Employees and Customers

1. Employees and Customers “You don’t get happy guests with unhappy employees.” J. W. Marriot

2. Servant Leadership • Customer • Distributors/Dealers • Front-line workers • Supervisor • Managers • CIO, CFO, COO • CEO

3. Value Chain of People Business Profitability + + + Employee Value Customer Satisfaction + + Shareholder Value +

4. End-to-End Processes Customer Account Receivable Marketing/ Sales Shipping Inventory Mgmt. Manufacturing

5. End-to-End Process • Critical processes start and end with customers • Quote-to-cash Process • Streamlined order fulfillment process • Getting customers and keeping customers

6. Naming Your Processes Properly • Give processes a state-change name • Examples: Product development ð Concept to prototype Production ð Procurement to shipment Sales ð Prospect to order Service ð Problem identification to resolution Order fulfillment ð Order to payment

7. The Business Context of Business Networking • Share: • Costs • Skills • Market access • Technology Virtual Enterprising Customer's Customer Suppliers/ Partner Company Customer N C N C N C N C Competitor N: Needs and Perceived Needs C: Capabilities Source: Adapted from Charles M. Savage, "The Dawn of the Knowledge Era," OR/MS Today, pp. 18-23.

8. Boss-Focus Processes De-powerment Aiming the wrong target Customer Front-line Worker Out on a limb Tug of War

9. Empowered Customer-Focus Processes Manager as Coach Teamwork Customer-facing Process Empowered Font-line worker Values and Quality delivered to Customers timely

10. Think from the Customer Back Define Outcomes The Customer Redesign Outputs Activities/Tasks Determine Activities Functions/Processes Define Job Responsibilities Organization Management * Adapted from The Price Waterhouse Change Integration Team, Better Change, Irwin, 1995, p. 163. Develop Organization Structure

11. Reengineering & Customers* • Paradigm Shift: • Make and sell ð Sense and service • Mass marketing ð Micro-marketing • Transaction marketing ð Relationship marketing • IT Enablers • Multimedia • Communication networks • Customized publishing • Scanning technologies • Eletronic commerce • Customer databases • Wireless communication (data and voice networks) Source: James I. Cash, Jr., "Listen To Your Customers", Information Week, Feb. 27, 1995, p. 108.

12. Conflicts • Investment in tools vs. Investment in people • IT-driven rigidity vs. IT-support discretion • Building knowledge-intensive relationships vs. Invading customer privacy

13. Service • A service is a deed, a performance, an effort. • What is being bought is intangible. • Services are produced and consumed almost simultaneously. • Services cannot be inventories. • Customers are involved in the production of the services. • Services also have a service component of their own. • Instant delivery and custom design are both services.

14. MOT Analysis Example • Pri to MOT • Recognition • Information gathering • Comparison • MOT • Applying for Credit Card • Receiving Credit Card • Using Credit Card • Providing Information • Changing and Upgrading • Gifts giving • Emergency Assisting • After MOT • No usage follow-up • Stop membership follow-up

15. Evolution of Works

16. Classification of Services Source: Front Stage • Extractive (agriculture, mining) • Transformative (construction, food, manufacturing): Second sector • Producer services (Business services and marketed services) • Personal services (domestic, hotel, repair, dry-cleaning, entertainment, etc.) • Distributive services (logistics, communication, wholesale and retail trade) • Non-marketed services (Health, welfare, government, legal serices, education services, etc.) Industry sector: Mining, Construction, & Manufacturing

17. More T-shaped People to work in, study, and innovate service systems Engineering (Technology) Management (Business) Social Science (People) Slide by Jean Paul Jacob

18. Service • A service is a deed, a performance, an effort. • What is being bought is intangible. • Services are produced and consumed almost simultaneously. • Services cannot be inventories. • Customers are involved in the production of the services. • Manufacturing firms also have a service component of their own. • Instant delivery and custom design are both services.

19. Services Definition A service is a provider/client interaction that creates and captures value. The provider and client coordinate their work (co-production) and in the process, both create and capture value (transformation). Services typically require assessment, during which provider and client come to understand one another's capabilities and goals. A time-perishable, intangible experience performed for a customer acting in the role of co-producer (Fitzsimmons, 2001)

20. Service Layering • Pure service: Legal service, barber shop • IT-enabled Service: Google for information search, eBay for online auction services, WebMD for online health information • IT Services: IT outsourcing service provider (IBM Global Service), on-demand data center (EDS), on-demand computing (IBM) • Service-wrapped IT products: iTune and iPod; GM OnStar (Emergency service + remote diagnosis & sensing + GPS & Navigation) • Manufacturing services: IC design houses, TSMC foundry service • Pure manufacturing: Manufacturing of commodity products Source: Minder Chen, 2007

21. Service-Oriented Model & Architecture The service target may be the service client itself.

22. Service Systems • Service systems are value-creation networks composed of people, technology, and organizations. • Interventions taken to transform state and coproduce value constitute services. • Example in IT outsourcing • A service provider operates the computing infrastructure for a service client. • The provider augments the client’s capabilities, taking on responsibility for monthly service-level agreements and year-over-year productivity improvements. • Service system complexity is a function of the number and variety of people, technologies, and organizations linked in the value creation networks, ranging in scale from professional reputation systems of a single kind of knowledge worker or profession, to work systems composed of multiple type of knowledge workers, to enterprise systems, to industrial systems, etc.

23. Modeling People • The challenge lies not simply in formally modeling the technology or organizational interactions, but in modeling the people and their roles as knowledge workers in the system. • Traditional modeling assumes people are either • like machines or other resources, • different in that they can be modeled as a set of skills that change with experience, or • different in that they form relationships and social networks to improve productivity.

24. Service blueprint components Physical evidence Customer actions Onstage Employee actions Backstage Employee actions Support processes Desktop PC and applications, ticket, records IT request, problem call to help desk, etc Line of interaction Takes call, opens ticket, visit to employee desk side Line of visibility Refers to manuals, asks for help from team Line of internal interaction Time recording, payroll, training, etc