Difference between manufacturing and service operations

1. DIFFERENCE BETWEEN
MANUFACTURING AND SERVICE
OPERATIONS

2. DIFFERENCE BETWEEN MANUFACTURING AND
SERVICE OPERATIONS
 Manufacturing and Service are often different in terms
of what is done but quite similar in terms of how it is
done.

For example, manufacturers decide what size factory
needed and service organizations must decide what size
building is needed.

Manufacturing and Service differ cause manufacturing
is goods-oriented and service is act-oriented.

3. PRODUCTION OF GOODS VS. DELIVERY OF
SERVICES
 Production of goods – tangible output
 Delivery of services – an act
 Service job categories
 Government (state, local, etc..)
 Wholesale/retail (clothing, food, stationery,etc..)
 Financial services (banking, insurance, etc..)
 Healthcare (doctors, dentists, hospitals, etc..)
 Personal services (laundry, dry cleaning, etc..)
 Business services ( data processing, e-business, etc..)
 Education (schools, colleges, etc..)

4. KEY DIFFERENCES BETWEEN MANUFACTURING AND
SERVICE OPERATIONS
1. Customer contact
2. Uniformity of input
3. Labor content of jobs
4. Uniformity of output
5. Measurement of productivity
6. Production and delivery
7. Quality assurance
8. Amount of inventory
9. Evaluation of work
10. Ability to patent design

5. GOODS VS. SERVICE

6. CHALLENGES OF MANAGING SERVICES
 Service jobs are often less structured than manufacturing
jobs
 Customer contact is higher
 Worker skill levels are lower
 Services hire many low-skill, entry-level workers
 Employee turnover is higher
 Input variability is higher
 Service performance can be affected by worker’s
personal factors

7. KEY DECISIONS OF SERVICE MANAGERS
 What
What resources/what amounts
 When
Needed/scheduled/ordered
 Where
Work to be done
 How
Designed
 Who
To do the work

8. DECISION MAKING

9. DECISION MAKING

10. PRODUCTION OF GOODS VS. DELIVERY OF
SERVICES
Production of goods – tangible output
Delivery of services – an act
Service job categories
 Government
 Wholesale/retail
 Financial services
 Healthcare
 Personal services
 Business services
 Education