management of service operations management of service operations professor ron sedlock welcome to
DESCRIPTION
Service Definitions A service is a time-perishable, intangible experience performed for a customer acting in the role of a co-producer. A service is a time-perishable, intangible experience performed for a customer acting in the role of a co-producer. James Fitzsimmons James FitzsimmonsTRANSCRIPT
Management of Management of Service Service
OperationsOperationsProfessor Ron SedlockProfessor Ron Sedlock
Welcome toWelcome to
Learning Objectives Learning Objectives (Chap 1)(Chap 1)
1.1. Describe the central role of services Describe the central role of services in an economy.in an economy.
2.2. Discuss the evolution of an economy Discuss the evolution of an economy from an agrarian society to a service from an agrarian society to a service society.society.
3.3. Describe the features of preindustrial, Describe the features of preindustrial, industrial, and postindustrial industrial, and postindustrial societies.societies.
4.4. Describe the features of the new Describe the features of the new service economyservice economy
Service DefinitionsService Definitions A service is a time-perishable, A service is a time-perishable,
intangible experience performed for intangible experience performed for a customer acting in the role of a co-a customer acting in the role of a co-producer.producer.
James James Fitzsimmons Fitzsimmons
Role of Services in an Role of Services in an EconomyEconomy
Trends in U.S. Employment Trends in U.S. Employment by Sectorby Sector
0
10
20
30
40
50
60
70
80
90
Year
Prop
orta
tion
of to
tal e
mpl
oyem
ent
Service
ManufacturingAgriculture
Stages of Economic Stages of Economic DevelopmentDevelopment
Pre- Use of StandardPre- Use of Standard dominant human Unit of of living dominant human Unit of of living Society Game activity labor social life measure Structure TechnologySociety Game activity labor social life measure Structure Technology
Pre- Against Agriculture Raw Extended Sub- Routine Simple Pre- Against Agriculture Raw Extended Sub- Routine Simple handhand
Industrial Nature Mining muscle household sistence Traditional toolsIndustrial Nature Mining muscle household sistence Traditional tools power Authoritative power Authoritative
Industrial Against Goods Machine Individual Quantity Bureaucratic Machines Industrial Against Goods Machine Individual Quantity Bureaucratic Machines fabricated production tending of goods Hierarchical fabricated production tending of goods Hierarchical naturenature Post- Among Services Artistic Community Quality of Inter- InformationPost- Among Services Artistic Community Quality of Inter- Information industrial Persons Creative life in terms dependentindustrial Persons Creative life in terms dependent Intellectual of health, GlobalIntellectual of health, Global education,education, recreation recreation
The New Experience The New Experience EconomyEconomy
Economy Agrarian Industrial Service Experience
Function Extract Make Deliver Stage
Nature Fungible Tangible Intangible Memorable
Attribute Natural Standardized Customized Personal
Method of supply
Stored in bulk
Inventoried Delivered on demand
Revealed over time
Seller
Trader
Manufacturer
Provider
Stager
Buyer
Market
User
Client
Guest
The Four Realms of an The Four Realms of an ExperienceExperience
Customer Participation
Passive Active
Environmental
Absorption Entertainment (Movie)
Education (Language)
Relationship Immersion Esthetic (Tourist)
Escapist (ScubaDiving)
Experience Design Experience Design PrinciplesPrinciples
• Theme the Experience (Forum shops)Theme the Experience (Forum shops)• Harmonize Impressions with Positive Harmonize Impressions with Positive
CuesCues(O’Hare airport parking garage)(O’Hare airport parking garage)
• Eliminate Negative CuesEliminate Negative Cues(Cinemark talking trash containers)(Cinemark talking trash containers)
• Mix in Memorabilia (Hard Rock T-shirts)Mix in Memorabilia (Hard Rock T-shirts)• Engage all Five Senses (Mist in Engage all Five Senses (Mist in
Rainforest)Rainforest)
Source of Service Sector Source of Service Sector GrowthGrowth
• InnovationInnovationPush theory (e.g. Post-it)Push theory (e.g. Post-it)Pull theory (e.g. Cash Management)Pull theory (e.g. Cash Management)Services derived from products (Video Services derived from products (Video Rental)Rental)Information driven servicesInformation driven servicesDifficulty of testing service prototypesDifficulty of testing service prototypes
• Social TrendsSocial Trends Aging of the populationAging of the populationTwo-income familiesTwo-income familiesGrowth in number of single peopleGrowth in number of single peopleHome as sanctuaryHome as sanctuary
Discussion TopicsDiscussion Topics• Illustrate how the type of work he or Illustrate how the type of work he or
she does influences a person’s lifestyle. she does influences a person’s lifestyle. For example, contrast a farmer, a For example, contrast a farmer, a factory worker, and a school teacher.factory worker, and a school teacher.
• Is it possible for an economy to be Is it possible for an economy to be based entirely on services?based entirely on services?
• What is the value of self-service in an What is the value of self-service in an economy?economy?
• How does trade barriers affect a How does trade barriers affect a nation’s economy?nation’s economy?