Service operations management improving service delivery 4th edition pdf

Service Operation Paper

Best Practice Paper: the objective of this paper is to apply the theories presented to you in the text and the lectures. You may choose a company, for which you will write a paper of approximately 2,000 words minimum, which contains answers or recommendations to the next seven questions.

What should the company do to develop good customer relationships? How can managers of the company develop good business relationships?
How can managers of the company design the customer journey? What is the role of technology in developing the customer experience?
What should the company do to measure the customer’s perspective? How can managers of the company measure, control and manage the operation?
What should the company do to manage and motivate service providers? How can customers be ‘managed’ and motivated?
What should the company do to use “value” to drive continuous improvement?
Identify PUV criteria of the company. What are the options for change?
What should company and its managers do to influence cultural change?
The content and grading of this paper is as follows:

Executive summary (10%)
Recommendations for each of the seven points above (70%)
Graphs and charts—must be service operations related (10%)
References—in proper bibliographic form. These should be from several of the following: journals, books, interviews, company information, and credible Internet sources (10%)
This paper will be subjected to a Turn It In analysis and the expected maximum of unoriginal material is no more than 25%.

The attachment's page 392 is the definition of PUV. For question 6.

Robert Johnston Graham Clark Michael Shulver

Service OperatiOnS ManageMent Improving Service Delivery

Fourth Edition

This international market-leading book, aimed at both students and practising managers, provides a comprehensive and balanced introduction to service operations management. Building on the basic principles of operations management, the authors examine the operations decisions that managers face in controlling their resources and delivering services to their customers.

Combining a unique practical approach with a detailed theoretical underpinning, the authors provide tools, frameworks and techniques for operational analysis and improvement and set operations management within the wider business context, bringing a valuable ‘real world’ perspective to this growing area.

Each chapter includes definitions of key terms, real-world examples and case studies with exercises, questions to test both understanding and application, together with recommended further reading and suggested websites to deepen your knowledge.

New features for this 4th edition include:

• A new 17 chapter structure • A practical focus on ‘how to’ deal with the key

issues and challenges facing service operations managers

• A new chapter on the customer experience • A new chapter on driving continuous improvement • A new chapter on learning from other operations • A new chapter on world-class service • Six new end-of-chapter case exercises • A new full-colour design

Service Operations Management is an invaluable guide to students and managers confronting operational issues in service management, whether from a general management perspective or focused in specific sectors, such as tourism and leisure or business services. This book is ideal for undergraduates, postgraduates or executives wishing to gain a deeper understanding of managing service operations and improving service delivery.

Service OperatiOnS ManageMent Improving Service Delivery

Fourth Edition

Robert Johnston, Graham Clark and Michael Shulver

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CVR_JOHN0483_04_SE_CVR.indd 1 13/03/2012 09:22

SERVICE OPERATIONS MANAGEMENT

Robert Johnston Graham Clark and Michael Shulver

SERVICE OPERATIONS MANAGEMENT Improving Service Delivery

Fourth Edition

Pearson Education Limited Edinburgh Gate Harlow Essex CM20 2JE England

and Associated Companies throughout the world

Visit us on the World Wide Web at: www.pearson.com/uk

First published 2001 Fourth edition published 2012

© Pearson Education Limited 2012

The rights of Robert Johnston, Graham Clark and Michael Shulver to be identifi ed as authors of this work have been asserted by them in accordance with the Copyright, Designs and Patents Act 1988.

All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form or by any means, electronic, mechanical, photocopying, recording or otherwise, without either the prior written permission of the publisher or a licence permitting restricted copying in the United Kingdom issued by the Copyright Licensing Agency Ltd, Saffron House, 6–10 Kirby Street, London EC1N 8TS.

All trademarks used herein are the property of their respective owners. The use of any trademark in this text does not vest in the author or publisher any trademark ownership rights in such trademarks, nor does the use of such trademarks imply any affi liation with or endorsement of this book by such owners.

Pearson Education is not responsible for the content of third-party internet sites.

ISBN 978-0-273-74048-3

British Library Cataloguing-in-Publication Data A catalogue record for this book is available from the British Library

Library of Congress Cataloguing-in-Publication Data A catalog record for this book is available from the Library of Congress

10 9 8 7 6 5 4 3 2 1 16 15 14 13 12

Typeset in 10/12pt Minion by 73 Printed and bound by Rotolito Lombarda, Italy

Contents

Preface xiii New features for this edition xvi Case Examples xvii Authors’ acknowledgements xix Publisher’s acknowledgements xx About the authors xxi

Introduction 3 Part 1

Chapter 1 Introducing service operations management 4

1.1 Introduction 4 1.2 What are services? 5 1.3 What is ‘service’? 6 1.4 What is service operations management? 12 1.5 Why is service operations management important? 15 1.6 Summary 17 1.7 Discussion questions 18 1.8 Questions for managers 18 Suggested further reading 18 Useful web links 19 Notes 19

Chapter 2 Understanding the challenges for operations managers 21

2.1 Introduction 21 2.2 What are the key strategic challenges faced by service operations managers? 22 2.3 What are the key tactical challenges faced by service operations managers? 25 2.4 What are the challenges for different types of services? 30 2.5 What are the challenges for different types of processes? 35 2.6 What are the challenges in working with other management functions? 38 2.7 How can this book help? 39 2.8 Summary 40 2.9 Discussion questions 41 2.10 Questions for managers 41 Case Exercise: Sky Airways 41 Suggested further reading 43 Useful web links 43 Notes 43

Frame 45 Part 2

Chapter 3 Developing and using the service concept 46

3.1 Introduction 46 3.2 What is a service concept? 47 3.3 How can managers use the service concept? 53 3.4 Summary 61 3.5 Discussion questions 62 3.6 Questions for managers 62 Case Exercise: The Sunningtree Golf Club 62 Suggested further reading 64 Useful web links 64 Notes 64

Contentsvi

Connect 67 Part 3

Chapter 4 Understanding customers and relationships 68

4.1 Introduction 68 4.2 Customers, who are they? 69 4.3 What are the benefi ts of retaining good customers? 77 4.4 How can managers develop good customer relationships? 79 4.5 How can managers develop good business relationships? 86 4.6 Summary 94 4.7 Discussion questions 95 4.8 Questions for managers 95 Case Exercise: The National Brewery 96 Suggested further reading 98 Useful web links 98 Notes 99

Chapter 5 Managing customer expectations and perceptions 101

5.1 Introduction 101 5.2 What is customer satisfaction? 102 5.3 What infl uences expectations and perceptions? 106 5.4 How can expectations and perceptions be ‘managed’? 109 5.5 How can service quality be operationalised? 115 5.6 How can managers capture customers’ expectations? 120 5.7 How can a service be specifi ed? 123 5.8 Summary 124 5.9 Discussion questions 125 5.10 Questions for managers 126 Case Exercise: The Northern Breast Screening Unit 126 Suggested further reading 128 Useful web links 128 Notes 129

Contents vii

Chapter 6 Managing supply networks and supplier relationships 131

6.1 Introduction 131 6.2 What are supply chains and networks? 132 6.3 What is the role of information and inventory? 135 6.4 How can supply networks be managed? 137 6.5 How can managers develop a global network strategy? 153 6.6 Summary 154 6.7 Discussion questions 155 6.8 Questions for managers 155 Case Exercise: The Regional Forensic Science Laboratory 156 Suggested further reading 157 Useful web links 157 Notes 158

Deliver 161 Part 4

Chapter 7 Designing the customer experience 162

7.1 Introduction 162 7.2 What is a customer experience? 163 7.3 How can the servicescape be designed? 167 7.4 How can managers design the customer journey? 169 7.5 What is the role of technology in developing the customer experience? 180 7.6 Summary 186 7.7 Discussion questions 187 7.8 Questions for managers 187 Case Exercise: The Southern Provincial Hospice 188 Suggested further reading 189 Useful web links 190 Notes 190

Chapter 8 Designing the service process 193

8.1 Introduction 193 8.2 Why is service process design important? 194 8.3 What are the main types of service process? 194 8.4 How can managers ‘engineer’ service processes? 206 8.5 How can service processes be repositioned? 208 8.6 How can managers harness technology in service process design? 216 8.7 Summary 220 8.8 Discussion questions 222 8.9 Questions for managers 222 Case Exercise: Banca San Giovanni 222 Suggested further reading 225 Useful web links 225 Notes 225

Chapter 9 Measuring, controlling and managing 226

9.1 Introduction 226 9.2 Why do managers need to measure things? 227

Contentsviii

9.3 What needs to be measured? 228 9.4 How can managers measure the customer’s perspective? 231 9.5 How can managers measure, control and manage the operation? 235 9.6 Summary 244 9.7 Discussion questions 244 9.8 Questions for managers 245 Case Exercise: The Squire Hotel Group 245 Suggested further reading 247 Useful web links 247 Notes 247

Chapter 10 Managing people 249

10.1 Introduction 249 10.2 Why is service delivery a pressurised task? 250 10.3 How can organisations manage and motivate service providers? 255 10.4 How can customers be ‘managed’ and motivated? 274 10.5 Summary 277 10.6 Discussion questions 278 10.7 Questions for managers 278 Case Exercise: The Empress Hotel Group 278 Suggested further reading 280 Useful web links 280 Notes 280

Chapter 11 Managing service resources 283

11.1 Introduction 283 11.2 What is capacity management? 284 11.3 How can managers balance capacity and demand? 287 11.4 How is day-to-day planning and control carried out? 295 11.5 How do organisations manage bottlenecks and queues? 299 11.6 What happens when managers can’t cope with demand? 303 11.7 How can organisations improve their capacity utilisation? 308 11.8 Summary 312 11.9 Discussion questions 313 11.10 Questions for managers 314 Case Exercise: Medi-Call Personal Alarm Systems Ltd 314 Suggested further reading 315 Useful web links 316 Notes 316

Improve 319 Part 5

Chapter 12 Driving continuous improvement 320

12.1 Introduction 320 12.2 How can managers use ‘value’ to drive continuous improvement’? 321 12.3 What are the main approaches to continuous improvement? 323 12.4 How can managers sustain continuous improvement? 337 12.5 Summary 338 12.6 Discussion questions 339

Contents ix

12.7 Questions for managers 339 Case Exercise: Cranleigh Metropolitan Council 340 Suggested further reading 342 Useful web links 342 Notes 342

Chapter 13 Learning from problems 344

13.1 Introduction 344 13.2 Why do problems occur? 345 13.3 How can complaining customers be dealt with? 346 13.4 How can managers use problems to drive improvement? 350 13.5 How can managers prevent problems occurring? 354 13.6 Summary 362 13.7 Discussion questions 363 13.8 Questions for managers 363 Case Exercise: Gold Card Protection Service 363 Suggested further reading 365 Useful web links 366 Notes 366

Chapter 14 Learning from other operations 368

14.1 Introduction 368 14.2 What is benchmarking? 369 14.3 How can benchmarking help organisations improve their performance? 369 14.4 What are the different types of benchmarking? 370 14.5 How do organisations go about benchmarking? 375 14.6 How can quality awards and academic studies help with benchmarking? 381 14.7 Summary 382 14.8 Discussion questions 383 14.9 Questions for managers 383 Case Exercise: Mumbai Private Bank 384 Suggested further reading 384 Useful web links 385 Notes 385

Implement 387 Part 6

Chapter 15 Creating and implementing the strategy 388

15.1 Introduction 388 15.2 What is a service strategy? 389 15.3 How can service provide a competitive advantage? 390 15.4 How can managers turn performance objectives into operations priorities? 394 15.5 How can strategy be formulated and developed? 397 15.6 How can a strategy be sustained? 402 15.7 Summary 403 15.8 Discussion questions 404 15.9 Questions for managers 404 Case Exercise: Smith and Jones, Solicitors 404 Suggested further reading 406 Useful web links 406 Notes 407

Contentsx

Chapter 16 Understanding and infl uencing culture 408

16.1 Introduction 408 16.2 Why is understanding and infl uencing organisational culture important? 409 16.3 What is organisational culture? 410 16.4 What are the main culture types and the implications for service delivery? 421 16.5 What is the infl uence of national cultures? 423 16.6 How can managers infl uence cultural change? 424 16.7 Summary 429 16.8 Discussion questions 430 16.9 Questions for managers 430 Case Exercise: North Midlands Fire and Rescue Service 430 Suggested further reading 432 Useful web links 432 Notes 433

Chapter 17 Building a world-class service organisation 434

17.1 Introduction 434 17.2 What is excellent service? 435 17.3 How do organisations go about becoming and remaining world-class? 439 17.4 How can managers make the business case for service? 446 17.5 A fi nal word 449 17.6 Summary 449 17.7 Discussion questions 450 17.8 Questions for managers 450 Case Exercise: Superstore Plc 451 Suggested further reading 453 Useful web links 454 Notes 454

Index 455

Supporting resources for lecturers

Please visit www.servops.net to fi nd valuable online resources. These include:

● A downloadable Instructor’s Manual

● PowerPoint and Keynote slides that can be downloaded and used for classroom presentations

● Instructional video screencasts by the author team showing you how we approach the subjects in our own teaching

● Lesson plans

● Opportunities to network, share ideas and provide feedback

● …and much, much more.

Contents xi

Preface

Introduction

This book is about how to manage and improve the operations in service organisations. Service operations are important . They are the parts of the organisation that create and deliver service to customers. The service could be that delivered to customers inside an organisation, such as staff in other functions, or the service provided by public sector organisations, voluntary organisations, mass transport services, professional services, business-to-business services, retailers, internet services, tourism and hospitality, for ex- ample. In this book we do not focus on any particular type of service but seek to cover the many decisions faced by operations managers in all these organisations. To illustrate this diversity we have provided examples from many different organisations and from many countries, including Australia, Denmark, France, Hong Kong, India, Japan, Malaysia, the Maldives, New Zealand, Singapore, Sweden, Thailand, the United Arab Emirates, the UK and the USA.

Service operations management is important. Operations managers are usually responsi- ble for most of the costs in an organisation, and for most of the revenues, and they manage most of the people and physical assets. Operations managers deliver the ‘profi t’. In this book we refer to many aspects of ‘business performance’, not simply profi t. Although many organi- sations are motivated by profi t, most operations are also assessed on criteria such as costs, revenues, adherence to budgets, customer loyalty and technological leadership.

Service operations management is also very challenging . We have captured many of the challenges that operations managers face every day and the book is structured around how to deal with those challenges. Managing operations is also exciting . Operations deal with cus- tomers, often in real time, so part of the excitement comes from the immediacy of operations; dealing with the needs of a stream of customers, managing the staff and making operational decisions to ensure the delivery of an appropriate quality of service at an appropriate cost.

The aim of this book

The aim of this book is to provide a clear, authoritative, well-structured, easy to read and interesting treatment of service operations management. Our objective in writing this book is to help students and managers understand how service performance can be improved by studying service delivery and associated management issues. Service delivery is the focus of this book, yet we recognise that success depends not only on the obvious territory of opera- tions in managing processes and resources, but also in understanding how operations managers must be involved in aspects of the organisation’s strategy, organisational culture, and the way employees and customers are motivated and managed. How well a service is delivered refl ects the ability of the organisation to pull all these strands together. The result should be a service which meets the demands of its various stakeholders, including an appropriate and achievable level of service for customers, delivery of the required operational and fi nancial targets and implementation of the organisation’s strategy.

xiv Preface

Who should read this book?

This book is intended as a textbook for those who want to build on knowledge of the basic principles of operations management. It will also serve as a handbook for operations man- agers in service organisations as they seek to develop and implement operations strategies. Specifi cally it is intended for:

● Undergraduates on business studies or joint studies degrees or those specialising in hospi- tality, tourism or the public sector, for example, who wish to enhance their understanding of service operations management.

● MBA students who are managing service organisations and want to stretch their under- standing of the area and assess and improve their operations.

● Executives who want to focus on certain aspects of service delivery, such as the customer ex- perience, process design, capacity management, improvement, creating high- performance teams, performance measurement, world-class service or service strategy development, for example, in order to challenge and change their own organisations.

Distinctive features

● Operations focused. This text has a clear operations focus and is concerned with managing operations. It explores operational issues, problems and decisions. It exposes undergradu- ates to the problems faced by service operations managers and helps practising managers deal with those issues. Each of the main chapters addresses how to deal with a particular problem or challenge.

● Frameworks and tools. Each chapter provides tools, frameworks and techniques that will help students and managers not only analyse existing operations but also understand better how they can deal with the issues that operations managers face. The frameworks, approaches and techniques will vary from topic to topic and will include, for example:

• a list of key points to bear in mind when making decisions in a particular area • a diagram or chart showing the relationship between two variables or sets of variables

to help position an operation or help identify the nature of the relationships • a list of questions, checks or tests that can be applied to a situation • ways of quantifying or assessing qualitative variables • the key stages in undertaking a particular activity.

● Real world illustrations. Operations management is an applied subject so each chapter includes a number of short illustrations, case examples, from around the world that show how organisations have either identifi ed or dealt with the particular issues being discussed.

● International. The real world illustrations – examples in the text, case examples and case exercises – are drawn from many countries to show the diversity and international nature of operations issues and activities. The Case Examples are listed on pages xvii�xviii.

● Underpinned by theory. Appropriate theoretical underpinning and developments are in- cluded and we have tried to explain them in an unobtrusive and accessible way. References, web links and suggestions for further reading are provided for anyone wishing to under- take more work in a particular area.

● Managing people. A key task for operations managers is managing people and so this book contains a signifi cant ‘managing people’ element. This includes not only employees but also customers, as well as managing and changing the culture of the organisation as a whole.

● E-service. Information technology, e-service and virtual operations are integrated into the book and their operational implications explored.

xvPreface

● State of the art. The book contains some of the most recent ideas and information, cov- ering in particular world-class service, performance management, service concept, the customer experience and service processes.

● Summaries. Each chapter includes a bullet-point checklist summarising key points, struc- tured using the questions at the start of the chapter.

● Web links. We have provided some web links at the end of each chapter which will provide further information about the subject material or suggest some service organisations that are demonstrating interesting service operations approaches.

● Questions for managers. At the end of each chapter there are some questions aimed at practising managers, which they can ask of their/an operation. We hope that these ques- tions will encourage you to apply the material in the chapter to your situation and allow you to understand better, challenge and improve your service operations.

● Discussion questions and further reading. We have also provided some general discussion questions, aimed at undergraduates, to help them both assess and apply the material to a variety of situations. There are also some suggestions for further reading.

● Case exercises. Each chapter, with the exception of the fi rst chapter, concludes with a case exercise suitable for class discussion. The cases are short but focused on the topic and are a rich source of material for debate and development.

● Instructor’s manual. An instructor’s manual is available to lecturers adopting this text- book. It can be downloaded from www.servops.net and provides detailed questions to go with the cases and bullet-point answers to the questions.

● Servops.net is the instructor’s companion website for our textbook. Besides the instructor’s manual it provides a range of presentations in PowerPoint and Keynote formats to suit a range of teaching styles, experience and time constraints. The site also makes available a series of video screencasts in which the authors explain their approach to teaching each topic. Servops.net also gives instructors a series of lesson plans and handout designs.

Feedback and ideas

We would welcome feedback and suggestions to help us develop our textbook. In particular we would like to know how you use the book, and if you have any suggestions for web links, readings or case examples, for example. Please do not hesitate to contact bob.johnston@ wbs.ac.uk.

New features for this edition

We are delighted to welcome Dr Michael Shulver to the author team for this fourth edition of the book. Michael brings a wealth of teaching experience and has been instrumental in developing some of the chapters. More importantly Michael has taken the lead in developing the teaching materials which we know will be greatly appreciated by the lecturers.

The fi rst edition of this textbook was published in 2001 and the subject of service opera- tions management and service management has advanced in that time. As a result we have made quite a few changes to this edition. In particular we have taken the bold step of chang- ing the chapter structure – our apologies in advance for those classes who are using the third edition at the same time. This has allowed us to expand the fi rst chapter about service and services, providing some important and recently developed concepts and defi nitions. Impor- tantly we have split the process chapter into two with one whole chapter now focusing on the customer experience. We have also provided a much clearer explanation of the structure in Chapter 2 , which covers the challenges for operations managers. There are more things we want to do in future editions and we always appreciate and welcome feedback. Indeed, your suggestions have led to many of the changes we have made. In summary the changes have included:

● A new 17-chapter structure

● A practical focus on how to deal with the key issues and challenges facing service opera- tions managers

● A new more helpful structure diagram summarising the ‘how tos’

● Sharpened defi nitions of key terms and concepts

● A new chapter on the customer experience

● A new chapter on driving continuous improvement

● A new chapter on learning from other operations

● A new chapter on world-class service

● Several new case examples; others have been updated

● Six new end-of-chapter Case Exercises

● Updated web links

● Full colour pictures to illustrate the case examples

● A new look and format.

Case Examples

Chapter Case Example Organisation Location Page

Chapter 1

1.1 1.2 1.3

Singapore General Hospital IBM Global Services Baros, the Maldives

Singapore International Republic of the Maldives

9 10 13

Chapter 2

2.1 2.2 2.3 2.4

SouthWest Airlines Cybernurseries Cathay Pacifi c Airways Oxfam International

USA UK Hong Kong International

23 24 27 33

Chapter 3

3.1 3.2 3.3 3.4

3.5

The Icehotel Singapore Zoo Designing a new hairdressing concept in Japan The Earth Galleries at the Natural History Museum, London TECLAN Translation Agency

Sweden Singapore Japan UK

UK

47 55 57 59

60

Chapter 4

4.1 4.2 4.3 4.4 4.5 4.6

GSV Software The Prison Service Harley Owners Group (HOG) Travelco Ltd National Grid Transco Group GP Group (Bangkok)

Europe UK International UK UK Thailand

71 73 81 85 88 93

Chapter 5

5.1 5.2

TNT Express Dubai Singapore Airlines (SIA)

UAE Singapore

118 121

Chapter 6

6.1 6.2 6.3

6.4 6.5 6.6

Sharnbrook Upper School Lunch delivery in Mumbai Child protection – Torfaen County Borough Council, Wales Microsoft Norwich Union Call Centre, Delhi Northwards Housing

UK India UK

International India UK

133 135 138

139 144 146

Chapter 7

7.1 7.2 7.3 7.4

Britannia Building Society British Airways, Waterside The acute patient’s journey Technology and innovation at the National Library Board of Singapore

UK UK UK Singapore

163 168 170 181

Chapter 8

8.1 8.2 8.3 8.4

PC World Business Ku-Ring-Gai Vet Hospital BT Wholesale Blackboard.com

Europe Australia UK International

202 210 213 219

xviii Case Examples

Chapter Case Example Organisation Location Page

Chapter 9

9.1 9.2

The RAC – customer satisfaction is king Lombard Direct

UK UK

233 236

Chapter 10

10.1 10.2 10.3 10.4

New Islington and Hackney Housing Association First Mortgage Direct Open Door Church, St Neots, UK First Direct

UK UK UK UK

251 260 269 271

Chapter 11

11.1 11.2 11.3 11.4

Pelorus Water Transport Alton Towers Resort Karolinska Hospital, Stockholm The Kowloon Hotel, Hong Kong

New Zealand UK Sweden Hong Kong

284 287 298 309

Chapter 12

12.1 12.2 12.3 12.4

Pirates The Legend Hotel, Kuala Lumpur The National Board of Industrial Injuries, Denmark Kaiten-zushi restaurants

International Malaysia Denmark International

322 327 333 335

Chapter 13

13.1 13.2 13.3 13.4 13.5

MTR Corporation, Hong Kong TNT Express Zane’s Cycles Datapro Singapore Radisson Hotels

Hong Kong International USA Singapore International

349 353 355 359 361

Chapter 14

14.1 14.2

14.3

The benchmark that nobody wants! Benchmarking the NBA: bouncing accepted wisdom School performance tables

USA USA

UK

373 374

380

Chapter 15

15.1 15.2

Telecorp A new strategy for Singapore’s libraries

International Singapore

394 401

Chapter 16

16.1 16.2 16.3

Disneyland Resort Paris First Direct Amnesty International

France UK International

409 420 426

Chapter 17

17.1 17.2 17.3 17.4

TNT Express, Thailand The Centara Grand Beach Resort Hotel, Samui Singapore Airlines (SIA) BUPA

Thailand Thailand Singapore International

436 438 442 448

Authors’ acknowledgements

Many people have helped us in the writing of this book. Academic colleagues from around the world have provided stimulation, encouragement and/or contributions, including important ideas and material, useful feedback, illustrations and case examples. We would like to express our gratitude to all of them. Practising managers from around the world have also been kind enough to provide some rich material about their activities and organisations; our grateful thanks to them.

We are particularly grateful to the book’s reviewers over the various editions whose consid- erable efforts and expertise provided us with comments, ideas and suggestions, all of which have had a signifi cant infl uence on the text. The reviewers included Par Ahlstrom, Chalmers University of Technology; Thomas Christiansen, Technical University of Denmark; Steven Disney, University of Cardiff; John Flanagan, University of Wollongong; Andrew Greasley, Aston University; Lesley Kimber, Southampton Business School; Geoffrey Plumb, Stafford- shire University; Graham K. Rand, University of Lancaster; Frank Rowbotham, De Monfort University; Rhian Silvestro, Warwick Business School; Martin Spring, UMIST; Remko Van Hoek, Erasmus and Cranfi eld Universities; and Jan de Vries, the University of Groningen.

Our colleagues at Warwick and Cranfi eld have helped us greatly by not only providing ideas and encouragement but also creating the stimulating environment in which we work. We are particularly grateful to our secretaries, Mary Walton and Lyn Selby, whose efforts have kept us focused on the task and as organised as is possible.

We have greatly benefi ted from the guidance, encouragement and support of Rufus Curnow and the highly polished and professional team at Pearson Education.

It is appropriate also for us to thank all our students, both past and present. They have, over many years, been a source of great stimulation and development. Each one of them has had an infl uence on this book.

Finally we would like to thank our partners, Shirley, Dawn and Helen for allowing us to dedicate a signifi cant amount of our time to this project. They have been our major source of encouragement; without their support, and also their direct involvement in the book, we would never have completed this task.

Bob Johnston, Graham Clark and Michael Shulver

Publisher’s acknowledgements

We are grateful to the following for permission to reproduce copyright material:

Figures

Figure 4.5 from SHAPE International, www.shape-international.com; Figure 4.6 adapted from Relationship Marketing for Competitive Advantage , Butterworth Heinemann (Payne, A., Christopher, M., Clark, M., Peck, H. 2000); Figure 6.4 adapted from Customer Service and Support , Pearson Education (Armistead, C.G., Clark, G.R. 1992); Figure 6.7 from Strategic Global Manufacturing Management: A Study of the Process and Current Practices , Cranfi eld School of Management Report (Sweeney, M.T. and Dr M.Q. Szwejczewski 2002); Figure 15.5 adapted from Operations Management, 6 ed, FT Prentice Hall (Slack, N., Cham- bers, S., Johnston R. 2010); Figure 16.1 adapted from Organisational Culture and Leadership, 3 ed, John Wiley & Sons, Inc (Schein, E.H. 2004)

Tables

Table 15.1 adapted from Operations Management , 6 ed, Pearson Education (Slack, N., Chambers, S., Johnston, R. 2010); Table 15.2 adapted from Operations Management , 6ed, Pearson (Chambers, N.S., Johnston, R. 2010)

Text

Case Example 4.1 adapted from Sara Sheppard, ITSMA, Europe

Photographs

Alamy Images: Chuck Pefl ey 139, David Bagnall 163, David Levenson 353, Portus Imag- ing 335; Andy Maluche/Photographers Direct: 57; Aspectra/Maurine Traffi c: 93; BT Image Library: 213; Cathay Pacifi c: 27; Graham Clark: 202, 269, xxi; Corbis: Chris Gasgoigne 361, Jonathan Drake / epa 9; First Direct: 271, 420; Fotolia.com: Wingnut Designs 322; Helen Jones: 33; Image courtesy of The Advertising Archives: 236, 448; Getty Images: 374, AFP 181, 409; iStockphoto: Eimantas Buzas 394, istrejman 85, Sheryl Griffi n 138; James Davies: 309, 349; Bob Johnston: 13, 47, 55, 135, 168, 284, 401, 438, xxi; National Grid: 88; Natural History Museum Picture Library: 59; Northwards Housing: 146; Pearson Education Ltd: Andy Myatt / Alamy 73, Corbis 426, Corbis / BrandX 298, David R. Frazier Photolibrary, Inc. Alamy 333, Image State / John Foxx Collection 359, Imagestate / John Foxx Collection 170, Imagestate / John Foxx Collections 10, Jon Barlow 133, Jules Selmes 24, 251, Naki Kouyioumtzis 60, Photodisc / David Buffi ngton 210, Studio 8 260, Thinkstock / Alamy 71; RAC: 233; Michael Shulver: 287, xxii; Shutterstock.com: Adriano Castelli 81, Laurence Gough 380, Stuart Jenner 327; Singa- pore Airlines: 002 442, 121; Soumik Kar: 144; Southwest airlines: 23; © 2010 TNT N.V.: 436; TNT Dubai: 118; Zane’s Cycles: 355

In some instances we have been unable to trace the owners of copyright material, and we would appreciate any information that would enable us to do so.

Robert (Bob) Johnston is Professor of Operations Management at Warwick Business School. He has a management degree from the University of Aston and a PhD from the University of Warwick. Before moving to academia Bob held several line management and senior man- agement posts in a number of service organisations in both the public and private sectors. He continues to maintain close and active links with many large and small organisations through his research, management training and consultancy activities. Bob teaches both undergraduate and postgraduate courses and has global experience in executive education with leading companies. Bob’s research interests include service trans- formation, service excellence and leadership, service recovery, complaint management, performance management, service design and service strategy. He has published around 150 papers, books and chapters, and has written over 100 case studies. Bob has served as Deputy Dean of the Business School, the Academic Director of the Warwick MBA and Head of the Operations Management Group. He serves on the editorial boards of ten leading journals. He is a member of several international advisory boards, an Honorary Fellow of the European Operations Management Association and a Vice President of the Institute of Customer Service.

Graham Clark is Senior Lecturer in Operations Management at Cranfi eld School of Management and Director of the Executive MBA Programme. He has a degree in mechanical engineering from Leeds University and a master’s degree in management from Imperial College, London Uni- versity. Prior to moving to Cranfi eld in 1986, Graham managed both manufacturing and customer support operations for companies in the engineering sector. His focus is on the development and implementation of operations strategies, with a specifi c interest in the leadership of serv- ice employees through operational transitions. Graham teaches across Cranfi eld’s MBA and executive education programmes, and is engaged in management development and consultancy activities with organisa- tions from all sectors. He also leads the ‘Implementing Change’ theme on the MBA programme and tutors’ personal development programmes. He is a non-executive director of the Institute of Customer Service and a member of the leadership team of the UK chapter of the Association for Service Management.

About the authors

xxii About the authors

Michael Shulver is a Senior Teaching Fellow in the Operations Man- agement Group at Warwick Business School where he is the Aca- demic Director of the School’s BSc in Management. Michael has an astrophysics degree from the University of London, and MBA and PhD degrees from the University of Warwick. Before his time in academia Michael was an aircraft engineer, and he actively retains his Chartered Engineer status. Michael also took a two-year sab- batical as a consultant in performance management in 2005/6. In this role Michael worked with the UN, Syngenta and BP. Michael’s teaching portfolio covers mainstream Operations Management, Service Management, Performance Management and Service Sec- tor Innovation / Design Management. Michael has delivered lectures and workshops in these fi elds at Executive, MBA and undergradu- ate levels at Warwick Business School and has taught as a visiting lecturer for Stockholm School of Economics, Vlerick Gent Man- agement School, Templeton College, Oxford and the UBS Business University. Michael is an innovator in games and simulations for management education and research, and in pedagogy as it relates to operations management teaching.

Part 1 Introduction

Chapter 1 Introducing service operations management 4

Chapter 2 Understanding the challenges for operations managers 21

Frame

Connect Deliver

Implement Improve

Introduction 1.1

We all come into contact with service operations and experience their services every single day. We are customers or users of a wide range of commercial and public services, such as childcare services, hospitals, shops, schools, holiday fi rms, restaurants, television and the internet. Furthermore, many of us are responsible for providing services not only as part of our jobs, in organisations such as those above, but also as part of daily life for our friends and families; providing cooking, cleaning and ‘taxi’ services, organising holidays and providing emotional support services for example.

It is important to note at the start of this book that service operations covers a far broader fi eld than these ‘everyday’ services that we buy or receive or the ‘personal’ services that we provide to each other. They include the services organisations provide to each other such as procurement or consulting services; services inside organisations (internal services) such as information technology (IT) or human relations (HR) support; public services provided by governments (social services, police services or fi re and rescue services); and the many and diverse services provided by not-for-profi t and voluntary organisations such as faith organi- sations or international aid organisations (see next section).