Page 8 - DMGT522_SERVICES MANAGEMENT

Unit 1: Service Operation Management

1.1 Service Operation Management Notes

The service movement was driven, in part, by a realisation that classes were filled with students
who would be, or were, involved in non-manufacturing tasks. There was some disillusion felt
with the existing operations management material, by both the students and by academics.
Economic batch quantities, line balancing and stock control are just a few of the topics widely
taught then which bore little relation to the key issues faced by managers running service
operations. That is not to say that these tools and techniques were of no value, but customer
service, service quality and service design were central issues facing many service operations
managers, yet there were no tools or techniques to help them in these matters.
The need for service-based material was also timely. It matched the emerging realization of the
importance of the customer and a more customer-oriented view of operations. This was a
significant shift away from the more internally-focused efficiency view of operations
management. It also fitted with a growing “strategic” trend in operations. This questioned the
traditional reactive role of operations and attempted to make the subject more market-oriented
by understanding how operations could not only support but also help develop a strategic
advantage (see for example Hayes and Wheelwright, 1984; Hill, 1985, 1989; Skinner, 1974, 1985).
Service operations have great appeal, and they are all around us. There is a plethora of examples
and experiences and, indeed, research data that can be gleaned from everyday life: service
operations are all-pervasive. They are therefore a normal part of our students’ lives. They can
easily relate to the problems of scheduling hospital beds, the layout of a multiplex cinema or the
quality of a retail encounter. Although undoubtedly important, car factories, paper mills and
plastic coating lines can seem remote from many people’s lives. Furthermore, each one of us is
almost constantly playing out some role or other within a service operation. As students sit in
a lecture they are playing a part in a service experience, just as we are delivering, or rather
orchestrating, that service. As they go to the library, or to eat, or to socialize, they are having
interactive service experiences. Service “factories” are everywhere; “The mall is my factory” is
the title of a reflective piece on service operations by Chase (1996).

Self Assessment

State True or False:
1. Services are those activities that are not identifiable separately.

2. Services are intangibles that provide want satisfaction to consumers.
3. Services are marked indirectly to consumers and also to the industrial users.
4. Services may or may not be tied with the sale of goods.
5. A service may be or may not be tied with the sale of another service.

Did u know? “Service” captured the interest and imagination of Operations Management
(OM) academics in the 1980s?
Operations academics, just like operations practitioners, tend to be enthusiasts. On plant tours,
students experience their teacher’s fascination and insights into the processes and the systems
and procedures that support them. Student feedback lays testimony to their enthusiasm,
understanding and fascination with all things operational. Service operations are even more
compelling. The full title of Chase’s paper is “The mall is my factory: reflections of a service

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