Introduction

Queuing theory is the mathematical study of the congestion and delays of waiting in
line. Queuing theory (or "queuing theory") examines every component of waiting in
line to be served, including the arrival process, service process, number of servers,
number of system places, and the number of customers—which might be people,
data packets, cars, etc.
As a branch of operations research, queuing theory can help users make informed
business decisions on how to build efficient and cost-effective workflow systems.
Real-life applications of queuing theory cover a wide range of applications, such as
how to provide faster customer service, improve traffic flow, efficiently ship orders
from a warehouse, and design of telecommunications systems, from data networks
to call centres.
Queues happen when resources are limited. In fact, queues make economic sense; no
queues would equate to costly overcapacity. Queuing theory helps in the design of
balanced systems that serve customers quickly and efficiently but do not cost too
much to be sustainable. All queuing systems are broken down into the entities
queuing for an activity.
At its most elementary level, queuing theory involves the analysis of arrivals at a
facility, such as a bank or fast food restaurant, then the service requirements of that
facility, e.g., tellers or attendants.
Queuing theory is the study of queues and the random processes that characterize
them. It deals with making mathematical sense of real-life scenarios. For example, a
mob of people queuing up at a bank or the tasks queuing up on your computer’s
back end.
In queuing theory we often want to find out how long wait times or queue lengths
are, and we can use models to do this. These models are typically important in
business and software applications, and queuing theory is often considered a part of
operations research.
Queuing System
The mechanism of a queuing process is very simple. Customers arrive at services
counter are attended by one or more of the servers. As soon as a customer is served,
he departs from the system. Thus a queuing system can be described as composed
of customers arriving for service, waiting for service if it is not immediate, and if
having wanted for service, leaving the system after being served.
Component/Charateristics of a Queuing System
A queuing system can be described by the following components:

1. The arrival pattern.

2. The service mechanism.

3. The queue discipline.

4. Customer’s behaviour

Input process (or Arrival pattern)

This is considered with the pattern in which the customers arrive and join the
system. An input source is characterized by

a)      Size of the calling population.

b)      Pattern of arrivals at the system.
c)      Behaviour of the arrivals.
Customers requiring service are generated at different times by an input source,
commonly known as population. The rate at which customers arrive at the service
facility is determined by the arrival process.
Size  of the calling population
The size represents the total number of potential customers who will require service.
The source of customers can be either finite or infinite. It is considered infinite if the
number of people being very large e.g. all people of a city or state (and others) could
be the potential customers at a milk parlour. The customers may arrive for service
individually or in groups. Single arrivals are illustrated by a customer visiting a
milk parlour, students arriving at a library counter etc. On the other hand, families
visiting restaurants, ships discharging cargo at a dock are examples of bulk or batch
arrivals.
Pattern  of arrivals at the system
Customers arrive in the system at a service facility according to some known
schedule (for example one patient every 15 minutes or a candidate for interview
every half hour) or else they arrive randomly. Arrivals are considered at random when
they are independent of one another and their occurrence cannot be predicted
exactly. The queuing models wherein customer’s arrival times are known with
certainty are categorized as deterministic models and are easier to handle. On the
other hand, a substantial majority of the queuing models are based on the premise
that the customers enter the system stochastically, at random points in time. The
arrival process (or pattern) of customers to the service system is classified into two
categories: static and dynamic. These two are further classified based on the nature
of arrival rate and the control that can be exercised on the arrival process.
In static arrival process, the control depends on the nature of arrival rate (random or
constant). Random arrivals are either at a constant rate or varying with time. Thus to
analyze the queuing system, it is necessary to describe the probability distribution of
arrivals. From such distributions average time between successive arrivals, is obtained
also called inter-arrival time (time between two consecutive arrivals), and the average
arrival rate (i.e. number of customers arriving per unit of time at the service system).
 
The dynamic arrival process is controlled by both service facility and customers. The
service facility adjusts its capacity to match changes in the demand intensity, by
either varying the staffing levels at different timings of service, varying service
charges (such as telephone call charges at different hours of the day or week) at
different timings, or allowing entry with appointments. Frequently in queuing
problems, the number of arrivals per unit of time can be estimated by a probability
distribution known as the Poisson distribution, as it adequately supports many real
world situations
Service Mechanism (or Service Pattern)
The service is provided by a service facility (or facilities). This may be a person (a bank
teller, a barber, a machine (elevator, gasoline pump), or a space (airport runway,
parking lot, hospital bed), to mention just a few. A service facility may include one
person or several people operating as a team. There are two aspects of a service
system
a)      the configuration of the service system
b)      the speed of the service.
Configuration  of the service system
The customer’s entry into the service system depends upon the queue conditions. If
at the time of customer’s arrival, the server is idle, then the customer is served
immediately. Otherwise the customer is asked to join the queue, which can have
several configurations. By configuration of the service system we mean how the
service facilities exist. Service systems are usually classified in terms of their number
of channels, or numbers of servers.
i)      Single Server Single Queue -- The models that involve one queue one
service station facility are called single server models where customer waits
till the service point is ready to take him for servicing. Students arriving at a
library counter are an example of a single server facility.
ii)    Single Server Several Queues - In this type of facility there are several
queues and the customer may join any one of these but there is only one
service channel.
 iii)  Several (Parallel) Servers Single Queue - In this type of model there is more
than one server and each server provides the same type of facility. The
customers wait in a single queue until one of the service channels is ready to
take them in for servicing.
iv)  Several Servers Several Queues - This type of model consists of several
servers where each of the servers has a different queue. Different cash
counters in an electricity office where the customers can make payment in
respect of their electricity bills provide an example of this type of model.
Different ticket issue encounters in a trade fair and different boarding pass
encounters at an airport are also other possible examples of this type of
model.
v)    Service facilities in a series - In this, a customer enters the first station and
gets a portion of service and then moves on to the next station, gets some
service and then again moves on to the next station and so on, and finally
leaves the system, having received the complete service. For example in a
milk plant packaging of milk pouches consist of boiling, pasteurization,
cooling and packaging operations, each of which is performed by a single
server in a series.
Speed  of service
In a queuing system, the speed with which service is provided can be expressed in
either of two ways as service rate and as service time.  The service rate describes the
number of customers serviced during a particular time period and the service time
indicates the amount of time needed to service a customer. Service rates and times
are reciprocal of each other and either of them is sufficient to indicate the capacity
of the facility. Thus if a cashier can attend, on an average 5 customers in an hour, the
service rate would be expressed as 5 customers/hour and service time would be
equal to 12 minutes/customer. Generally, we consider the service time only. If these
service times are known exactly, the problem can be handled easily. But, as generally
happens, if these are different and not known with certainty, we have to consider the
distribution of the service times in order to analyze the queuing system. Generally,
the queuing models are based on the assumption that service times are
exponentially distributed about some average service time.
Queue discipline
In the queue structure, the important thing to know is the queue discipline. The
queue discipline is the rule determining the formation of queue, manner in which
customers form the queue are selected for service. There are a number of ways in
which customers in the queue are served. Some of these are:
Static queue disciplines
These are based on the individual customer's status in the queue. The most common
queue disciplines are:
i)      First-Come-First-Served (FCFS): If the customers are served in the order of
their arrival, then this is known as the FCFS service discipline. For example, this
type of queue discipline is observed at a milk parlour, railway station etc. FCFS
is also known as First in First out (FIFO).
ii)    Last-Come-First-Served (LCFS): Sometimes, the customers are serviced in
the reverse order of their entry so that the ones who join the last are served
 first and the system is referred to as LCFS. For example, in a big godown the
items which come last are taken out first. Similarly, the people who join an
elevator last are the first ones to leave it.
Dynamic queue disciplines
These are based on the individual customer attributes in the queue. Few of such
disciplines are:
i)      Service in Random Order (SIRO): Under this rule customers are selected for
service at random, irrespective of their arrivals in the service system. In this,
every customer in the queue is equally likely to be selected. The time of arrival
of the customers is, therefore, of no relevance in such a case.
ii)    Priority Service: Under this rule customers are grouped in priority classes on
the basis of some attributes such as service time or urgency or according to
some identifiable characteristic, and FCFS rule is used within each class to
provide service. Treatment of VIPs in preference to other patients in a hospital
is an example of priority service.
Customer’s behaviour
Another thing to consider in the queuing structure is the behaviour or attitude of the
customers entering the queuing system. On this basis, the customers may be
classified as being patient, or impatient. If a customer, on arriving at the service
system stays in the system until served, no matter how much he has to wait for
service is called a patient customer whereas the customer, who waits for a certain
time in the queue and leaves the service system without getting service due to
certain reasons such as a long queue in front of him is called an impatient customer.
Customers in a queue generally behave in four ways:
1. Balking: A customer may leave the queue because the queue is too long and
he has no time to wait, or there isn’t sufficient waiting space.
Imagine a customer comes, and sees there is no place in the waiting room. He
then decides to not join the queue at all. Similarly, when a customer comes
and sees how long the queue is, he decides to not join the queue at all.
A typical example of such a scenario is at the train station where there usually
are long lines to buy tickets. So the customer decides to not join the line at all.
2. Reneging: This occurs when a waiting customer leaves the queue due to
impatience. He joins the queue (thinking it will move quickly), but gets
impatient after some time and then decides to leave.
The train station can be used as an example again for this, where people wait
for some time in the line, but then get impatient and leave.
Another example is in a supermarket. People get impatient waiting in line to
check out, so many times people leave the baskets, and just walk out without
buying anything.
3. Priorities: In certain applications, some customers are served before others
regardless of their order of arrival. These customers have priority over others.
Again using the example of a train station, such a scenario occurs when
someone comes to buy a first class ticket; he is given priority over those who
are buying a second class ticket. Such a scenario can also be seen in a bank,
 wherein a Platinum level customer gets preferential service over the Silver
level customer, and so on.
4. Jockeying: Customers may jockey from one line to another, i.e. move from
one line to another.
This can be seen typically at supermarkets as well as train stations, where a
person leaves the line he is standing in, and joins another line which appears
to be shorter, or appears to be moving faster.

Types of Models
 Deterministic Model
A deterministic model assumes certainty in all aspects. The deterministic approach
typically models scenarios, where the input values are known and the outcome is
observed. A Deterministic Model allows us to calculate a future event exactly,
without the involvement of randomness. If something is deterministic, the system
have all of the data necessary to predict (determine) the outcome with certainty. 
Examples of deterministic models are timetables, pricing structures, a linear
programming model, the economic order quantity model, maps, accounting.
There are a number of problems with a deterministic approach, including the fact
that it does not consider the full range of possible outcomes, and does not quantify
the likelihood of each of these outcomes. Consequently, deterministic scenario
planning may actually be underestimate the potential risk. In order to address this
short-fall, we have to adopt a probabilistic approach.
Pros
 Deterministic models have the benefit of simplicity. They rely on single
assumptions about long-term average returns and inflation.
 Deterministic is easier to understand and hence may be more appropriate for
some customers.
Cons
 Cash flow modelling tools that use deterministic or over-simplistic stochastic
projections are fundamentally flawed when making financial planning
decisions because they are unable to consider ongoing variables that will
affect the plan over time.
 Deterministic tools tend to overestimate the level of sustainable income (on a
like for like basis) because they are unable to take into account market
volatility, which causes ‘pound cost ravaging' and sequencing risk, both of
which have a significant negative effect on sustainable income.
 The choice of future increase assumption is critical and puts the responsibility
of the final outcome on the provider of the tool.

 Probabilistic Model
Probabilistic modelling is a statistical technique used to take into account the impact
of random events or actions in predicting the potential occurrence of future
outcomes. Most models really should be stochastic or probabilistic rather than
deterministic, but this is often too complicated to implement. Representing
uncertainty is fraught. Some more common stochastic models are queuing models,
markov chains, and most simulations.

For example when planning a school formal, there are some elements of the model
that are deterministic and some that are probabilistic. The cost to hire the venue is
deterministic, but the number of students who will come is probabilistic. A GPS unit
uses a deterministic model to decide on the most suitable route and gives a
predicted arrival time. However we know that the actual arrival time is contingent
upon all sorts of aspects including road, driver, traffic and weather conditions.

Probabilistic Models, use lots of historical data to illustrate the likelihood of an event
occurring, such as your client running out of money. These types of financial
planning tools are therefore considered more sophisticated compared with their
deterministic counterparts. A Probabilistic model will not produce one determined
outcome, but a range of possible outcomes, this is particularly useful when helping a
customer plan for their future.
Pros
 Probabilistic models can reflect real-world economic scenarios that provide a
range of possible outcomes your customer may experience and the relative
likelihood of each.
 By running thousands of calculations, using many different estimates of future
economic conditions, stochastic models predict a range of possible future
investment results showing the potential upside and downsides of each.
 A Probabilistic model also has the ability to avoid the significant shortfalls
inherent in deterministic models, which gives it the edge. 
Cons
 Managing drawdown effectively and choosing suitable investment strategies
requires the ability to model investment risk and return realistically. The
problem is that nearly all strategies and solutions are currently designed using
an assumed fixed rate of investment return throughout retirement. This is
obviously unrealistic and ignores the important effect that the sequence of
returns and volatility has on drawdown outcomes.
 The problem of ignoring specific risk factors not only applies with
deterministic modellers, but also with a commonly used type of simple
stochastic model - mean, variance, co-variance (MVC) models. For instance,
MVC models provide time-independent forecasts, which means that they
ignore the fact that specific investment risks change over time depending on
the combination of assets held within the customer’s portfolio.

POISSON-EXPONENTIAL SINGLE CHANNEL QUEUING MODEL

Single-station or single-channel queuing problem is the name applied on those problems in
which only one unit (station) is delivering the service. The easiest waiting line model involves
a single-server, single-line, single-phase system. The following assumptions are made when
we model this environment:

1. The number of arrivals per unit of time is described by poisson distribution. The mean
arrival rate is denoted by λ, l.
 2. The service time has exponential distribution. The average service rate is denoted by
μ, m.

3. Arrivals are from infinite population.

4. The queue discipline is FIFO, that is, the customers are served on a first come first
serve basis.

5. There is only a single service station.

6. The mean arrival rate is less than the mean service rate i.e. λ < μ.

7. The waiting space available for customers in the queue is infinite.

POISSON-EXPONENTIAL MULTIPLE CHANNEL QUEUING MODEL

In a multiple-channel queuing system, two or more channels (or servers) are available to
handle customers who arrive for service. It covers situations where, for example, there may
be more than one runway at an airport for takeoff and landing, there may be more than one
doctor in a hospital O.P.D. whom the patients can visit, there may be more than one teller in
a bank, ... and so on.

The most common and basic multiple-channel system contains parallel stations serving a
single queue on a first-come first-served basis. The service stations all provide the same
service. The single queue may separate into shorter queues in front of the respective service
stations. Also, when it is advantageous, calling units can shift from one queue to another.

Assumptions. The model is based on the following assumptions:

1. The input population is infinite.

2. A single waiting line is formed.

3. The service is on a first-come first-served basis.

4. The arrival of customers follows Poisson probability law and service time has an
exponential distribution.

5. There are k service stations, each of which provides identical service.

6. The arrival rate is smaller than the combined service rate of all k service facilities. With the
number of calling units represented by n and the number of channels or service stations by
k.