Lecture 3 (cont’d)

Example:
CAA Airlines carries out charter and regular flights to medium‐haul destinations – such as the Mediterranean,
North Africa and the Red Sea – and to long‐haul destinations such as the Caribbean. Today, CAA ’ s fleet
consists of three (new) Boeing 737‐800s and four (out dated) Boeing 767‐300s. Because the Boeing 767s are
rather out dated they need more maintenance than the average airplane. Despite an intensive
maintenance program, these planes have a lot of technical problems. Consequently, the long‐haul fleet of
CAA has needed to deal with a lot of delays recently. New long‐haul planes have been ordered, but these
planes will not be delivered before 2016. This means that more delays will inevitably occur. This may
translate into much frustration among airline passengers, to switching behaviour, and to negative word‐of
mouth communication. These feelings and behaviours of consumers may eventually have negative effects
on the performance and the profitability of the fi rm.
Prior research has claimed that service waits can be controlled by two techniques: operations
management and management of perceptions. For CAA Airlines it is very difficult to obtain “zero defects”
(no delays). Hence, this project will focus on managing the perceptions of the wait experience: because
CAA Airlines cannot control the actual amount of delays and the duration, the company must focus on
managing the customers ’ perception of the waiting experience. The purpose of this study is twofold:
A. to identify the factors that influence the passengers ’ waiting experience and
B. to investigate the possible impact of waiting on customer satisfaction and service evaluations.
Therefore, this project focuses on the following research questions:
1. What are the factors that affect the perceived waiting experience of airline passengers and to what
extent do these factors affect the perception of waiting times?
2. What are the affective consequences of waiting and how does affect mediate the relationship
between waiting and service evaluations?
3. How do situational variables (such as filled time) influence customer reactions to the waiting
experience?
Drawing from prior research in the areas of waiting, service evaluations, and mood theory, hypotheses are
generated regarding the relationships among a delay, the waiting experience, affect, and service
evaluations. The hypothesized relationships are tested in a field setting involving delayed CAA airline
passengers.
VARIABLES:
A variable is anything that can take on differing or varying values. The values can differ at various times for
the same object or person, or at the same time for different objects or persons.
Examples of variables are production units, absenteeism, and motivation.
There are four main types of variables:
1. The dependent variable (also known as the criterion variable).
2. The independent variable (also known as the predictor variable).
3. The moderating variable.
4. The mediating variable.
Each of these variables can be discrete (e.g., male/female) or continuous (e.g., the age of an individual).
Dependent Variable
The dependent variable is the variable of primary interest to the researcher. The researcher’s goal is to
understand and describe the dependent variable, or to explain its variability, or predict it. In other words, it is
the main variable that lends itself for investigation as a viable factor. Through the analysis of the dependent
variable (i.e. finding what variables influence it), it is possible to find answers or solutions to the problem. For
this purpose, the researcher will be interested in quantifying and measuring the dependent variable, as well
as the other variables that influence this variable.
Independent Variable
It is generally conjectured that an independent variable is one that influences the dependent variable in
either a positive or negative way. That is, when the independent variable is present, the dependent variable
is also present, and with each unit of increase in the independent variable, there is an increase or decrease
in the dependent variable. To establish that a change in the independent variable causes a change in the
dependent variable, all four of the following conditions should be met:
1. The independent and the dependent variable should covary: in other words, a change in the
dependent variable should be associated with a change in the independent variable.
2. The independent variable (the presumed causal factor) should precede the dependent variable. In
other words, there must be a time sequence in which the two occur: the cause must occur before the
effect.
3. No other factor should be a possible cause of the change in the dependent variable. Hence, the
researcher should control for the effects of other variables.
4. A logical explanation (a theory) is needed and it must explain why the independent variable affects the
dependent variable.
Moderating Variable
The moderating variable is one that has a
strong contingent effect on the independent
variable–dependent variable relationship.
That is, the presence of a third variable (the
moderating variable) modifies the original
relationship between the independent and
the dependent variables. For example it has
been found that there is a relationship
between the availability of reference
manuals that manufacturing employees have
access to and the product rejects. That is,
when workers follow the procedures laid
down in the manual, they are able to
manufacture products that are flawless. But
only those who have the interest and urge to
refer to the manual every time a new process
is adopted will produce flawless products.
Others who do not consult the manual will not
benefit and will continue to produce
defective products.
As in the above case, whenever the relationship between the independent variable and the dependent
variable becomes contingent or dependent on another variable, we say that the third variable has a
moderating effect on the independent variable–dependent variable relationship. The variable that
moderates the relationship is known as the moderating variable.
Mediating Variable
A mediating variable (or intervening variable) is one that surfaces between the time the independent
variables start operating to influence the dependent variable and the time their impact is felt on it. There is
thus a temporal quality or time dimension to the mediating variable. In other words, bringing a mediating
variable into play helps you to model a process. The mediating variable surfaces as a function of the
independent variable(s) operating in any situation, and helps to conceptualize and explain the influence of
the independent variable(s) on the dependent variable. The following example illustrates this point.
In the previous example, where the independent variable (workforce diversity) influences the dependent
variable (organizational effectiveness), the mediating variable that surfaces as a function of the diversity in
the workforce is “creative synergy.” This creative synergy results from a multiethnic, multiracial, and
multinational (i.e., diverse) workforce interacting and bringing together their multifaceted expertise in
problem solving. This helps us to understand how organizational effectiveness can result from having
diversity in the workforce.

Note that creative synergy, the mediating variable, surfaces at time t2, as a function of workforce diversity,
which was in place at time t1, to bring about organizational effectiveness in time t3. The mediating variable
of creative synergy helps us to conceptualize and understand how workforce diversity brings about
organizational effectiveness. The changing aspects of these relationships are illustrated in the figure above.
The independent variable helps to explain the variance in the dependent variable; the mediating variable
surfaces at time t2 as a function of the independent variable, which also helps us to conceptualize the
relationship between the independent and dependent variables; and the moderating variable has a
contingent effect on the relationship between two variables.
Example
A store manager observes that the morale of employees in her supermarket is low. She thinks that if their
working conditions are improved, pay scales raised, and the vacation benefits made more attractive, the
morale will be boosted. She doubts, however, if an increase in pay scales would raise the morale of all
employees. Her conjecture is that those who have supplemental incomes will just not be “turned on” by
higher pay, and only those without side incomes will be happy with increased pay, with a resultant boost in
morale.
Please answer the following:
1. List and label the variables in this situation.
2. Explain the relationships among the variables
3. Illustrate them by means of diagrams.
4. What might be the problem statement or problem definition for the situation?