Chapter 12 3rd ed

Topics: Management, Supply chain management, Capacity management Pages: 17 (1925 words) Published: June 13, 2015
Chapter 12
SERVICE
RESPONSE
LOGISTICS

Prepared by Mark A. Jacobs, PhD
©2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

LEARNING OBJECTIVES
You should be able to:
 Understand how supply chain management in services
differs from supply chain management in
manufacturing
 Define service response logistics & describe all of its
elements
 Understand the importance of service layouts &
perform a layout analysis using several techniques
 Describe the strategies for managing capacity, wait
times, distribution, & quality in services

©2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

2

LEARNING OBJECTIVES
(Continued)

You should be able to:
 Understand queuing system design issues &
calculate queue characteristics.
 Use various techniques for managing
customers’ perceived waiting times.
 Understand the different distribution channels
available for services.
 Define service quality & describe how to
measure it & improve it.
©2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

3

CHAPTER OUTLINE






Introduction
An Overview of Service Operations
Supply Chain Management in Services
The Primary Concerns of Service Response Logistics

©2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

4

Introduction
 Many services are pure services, offering few or
no tangible products to customers
 Others may have end products with a larger
tangible component (e.g., restaurants & repair
facilities)
 Customers are often involved in the production of
the service
 Services may provide state utility - they do
something to things owned by the customer (e.g.,
store supplies & repair machines

An Overview of Service
Operations
Differences between goods & services –
 Services cannot be inventoried
 Services are often unique (e.g., Insurance
policies & legal services
 Services have high customer-service
interaction
 Services are decentralized due to inability to
inventory & transport service products

An Overview of Service
Operations
(Continued)

Service Productivity
Productivity =

Outputs produced
Inputs used

 Outputs produced (ex. sales amount)
 Inputs (single factor productivity) (ex. labor
hours)
 Inputs (multiple-factor productivity) (ex. labor,
material, energy, & capital).

An Overview of Service
Operations
(Continued)

Service Productivity
Baumol’s disease – productivity growth in
services is low
 Improving service productivity is possible
through –
 Outsourcing to lower labor countries
 Improving education
 Increase level of technology

An Overview of Service
Operations
(Continued)

Global Services Issues
 Global services are increasing all over the world
and managing them involves a number of issues –
 Labor, facilities, & infrastructure support
 Legal & political issues: Laws may restrict foreign
competitors.
 Domestic competitors & the economic climate:
Managers must be aware of local competition and
their environment.
 Identifying global customers.

An Overview of Service
Operations
(Continued)

Service Strategy Development


Cost Leadership Strategy




Differentiation Strategy




Requires large capital investment in state-of-the
art equipment & significant efforts to control &
reduce costs.
Unique service is created as companies listen to
customers.

Focus Strategy


Serve a narrow niche better than other firms

An Overview of Service
Operations
(Continued)

The Service Delivery System
 Bundle of attributes (the combination of) –
...
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