1. Service Delivery Process

2. FOUR STAGES OF OPERATIONAL COMPETITIVENESS
Philosophical viewpoint where operations move from “necessary evil” to the key source of competitive advantage.

3. FOUR STAGES OF OPERATIONAL COMPETITIVENESS
Stage 1: Available for Service
operations are a “necessary evil”
operations are “reactive”
the primary mission is to avoid mistakes
technological investment, training, and personnel costs are minimize
may actually work if no competition
however, it may attract competition

4. FOUR STAGES OF OPERATIONAL COMPETITIVENESS
Stage 2: Journeyman
prompted by the arrival of competition
operations become outward-looking
investment in technology is linked to long-term costs savings
processes are developed, implemented, and monitored
operations still viewed as a secondary function

5. FOUR STAGES OF OPERATIONAL COMPETITIVENESS
Stage 3: Distinctive Competencies Achieved
the firm has mastered the core service
understands complexity of making changes
operations are now viewed equal with other departments
view of technology changes from “cost savings” to “enhancing the customers experience”

6. FOUR STAGES OF OPERATIONAL COMPETITIVENESS
Stage 4: World Class Service Delivery
company’s name is synonymous with with service excellence
mission goes beyond satisfaction to “delightment”
technology provides a means to accomplish tasks that the competition cannot duplicate

7. THE CUSTOMER’S INVOLVEMENT IN THE PRODUCTION PROCESS
If the consumer is in the service factory,
it is clear that if the factory is changed,
consumer behavior will have to be changed
Changing the factory,
will mean changes in the consumer’s script,
as well as changes in the scripts of contact personnel

8. SERVICE DELIVERY PROCESS
The marriage of customer needs with the mfg and technological capabilities of the firm
The marriage involves compromise
customer needs can seldom be met completely and economically
operational efficiency has to be balanced against the effectiveness of the system from the consumer’s point of view

9. SERVICE DELIVERY PROCESS
Peak efficiency models
inputs flow at a steady rate into the technical core
the market absorbs a single kind of product at a continuous rate

10. SERVICE DELIVERY PROCESS
Peak efficiency models
decisions within the technical core can be programmed and individual discretion can be replaced by rules
jobs are deskilled
lower quality of labor can be used which lowers the labor cost
rules can be programmed into machines

11. THE FOCUSED-FACTORY CONCEPT
Accepts the notion that the “ideal world” is virtually impossible to create
Concentrates on performing one particular task in one particular part of the plant
buffering--surrounds the tech core on the input and output sides
smoothing--attempts to manage fluctuations in supply and demand
anticipating--predicts fluctuations
rationing--triage’ strategies
Focus generates efficiency as well as effectiveness

12. APPLYING EFFICIENCY MODELS TO SERVICES
Servuction system is an operations nightmare
impossible to use inventories
problems with decoupling production from the customer
system is directly linked to the market
demand varies day to day, hour to hour, minute to minute
massive problems in capacity planning and utilization

13. POSSIBLE SOLUTIONS TO SERVICE OPERATION PROBLEMS
Isolate the technical core
technical core should be subjected to production-ling approaches
hard technologies--hardware
soft technologies--rules and regulations
high contact areas should sacrifice efficiency in the interest of the consumer

14. SERVICE BLUEPRINTS
Blueprints provide a means of communication between operations and marketing and can highlight potential problems on paper before they occur.
essentially a flowchart that shows lines visibility

15. COMPONENTS OF A SERVICE BLUEPRINT
Identify direction in which processes flow
Identify the time it takes to move from one process to the next
Identify the costs involved with each process step
Identify the amount of inventory build-up at each step
Identify the bottlenecks in the system

16. CONSTRUCTING THE SERVICE BLUEPRINT
Elicit scripts from employees and customers
order events in sequence of occurrence
Identify potential fail points in the system
Specify the time frame for service execution
Given the costs of inputs needed for the system to operate, analyze the profitability of the system

17. BLUEPRINTING AND NEW PRODUCT DEVELOPMENT
Complexity--the number and intricacy of steps
Specialization strategy
reduces complexity
by reducing the number of steps in the process
it unbundles the service offering
niche strategy

18. BLUEPRINTING AND NEW PRODUCT DEVELOPMENT
Complexity--the number and intricacy of steps
Penetration strategy
increases complexity
by increasing the number of steps
attempts to appeal to a broader market

19. BLUEPRINTING AND NEW PRODUCT DEVELOPMENT
Divergence--degrees of freedom in decision making
Volume-oriented strategy (production-line)
decreases divergence
produces standardized output and reduces costs
but does so at the expense of increasing conformity and inflexibility

20. BLUEPRINTING AND NEW PRODUCT DEVELOPMENT
Divergence--degrees of freedom in decision making
Customization strategy
increases divergence
produces a heterogeneous output
creates flexibility in tailor-made solutions
but it does so at increased expense