The implementation of operations management techniques in service organisations

Abstract

Purpose This paper seeks to present an empirical snapshot of the application of operations management (OM) activities in Australian service firms. The four key areas addressed in this study are the nature or characteristics of services, the level of importance of OM techniques, the level of importance of performance indicators, and the challenges encountered by the management of service firms. Design/methodology/approach The empirical data for this study were drawn from 190 managers of the Australian service organisations whose primary responsibilities were related to the daily operations of the firms. The targeted service organisations encompassed various sectors including transportation, communication, banking, insurance, health care, education, wholesale, retail, and professional services. Findings The results indicate that most services are characterised by high customer contact and a low degree of differentiation. In terms of OM activities, service delivery, customer service and quality control received the highest priority. This result was confirmed by customer retention, on time delivery, and quality which received the highest priority among performance measures. Innovation, on the other hand, surprisingly received the least attention among the surveyed firms. Finally, building service culture appears to be the most challenging issue encountered by managers in dealing with service operations as opposed to managing facilities which raised only little concern from management's point of view. In general, there is no significant difference between Schmenner's four service types with respect to the key issues addressed in this study. Practical implications From a managerial point of view, this study provides an insight into the importance of key OM practices and strategic performance indicators in the Australian service industry. Originality/value This study builds on previous studies focusing on the implementation of OM practices carried out in the USA. Therefore, it contributes to knowledge by providing comparison with the Australian context.

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