W8

Question 1

the rise of services

Answer 1

• increasing dominance of the services sector (finance/ legal/ tourism)
• explosions in services terminology
• ops and supply still equated with manufacturing

OE - original equipment - means a component fitted as part of initial manufacture

MRO - Maintenance, Repair, Overhaul - means downstream aftermarket care

Question 2

servitisation

Answer 2

• an organisation increasingly develops services in order to add or extend product value
• example = extended warranties on cars
• services is about adding value costa don’t just provide coffee but the value of socialising with customers
• add ons to services is what servitisation is - phone has access to calling people but the servitisaiton is other apps like music and camera

Question 3

services: how they are created
(diagram)

Answer 3

• processing the inputs make them outputs to the customer (OPERATION)
• you cannot provide services without a customer experience (PRODUCT)
• delivering services involves inputs combined as part of a process experience which leads to an outcome
• all involving the customer and in a relatively short period of time

Question 4

why develop new products and services

Answer 4

• 3 important points of developing new products
  1. efficiency
  2. timing
  3. innovation
• firms that get to market faster and more efficiently with products that are well matched to the needs and expectations of customers create significant competitive leverage

Question 5

the value stream framework

Answer 5

• how firms change position in supply chain to gain value
• framework identifies implications of moving based on capabilities - also defines system integration function

(look at diagram)

GO DOWNSTREAM

• moving between concept and disposal each step needs innovation
• each stage should have a different innovation strategy

traditional emphasis:
- build to price, cost plus contracts

future focus - in service support
- through life management

Question 6

through life management (look at diagram)

Answer 6

• If the customers overall experience is smooth they are more likely to stay with the company due to their smooth operations.
• Through life management is about managing extended lifecycles and offering better long term service to the customer
• Extending product or platform life means increasing the opportunity to generate revenue by offering integrated support services

Question 7

product service systems (PSS) (DIAGRAM)

Answer 7

• PSS has evolved to describe integrated bundles of customer focused products, services and knowledge based activity which increased the value of a core offering (Aurich et al, 2006)
• Left are physical product components
• Right is non physical service components
• At the core is physical - for example a phone
• Outside is the services - subscriptions for the phone etc.

Lifecycle benefits - upgrades with companies like EE or get some money back when u dispose of ur phone

Question 8

leasing - the end of product ownership

Answer 8

• Leasing models offering customers complete service packages have become increasingly attractive
  ○ Emphasis on power by the hour, pay per use and customised added value services for specific customer requirements
• Example washing machines
  ○ if you own a washing machine and it breaks down you have to repair it with all the costs
  ○ If you lease it all the maintenance costs go to samsung not you
• leasing = more sustainable can lead to circular economy

Question 9

product - service innovation (diagram)

Answer 9

• two things to develop products and services
  1. operations and supply resources
  2. market requirements
• both need to be researched equally to make an impact on product service industry