Service Productivity Management
The service economy is now the largest portion of the industrialized world's economic activity. This development has dramatically raised the importance of maximizing productivity excellence in service organizations. The need for productivity excellence has led service organization managers to use benchmarking techniques to identify and adopt best practices in their organizations. Benchmarking has enabled service organizations to continuously improve by allowing service units to learn from methods that prove the most efficient and effective.
Service Productivity Management systematically explores complex service issues and suggests the most appropriate methods to improve service productivity, quality, and profitability. The book provides insights and methods to answer questions on a range of productivity issues: How do you manage profitability of a network of hundreds or thousands of branch offices disbursed over several states and countries? How can managed-care organizations manage the quality and cost of hundreds of physicians providing health services to millions of plan members? What methods would enable a government to ensure that the multiple offices serving citizens across a country are operating at low cost while meeting the required service quality? Each of these service settings are examples of the many service providers that deliver a complex set of services to a widely diversified set of customers.
Service Productivity Management is an in-depth guide to using the most powerful available benchmarking technique to improve service organization performance — Data Envelopment Analysis (DEA). The underlying concepts that drive DEA and enable it to increase productivity and profitability of service organizations are explained in non-technical language. It describes how DEA: (1) Identifies best practice service units; (2) Exposes high cost inefficient service units; (3) Identifies specific changes to each service unit to elevate performance to the best practice level that provides high quality service at low cost; and most important, (4) Guides the improvement process. Use of basic and advanced DEA methods are all supported by case-study applications of organizations that have successfully improved their performance. The techniques discussed in the book are accessible to all managers with access to Microsoft® Excel spreadsheet software (Excel). The book provides step-by-step guidance to enable the reader to apply DEA and Excel software to their organization. DEAFrontier is a Microsoft® Excel Add-in designed to run DEA analyses on any set of organizations of interest to the reader. For a free trial version of the DEAFrontier software, please visit www.deafrontier.com.
The book provides the roadmap for managers to understanding DEA. It demonstrates how these methods can be used to improve productivity and how to evaluate its value to an organization. Finally, the book applies and analyzes the results to identify specific ways to improve organizational performance and profitability. One manager who recognized that the realized benefits of DEA benchmarking were so substantial he described these methods as "benchmarking on steroids!" Users have acknowledged the benefits of DEA in news articles, journals, and professional publications.The productivity methods in the book have been applied in actual cases to government service operations, with the result of streamlining government costs by identifying ways to provide the same service levels and reduce operating costs where excesses are exposed and best performance is demonstrated. Similarly, in healthcare, new insights about managing hospital costs, nursing home costs, and physician practice pattern costs have been realized by these techniques. Throughout the book step-by-step guidance is provided to enable any reader to apply DEA with Excel to their organization.