Service Design

5-1

Lecture Outline
Service Economy Characteristics of Services Service Design Process Tools for Service Design Waiting Line Analysis for Service Improvement

5-2

Service Economy

5-3

U.S. Economy

5-4

Characteristics of Services
Services
acts, deeds, or performances

Goods
tangible objects

Facilitating services
accompany almost all purchases of goods

Facilitating goods
accompany almost all service purchases

5-5

Continuum From Goods to Services

Source: Adapted from Earl W. Sasser, R.P. Olsen, and D. Daryl Wyckoff, Management of Service Operations (Boston: Allyn Bacon, 1978), p.11.

5-6

Characteristics of Services
Service are inseparable from delivery Services tend to be decentralized and dispersed Services are consumed more often than products Services can be easily emulated Services are intangible Service output is variable Services have higher customer contact Services are perishable

5-7

Service Blueprinting

5-8

Elements of Waiting Line Analysis

Operating characteristics
average values for characteristics that describe performance of waiting line system

Queue
a single waiting line

Waiting line system

consists of arrivals, servers, and waiting line structure

Calling population
source of customers; infinite or finite

5-9

5-10

Elements of Waiting Line Analysis

Arrival rate ()
frequency at which customers arrive at a waiting line according to a probability distribution, usually Poisson

Service rate ()
time required to serve a customer, usually described by negative exponential distribution

Service rate must be higher than arrival rate ( < ) Queue discipline
order in which customers are served

Infinite queue
can be of any length; length of a finite queue is limited

5-11

Elements of Waiting Line Analysis

Channels
number of parallel servers for servicing customers

Phases
number of servers in sequence a customer must go through

5-12

Operating Characteristics
Operating characteristics are assumed to approach a steady state

5-13

Traditional Cost Relationships

As service improves, cost increases

5-14

Basic Single-Server Model

Assumptions
Poisson arrival rate exponential service times first-come, first-served queue discipline infinite queue length infinite calling population

Computations
= mean arrival rate = mean service rate n = number of customers in line

5-15

Basic Single-Server Model

probability that no customers are in queuing system average number of customers in queuing system

P0 =

( )
1
n

L=

probability of n customers in queuing system

n

average number of customers in waiting line 2 ( )

Pn =

( ) ( )( )
P0 = 1

Lq =

5-16

Basic Single-Server Model

average time customer spends in queuing system 1 L = probability that server is busy and a customer has to wait (utilization factor)

W=

average time customer spends waiting in line ( )

probability that server is idle and customer can be served I=1 =1 = P0

Wq =

5-17

Basic Single-Server Model Example

l = 24 m = 30

5-18

Basic Single-Server Model Example

5-19

THANK YOU

5-20