Service systems


The process performed by the service systems for providing services is functionally called ‘Service operations’. They are those operations which do not produce tangible products. They are also known as non-manufacturing operations. Service operations can be classified as

(a) Standard services.
(b) Customer services

This classification is according to the degree of standardization of the outputs and the process performed by the service systems.

Service systems do not hold finished goods inventories and the demand or their output is highly variable from time to- time (e.g. hour to hour, day to day and week to week). Their operations are labor intensive. The principal means of performing the services is through personnel. Hence, personnel scheduling becomes quite complex because the demand the demand for services is highly variable and services are consumed as they are produced.

Service systems providing standard services are more like product-focused manufacturing systems. Services are standard for most customers and the processes once begun, are carried through to completion without significant delays. The only difference as compared to product focused manufacturing is that services are produced according to customers order rather than for finished goods inventory.

Example of service system providing standard services are transport companies, fast food restaurants, postal services, airlines etc. Sophisticated scheduling such as on-line computer based scheduling systems, are used in the airlines.

Service systems providing customer services are like job shops in their characteristics and hence, their scheduling systems are much like that of job shops. In small services such as doctor’s clinics, small retailers and local transport companies, no formal scheduling systems are employed. Simple scheduling devices such as appointment schedules, take-a-number system (i.e. token system) or first-cum-first-served rules are used to assign priorities to the customers. Part-time workers and stand-by equipments are frequently employed during high demand periods.

Service systems such as hospitals use more sophisticated scheduling systems than that, found in job shop manufacturing. These systems are also produce-to-order system and as finished goods inventories cannot be maintained, capacities must be variable to meet wide variations in customer demand levels. Since customer demand is highly variable from time to time (i.e. day to day, or week to week) and services must often be provided on short notice, the scheduling system work on short planning horizon. (That is usually a planning horizon of one week). In setting priorities among patients at each work center in a hospital, the hospital might use most critical need criteria just like in a job shop, where a first-cum-first served criteria is used.

Scheduling Personnel in Services

Four approaches that are usually used by operations mangers in service system are

Ø Use of waiting lines (based on first-cum-first served priority) as a buffer for the difference between customer demand and system capacity (when demand is more than capacity). This approach enables operation managers to schedule personnel to maintain uniform system capacity from time to time (day to day or week to week).

Ø Use of appointment schedules to level out the demand for services. This approach enables operation managers to schedule personnel so that the system capacity is almost uniform. For example appointment schedules are commonly used in medical, legal and other professional services. Priority system in hospitals and medical clinics allow emergency patients to be admitted on a priority basis and the remaining patients are admitted by appointment.

Ø Personnel schedules are developed to allow system capacities which almost match the pattern of customer demand. The system capacity is varied by varying the number of personnel scheduled to work during each hour of the day. Part time personnel may be employed during periods of peak demand in addition to the full time personnel.

Ø For emergency services, such as fire departments or police departments, scheduling of personnel is done for 24 hour full crew coverage. During low-demand period, the crews perform not only necessary but non-emergency tasks also. During peak demand periods, off-duty personnel are called in and are compensated with overtime payment or compensating time-offs.

Three general difficulties encountered in scheduling personnel in services are (a) demand variability (b) service time variability and (c) availability of personnel when they are needed. It can be seen that operations managers develop personnel schedules based on approximately uniform system capacity or highly variable system capacities. The uniform capacity approach is accompanied by other means of leveling out demand viz., appointment schedules, priority systems and waiting lines (queues).