Just in time' pricing strategies in services: towards a concept of `customized management of service supply'

This article proposes a methodology based on capacity management and dynamic pricing strategies by questioning some of the traditional assumptions of Yield Management as they were first developed in the field of air transportation and extend the analysis to telecommunications and similar service sectors. Bearing in mind that the influence of dynamic pricing is not limited to the sole optimization of short term revenues but also applies to operations management and to long term investment policy, the authors present and discuss the concept of ‘just in time’ pricing strategies which aims at reaching a better compromise between the capacity of a company and demand in an environment where services cannot be sold in advance. In applying the concept to telecommunications, the authors then emphasize and demonstrate the strategic importance for a service company to have full command of its database and information networks and present the concept of ‘customized management of services supply’.