question 17, which of the following would be a necessary constraint in the problem? (a) T+C ≤ 40 (b) T+C ≤ 200 (c) T+C ≤ 180 (d) 120T+80C ≥ 1000…arrow_forward
- As much detail as possible. Dietary Management- Nursing Home Don't add any fill-in-the-blanksarrow_forwardMenu Planning Instructions Use the following questions and points as a guide to completing this assignment. The report should be typed. Give a copy to the facility preceptor. Submit a copy in your Foodservice System Management weekly submission. 1. Are there any federal regulations and state statutes or rules with which they must comply? Ask preceptor about regulations that could prescribe a certain amount of food that must be kept on hand for emergencies, etc. Is the facility accredited by any agency such as Joint Commission? 2. Describe the kind of menu the facility uses (may include standard select menu, menu specific to station, non-select, select, room service, etc.) 3. What type of foodservice does the facility have? This could be various stations to choose from, self-serve, 4. conventional, cook-chill, assembly-serve, etc. Are there things about the facility or system that place a constraint on the menu to be served? Consider how patients/guests are served (e.g. do they serve…arrow_forwardWork with the chef and/or production manager to identify a menu item (or potential menu item) for which a standardized recipe is needed. Record the recipe with which you started and expand it to meet the number of servings required by the facility. Develop an evaluation rubric. Conduct an evaluation of the product. There should be three or more people evaluating the product for quality. Write a brief report of this activity • Product chosen and the reason why it was selected When and where the facility could use the product The standardized recipe sheet or card 。 o Use the facility's format or Design one of your own using a form of your choice; be sure to include the required elements • • Recipe title Yield and portion size Cooking time and temperature Ingredients and quantities Specify AP or EP Procedures (direction)arrow_forward
- ASSIGNMENT: Inventory, Answer the following questions 1. How does the facility survey inventory? 2. Is there a perpetual system in place? 3. How often do they do a physical inventory? 4. Participate in taking inventory. 5. Which type of stock system does the facility use? A. Minimum stock- includes a safety factor for replenishing stock B. Maximum stock- equal to a safety stock plus estimated usage (past usage and forecasts) C. Mini-max-stock allowed to deplete to a safety level before a new order is submitted to bring up inventory up to max again D. Par stock-stock brought up to the par level each time an order is placed regardless of the amount on hand at the time of order E. Other-(describe) Choose an appropriate product and determine how much of an item should be ordered. Remember the formula is: Demand during lead time + safety stock = amount to order Cost out an inventory according to data supplied. Remember that to do this, you will need to take an inventory, and will need to…arrow_forwardHuman Relations, Systems, and Organization Assignments ORGANIZATION: Review the organization chart for the facility • Draw an organization chart for the department. • . Identify and explain the relationships of different units in the organization and their importance to maintain the food service department's mission. Include a copy in your weekly submission. There is a feature in PowerPoint for doing this should you want to use it. JOB ORGANIZATION: ⚫ A job description is a broad, general, and written statement for a specific job, based on the findings of a job analysis. It generally includes duties, purpose, responsibilities, scope, and working conditions of a job along with the job's title, and the name or designation of the person to whom the employee reports. Job description usually forms the basis of job specification. • Work with your preceptor or supervisor to identify a position for which you will write a job description. Include a copy of the job description you write in your…arrow_forwardASSIGNMENT: Production Sheet Watch at least 3 workers prepare foods. Write down what they do and the amount of time it takes for them to complete the task. Calculate the production cost. Example: Food Item: Green Beans Time Worker #1 Worker #2 Worker #3 Start End Time (Hours) Time Time Activity Activity Activity (Hours) (Hours) 11:45 am 12:01 pm 0.27 Steam and 0.05 Microwave blenderize pureed frozen green green beans beans 16.25 Total Production Time 3 minutes minutes Hourly Wage $16.07 $12.28 24% Benefits *** $3.86 $2.95 Labor Costs $5.37 $0.76 *** Check with facility to see Benefit %arrow_forward
- Menu Planning and Quality Monitoring Rotation site: Hospital/Commercial Foodservice Rotation Objectives: Menu development (this will be your Theme Meal) 1. Develop a modified menu (vegetarian, vegan, gluten-free, etc.) that is appropriate in texture, color, flavor, eye appeal, temperature, and methods of preparation. 2. Develop a menu that takes into consideration food preferences due to clients' ethnicity and age group. 3. Develop menus that fulfill the nutritional needs of the target population. 4. Develop a modified menu that maintains consistency with a regular menu. 5. Demonstrate knowledge of operational constraints and limitations when designing menus 6. Identify appropriate type and amounts of foods for an emergency plan. ACTIVITY: Quality improvement monitoring 1. Participates in rounds to get feedback from clients on Theme Meal menu. 2. Takes corrective actions if necessary according to results of the quality measures 3. Completes one or more critical incident reports for the…arrow_forwardWork with the chef and/or production manager to identify a menu item (or potential menu item) for which a standardized recipe is needed. Record the recipe with which you started and expand it to meet the number of servings required by the facility. Develop an evaluation rubric. Conduct an evaluation of the product. There should be three or more people evaluating the product for quality. Write a brief report of this activity • Product chosen and the reason why it was selected When and where the facility could use the product The standardized recipe sheet or card ○ Use the facility's format or о Design one of your own using a form of your choice; be sure to include the required elements Recipe title " Yield and portion size ■ Cooking time and temperature Ingredients and quantities Specify AP or EP Procedures (direction)arrow_forwardItem Prepared: Work with one or more cold food production workers to learn job descriptions, flow of work, how the menu items are prepared and served, and needs for further training or process improvement. Document a specific menu item you prepared. Record the temperature of a product when it goes into the refrigerator or blast chiller. Record how long it took for the product to cool to the appropriate temperature. Evaluate the menu item you were involved in preparing. Follow the product and process to completion and utilize resources to correct any wrong procedures you observe. Take your notes and write a brief report of the actual experience based on the following criteria: 1. Pre-preparation 2. Preparation 3. Compare menu item to diets it is used for by completing a nutritional analysis 4. Temperatures during and after preparation. 5. Tray service to patient or guest (how it looks, holds up, appropriate temperature maintained from production through delivery) 6. Waste disposal (what…arrow_forward
Purchasing and Supply Chain ManagementOperations ManagementISBN:9781285869681Author:Robert M. Monczka, Robert B. Handfield, Larry C. Giunipero, James L. PattersonPublisher:Cengage Learning
Practical Management ScienceOperations ManagementISBN:9781337406659Author:WINSTON, Wayne L.Publisher:Cengage,