Building and Managing modern E-services

MBA 746: E- Supply Chain Management

Presented By:
Gaurav Shah (15125014)
Sapna Tuteja (15125032)
Soumya (15125037)
Vibhu Upadhyay (15125041)
Sanjay Kumar Gupta (15114016)

Our Agenda for Today

Introduction
Service models and topologies
Supply Chain Management
Demand chain management
Value chain management
Balance score card method

Introduction to services
All products involve services and consequently maybe be
considered as service systems
Progression from supply and demand chains, to value
chains
Fully integrated e-demand and e-supply chains delivers
both services and e-services
Division of all Economies into:
Primary (agricultural)
Secondary (manufacturing)
Tertiary (services)

Introduction to Services

Services management is a trans-functional

research area which includes service quality,
services encounters and service execution
Activities, benefits, or satisfactions which are
offered for sale are provided in connection with the
sale of goods
All economic activities where output is not a
physical product and is usually consumed when
produced and is delivered as an intangible value-add
(like travel comfort) to the customer
Example: Accommodation, banking, education,
entertainment, finance, medical areas, real estate
services, transportation, as well as the individual
services etc.

Service Models and Topologies

Mathematical Models of Services (Rust & Metters, 1996)

Service Models and Topologies (contd.)

Integrated Schematic Representation of

Services
(Cook et
al.,1999)

Integrated Schematic & Service Strategy Triad

Services could be split into:

Marketing (product) & Operations (process)
orientations
Need to integrate and interact with both orientations

Service strategy Triad:

Separate the what, the how, and the who of
service encounters
The who defines the right targeted customers

Five Elements of Service Strategy Triad

Service Delivery Systems Architecture

Framework to investigate three interrelated and dynamic components of service.

Strategic service design

Portrayed as structural, infrastructural, and integration of major supply

Service delivery execution system

Exemplified by programs, policies, and behavioural aspects delivering complimentary areas of customer focus
Customer perceived value of the total service concept

Intangibles and other effectiveness aspects of the service

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Service Delivery Systems Architecture

(Roth & Menor, 2003)

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Service Models Analysis

Above models indicate that delivery of services requires the business to adopt both an internal and an external
perspective
Services may be considered from a marketing or an operations focus
Business-customer service encounters may be considered as combinations of three functional areas the customer, the
service product, and the service delivery system
Business-customer service encounter may arise where the customer perceived improved customer value with the
services provided or in the services package being delivered
The businesss supply chain became an integral delivery tool for the final upstream service provider
To deliver customer expectations: Requirement of Sound supply chain integration and management, the integration of
the above functional areas, and quality communications channels throughout the supply chain network

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SUPPLY CHAIN MANAGEMENT

A Hot topic in business (Chase et al., 2005)

Integration of business processes from end-user to original
suppliers
Link between manufacturers operations with strategic its
suppliers
To improve timing and cost in manufacturing through strong
vendor relationships
It seeks to integrate the relationships, and operations, of both
immediate, first-tier suppliers, and those several tiers back in the
supply chain

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Fishers Framework & Lees Contribution

Fisher identified specific functional products like lifecycle,

percentage contribution margin etc.
Each category required a different kind of supply chain and
mismatches between product type and supply chain could be
identified
Lee defined the stable supply processes as well as the evolving
supply processes
Challenge for the market was to implement an agile or responsive
model

Role of INTERNET
To provide communication and Inter-Business connectivity
For near instantaneous, enhanced information flow
To deliver responsive and agile supply chain strategies
Nurturing new supply chain solutions in information storage and transmission, e-business, e-CRM etc.
Thereby helping to deploy highly innovative and responsive agile supply chains without being rigid in its service offerings

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Demand Chain Management

Aims to serve individual customers with customized

bundles of goods and services to deliver high level of
customer satisfaction
It must balance a globally diverse mix of new customers
(each with different needs and expectations), as well as
offer a degree of uniqueness to the business
Thus aiming to constantly improving its efficiencies
Beechs argument for an integration of the supply and
demand chains led to the need of three key elements

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Beechs Model

The key elements are:

The core processes of the supply and demand chains, as
viewed from a broad cross-enterprise vantage point, rather
than as discrete functions
The integrating processes that created the links between the
supply and demand chains
The supporting infrastructure that made such integration
possible

Demand and supply chain process (Source: Beech, 1998)

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Comergents Simplification of External Sales

Process
The five key areas are:
Analytics and metrics
Product information management
Pricing, configuration, and quoting
Distributed order management
Commerce portal
The external sales process (Source: Comergent, 2003)

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Value Chain
The overview of customer
value:

Equations describing
business and customer value:

Linked to the use of a

product or service, thereby
removing it from personal
values

Business value = (Benefits of each

delivered value chain activity minus
its cost) +(Benefits of each service
interface between value chain
activity minus its cost)

Perceived by the customers,

rather than
objectively determined by the
seller
Often traded between what
the customer wants
(including quality, benefits,
worth),and what the customer
gave up to acquire, and use, a
product or service

Customer value = (Benefits of each

customer service interface
interaction) + (Benefits of each
added value business offering) +
(Benefit perceived for the cost
involved)

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Value Chain Management

Sampson (2000) demonstrated that service supply chains were bi-directional, and that communication between customers and
suppliers, and vice versa, must occur.
Sampson also indicated bi-directional supply chains were typically short lived, but had just-in-time implications with inherent valueadded expectations.
To measure such information, new metrics tools have been devised.
Management has increasingly incorporated such tools to interpret their Web tracking data, and to apply these findings throughout the
demand-supply chain. Thus new levels of recording, understanding, and interpreting value-adding solutions have emerged.
These metrics tools helped management to:
Convert and distribute information, products, and services
Manage knowledge, quality, and connectivity
Work with virtual partners and customers
Deliver strategic information to management

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Value Chain Model Progression

Modern value chain (Source: Slywotzky & Morrison, 1997)

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Service Value Chain

A more recent variant of the value chain
Refer to optimizing after-sales service situations right across
the service supply chain
The service supply chain was seen as one that, over time,
delivered the fully collaborative state of low inventories,
efficient planning, and high customer service levels
Beck suggested groups of equal business partners would share
their specific, market-leading competencies, identify a group of
similar buyers, and would deliver the required vertical solution
repeatedly, reliably, and cost effectively
Service value chain aggregator (Source: Beck, 2002)

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Service Value Network

Service value chain approaches involve combinations of:
External supply chains
Internal value integrators
Various strategic approaches

This complex aggregated structure is thus better termed a service value network
A service value network may be defined as the flexible, dynamic delivery of a service, and/or product, by a business
and its networked, coordinated value chains such that a value adding, and target specific service and/or product
solution is effectively, and efficiently, delivered to the individual customer in a timely, physical, or virtual manner.
(Hamilton, 2004)
Service value networks interlink the understanding and deliverability of the businesss
Downstream business e-supply chain networks
Upstream customer service offerings

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Balanced Scorecard Approach

Developed by Kalpan and Norton (1992)

Strategic planning and management system (decision making
approach)
Performance measurement framework
Allows high growth rates to be defined and targeted
Differentiates competitive advantage
Delivers considerable measurable
financial rewards
Service value network concepts fits

Balanced Scorecard model

Balanced Scorecard Approach (contd.)

Balanced scorecardnine-step strategy development cycle model (Source: Rohm,2002)

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Balanced Scorecard Approach (contd.)

The model begins with the development of the visionary strategy
Delivers a global business perspective
Increased customer numbers and New revenue streams
Greater cultural understanding and improved community involvement
Up-skilling of the operational staff and the business itself
Customers must be targeted to receive their expected outcomes
The business block must develop its skills (and knowledge) and provide improved solutions
The internal processes must meet all legislative and business-specific requirements (like dispensing provisions)
Finally, a set of financial outcomes (tangible and intangible) must be delivered

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CONCLUSION

Models lack a customerization approach and need further enhancements

The balanced scorecard offers a strategic measurement agenda allowing management to monitor tangible and
intangible service factors
Mechanism underpinning these service value network allows industry and its management to cohesively move
forward towards an enhanced competitive position - delivering a GLOCAL (Global & Local) solution

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