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Service Chain: by Amardeep Ukrande Amrita Tripathi Apurva Kulkarni Rucha Vaidya Yashasvi Sanghavi

The document discusses service chains and spare parts management. It defines a service chain as providing after-sales services like installation, maintenance, and repairs to customers. Service chains aim to optimize processes like technician scheduling, spare parts inventory, and customer service. Establishing an efficient service chain can reduce costs, improve customer satisfaction, and increase revenue. The document also discusses types of service supply chains and implications for management, like location decisions being customer-based. Outsourcing some services is also reviewed. Spare parts management seeks to satisfy customers' parts needs at the right time, place, price, quality and in usable condition. The repair cycle and replenishment lead times impact spare parts effectiveness.

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Devavrat Singh
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68 views28 pages

Service Chain: by Amardeep Ukrande Amrita Tripathi Apurva Kulkarni Rucha Vaidya Yashasvi Sanghavi

The document discusses service chains and spare parts management. It defines a service chain as providing after-sales services like installation, maintenance, and repairs to customers. Service chains aim to optimize processes like technician scheduling, spare parts inventory, and customer service. Establishing an efficient service chain can reduce costs, improve customer satisfaction, and increase revenue. The document also discusses types of service supply chains and implications for management, like location decisions being customer-based. Outsourcing some services is also reviewed. Spare parts management seeks to satisfy customers' parts needs at the right time, place, price, quality and in usable condition. The repair cycle and replenishment lead times impact spare parts effectiveness.

Uploaded by

Devavrat Singh
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd
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SERVICE CHAIN

By
Amardeep Ukrande
Amrita Tripathi
Apurva Kulkarni
Rucha Vaidya
Yashasvi Sanghavi

An Introduction..
A

service chain is often superimposed on the


core Finished Goods supply chains of many
companies.
While defining a service chain, we take view of
CUSTOMER, i.e. All services have customers as
primary suppliers of inputs.
It majorly seeks to provide after-sales services,
such as installation, maintenance, repairs,
upgrades, etc. to the customers.

Characteristics
Most service-intensive supply chains require
larger inventories and tighter integration with
field service and third parties.
They also must accommodate inconsistent
and uncertain demand by establishing more
advanced information and product flows.
Moreover, all processes must be coordinated
across numerous service locations with large
numbers of parts and multiple levels in the
supply chain.

Drivers to establish an EFFICIENT


service chain
Reduce

high service costs, i.e. by integrating the


service and products supply chain.
Reduce total inventory costs ,i.e. reducing
Inventory levels of service parts.
Optimised Customer service or parts/service
quality
Increasing service revenue.
Improved forecasting.
Improve customer satisfaction levels.
Minimize technician visits - if they have the right
part in hand, they can fix the problem on the first
visit.

force effectiveness

Technician enablement
Service chain optimizes
the
E-learning
Activity scheduling
following..

Service strategy and


offerings
Go-to-market strategy
Service portfolio
management

Spare parts
management
Parts supply management
Inventory management
Parts demand
management
Fulfilment operations &
logistics

Service billing

Returns, repairs, and

Customer
management
Order management &
availability
Channel & partner
management
Customer insight record.
Technical
documentation

Types of services:
Services that act on peoples :
1) Minds
E.g. education, entertainment, psychology
2) Bodies
E.g. transportation, lodging, funeral services
3) Belongings
E.g. landscaping, dry cleaning, repair
4) Information
E.g. insurance, investments, legal services

HUBS
Advantages of having short
HUBS

Service chains tend to be short (hubs) leading to


reduced complexity
Easier sharing of information
Provides individualized service for the customer
and
Cost-effective service for the service enterprise.
Acts as an agent for the customer when dealing
with outside service providers for outsourced
services.

Customer-Supplier Duality in
Service Supply Relationships
(Hubs)

Customer-Supplier Duality
The

idea is that customers are the suppliers for


the service organizations.
The customers are bringing inputs to the service
organization to be processed.
Bi-directional

Supply Chain
Production flow is bi-directional, meaning the
production goes not only from suppliers to
customers, but from customers to suppliers.

Types of Service Supply Chains


i) Single Layer Bidirectional Supply
Chain:

It means there is only one service provider


serving to customers directly.

Types of Service Supply Chains


ii) Two Level Bi-directional Supply
Chain:

It happens when the service provider employs


another service provider to assist with the
processing of customer inputs.

Types of Service Supply Chains


iii) Third type of service supply
chain
The

customer provides inputs to the service


provider and the service provider processes the
inputs and delivers them to a separate entity.
E.g. postal delivery.

Practical Implications
Bi-directional

supply chains are generally


short & consist of three stages:
- Transfer of customer inputs to service provider
- Processing by the service provider
- Transfer of processed output back to the
customer

Service

providers do not usually pay for


inputs coming from customers-suppliers
- Customers are not paid for bringing in inputs
- They will receive the inputs back after they are
processed
- They pay for the added value to their inputs.

Practical Implications
Bi-directional

supply chains are mostly JIT


- Service providers cannot regulate the inputs from
the customer-suppliers, they come at a time of
demand
- Customer expects their inputs to be processed
immediately or in a short amount of time

Bi-directional

supply chains have implicit


expectations for value added
- Value added by service providers can be easily
monitored by the customers
- Can simplify by demonstrating the real added
values, customers can see the changes made
- It can complicate because some customers have
unrealistic value adding expectations

Implications for Management


Most

of the production cannot begin until the


customer supplies the inputs

Service

outputs tend to be heterogeneous,


meaning not every service will be the exact
same for each customer.

Services

tend to be labor intensive; customers


often prefer personal treatment of their inputs,
even with significant advances in technology.

Service

based.

location decisions tend to be customer

Outsourcing
Outsourcingis

the process
ofcontracting out abusiness process,
which an organization may have
previously performed internally to an
independent organization, where the
process is purchased as a service

Outsourcing
Benefits
Allows

the firm to focus


on its core competence.
Service is cheaper to
outsource than perform
in-house.
Provides access to
latest technology.
Leverage benefits of
supplier economy of
scale.

Risks
Loss

of direct control of
quality.
Jeopardizes employee loyalty
Exposure to data security
and customer privacy.
Dependence on one supplier
compromises future
negotiation leverage.
Additional coordination.
Expense and delays.
Atrophy of in-house
capability to perform service.

Outsourcing process

Outsourcing considerations
Focus on property
Facility

support service

Low cost
Identify responsible party to evaluate performance
Precise specifications can be written
Equipment

support service

Experience & reputation of vender


Availability of vender for emergency response
Designate a person to make service call and to
check that if service is satisfactory.

Outsourcing considerations
Focus on people
Employee

support service

Contact vender clients for references.


Specifications prepared with end user inputs.
Evaluate performance on periodic basis
Employee

development service

Experience with particular industry important


Involve high level of management in vender
identification and selection
Contact vender clients for references.
Use employees to evaluate vender performance

Outsourcing considerations
Focus on process
Facilitator

service

Knowledge of alternate venders is important.


Involve end-user in vender identification.
Reference or third party evaluation is useful.
Have user written detailed specifications.

Professional

service

Involve high level of management in vender


identification and selection.
Reputation & experience are very important.
Performance evaluation by top management.

Spare Parts Chain


Spare

part/service part-

It is aninterchangeable partthat is kept in an inventory


and used for the repair or replacement of failed parts

Service

parts management-

Process of planning and aligning service parts inventories,


resources, and processes to ensure optimal customer
service and response with minimal risk and cost.

Spare Parts Chain

Repair/Replace

Service
center

Objective of Service Parts


management
Satisfy

customers by providing the necessary


parts, at the users location, for a reasonable price,
in usable condition, at the proper time

Item

Place

Price

Qualit
y

Time

Classification Of Spare Parts

Repairabl
e

Parts that are worthy of


repair, usually by virtue of
economic consideration of
their repair cost

Consuma
ble

Parts that are not repairable,


are considered consumable
parts
Scrapped when they are
found to have failed

Repair Cycle
Repairable parts are either repaired by local
maintenance capabilities, or sent out for repair by
repair providers
Repair of
Total time a part spends being repaired is known as
repairable
the repair cycle time
Parts are scrapped directly, and a replacement must
be obtained from a supplier
Replenish Time taken by a supplier to provide a replacement
ment
part is thelead time

Performance metricscan be used to evaluate the


effectiveness of the repair cycle. Key performance
Performan metrics include repair turn-around time, ready rate
ce metric
&fill rate etc.

Benefits

Cost-effectiveness
Customer satisfaction
Reduce downtime

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