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Som T5 9 1 19
Som T5 9 1 19
Service Inventory
• In services the input form and output form of service inventory can be of
same type or may have different types;
Managing Inventory in services versus managing inventory in
manufacturing sector
In service sector it is very difficult to anticipate the exact demand of customer. It is very difficult to
predict what kind of service or queries or problems a customer will have before the actual arrival of
customer to service organization. There are differences in managing inventories in manufacturing
sector and service sector which are the following;
Lead Time
• The tools required to set up and run online auctions like eBay Inc.
• In the Insurance sector, the life insurance agents have tools equipped
with software (algorithms/formulae), which after entering the age of client
and the policy period requested by the client generates automatically the
sum assured and returns. Service inventory in the form of database
presents extreme economies of scale. For any service creative database
can be very expensive, but once the database is ready the incremental
cost of adding records to established database provide extreme
economies of scale.
Define Service Supply Chain and major issues associated with the
concept.
Customer-supplier duality
In services, the service activity is initiated by the customers. Service is an
act or deed performed on the customer’s mind, body, belongings or
information provided by the customer. Hence, customer acts like a
supplier to the service provider who provides something to get the service
done. This dual role of customer, of being supplier also, in service
exchange is called as customer-supplier duality. The customer-supplier
duality is also known as bidirectional relationships between service
provider and customer as shown in the Figure;
Outsourcing
In recent past most of the organizations have started outsourcing their
internal functions to focus on core competencies. Service outsourcing is
also referred to as Business Process Outsourcing (BPO), which has become
specialist firms offering focused services. Most of the service companies
like banking, financial services, and insurance (BFSI) and
telecommunication service providers are outsourcing their in-house
service products to outsource to IT and ITeS (IT enabled) companies.
Service supply chains are generally very short for some of the services.
For example service providers like dry cleaners and shoe repair hardly
have many tiers of suppliers.
Challenges in managing service supply chains
Varying output
Demand Management
Service supply chain deals with flow of information, capacity and cash as
mentioned below:
Information Flow
Capacity Flow
Investing in assets
Recruiting quality staff
Recruiting appropriate staff
Cash Flow
An SLA defines the nature of the goods or services and the level of quality
to be provided. It helps in development and formalization of service
provider client relationship. It is comprised of following components.
Service specification
• DEA techniques are based on linear algebra and are related to linear
programming concepts. The technique is similar to mathematical duality
relations in linear programming.
DEA process
Partial productivity measures does not consider all output and input
factors, whereas, total factor productivity measure can take into account
of all the outputs and inputs. Therefore the mistake of imputing gains to
one output that are attributable to another output in partial productivity
measures can be avoided using total factor productivity measures.
In the given example with one input and one output of a chain of coffee
shops ‘Coffees and more’ located in eight locations from A to H as shown
in Table, The owner of the coffee shop wants to evaluate the efficiency of
the shops in one city. He considers the cups of coffee sold (per day) as
output and the number of employees in the store as inputs. The owner
wants to know which store is efficient and which store is inefficient. He is
also interested to benchmark the best store so that he can suggest
improvements for the inefficient stores by comparing inefficient stores
with efficient store.
The efficiency of each store is determined with the help of ratio of number
of cups sold and Number of employees as shown in Table below. It is clear
that most efficient store is B with an efficiency of 1 and the least being F,
with an efficiency of 0.4.
Advantages
1. DBA compares service units considering all resources used and services
provided, and identifies the most efficient units or best practice units
(branches, departments, individuals) and the inefficient units in which real
efficiency improvements are possible. This is achieved by comparing the
mix and volume of services provided and the resources used by each unit
compared with those of all the other units. In short, DBA is a very powerful
benchmarking technique.
2. DBA calculates the amount and type of cost and resource savings that
can be achieved by making each inefficient unit as efficient as the most
efficient - best practice -units.
SIMULATION
System
State of a system
Discrete system
A discrete system is one in which the state variables change only at a
discrete set of points in time. The number of customer waiting in line in a
bank is an example of discrete system.
Continuous systems
Model of a system
Types of model