Hamdard University Bangladesh

Department of Electrical & Electronic Engineering

BBA-321 Industrial & Operations Management
Submitted to:
Israt Jahan
Lecturer, Department of BBA

Submitted by:
Md. Ziaul Haque Shimul
Id: 555181028 (EEE, 14th)
Semester: 6th
PRODUCTION OF GOODS VERSUS PROVIDING SERVICES

Production is a process of combining various material inputs and immaterial inputs

in order to make something for consumption.
Although goods and services often go hand in hand, there are some very basic
differences between the two, differences that impact the management of the
goods portion versus management of the service portion. There are also many
similarities between the two.

Production of goods results in a tangible output, such as an automobile, eyeglasses,

a golf ball, a refrigerator—anything that we can see or touch. It may take place in a
factory, but it can occur elsewhere. For example, farming and restaurants produce
nonmanufactured goods.

Delivery of service generally implies an act. A physician’s examination, TV and auto

repair, lawn care, and the projection of a film in a theater are examples of services.
The majority of service jobs fall into these categories:

Professional services (e.g., financial, health care, legal).

Mass services (e.g., utilities, Internet, communications).
Service shops (e.g., tailoring, appliance repair, car wash, auto repair/maintenance).
Personal care (e.g., beauty salon, spa, barbershop).
Government (e.g., Medicare, mail, social services, police, fire).
Education (e.g., schools, universities).
Food service (e.g., catering).
Services within organizations (e.g., payroll, accounting, maintenance, IT, HR,
janitorial).
Shipping and delivery (e.g., truck, railroad, boat, air).
Residential services (e.g., lawn care, painting, general repair, remodeling, interior
design).
Transportation (e.g., mass transit, taxi, airlines, ambulance).
Travel and hospitality (e.g., travel bureaus, hotels, resorts).

Miscellaneous services (e.g., copy service, temporary help).

Similaraties between production of goods and provision of services:

a. Forecasting and capacity planning to match supply and demand.

b. Process management.
c. Managing variations.
d. Monitoring and controlling costs and productivity.
e. Supply chain management.
f. Location planning, inventory management, quality control, and scheduling.

Differences between production of goods and provision of services:

Characteristic Goods Services

Output Tangible Intangible
Customer contact Low High
Labor content Low High
Uniformity of input High Low
Measurement of Easy Difficult
productivity
Opportunity to correct High Low
problems
before delivery
Inventory Much Low
Wages Narrow range Wide range
Patentable Usually Not usually

Many service activities are essential in goods-producing companies. These include

training, human resource management, customer service, equipment repair,
procurement, and administrative services.
Though, that most systems involve a blend of goods and services.