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Transcript of Service Supply Relationships Value chain coordination For balanced supplies & demands Ch. 9,...
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Service Supply Relationships
Value chain coordinationFor balanced supplies & demands
Ch. 9, 第八章
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• Hewlett-Packard Deskjet printers– Traditional• Made for all nations
– Taiwan, Hong Kong, …– If the sales in Taiwan is slow, inventory build up
– Supply chain approach• One generic Deskjet• Option to localize
– Manuals and power cords– Eliminate the need for separate inventory
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• Supply chain management– A total systems approach• From product design to after sale customer service• To deliver manufactured products efficiently
– Poor planning• Lost sale opportunity• Expensive end-of-life inventory write-offs
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– Greatest customer satisfaction at reasonable cost• Asset cost
– Inventory– Capital equipment
• Time domain characteristics of customer service– Responsiveness– Reliability in customer delivery
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– Bullwhip effect• Uncoordinated supply chain
– Small change in retail orders– Magnified as we move back up the supply chain
» Distributors» Manufacturers
– Delays in orders being filled» Create the oscillation in inventory
– Simultaneously overstocking systemwide
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– Network model• Physical goods supply chain
– Network of value adding material processing stages» Supply input» Material transformation» Demand output
• Figure 9.1
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mfg
mfg
DistributorDistributor
DistributorDistributor
Retailing
Retailing
Retailing
Retailing
Retailing
Retailing
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• Material flow downstream– Responsiveness, delivery reliability
• Information flow upstream– Utilization of information
» Automobile manufacturer• After sale service
» POS data• Facilitate planning production schedule
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– Managing uncertainty• Sources of uncertainty
– Supplier delivery performance– Manufacturing reliability– Customer demand
» Inventory is used as insurance to cope with uncertainty
• Variation in delivery– Storm delay– Quality problems– Machine failure– Late arrival of raw materials
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• Manufacturing reliability– Internal scheduling delays
» Several products competing for shared resources• Overhead crane• Raw materials
• Customer demands– Short product life cycle– Competition– General economy conditions
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– Strategic initiatives to smooth uncertainty• Total quality management
– Improvement of manufacturing reliability
• Dependable transportation modes– Third party logistics contracts
• Supply chain collaboration– P&G and Walmart
» Efficient customer response (ECR)
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Service supply relationship
• Customer-supplier duality– Manufacturing goods• Pass from one entity to another
– Service objects• Minds
– Education, entertainment, religion
• Bodies– Transportation, lodging, healthcare
• Information– Tax preparation, insurance, legal defense
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– Services act on something provided by the customers• Bidirectional relationship
– Figure 9.2
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– Single level service supply chains• Table 9.2
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– Two-level service supply chains– Table 9.3
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• Service supply relationships are hubs, not chains– Service providers act as agent for the customer– Dentist• Dentures• Dental procedures
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• Service capacity is analogous to inventory– Goods supply chains• Inventory is used to buffer customer demands
– Service • Excess capacity is held in reserve
– Seasonal workers for high season– Part time employees for rush hours
• Reservation– To smooth the demand
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• Customers supplied inputs can vary in quality• Incomplete
– Tax documents
• Unprepared– Naïve backpacker
• Unrealistic expectation– Cancer patients
– Effective communication• To avoid misunderstanding
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Managing service relationship
• Home health care– Healthy enough
• No need for hospitalization or nursing home care
– Not mobile enough• To visit a healthcare
provider
– Nurse, dietitians, therapists• Visit patients at home
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• Bidirectional optimization– Patients• Highly individualized service
– Organization• Very cost effective operations
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– “Time windows” reservation• Between noon and 5pm
– Route, customers sequencing, language, worker skills, worker licenses, supplies on the vehicle
• No information available– Optimization is impossible
– Better information for optimization
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• Productive capacity• Value
– Time at customer site
• Lost productive capacity– Time spent traveling
– Transfer• Make knowledge available to customers
– For self service– Web-based frequent asked questions
» Side effects of medicine, explanation of symptoms, procedure to follow
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– Replacement• Substituting technology human resources
– Blood pressure measurement
– Embellishment customer skills to enable self service• Teach patient or patient’s family to change a surgical
dressing
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• Perishability– Minimize the negative impact of idle productive
capacity• Dynamic job allocation
– Schedules are constructed and revised up until the very last possible moment» Before dispatch a worker
– Mobile data communication required
• Potential idle time – Training, refining, extending skills and capability of worker
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Social media in service
• Social media enable the co-creation of value– Building customer relationship– A wide reach• Decentralized, less hierarchical
– Easy access– Ease of use– Immediacy– Flexibility that allow information to be altered
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– Top 5 industry groups • Customers use social media for customer service
– Retail– Telephone– Travel and hospitality– Cable – Bank
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• Social media as a competitive strategy– Tune-up reminders• First day of tickets on sale
– Cookie-cutter presence in cyberspace• Identify where customer go online• When they have feedback and questions
– Lead generation• Develop relationship lead to referral
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– Customer education• Educate customer a lifestyle
– Align with its service offerings
• Insurance company– Promote safe driving practices
– Start online, finish offline• Information gathering online• Purchase offline
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• Social media and customer convenience– Innovative use of technology• Check deposit with smartphone photo• Boarding pass on smartphone
– Insurance data mine customers information in social media• Identify a link between consumers’ payment history
and risky driving behavior• Privacy issues
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– Social media “netiquettes” for service providers• “Three D’s” to avoid
– Disclosure, – Defamation, and – Discrimination
• “Three R’s” to promote– Reciprocation– Respect– Reliability
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• Social media for organizing and co-creation of value– Red Robin• Launch Tavern Double burger
– Internal social network– Not spiral-bound books
• Reduce time for idea-to-counter process
– Dell computers• IdeaStorm site
– Product improvement idea
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– Social media for service• Branding• Recruiting• Building awareness• Information sharing• Networking• Listen to customers
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Professional service firms
• Professional services are attractive– Intellectual challenge– Potential for job growth– High income
• Architects• Lawyers• Consultants• Accountants• Contracting engineers
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• Attributes of professional services– Knowledge workers• Work involves high level of specialization and
customization– Different from mass-market standardized approach– Ability to manage activities and information without proven
routines
• Face-to-face interaction with customer– Quality are perceived and measured
• Service are delivered by highly educated
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• Command a body of knowledge– Cognitive knowledge (know-what)
» Basic mastery of a discipline» Extensive training and certification
– Advanced skills (know-how)» Ability to apply “book learning” into effective execution
– Systems understanding (know-why)» Anticipate subtle interaction and unintended
consequences– Self-motivated creativity (care-why)
» Will, motivation, and adaptability for success
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• Service consulting– Firms face challenges or opportunity• Can not handle with its internal capabilities
– Health care– Financial service– Hospitality– Staffing– Billing – Office automation
– Major service firm• Accenture, Bain, Deloitte, IBM global services
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– Strategy components of consulting business• People
– Workforce management, productivity improvement
• Processes– Process improvement, office automation
• Programs– Quality program, lean/kaizen projects
• Plant– Facility and layout
• Planning and control systems– Dispatching, close-loop systems
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– Tips for success consulting• McKinsey model
– Under-promise and over-deliver– 80-20 rules
» 80% problems come from 20% issues– “Don’t boil the ocean”– Use the “elevator rule”
» Explain to your client in 30 seconds– Pluck the low-hanging fruit– Hit singles– Engage your client
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– Operational characteristics
• Match skill level with project requirements– Brain Project
» Ability to create, innovate, and pioneer new approaches» “hire us because we are smart”
– Grey-hair project» Standardized and repeated with discretion» Implement ERP systems» “hire us because we have done this before”
Partner
Staff
Staff
Fees
Fees
ofitPartnerperofit
PrPr
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– Procedure projects» Well recognized and standardized» Conducting an audit» Complete the work quickly and inexpensively» “hire us because we know how to do this and we can
deliver it effectively”
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Outsourcing services
– Transaction cost for outsourcing• Search cost• Bargaining cost• Enforcement cost
– Stick to the term of the contract
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• Benefits and risks of outsourcing services– Reasons for outsourcing• Focus on its core competence• Decreases costs by purchasing• Access to latest technology without investment
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– Risks of outsourcing• Loss of direct control over quality• Jeopardizes employee loyalty because of job-loss fears• Exposure to data security• Dependence on suppliers• Additional coordination expense and delay• Decline of in-house capability
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• Fig 9.4
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– Supplier selection and performance evaluation• Multinational retailer
» Target, Walmart– Experience– Reputation– Geographical proximity– Cost parameters– Communication ability– Dependability– Flexibility– On-time delivery
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– Supplier relationship structure• Arm’s-length relationship
– No need for closely control– Outsourcing candidates– Highly codified and standardized information
» Price, quantity, and delivery schedule
• Vertical integration– Strategic control desired– Intellectual property
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• Multinational apparel» Sport Obermeyer
– Head quarter, Cororado» Monitor fashion trend» Consumer preference» Retailer management
– Manufacturing unit, Hong Kong» Fabric selection» Printing options» Managing suppliers
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– Classification of business services• Table 9.6
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• Managerial considerations with service outsourcing– Facility support service (property/ low
importance)• Commodity service• Tight specification• Vendor selection based on low bid• Evaluation of service delivered
– Quality and timeliness
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– Equipment support service (property/high importance)• Locate close enough to provide emergency service• Reputation and references• Communication• Dependability
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– Employee support service (people/low importance)• Temporary personnel• Specification• Periodically review
– Employee development (people/high importance)• Health care• Important investment in the firm’s human capital• Outside expertise often is sought• Vendor reputation and expertise
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– Facilitator service (process/low importance)• Bookkeeping/travel booking
– Information processing– Detail specifications– Final selection might based on ancillary service
» Travel agency• Delivery of tickets• Monthly billing
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– Professional service (process/high importance)• Significant impact on the strategic future• Need specification• Trust in the supplier
– Reputation– Experience
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• Mini case– 9.1 Boomer consulting, Inc.– 9.2 Evaluation of B2C E-Commerce in Japan