Attempt all the questions.
Section-A
Question1) How do such concepts as TQM, ISO 9000, Malcolm-Baldrige Approach, and Six Sigma relate to managing and improving productivity and service quality?
Question2) Explain the application of information technology in service operations
Question3) What do you mean by service operations? Describe with suitable examples.
Question4)(a) What are the key drivers for increasing globalization of services?
(b) How does the nature of the service affect the opportunities for globalization?
Section-B
Case Study: Pay Only if Delivered
Sunny and his wife Rekha both had degrees in hotel management, with specialization in catering and hospitality, respectively. Both were working at Host, a restaurant located in a busy business area. The area had the stock exchange and offices of many companies in India including reputed business houses, business and financial consultants, and multinationals. The area was known as the financial district of the city.
Sunny and Rekha were keen on starting an enterprise of their own and were looking for the right business opportunity. At Host, Sunny was working in the restaurant and Rekha was supervising the dining area and was handling customer relations, billing and the cash register. So, between the two of them, they had the required experience in almost all the functions to run a food business.
Rekha had observed that most of the guests coming for lunch to the Host were investors, stock brokers and bankers, and their business operations were concentrated at the stock exchange. Since the lunch break was only for half an hour, they could not afford to be out of their business premises for a long time. Sunny and Rekha once visited the stock exchange to study the workplace of their guests and realized how hard pressed they were for time. They were convinced that if they could offer these customers an appealing lunch at their workplace, they would certainly develop a good clientele. The customers would be able to relish their lunch, as they would get more time for eating.
They started talking to a select list of potential customers about the service they were planning to introduce. They found that their concept was liked by most of them. A demand for onsite food service was established. Sunny and Rekha worked on the economies of this service and came to the conclusion that they could build a very profitable business. So, they decided to quit their jobs and start the on site food delivery service.
The focus of the service was ‘quality food delivered on time’. The operational strategy was very simple, but focused. They practiced the following service procedure:
The customers would order their food by 10 a.m. and indicate the time when they wanted the delivery.
The delivery time was fixed at 11 a.m. So, all food had to be filled, packed, labeled and sorted out by 11 a.m.
The delivery boys had to report at 11 a.m. to pick up their packs. The delivery boys were selected on the basis of their location in the customer area, their knowledge of the topography, and distribution skills.
The client base of 70 people, located at seven different places, was served by seven delivery boys, with each handling 10 customers whose offices were located either in the same building or in the immediate vicinity. The distribution strategy and mode was designed on the basis of client dispersion in the segment.
Their work-study had indicated that each delivery boy would deliver the food and return the empty cases within one and half hours form the start of service. The kitchen was located five kilometers away form the business offices.
In the same area, there were four other organizations that more providing a similar food delivery service and Sunny and Rekha had to compete with them. Being a new entrant, they had to have a clear-cut strategy to gain a competitive edge. They decided to adopt a pro-active strategy. They started providing a service guarantee, stating, ‘Not delivered as promised – don’t pay for it.’ Their main focus was speed of services (SOS) and delivery on time.
As a result of the service guarantee and its fulfillment, their service acquired the reputation of accessibility, reliability and responsiveness. More and more customers were willing to enroll themselves as regular members for this service. The other suppliers in the same area were not willing to match the service and the guarantee. Their customers started leaving them. This helped Sunny and Rekha to consolidate their business.
The increased flow of customers was inducing Sunny and Rekha to expand the business. The collective experience of both also convinced them to go ahead for expansion and enter to the larger segment they had identified and they were confident of further success.
Case Questions:
Question5)a) Identify the core and supplementary services in the above case. Elaborate on their importance.
b) “Identification of customer need is the key for success in services sector” Justify this statement in light of the case.
c) What could be the possible drawback of using service strategy such as “Not delivered as promised, don’t pay for it”?