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Ch. 13 Service Supply Relationships

Ch. 13 Service Supply Relationships. 實務問題. transaction business VS. relationship business Supply Chain Management → Service Industry outsourcing: uncertainty. Learning Objectives. 1. supply chain management 2. bidirectional service supply relationship 3. sources of value in SSR

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Ch. 13 Service Supply Relationships

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  1. Ch. 13 Service Supply Relationships

  2. 實務問題 • transaction business VS. relationship business • Supply Chain Management→ Service Industry • outsourcing: uncertainty

  3. Learning Objectives 1. supply chain management 2. bidirectional service supply relationship 3. sources of value in SSR 4. outsourcing services

  4. 1. Supply chain management (1) Total systems view of the entire supply chain. “Bullwhip effect” (2) Network of value-adding material- processing stages. (3) Uncertainty: supplier delivery performance, manufacturing reliability, customer demand. (4) Buffered by inventory stocks.

  5. Suppliers Disposal Recycling/Remanufacturing Manufacturing Distribution Retailing Consumer Product and Process Design After-sales Service 1. Supply Chain for Physical Goods Information Transfer Material Transfer

  6. Supplier Service Service Customer Provider Design Material transfer Information transfer 1. Customer-Supplier Duality in Service Supply Relationships (Hubs)

  7. 1. Strategy of postponement (1) Partially completed product is held until a customer order is received. (2) Fast-food restaurants: assemble-to-order. VS make-to-order. (3) Dell computer: “service-like” goods producer.

  8. 2. Single-Level Bidirectional Service Supply Relationship

  9. 2. Two-Level Bidirectional Service Supply Relationship

  10. 2. Managerial implications of BR (1) Service supply relationships are hubs, not chain. (2) Service capacity is analogous to inventory. (3) Customer supplied inputs can vary in quality.

  11. 3. Source of value in SSR (1) Bi-directional Optimization (2) Managing Productive Capacity- Transfer: make knowledge available (ex. web based FAQ database)- Replacement: substitute technology for server (ex. digital blood pressure device)- Embellishment: enable self-service by teaching (ex. change surgical dressing) (3) Management of Perishability: mobile workers.

  12. Problem Definition References "Do-versus-Buy" Analysis Personal Contact Involve Interested Parties Recommendations Specification Development Trade Directory Quality of Work Flexibility Communication Dependability 4. Outsourcing Process Vendor Selection Information Search Need Identification Cost Experience Location Reputation Size References Performance Evaluation Identify Evaluator Meet Deadlines

  13. Outsourcing Services • Benefits• Allows the firm to focus on its core competence• Service is cheaper to outsource than perform in-house• Provides access to latest technology• Leverage benefits of supplier economy of scale • Risks • Loss of direct control of quality • Jeopardizes employee loyalty • Exposure to data security and customer privacy • Dependence on one supplier compromises future negotiation leverage • Additional coordination expense and delays • Atrophy of in-house capability to perform service

  14. Importance of Service Low High Facility Support: Equipment Support: Property -Laundry -Repairs -Janitorial -Maintenance Focus -Waste disposal -Product testing Employee Support: Employee Development: People -Food service -Training of -Plant security -Education -Temporary personnel -Medical care Service Facilitator: Professional: Process -Bookkeeping -Advertising -Travel booking -Public relations -Packaged software -Legal 4. Taxonomy for Purchasing Business Services

  15. • Precise specifications can be written Focus on Property Facility Support Service • Low cost • Identify responsible party to evaluate performance Equipment Support Service • Experience and reputation of vendor • Availability of vendor for emergency response • Designate person to make service call and to check that service is satisfactory

  16. Focus on People Employee Support Service • Contact vendor’s clients for references • Specifications prepared with end user input • Evaluate performance on a periodic basis Employee Development Service • Experience with particular industry important • Involve high levels of management in vendor identification and selection • Contact vendor clients for references • Use employees to evaluate vendor performance

  17. Focus on Process Facilitator Service • Knowledge of alternate vendors important • Involve end user in vendor identification • References or third party evaluations useful • Have user write detailed specifications Professional Service • Involve h igh level management in vendor identification and selection • Reputation and experience very important • Performance evaluation by top management

  18. Topics for Discussion • What are some possible disadvantages associated with the product postponement strategy? • Discuss the similarities and differences in the product postponement strategy used by Hewlett-Packard and Taco Bell? • Speculate on the effect that the Internet will have on the process of business-to-business purchase of services?

  19. Interactive Exercise The class divides into small groups and members come up with examples of multilevel bidirectional service relationships (i.e, service supplier relationships with three or more levels). Be prepared to argue why such service relationships are so rare.

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