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Finally, because human beings are one of the primary resources of the service sector, employee attrition is always a problem. Poor employee training results in poor customer service, and a loss of critical demand. In manufacturing, a behind-the-scenes employee can be retrained with greater alacrity, and his or her personality and ability to provide good customer service is less critical to the survival of the business.
From an operation manager's perspective, the most frustrating difference between the two sectors lies in the fourth area of expense, the greater overhead costs of the service sector. It is often more difficult to pinpoint where needless waste is occurring, in the service industry, because it is often due to human factors, or incorrect use of the equipment by employees. In the manufacturing sector, a manager can quantitatively track how raw materials are used to make the final product, and target inefficient methods of production or overly expensive raw materials, or critical areas of lag in the production line. But in the service sector, personnel who demoralize the operation, come in late, or otherwise result in a less clearly quantifiable lag time of production speed and loss of consumer demand, can go unnoticed. A manager must keep careful track of employee hours, and ensure that regular performance reviews demand that employees follow the regulations of the company regarding employee duties and...
Cutting costs in areas such as employee methods, perhaps encouraging cleaning staff to clean with better efficiency, by using different cleaning techniques when approaching a home can allow the company to take on more houses, and reduce the costs of production. Finding cheaper raw materials that allows the company to pass on this lessened expense to the consumer can generate more consumer demand, and thus more profits overall as a whole for the service, and can act against the greater instability of demand.
One final, third area that cannot be overlooked by operations managers in the service sector is that, no matter how tempting it may be to cut costs, the manager cannot lose sight of the fact that the customer is always right, and that customers can often very easily eliminate services from their weekly budget. Although using an inferior cleaning product might save money, if the customers do not like the way that it makes their homes smell, and thus they refuse to renew their contracts and begin cleaning their houses themselves, or use a different company, little has been gained. Operations managers must strive to create a balance between efficiency and staying true to the mission of the business.
Operations at Apple Inc. Statistical technique to measure the quality characteristics of Apple Inc. Six-sigma was created in the 1980s at Motorola as a strategy to measure and enhance high-volume processing procedures. Its overall objective was to measure and dispose of waste by endeavoring to accomplish nearly perfect outcomes. The term six sigma refers to a statistical technique of measuring quality with a maximum of 3.4 imperfections out of a million. Various
Operations Management What is the relationship between productivity, capital expenditures, and new machinery at Michelin? Would you think that this would be the case for most manufacturing operations? If so, why or why not? Productivity expenditures Productivity expenditures are necessary in any performing body in the market. The expenditure conditions in Michelin Company are crucial to the general productivity and growth of the company in the global market. There is more protection a
Manufacturing Seven Key Elements for Successful Implementation Norman Binette, Jr. Biddeford, Maine Manufacturing organizations are built on the premise that they possess the ability to provide a wide variety of quality products for their customers. This reputation is dependent upon the constant review of existing processes and the identification of new and innovative methods of production that will enhance and increase the diversification of product lines. One such process that has proven itself
In fact, the developed world is moving very rapidly towards a greater service economy -- how can this engender a perception that these organizations are intangible and produce nothing? In fact, their model, "service," becomes even more necessary because certain process technologies remain aloof from adapting to stakeholder inputs. However, like the goal to find a unified field theory of physics to explain the universe, the unified services theory
Service Demand & Supply Service Demand and Supply Planning Planning is considered the most important function of every project and organization (Singla, 2011). Successful organizations spend their more than 60% of the time in the planning process. It is because strong planning makes the subsequent steps easy. If planning is poor, the rest of the activities are bound to fail. It is, therefore, mandatory to spend maximum time and put in the
Operations Management Boeing: Boeing is the largest aerospace company across the globe and the leading producer of commercial jetliners as well as space, defense, and security systems. Since the firm is a top American exporter, it supports airlines and American and allied customers in approximately 150 countries. The firm's products and customized services include commercial and military weapons, launch systems, satellites, aircrafts, electronic and defense systems, advanced information and communication systems,