Post on 21-Dec-2015
Product Design and Process Selection: Services
Based on slides for Chase Acquilano and Jacobs, Operations Management, McGraw-Hill
Types of Services
Facilities-based servicesYou go to the service providerExamples??
Field-based services The service provider comes to youExamples??
Internal servicesEmployees as customers
What opportunities exist to transform facilities based into field based?
Service Strategy: Focus and Performance Priorities
Treatment of the customerSpeed and convenience of service
deliveryPriceVarietyQuality of the tangible goods Unique skills that constitute the service
offeringExamples of companies??
Example: Hotel Services
Example: Hotel Services Departments
Question --
Based on the two videos – and your own experiences -- what are some of the operational issues that hotel managers face?
What are some suggestions you might have for hotels to facilitate better allocation of resources and more effective problem solving?
High & Low Contact Systems
Design Decision High Contact Low Contact
Facility location Near customer Near resources
Facility layout Accommodate customer Focus on effi ciency
Product design Environment & product Fewer attributes
Process design Production aff ects customer Customer rarely involved
Scheduling Accommodate customer Focus on completion date
Production Planning Cannot smooth production Can smooth and backlog
Worker skills I nteracts with public Technical skills only
Quality Control Variable - eye of the beholder Measurable & fi xed
Time standards I nherently loose Tight
Wage payment Time-based Output-based
Capacity planning Match peak demand Average demand
Contrasting Service Designs
Automated Approach The production line approach The self-service approach The personal attention
approach Group Exercise: Select an
example of each; identify operations management issues and ways to improve the service experience.
None High
High Automated
Production Line
Self Service
LowPersonal Attention
High Low
Low High
Low High
Low High
Customer Contact
Sales Opportunity
Scheduling Complexity
Labor Skill
Efficiency
Volume
Characteristics of a Well-Designed Service System
1. Each element of the system is consistent with the operating focus of the firm.
2. Is user-friendly.
3. Is robust
4. Structured so that consistent performance by its people & systems is easily maintained.
5. Provides effective links
between back & front
office -- nothing falls
between the cracks.
6. Manages the evidence of
service quality in so that
customers see the value
of the service provided.
7. Is cost-effective.
Demand and Capacity Management
Demand Management
Vary pricesVary promotionChange lead times
(e.g., backorders)Examples??
Capacity Management
Vary staffingChange equipment
& processesRedesign the product
for faster processingExamples??
CustomerArrivals
Servers
Waiting Line
Servicing System
Exit
Queuing
Example of Queues: Phone Systems
Suggestions for Managing Queues
Determine the acceptable waiting timeuse as upper limit
Distract and entertainManage expectations Segment customers
triageUse demand management Keep “idle” resources out of sight
even if they’re working