Service Operations

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1/5/2011

Presented by: Michael Mondragon BA 509

Operations Management: Service Operations

Service Operations


Services experts haven’t yet agreed on a definition of service operations. Some definitions of services use manufacturing operations as the norm – for example: •





Schroeder (1999, p. 75) gives the traditional perspective on services that they are ‘manufacturing with “a few odd characteristics” Russell and Taylor (2000, p. 91) suggest that ‘services and manufacturing companies have similar inputs but different processes and outputs’.

Steve Brown, OPERATIONS MANAGEMENT - Policy, practice and performance improvement (Butterworth-Heinemann, 2001), p.18.

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Service Operations
Transformation processes in which there is a high degree of interaction between the customer and the organization, and in which the output may be primarily or partly intangible.

Steve Brown, OPERATIONS MANAGEMENT - Policy, practice and performance improvement (Butterworth-Heinemann, 2001), p.18.

Manufacturing Operations vs. Service Operations


A conversion process that includes manufacturing (or production) yields a tangible output: a product. In contrast, a conversion process that includes service yields an intangible output: a deed, a performance, an effort. For example, Mesfin Industries produces a lot of tangible products, whereas Ethiopian Airlines provides air transport services to passengers which is an intangible output.



Ram Naresh Roy, A Modern Approach to OPERATIONS MANAGEMENT (New Age International Publishers, 2008), p. 5.

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Characteristics to distinguish Manufacturing & Service Operations Tangible/Intangible nature of output  Production and consumption  Nature of work (job)  Degree of customer contact  Customer participation in conversion  Measurement of performance  Quality of output  Inventory accumulated 

S. Anil Kumar, New Approach Operations Management (New Age International...
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