Service Management: Operations, Strategy, Information Technology

Cover
Service Management
Dedication
About the Authors
Preface
Overview of the Book
Supplemental Features
Brief Contents
Table of Contents
Part One: Understanding Services
	Chapter 1: The Service Economy
		Learning Objectives
		Chapter Preview
		Service Definitions
		Facilitating Role of Services in an Economy
		Economic Evolution
		Stages of Economic Development
			Preindustrial Society
			Industrial Society
			Postindustrial Society
		Nature of the Service Sector
		The Experience Economy
			Consumer Service Experience
			Business Service Experience
		Service-Dominant Logic
		Distinctive Characteristics of Service Operations
			Customer Participation
			Simultaneity
			Perishability
			Intangibility
			Heterogeneity
			Nontransferrable Ownership
		The Service Package
		Grouping Services by Delivery Process
		Open-Systems View of Service Operations Management
		Service Benchmark: Sharing Economy Pioneers Uber and Airbnb
		Summary
		Key Terms and Definitions
		Topics for Discussion
		Interactive Exercise
		CASE 1.1: Village Volvo
		CASE 1.2: Xpresso Lube
		Selected Bibliography
		Endnotes
	Chapter 2: Service Strategy
		Learning Objectives
		Chapter Preview
		The Strategic Service Vision
		Understanding the Competitive Environment of Services
		Competitive Service Strategies
			Overall Cost Leadership
			Differentiation
			Focus
		Strategic Analysis
			Porter’s Five Forces Analysis
			SWOT Analysis: Strengths, Weaknesses, Opportunities, Threats
		Winning Customers in the Marketplace
			Qualifiers
			Service Winners
			Service Losers
		Sustainability in Services
			Triple Bottom Line (TBL)
		The Competitive Role of Information in Services
			Creation of Barriers to Entry
			Revenue Generation
			Database Asset
			Productivity Enhancement
		The Internet of Things (IoT)
		Data Analytics in Services
		The Virtual Value Chain
			First Stage (New Processes)
			Second Stage (New Knowledge)
			Third Stage (New Products)
			Fourth Stage (New Relationships)
		Economics of Scalability
		Limits in the Use of Information
			Anticompetitive
			Fairness
			Invasion of Privacy
			Data Security
			Reliability
		Using Information to Categorize Customers
		Stages in Service Firm Competitiveness
			Available for Service
			Journeyman
			Distinctive Competence Achieved
			World-Class Service Delivery
		Service Benchmark: Outside the Box
		Summary
		Key Terms and Definitions
		Topics for Discussion
		Interactive Exercise
		CASE 2.1: United Commercial Bank and El Banco
		CASE 2.2: The Alamo Drafthouse
		Selected Bibliography
		Endnotes
Part Two: Designing the Service Enterprise
	Chapter 3: New Service Development
		Learning Objectives
		Chapter Preview
		Sources of Service Sector Growth
			Information Technology
			The Internet as a Service Enabler
			Innovation
			Changing Demographics
		Innovation in Services
			Challenges of Adopting New Technology in Services
			Readiness to Embrace New Technology
		New Service Development
			Service Design Elements
		Strategic Positioning through Process Structure
		Service Blueprinting
		Taxonomy for Service Process Design
			Degree of Divergence
			Object of the Service Process
			Type of Customer Contact
		Generic Approaches to Service System Design
			Production-Line Approach
			Customer as Coproducer
			Customer Contact Approach
			Information Empowerment
		Intellectual Property
		Service Benchmark: Ten Things Google Has Found To Be True
		Summary
		Key Terms and Definitions
		Topics for Discussion
		Interactive Exercise
		CASE 3.1: 100 Yen Sushi House
		CASE 3.2: Commuter Cleaning—A New Venture Proposal
		CASE 3.3: Amazon.com
		Selected Bibliography
		Endnotes
	Chapter 4: The Service Encounter
		Learning Objectives
		Chapter Preview
		Technology in the Service Encounter
		The Emergence of Self-Service
		The Service Encounter Triad
			Encounter Dominated by the Service Organization
			Contact Personnel–Dominated Encounter
			Customer-Dominated Encounter
		The Service Organization
			Culture
			Empowerment
			Control Systems
			Customer Relationship Management
		Contact Personnel
			Selection
			Training
			Creating an Ethical Climate
		The Customer
			Expectations and Attitudes
			The Role of Scripts in Coproduction
		Creating a Customer Service Orientation
		Service Profit Chain
		Service Benchmark: Miss Manners on Complaint Handling
		Summary
		Key Terms and Definitions
		Topics for Discussion
		Interactive Exercise
		CASE 4.1: Amy’s Ice Cream
		CASE 4.2: Enterprise Rent-A-Car
		Selected Bibliography
		Endnotes
	Chapter 5: Supporting Facility and Process Flows
		Learning Objectives
		Chapter Preview
		Environmental Psychology and Orientation
		Servicescapes
			Behaviors in Servicescapes
			Environmental Dimensions of Servicescapes
		Facility Design
			Nature and Objectives of Service Organizations
			Land Availability and Space Requirements
			Flexibility
			Security
			Aesthetic Factors
			The Community and Environment
		Process Analysis
			Types of Processes
			Flowcharting
			Gantt Chart
			Process Terminology
		Facility Layout
			Flow Process Layout and the Work Allocation Problem
			Job Shop Process Layout and the Relative Location Problem
		Summary
		Service Benchmark: Where, Oh Where Shall We Go?
		Key Terms and Definitions
		Topics for Discussion
		Interactive Exercise
		Solved Problems
		Exercises
		CASE 5.1: Health Maintenance Organization (A)
		CASE 5.2: Health Maintenance Organization (B)
		CASE 5.3: Esquire Department Store
		CASE 5.4: Central Market
		Selected Bibliography
		Endnotes
	Chapter 6: Service Quality
		Learning Objectives
		Chapter Preview
		Defining Service Quality
			Dimensions of Service Quality
			Gaps in Service Quality
		Measuring Service Quality
			SERVQUAL
			Walk-through Audit
		Quality Service by Design
			Incorporation of Quality in the Service Package
			Taguchi Methods
			Poka-Yoke (Failsafing)
			Quality Function Deployment
		Achieving Service Quality
			Cost of Quality
			Statistical Process Control
			Unconditional Service Guarantee
			Stages in Quality Development
		Service Recovery
			Approaches to Service Recovery
			Complaint Handling Policy
		Service Benchmark: Bronson Methodist Hospital
		Summary
		Key Terms and Definitions
		Topics for Discussion
		Interactive Exercise
		Solved Problems
		Exercises
		CASE 6.1: Clean Sweep, Inc.
		CASE 6.2: The Complaint Letter
		CASE 6.3: The Helsinki Museum of Art and Design
		Selected Bibliography
		Endnotes
	Chapter 7: Process Improvement
		Learning Objectives
		Chapter Preview
		Quality and Productivity Improvement Process
			Foundations of Continuous Improvement
			Plan-Do-Check-Act (PDCA) Cycle
			Problem Solving
		Quality Tools for Analysis and Problem Solving
			Check Sheet
			Run Chart
			Histogram
			Pareto Chart
			Flowchart
			Cause-and-Effect Diagram
			Scatter Diagram
			Control Chart
		Benchmarking
		Improvement Programs
			Deming’s 14-Point Program
			ISO 9001
			Six Sigma
			Lean Service
		Service Benchmark: When Something Doesn’t Work—Sometimes Just Hit it with a Hammer!
		Summary
		Key Terms and Definitions
		Topics for Discussion
		Interactive Exercise
		CASE 7.1: Sonora County Sheriff
		CASE 7.2: Mega Bytes Restaurant
		Chapter 7 Supplement: Data Envelopment Analysis (DEA)
		Measuring Service Productivity
			The DEA Model
			DEA and Strategic Planning
		Exercises
		CASE 7.3: Mid-Atlantic Bus Lines
		Selected Bibliography
		Endnotes
	Chapter 8: Service Facility Location
		Learning Objectives
		Chapter Preview
		Strategic Location Considerations
			Competitive Clustering
			Saturation Marketing
			Marketing Intermediaries
			Substitution of Communication for Travel
			Separation of Front from Back Office
			Impact of the Internet on Service Location
			Site Considerations
		Geographic Information Systems
		Facility Location Modeling Considerations
			Geographic Representation
			Number of Facilities
			Optimization Criteria
		Facility Location Techniques
			Cross-Median Approach for a Single Facility
			Huff Model for a Retail Outlet
			Location Set Covering for Multiple Facilities
		Regression Analysis in Location Decisions
		Summary
		Service Benchmark: Here a Bun, There a Bun, Everywhere a Bun-Bun
		Key Terms and Definitions
		Topics for Discussion
		Interactive Exercise
		Solved Problems
		Exercises
		CASE 8.1: Health Maintenance Organization (C)
		CASE 8.2: Athol Furniture, Inc.
		Selected Bibliography
		Endnotes
Part Three: Managing Service Operations
	Chapter 9: Service Supply Relationships
		Learning Objectives
		Chapter Preview
		Supply Chain Management
			Network Model
			Managing Uncertainty
			Omnichannel Supply Chain
		Service Supply Relationships
			Customer–Supplier Duality
			Service Supply Relationships Are Hubs, Not Chains
		Managing Service Relationships
			Bidirectional Optimization
			Productive Capacity
			Perishability
		Social Media in Services
			Social Media as a Competitive Strategy
			Social Media and Customer Convenience
			Social Media for Organizing and Co-creation of Value
		Professional Service Firms
			Attributes of Professional Services
			Service Consulting
			Operational Characteristics
		Outsourcing Services
			Benefits and Risks of Outsourcing Services
			Classification of Business Services
			Managerial Considerations with Service Outsourcing
		Summary
		Service Benchmark: Citizens Come First in Lynchburg
		Key Terms and Definitions
		Topics for Discussion
		Interactive Exercise
		CASE 9.1: Boomer Consulting, Inc.
		CASE 9.2: Evolution of B2C E-Commerce in Japan
		CASE 9.3: Mortgage Service Game
		Selected Bibliography
		Endnotes
	Chapter 10: Globalization of Services
		Learning Objectives
		Chapter Preview
		Domestic Growth and Expansion Strategies
			Focused Service
			Focused Network
			Clustered Service
			Diversified Network
		Franchising
			The Nature of Franchising
			Benefits to the Franchisee
			Issues for the Franchiser
		Globalization of Services
			Generic International Strategies
			The Nature of the Borderless World
			Planning Transnational Operations
		Global Service Strategies
			Multicountry Expansion
			Importing Customers
			Following Your Customers
			Service Offshoring
			Beating the Clock
		Service Benchmark: Small World and Other Myths
		Summary
		Key Terms and Definitions
		Topics for Discussion
		Interactive Exercise
		CASE 10.1: Goodwill Industries of Central Texas
		CASE 10.2: FedEx: Tiger International Acquisition
		Selected Bibliography
		Endnotes
	Chapter 11: Managing Capacity and Demand
		Learning Objectives
		Chapter Preview
		Generic Strategies of Level Capacity or Chase Demand
		Strategies for Managing Demand
			Customer-Induced Variability
			Segmenting Demand
			Offering Price Incentives
			Promoting Off-Peak Demand
			Developing Complementary Services
			Reservation Systems and Overbooking
		Strategies for Managing Capacity
			Defining Service Capacity
			Daily Workshift Scheduling
			Weekly Workshift Scheduling with Days-Off Constraint
			Increasing Customer Participation
			Creating Adjustable Capacity
			Sharing Capacity
			Cross-Training Employees
			Using Part-Time Employees
		Yield Management
			Yield Management Applications
		Service Benchmark: Pay Up Front and Take Your Chances
		Summary
		Key Terms and Definitions
		Topics for Discussion
		Interactive Exercise
		Solved Problems
		Exercises
		CASE 11.1: River City National Bank
		CASE 11.2: Gateway International Airport
		CASE 11.3: The Yield Management Analyst
		CASE 11.4: Sequoia Airlines
		Selected Bibliography
		Endnotes
	Chapter 12: Managing Waiting Lines
		Learning Objectives
		Chapter Preview
		The Economics of Waiting
		Queuing Systems
		Strategies for Managing Customer Waiting
			The Psychology of Waiting
			That Old Empty Feeling
			A Foot in the Door
			The Light at the End of the Tunnel
			Excuse Me, but I Was Next
		Essential Features of Queuing Systems
			Calling Population
			Arrival Process
			Queue Configuration
			Queue Discipline
			Service Process
		Summary
		Service Benchmark: The Magic of Disney Makes Queues Disappear
		Key Terms and Definitions
		Topics for Discussion
		Interactive Exercise
		Solved Problem
		Exercises
		CASE 12.1: Thrifty Car Rental
		CASE 12.2: Eye’ll Be Seeing You
		CASE 12.3: Field Study
		Selected Bibliography
		Endnotes
	Chapter 13: Capacity Planning and Queuing Models
		Learning Objectives
		Chapter Preview
		Capacity Planning
			Strategic Role of Capacity Decisions
		Analytical Queuing Models
			Relationships among System Characteristics
			Standard M/M/1 Model
			Standard M/M/c Model
			M/G/1 Model
			General Self-Service M/G/∞ Model
			Finite-Queue M/M/1 Model
			Finite-Queue M/M/c Model
		Capacity Planning Criteria
			Average Customer Waiting Time
			Probability of Excessive Waiting
			Minimizing the Sum of Customer Waiting Costs and Service Costs
			Probability of Sales Lost Because of Inadequate Waiting Area
		Service Benchmark: Don’t Guesstimate, Simulate!
		Summary
		Key Terms and Definitions
		Topics for Discussion
		Interactive Exercise
		Solved Problems
		Exercises
		CASE 13.1: Houston Port Authority
		CASE 13.2: Freedom Express
		CASE 13.3: Renaissance Clinic (A)
		Chapter 13 Supplement: Computer Simulation
		Systems Simulation
			Simulation Methodology
			Monte Carlo Simulation
			Generating Random Variables
			Discrete Random Variable
			Continuous Random Variable
			Discrete-Event Simulation
		Process Simulator by ProModel
		Solved Problems
		Exercises
		CASE 13.4: Drivers License Renewal
		CASE 13.5: Renaissance Clinic (B)
		Selected Bibliography
		Endnotes
Part Four: Quantitative Models for Service Management
	Chapter 14: Forecasting Demand for Services
		Learning Objectives
		Chapter Preview
		The Choice of Forecasting Method
		Subjective Models
			Delphi Method
			Cross-Impact Analysis
			Historical Analogy
		Causal Models
			Regression Models
			Econometric Models
		Time Series Models
			N-Period Moving Average
			Simple Exponential Smoothing
			Forecast Error
			Relationship Between a and N
			Exponential Smoothing with Trend Adjustment
			Exponential Smoothing with Seasonal Adjustment
			Exponential Smoothing with Trend and Seasonal Adjustments
			Summary of Exponential Smoothing
		Summary
		Service Benchmark: Googling the Future
		Key Terms  and Definitions
		Topics for Discussion
		Interactive Exercise
		Solved Problems
		Exercises
		CASE 14.1: Oak Hollow Medical Evaluation Center
		CASE 14.2: Gnomial Functions, Inc.
		Selected Bibliography
		Endnotes
	Chapter 15: Managing Service Inventory
		Learning Objectives
		Chapter Preview
		Inventory Theory
			Role of Inventory in Services
			Characteristics of Inventory Systems
			Relevant Costs of an Inventory System
		Order Quantity Models
			Economic Order Quantity
			Inventory Model with Quantity Discounts
			Inventory Model with Planned Shortages
		Inventory Management under Uncertainty
		Inventory Control Systems
			Continuous Review System
			Periodic Review System
			The ABCs of Inventory Control
		Radio Frequency Identification
		Single-Period Model for Perishable Goods
			Expected Value Analysis
			Marginal Analysis
		Retail Discounting Model
		Service Benchmark: Your Bag Is Tagged
		Summary
		Key Terms and Definitions
		Topics for Discussion
		Interactive Exercise
		Solved Problems
		Exercises
		CASE 15.1: A.D. Small Consulting
		CASE 15.2: Last Resort Restaurant
		CASE 15.3: Elysian Cycles
		Selected Bibliography
		Endnotes
	Chapter 16: Managing Service Projects
		Learning Objectives
		Chapter Preview
		The Nature of Project Management
			Characteristics of Projects
			Project Management Process
			Selecting the Project Manager
			Building the Project Team
			Principles of Effective Project Management
		Techniques for Project Management
			Gantt Project Charts
			A Critique of Gantt Charts
			Constructing a Project Network
			Critical Path Method
			Microsoft Project Analysis
		Resource Constraints
		Activity Crashing
		Incorporating Uncertainty in Activity Times
			Estimating Activity Duration Distributions
			Project Completion Time Distribution
			A Critique of the Project Completion Time Analysis
		Problems with Implementing Critical Path Analysis
		Monitoring Projects
			Earned Value Chart
			Project Termination
			Project History Report
		Service Benchmark: The House That Warren Built
		Summary
		Key Terms and Definitions
		Topics for Discussion
		Interactive Exercise
		Solved Problems
		Exercises
		CASE 16.1: Info-Systems, Inc.
		CASE 16.2: Whittier County Hospital
		Selected Bibliography
		Endnote
Appendix A: Areas of Standard Normal Distribution
Appendix B: Uniformly Distributed Random Numbers [0, 1]
Appendix C: Values of Lq for the M/M/c Queuing Model
Appendix D: Equations for Selected Queuing Models
Name Index
Subject Index