Operations managers are very important in stabilizing organizations procedures and policies across many business areas, both in the manufacturing and service industries. However, managers in service organizations face more challenges relative to their counterparts in the manufacturing industries, especially in managing quality. Therefore, this paper discusses the particular challenges that operations managers encounter in managing quality in a service organization compared to a manufacturing organization. It will also cite several specific examples in the discussion, including customer expectations, service quality, lean practices, process mapping, and globalization.
One of the main challenges that operations managers in service organizations face is the difficulty in measuring customer expectations and satisfaction. This happens because the managers do not have an explicit measure of the customer expectations of the service, which makes it hard to interpret the customers responses in a definite manner. More importantly, operations managers may inappropriately prioritize performance improvements since they do not have a complete picture of the customer expectations (Accounts Commission 1999, p.2). As such, the lack of explicit measures of customers expectations makes it difficult for the managers to interpret and analyze such satisfaction scores. In contrast, manufacturing organizations can meet customer expectations by simply producing more quality goods.
Another challenge facing operation managers is the issue of service quality, which is achieved when organizations meet or even exceed the customer expectations. According to the Accounts Commission (1999, p.3), organizations may fail to achieve service quality when they are unable to meet or exceed the customer expectations, and this gives rise to a problem referred to as service gap. This mainly affects customer satisfaction surveys because it will require the managers to measure both customers perceptions of the services offered and expectations as well. To identify any possible service gaps, the managers conduct an explicit assessment of the customer perceptions and expectations regarding the services offered. When the gap score is negative, it means that the organization is not meeting customer expectations. For some reason, it may not be practical for an organization to surpass customer expectations. This could be because such efforts may be too costly, some expectations cannot be really achieved, or the expectations may also have risen over time (Accounts Commission 1999, p.4). It is important for managers to have information on the levels of customer expectations since this will help them understand better actual expectations of a specific service. The information on the service quality gaps can also help service managers in identifying areas that require performance improvement. However, a major problem that arises for managers in designing the customer questionnaires is determining what areas of a service should be assessed. This requires some framework, without which the questionnaires would consist of a collection of unstructured and unrelated questions (Accounts Commission 1999, p.4-5). Such survey results can be difficult to analyze in relation to the performance improvement issues.
Managing quality in both manufacturing and service industries can also be successful when managers adopt lean practices in their operations. In manufacturing organizations, it is common for the operations managers to adopt lean practices, and different manufacturers can employ most of these techniques with minimum effort (Hanna, 2007). Despite attempts by the operations managers to implement lean practices in the service industries being challenging, an increasing number of service organizations are embracing lean practices in their operations. Studies also show that the adoption of lean practices by service organizations can be beneficial in terms of lower costs, higher quality, job satisfaction, and creativity. A good example is Wipro Technologies, based in India. It is ranked among the largest product engineering and IT services companies globally. The managers at Wipro showed that applying lean practices to service industries is not just a matter of adopting tools and methods that have proved successful in manufacturing (Hanna, 2007). The company started small by first launching ten pilot projects to determine whether it was viable for them to adopt lean principles. Eight of them exhibited positive results, which prompted them to task their productivity department with leading the entire organization in adopting lean practices (Staats and Upton 2011, p.100-110). Gradually, the organization was able to identify the ideas that worked well, those that would be refined as well as those that needed to be discarded. An important lesson from Wipros experience is that making operations lean is a very long process that may take many years for successful implementation.
However, there was a time when the staff at Wipro experienced communication problems. Wipro had some members of their team in the U.S. tasked with testing software, while others were in India and their task involved fixing any possible bugs that emerged (Staats and Upton 2011 p.100-110). As such, these team members were in different locations and different time zones. Sometimes, the engineers in India were not able to replicate the errors detected by their colleagues in the U.S. They finally fixed the problem by using web video tools that recorded every step, making it easier for the team in India to detect and fix any possible problems (Staats and Upton 2011, p.100-110). It is important to note that the communication problem is not unique to service organizations. Lack of structured and proper communication in a manufacturing industry can also negatively affect its operations and service delivery. British Vita International, a global producer of fibers and polymers, provides a notable example. In one area of its operations, the company realized that there were considerable variations in the product mix whenever the production operators changed shifts (Audit Scotland 2000, p.2). Upon further investigations, it was established that it was not the operators fault; rather they were given unclear operation instructions, which led to confusion. The company made improvements to the specific process, thereby saving them more than 2,000 every week. Therefore, it is important for the operations managers in both the service and manufacturing organizations to understand the language of operations well. They should also be able to communicate fluently with other functional areas to understand the activities of other managers because this will ultimately affect the policies and decisions they make and undertake in the production of the final products or services.
Another challenge for managers is to embrace process maps in their operations. Process maps refer to diagrams showing the activities of an organization as well as how it delivers its services (Audit Scotland 2000, p.3). The mapping indicates an organizations main process, the major activities that make up every process, sequencing of the activities, inputs needed, as well as outputs produced by every activity. Process maps help managers to ensure that the activities involved in every specific process are understood and managed properly to achieve or even exceed the appropriate customer service (Shalley and Gilson, 2016, p.13). Every organization seeks to deliver services to customers through various interrelated processes, which together form a full-service delivery chain. However, a major problem in virtually all organizations is that individual processes that complete the supply chain are most assigned to different teams or departments. The customer is only concerned with the service quality and not the background processes. For quality service delivery to the customer, every individual process should be able to deliver whatever is required (Audit Scotland 2000, p.3). This implies that the strength of an organizations service delivery chain can only be equal to its weakest link. When any of its single processes fail, the organization will not be able to deliver quality service to its customers. The public sector faces further problems because most of the necessary services for the external customers require a multi-agency approach in which the individual processes may be assigned to different parts or departments of a single organization (Gunasekaran and Spalanzani 2012, p.35-36).
Additionally, estimating the capacity needs of service organizations is not similar to estimating capacity needs of manufacturing industries. Similar to manufacturers, it is important for service providers to consider several variables when estimating their capacity and demand, for instance, the number of customers, delivery time and the time it will take to serve every customer. However, managers in the manufacturing industries can forecast the overall demand, produce their products, store them in the inventory, and deliver to their customers on order. This is in contrast to the managers in service industries as they cannot store their products or services for future use (Cusumano, Kahl and Suarez, 2015). As such, service industries have to develop adequate capacity to satisfy the needs of the customers on demand basis. Overseeing successfully a service industry puts significant demands on the managers of the organizations, especially those with a high level of contact with their customers.
Service organizations also offer their customers personal attention and have to satisfy their individual needs in good time. This task can further be complicated by great variations in the demand on any particular day (Gebauer et al. 2012, p.120-136). Therefore, managers must pay specific attention to the employee work schedules so that they can be available to handle the fluctuating customer demands. Since personalized service is very important, scheduling employees is more complex within service organizations compared to the manufacturing industries (Smith, Maull and Caldwell 2014, p.242-269). Operations managers in manufacturing organizations focus mainly on scheduling activities that are required to produce the goods, whereas, in service organizations, the focus is on scheduling the workers to ensure there are enough people at any given time to serve the customers (Fitzsimmons, Fitzsimmons & Bordoloi, 2014). While manufacturers produce tangible and standardized goods, service firms produce intangible products, which are often customized to satisfy the specific needs of customers.
It is imperative to note that both the operations managers in the manufacturing and service industries are faced with a similar issue of the ever-increasing globalization. Globalization implies that the local organizations not only face increasing competition from overseas organizations, but also require that the local organizations go international (Roth and Menor 2003). To compete with other organizations from abroad, any firm will be required to remain highly competitive through providing quality products or services at affordable prices. This provides a cause of concern for the operations managers because they have to oversee the organizational functions effectively, which include planning, organizing, leading as well as controlling to ensure that their products or services remain competitive in the market. Additionally, there would be more demand for creativity and innovation by the operations managers, which are important factors for business success in thi...
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