About UsBlog

Services Operations Management

Services Operations Management

Operations management for services has the functional responsibility for producing the services of an organization and providing them directly to its customers. Operation management process specifically deals with decisions required by operations managers for simultaneous production and consumption of an intangible product.

Service operations management is concerned with the process, people, information and the system that produces and delivers the service. It differs from operations management in general, since the processes of service organizations differ from those of manufacturing organizations.

There are six types of service operations management decisions made by operations managers in service organizations: process, quality management, capacity & scheduling, inventory, service supply chain and information technology.

Process decisions include the physical processes and the people that deliver the services to the customer. A service process consists of all the routines, tasks and steps that are used to deliver service to customers along with the jobs and training for service employees. There are many ways to organize a process to provide customer service in an effective and efficient manner to deliver the service-product bundle

Quality management. Quality management practices for services have much in common with manufacturing, despite the fact that the product is intangible.  They begin with defining and measuring the customer's needs (e.g. using SERVQUAL). Any service that does not meet a customer's need is considered a defect. Then these approaches seek to reduce defects through statistical methods, cause-and-effect analysis, problem solving teams, and involvement of employees. They focus on improving the processes that underlie production of the service.

Capacity and scheduling. Forecasting demand is a prerequisite for managing capacity and scheduling. Forecasting demand often uses big data to predict customer behavior. The data comes from scanners at retail locations or other service locations. In some cases traditional time series methods are also used to predict trends and seasonality.

Capacity planning  is quite different between manufacturing and services given that service cannot be stored or shipped to another location. As a result, location of services is very dispersed to be near the customer.

Inventory management and control is needed in service operations with facilitating goods. Almost every service uses some amount of facilitating goods. The presence of facilitating goods is critical in retail and wholesale operations but these operations don't manufacture anything, rather they distribute goods and provide service while doing it.

Service supply chains for service operations are critical to supply facilitating goods. A typical hospital supply chain is an example. A hospital will use many goods from suppliers to construct and furnish the building. During day-to-day operation of the hospital, inventories of supplies will be held for the operating rooms and throughout the building. The pharmacy will hold drugs and the kitchen will need supplies of food.

Information technology.Providing information and knowledge directly to consumers, service at a distance. Internal information systems now provide an array of management information to help managers make better decisions.

The most popular products in category Services Operations Management All category products

People's United Bank Online Banking
12
12

F.A.Q. about Services Operations Management

Main Benefits of Operations Management

Profitability Management. With proper operations management planning, executives are able to rely on the activity and find ways to come up with new ideas on how to potentially increase sales. With an experienced operations manager, monitoring revenue and expenses becomes much easier and can dive into statements of income and profitability trends.

Competitive Advantage and Incident Management for operations. A business that can manage their operations can get a handle on any key internal and external factors. Internal factors can include operating policies, average attrition rate, and intellectual capital. External factors pertain to the state of economy and any rival strategies.

Regulatory Compliance. Operations management is concerned with analyzing operating activities. This enables corporate management to rid themselves of the days of considerably large government fines and adverse regulatory decisions. The heads of the department are able to set adequate internal controls to ensure that tasks are performed in a lawful manner.
Manufacturing Edge. Changing or improving the way a good is produced can save a facility a large sum of money in the long run. With operations management, you are able to change or improve the way a product is made, as well as how to store raw materials more effectively. This extremely advantageous benefit aids the manufacturer through preventing a deterioration in affordability of debt.

Materials