The Impact of Delaying the Delay Announcement
Many service providers use delay announcements to inform customers of anticipated delays. However, this information is usually not provided immediately, but rather after a short period of time (spent either waiting or occupied by the system). The focus of this paper is on the impact of this postponement on the ability of the firm to communicate non-verifiable congestion information to its customers as well as on the profits and utilities for the firm and the customers respectively. We show that this postponement can actually help the firm create credibility and augment the equilibrium language. However, in other settings this delay can also detract the equilibrium language. Further, we show that whenever credibility is created it improves not only the profit for the firm, but also the customers’ overall utility.
Allon, Gad and Achal Bassamboo. 2012. The Impact of Delaying the Delay Announcement. Operations Research. 59(5): 1198-1210.