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SERVICE ORGANIZATIONS AND OPERATIONS

SERVICE ORGANIZATIONS AND OPERATIONS. Recognize the service component in an organization Understand the service encounter Understand the customer factor in service success Understand how to formulate a service strategy Understand how to design/plan a service organization

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SERVICE ORGANIZATIONS AND OPERATIONS

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  1. SERVICE ORGANIZATIONS AND OPERATIONS Recognize the service component in an organization Understand the service encounter Understand the customer factor in service success Understand how to formulate a service strategy Understand how to design/plan a service organization Understand how to operate/manage a service organization Learn OM tools and techniques useful in service operations management

  2. SERVICES IN THE U.S. ECONOMYChapter 1 • Service sector growth pp. 4- • By employment/GDP share/business starts/International trade • Theories explaining service sector growth 8 • Customer satisfaction with services declined 2 • Goods and services – dividing line 2- • Facilitating services 3 • Services produce time, place, form or psychological utilities – to individuals/businesses 3

  3. THE SERVICE ENCOUNTERChapter 2 • Manufacturing production systems from Mgt. 339 • Unit, Batch, Line, Continuous • Service systems p. 15 • Intangible output conversion systems • Hybrid conversion systems • Characteristics of services – I/I/P/V p.17 • Service organization p. 18- • See operations interactions with marketing and HR Exhibit 2-4

  4. THE SERVICE ENCOUNTER • The most important factor in • customer perception of service quality • customer satisfaction • repeat purchase decisions p. 14 • Where • customer meets service p. 26- • encounters the delivery system and the tangibles • encounters other customers p. 29 • Types/Elements/Factors in service encounters • Readings/class discussion following week

  5. CUSTOMERS – THE FOCUS IN SERVICE MANAGEMENTChapter 3 • Emergence of the importance of customer in management theory. P. 41- • ACSI, TQM component, Baldrige award category, NCQA focus in healthcare • Customer needs • As a human being – Maslow p. 43- • As a consumer – consumer behavior models 44- • Consumer decision making models 45 • Consumer evaluation of goods and services 49 • Three “qualities” in service evaluation 49, 131 • Information sources 50

  6. CUSTOMERS • Customer Needs (continued) • The concept of value Chapter 5 pp. 87-92 • Model of service value with 6 factors p. 88 • Other factors affecting needs 52- • Age - Ethnic/cultural background • Size of household • Gender • Education, occupation and income

  7. HOW CUSTOMERS EVALUATE SERVICES • Five dimensions of service quality 331 • Reliability • Responsiveness • Assurance • Empathy • Tangibles • The original indicators used to measure the dimensions • See SERVQUAL model Handout • How valid are these dimensions? Do they hold for any service? Do they hold across demographic factors (gender, age etc.) ? Do they hold across cultural diversity ? Are they really distinct dimensions ? Can they be used by managers to really understand customer perceptions and improve services ? Are all five dimensions equally important or is their a ranking ? Readings and class discussion following week/s

  8. Globalization of ServicesService management in International Settings Chapter 4 • Increase in demand for services in international trade. Reasons 62- • Services we “sell” globally • Services we export/outsource/subcontract • Advantages of going global with services 64- • Global environment has problem areas 67- • Different ways to sell services globally 68- • Different combinations of product-service package AND consumer/service producer interaction 70- • Discussion: special issues in selling services globally. Special issues in outsourcing services globally. • Readings and discussion following week

  9. FORMULATING A SERVICE STRATEGY Chapter 5 • Mgt 339 review: • What is strategy ? Also p. 93 • Strategy formulation process. SWOT p. 98 • Understanding the competition. Porter’s model p. 94- • Porter’s Generic (business level) competitive strategies. P. 97 Also called “competitive priorities” in 339 • Strategy implementation: Policies + Programs + Budgets

  10. FORMULATING A SERVICE STRATEGY • Formulating a competitive service strategy p. 100- • Target market segmenting + Positioning == SWOT • Service concept + Value/cost leveraging == Business level strategies a.k.a competitive strategies • Operating strategy + strategy/system integration + service delivery system == Operations strategy + policies • Southwest Airlines example 102- • Cooperative strategies; alliances

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