Services Management - Essay Example

Services Management By of [Word Count] Introduction In every business setting, there is need for sound and effectively managed service processes, which are necessary in the execution of certain integral roles and the realization of specific goals in these organizations. For an illustration, banks require loan processing services while an automobile company requires mechanical services while a human resource department may need new employee orientation services. Thus, it is rather apparent that service processes, people, and resources are rather integral to businesses’ operating margins. Thus, to succeed or perform well, businesses must not only model but also measure, improve, and modify their efforts and strategies that seek to effectively manage service processes, peoples and their resource allocation and utilization (Barnes, 2000). The main avenues by which effective service process, people, and resource allocation management help ensure businesses perform well include the improvement of customer experiences, the reduction of service delivery costs, reconfiguration of service processes, and the familiarization of process people with a business’ processes (Schmitt, 2003). Additionally, effective service processes and people/provider management helps in the continuous development of service processes to meet customer expectations. Included among the roles of service providers to an organization are taking of orders, giving advice, making good business image, delivering services, training and coaching leaders and employees, and handling of complaints (Johnston & Clarke, 2010). This paper explores how the effective management of service processes, service people, and resource allocation and utilization affects the performance of sample service business, the Virgin Trains. Specifically, this paper discusses these issues with regards to the purpose, application and limitations and how the effective management of these areas might contribute to the success of the organisation under study. Effective Service Processes and People Management That effective service processes and service people management helps Virgin Trains to benchmark against competitors and assists them in the identification of opportunities to improve so that their service processes are component-based, standardized, and personalized is undeniable (Rummler & Brache, 1995). Further, effective service process management enables the firm to practice with different process models, applications, and teams of service process experts and transformative specialists. Appropriate and effective resource allocation and utilization are the other aspects of services that grossly affect the performance of the business. The firm also uses resources of various kinds for equally a wide range of activities and processes such as machines, materials, and tools/equipment, their handlers, customers, service providers. Other resources such as warehouses, automated storage, and retrieval systems are used by the firm as storage resources while trucks, rail transport, and air-cargo are classified as logistics resources. Similarly, human resources such as technical and scientific personnel and manual labor are quite central to the success of the business (Obeng & Crainer, 2003). Finally, there are financial resources such as stocks and working capital, which are the keystone for the business. Notwithstanding the type of resource in question, it is imperative that every business and its leadership allocates and utilizes these resources efficiently not only to maximize the level of services offered to clients but also to optimize inventory levels and net income, and to minimize lead times. Unfortunately, the apparent scarcity of resources has constantly constrained the level of productivity of businesses, prompting them to design mechanisms that would aid them in effective decision making with regards to resource allocation and utilization (Davenport, 1993). Service Process Management Being a service-oriented business, Virgin Trains has the mandate to ensure that all of the services it offers, the processes by which they are produced, the resources therein allocated and used, and the people involved in these processes are delivered to its customers in the right quality to satisfy their needs (Kohlbacher, 2010). Thus, in realizing its objective to satisfy and support customer needs and desires, Virgin Trains requires effectively managed and delivered service processes, resource allocation and utilization and service people management. In general, service management is pretty integral to the delivery of services and other products to clients. As a matter of fact, service management is quite a generic term that cuts across many industries and trades. For instance, many an organization integrates service management into supply chain management to connect their actual sales and clients (Thoenssen & Lobo, 2010). In this regard, service management ought to target high performance and improved productivity, more so in the service-intensive businesses such as rail transport. One reason effective service management is vital for Virgin Trains’ success is that the organization may require more intensive integration and huge volumes of inventories, inconsistent and uncertain demands, huge volumes of information, and product/client flows among other factors. Further, the need to coordinate many activities, processes, resources, and persons involved in its businesses necessitate the effective management of service processes, people, and resources by the firm (Rummler, 1996). Besides improved performance, there are other numerous benefits that accumulate from the effective management of service processes, people, and resources at Virgin Trains. It is these benefits, among others, that should drive the organization’s leadership, owners, and workers to effectively manage service processes and people. One benefit of an effective management service process and service people and effective resource allocation and utilization is the reduction of service costs. This may be achieved via the integration of services and products in the firm’s supply chain. The other aspect of a business that service process and service people management reduces is the inventory levels of service processes and parts, in the process reducing the overall inventory cost (Hut, 2009). Third, the quality of customer service could be optimized via effective management of process services and people and resource allocation and utilization, which also increases service revenue in the long-term. Related to this benefit is the reduction of obsolescence costs of service parts via better forecasting. In essence, these benefits would translate to improved customer satisfaction levels. Also included among the mentioned benefits are reduced expediting costs and minimized visits by technicians since many process-people would be in a position to fix most of the service-related problems the firm encounters (Harrington et al., 1997). To achieve these benefits, Virgin Trains must have certain elements in its service management strategies. These elements include but are not limited to service strategy, service offerings, service portfolio management, service strategy and definition, service offerings positioning, go-to-market strategy, inventory management, fulfillment operations, logistics, field service management effectiveness, activity scheduling, service billing, customer management, order management, partner management, and customer insight (Gong & Janssen, 2011). Other elements are assets, maintenance, task scheduling, event management, and asset management/optimization. Before the quality of services offered to clients by the firm hits alarming and nonproductive levels, it is of the essence that team and organizational leaders and lower cadre employees ensure there is adequate initial and continued training for employees (Hut, 2009). Additionally, the servers of the organization’s products should be conversant with the clearly set standards regarding their profession and products. It is also important that these servers have expansive knowledge of the products they deal in and the various supplies related to the products. Besides the establishment of clear standards that would help the organization to realize quality products and compete fairly in the aggressive business atmosphere, efficient facility design is the other benefit of service management that would positively affect the business’ success (Harrington et al., 1997). In this context, effective service process management would ensure that firm’s service people/employees are organized in their work stations, thus helping them perform efficiently. For instance, an efficient design for a service process should avail ample space in work stations. Hence, the staffs would be quite comfortable and success in a work station not only because it is clean but also because they would be better placed to understand the owner’s expectations depending on the process designs and the equipment availed for their use in doing their jobs and delivering services (Strativity Group, 2009). Related to service process management is the allocation and utilization of business resources. It is undeniable that businesses that put into use effective resource allocation and utilization (management) measures soon record improved performance due to the efficient use of the said resources. Unfortunately, many an organization has been shown to misuse, underutilize, and over utilize their resources. To resolve these issues and bring an organization back on track, it is of the essence that businesses refocus on effective resource management that emphasizes the assessment of resource utilization and the actual utilization, in the end, identifying their most valuable and efficient uses (Smith & Fingar, 2003). Among the benefits that a business may accrue from effective resource utilization and allocation practices include availing information for managers to know when a business needs to downsize or expand its resource allocation and utilization or to whether resource are being misused, underutilized, or needs maintenance. Effective Management of Service People Besides processes and non-human resources, service people are the other components of service businesses that ought to be properly managed to ensure business success. That a service business such as Virgin Trains could be involved in rather complex and diverse activities and the production of various services implies that it should work towards the development of service people policies and programs that promote effective people management. Such policies and frameworks would serve as pillars not only for high business performance but also for building trust, confidence, and to achieve satisfaction among its clients and employees (Ryan, 2009). Effective service people management also goes a long way in assisting businesses keep abreast with the ever changing business environment and context and other emerging challenges such as globalization, diverse business situations, fiscal considerations, and fast paced change, all of which must be addressed if a business has to continue in offering excellent services to its customers (Harmon, 2007). It should also be clear to businesses that effective service people management is not limited to the transactional activities related to human resources such as leadership, values and ethics and employee engagement and development, often associated with business culture of excellence. In the contrary, service people management should be considered integral in the struggle to achieve a business’ operational goals. In this regard, service people management can be fast achieved via sustained investment of time, other resources, and leadership (Efraim, 2002). That is, all the managers, employees, and personnel department in an organization should be fully engaged in managing service people. Fundamental Principles on Service People Management To realize a service people management that would help in performance improvement, Virgin Trains ought to adopt an approach that is based on past changes besides empowering it to manage its process people in a manner that best supports the accomplishment of its objectives. Such a policy framework should also put into consideration the latest legislations, common people management principles, interparty collaborations, and effective risk management practices (Hut, 2009). As such, the firm’s people management policy should aim at attracting and retaining talented recruits and maximizing the potential of its workers in meeting both current and future business objectives (Cook, 1996). Also core to effective management of process people is the work environment, which ought to offer meaning, fair, ethical, and supportive work to employees. Such an environment should also foster leadership, offer clear directions, engage employees via demonstrations and promote ethical and professional values. It is also important that the business’ policy framework on its service people supports investment on infrastructure of people and systems that promote high quality people management services. For its service people management strategies and policies to translate into business success and improved performance, Virgin Trains needs to base such a policy on certain fundamentals. These are the core principles that the business needs to apply and guide its people management decisions. The first principle is that of people management based on governance in the entire business, more so its core administrative wings. The second principle is that of the recognition of the existence of staff and responsibility interdependency across departments and processes (Hut, 2009). Third is managerial and ownership support to corporate management of service people. The policy framework adopted by the firm should prioritize high risk areas or issues, respect for the primary role and authorities in the exercise of their responsibilities related to employee management. Fourth, the business should grant its processes and management the flexibilities to respond to emerging business needs. These principles can only be lived by if the firm’s people management practices are aligned in a particular manner by focusing on leadership, employee engagement and empowerment throughout the firm’s levels (Anderson, 2009). Second, the firm’s employee base should portray linguistic duality and diversity of backgrounds and skills. Other people management practices that should be fostered in the firm are a respectful workplace that promotes inclusiveness and dialogue, innovation, creativity, accountability, trust and a collaboration spirit. The Role of Leadership An important component of service people management is leadership, which must aptly address the various pressures that workers encounter at the workplace. In this regard, despite these pressures, the leadership should continuously motivate service employees for optimized delivery and productivity on their part (Vom Brocke & Rosemann, 2010). Importantly, the means by which pressures such as organizational and customer-related pressures may be eliminated or reduced should be devised. Regarding customers, pressures occur due to unrealistic expectations, anxiety, and customer incompetence among other sources (Scheer, 2007). It is imperative upon the firm’s leadership to ensure these pressures do not impinge on worker motivation or cause poor customer relations, stress, and anxiety. The other sources of pressure that the firm’s leaders should address to eliminate or minimize their impacts on service people are its reward and appraisal systems, performance targets, service designs, processes, and the allocated resources (Ryan, 2009). The following are some of the ways in which the leadership of Virgin Trains may manage and motivate its service people, thereby improving the overall performance of the business. First, the firm should offer inspirational leadership that would go a long way in fostering teamwork and power in the entire system (Vom Brocke & Rosemann, 2010). Second, the firm should make clear the roles and responsibilities of each of its service providers. Third, it should promote effective communication and establish the requisite machinery and mechanisms for communicating to its employees. This inclusive communication would be quite influential in involving employees and incorporating their ideas and other forms of input in the improvement of the firm (Shaun & Wheeler, 2002). In the process, the firm’s service providers, more so its employees would feel that they own the processes and the firm’s customers (Johansson et al., 1993). The employees may be involved by empowering them to influence work procedures and arming them with the right knowledge to understand and expand their level or contribution to organization operations and performance. Further, employees should be armed with information on the results so far achieved and the measures that have given the firm the competitive edge it has in the market (Hammer & Champy, 2007). Since customers are equally important to Virgin Trains as service providers, service specifiers, quality inspectors, and trainers, the firm should also manage them well to improve its performance (Rae, 2006). The firm should therefore motivate, train, and select its customers besides defining its own customer competence. Conclusion For Virgin Trains and any other business for that matter, to realize improved service delivery and performance emanating from effective service process and people management, it is imperative that the business’ processes are aligned with the wants, needs, preferences, and tastes of its clients and employees. Such an alignment is quite an effective approach in promoting business effectiveness, efficiency, flexibility, technology use, and innovativeness. In addition, there should be a continuous attempt by the company to improve its processes. In other words, the firm should adopt a "process optimization process." This approach replaces the functionally focused and traditionally hierarchical management approaches that most businesses practice with more effectiveness and capabilities to generate revenues and reduce costs. Importantly, Virgin Trains ought to regard its service processes, service people, and resources as strategic assets, which must be well managed, understood, and constantly improved to help the business add value to its products and services. Finally, Virgin Trains may adopt sound process governance in which it would allocate its processes and work towards realizing its objectives in both its operational and progress-related sections. Such an approach would entail the use of the following tools: the strategizing of functions and processes, establishing a baseline for its process and process improvement, simulating process changes, comparing various simulations to identify an optimal improvement, and selecting and implementing suggested improvement. Finally, the firm ought to deploy all its implementation and monitor the said improvements. References Anderson, C. (2009) What are the top ten core business processes? Bizmanualz. Barnes, D. (2000) Understanding business processes. 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(2009) “People, Process, and Performance Management in Project Management.” Retrieved on February 18, 2013 from http://www.pmhut.com/people-process-and-performance-management-in-project-management. Johansson, H. J. et al. (1993) Business process reengineering: break point strategies for market dominance. John Wiley & Sons. Johnston, R. and Clarke, G. (2010) Service operations management: improving service delivery third edition. FT, Prentice Hall. Kohlbacher, M. (2010) "The Effects of Process Orientation: A Literature Review". Business Process Management Journal, 16 (1):152. Obeng, E. and Crainer, S. (2003) Making re-engineering happen. Financial Times & Prentice Hall. Rae, J. (2006) "The Importance of Great Customer Experiences". Business Week. Retrieved on February 18, 2013 from http://www.businessweek.com/stories/ 2006-11-26/the-importance-of-great-customer-experience. Rummler, G. A. (1996) “Redesigning the Organization and Making It Work.” CMA Magazine, 70(5). Rummler, G. 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(2010) Handbook on business process management: strategic alignment, governance, people and culture (International Handbooks On Information Systems), volume 1. Berlin: Springer. Appendix I Virgin Trains Virgin Trains is to a UK company that operates trains. It is jointly owned by the Virgin Group and the Stagecoach. However, the Virgin Group is the majority shareholder with 51% compared to Stagecoach’s 49%. Specifically, Virgin Trains offers long-distance passenger services, mainly on the West Coast Main Line connecting Greater London, the West Midlands, North West England, North Wales and Scotland comprising the cities of Birmingham, Manchester, London, Liverpool, Edinburgh, and Glasgow. Among the services the Virgin Trains offers include First Class aboard a Class 390 Pendolino, First Class aboard a Class 221 Super Voyager, Pendolino 390001 Virgin Pioneer at Watford Junction, and Standard Class aboard a Class 390 Pendolino. Just like any other business entity, Virgin Trains has encountered both good and bad times since its entrance into the transport industry. For example, between 2001 and 2006, the company performed rather dismally compared with its competitors. Nonetheless, with the subsequent improvements in punctuality initiated by the company following this dismal performance, its performance improved significantly in the following years. Several core values drive the operations of Virgin Trains. These include its belief that rail transport has a rather core and clear role in sustainable transport for which it must take the lead. Similarly, the company recognizes the impacts of its operation such as carbon emissions, which affect air quality and affordability to security. The firm thus strives to reduce the levels of its negative impacts on the environment while accentuating the positive impacts. Core among the values of the business are safety, security, sustainable development in rail transport, reduced carbon emission, energy efficiency, sustainable stations philosophy, waste and recycling, employee engagement and empowerment, and community work. Read More