Service Systems Management and Engineering: Creating Strategic Differentiation and Operational Excellence

Preface xxi

Acknowledgments xxix

Chapter 1 Introduction 1

1.1 Introduction 1

1.2 Services versus Products 1

1.3 Service Sectors 7

1.4 System-Integrative View of Service Enterprises 10

1.5 Service Systems Engineering 14

1.6 Skill Sets for Service Systems Professionals 18

1.7 Roles of Technologists versus Managers/Leaders 23

1.8 Preparation of Service Systems Engineers/Leaders 25

1.9 Challenges in the New Millennium 27

1.10 Conclusions 27

1.11 References 28

1.12 Appendices 29

1.13 Questions 37

Part I The Functions of Engineering Management 39

Chapter 2 Planning 41

2.1 Introduction 41

2.2 New Business Technology Trends 41

2.3 Types of Planning 43

2.4 Strategic Planning 44

2.5 Participants in the Planning Process 52

2.6 Planning Roles of Engineering Managers 53

2.7 Tools for Planning 55

2.8 Planning Activities 60

2.9 Some Specific Advice on Planning 67

2.10 Planning in the Healthcare Industry 71

2.11 Conclusions 72

2.12 References 73

2.13 Questions 75

Chapter 3 Organizing 77

3.1 Introduction 77

3.2 The Concept of Structure Following Strategy 78

3.3 Activities of Organizing 80

3.4 Organizing One’s Own Workplace for Productivity 80

3.5 Developing Organizational Structure 83

3.6 Enhancing Corporate Performance by Organizing—Examples 92

3.7 Cross-Functional Teams 103

3.8 Delegating 107

3.9 Establishing Working Relationships 109

3.10 Informal Organizations 112

3.11 Conclusions 113

3.12 References 114

3.13 Appendix—Definitions 115

3.14 Questions 116

Chapter 4 Leading 119

4.1 Introduction 119

4.2 Leading Activities 119

4.3 Deciding 120

4.4 Communicating 135

4.5 Motivating 139

4.6 Selecting Engineering Employees 142

4.7 Developing People 147

4.8 Special Topics on Leading 148

4.9 Conclusions 152

4.10 References 153

4.11 Appendices 154

4.12 Questions 156

Chapter 5 Controlling 161

5.1 Introduction 161

5.2 Setting Performance Standards 161

5.3 Benchmarking 163

5.4 Talent Management 167

5.5 Means of Control 169

5.6 General Comments 170

5.7 Control of Management Time 170

5.8 Control of Personnel 172

5.9 Control of Business Relationships 174

5.10 Control of Projects 174

5.11 Control of Quality 175

5.12 Control of Knowledge 184

5.13 Conclusions 185

5.14 References 186

5.15 Questions 187

Part II Business Fundamental for Service Systems Engineers and Leaders 191

Chapter 6 Cost Accounting and Control 193

6.1 Introduction 193

6.2 Service/Product Costing 193

6.3 Application of ABC in Various Service Sectors 198

6.4 Application of ABC in the Manufacturing Sector 207

6.5 Target Costing 211

6.6 Risk Analysis and Cost Estimation under Uncertainty 211

6.7 Management of Overhead Costs 223

6.8 Miscellaneous Topics 223

6.9 Conclusions 231

6.10 References 232

6.11 Appendices 234

6.12 Questions 249

Chapter 7 Financial Accounting and Management for Service Systems Engineers 256

7.1 Introduction 256

7.2 Financial Accounting Principles 257

7.3 Key Financial Statements 258

7.4 Fundamentals of Financial Analysis 272

7.5 Balanced Scorecard 282

7.6 Capital Formation 283

7.7 Capital Assets Valuation 294

7.8 Conclusions 308

7.9 References 309

7.10 Appendices 311

7.11 Questions 317

Chapter 8 Marketing Management for Service Systems Engineers 332

8.1 Introduction 332

8.2 The Function of Marketing 333

8.3 Market Forecast—Four-Step Process 340

8.4 Market Segmentation 342

8.5 Marketing Mix (Seven Ps) 346

8.6 Customers 376

8.7 Other Factors Affecting Marketing Success 382

8.8 Conclusions 384

8.9 References 385

8.10 Appendices 387

8.11 Questions 388

Part III SSME Leadership in the New Millennium 391

Chapter 9 Service Systems Management and Engineering Leaders 395

9.1 Introduction 395

9.2 New Competency Model for Service Leaders 396

9.3 Total Leadership 401

9.4 Leading Change 402

9.5 Leadership Styles, Qualities, and Attributes 403

9.6 Leaders and Managers 413

9.7 Factors Affecting the Promotion to Manager 415

9.8 Leadership Skills for the Twenty-First Century 419

9.9 Unique Contributions Expected of SSME Leaders 423

9.10 Career Strategies for the Twenty-First Century 428

9.11 “Take Charge” to “Get Success” Formulae 428

9.12 Conclusions 430

9.13 References 430

9.14 Appendices 432

9.15 Questions 436

Chapter 10 Ethics in Service Systems Management and Engineering 439

10.1 Introduction 439

10.2 Ethics in the Workplace 442

10.3 Guidelines for Making Tough Ethical Decisions 451

10.4 Corporate Ethics Programs 454

10.5 Affirmative Action and Workforce Diversity 457

10.6 Global Issues of Ethics 459

10.7 Philosophical Approach of Addressing Ethics Issues 468

10.8 Conclusions 468

10.9 References 469

10.10 Questions 471

Chapter 11 Knowledge Management 475

11.1 Introduction 475

11.2 Basics of Knowledge Management (KM) 475

11.3 Management of KM Programs 486

11.4 Knowledge Management Practices in Service and Manufacturing Sectors 489

11.5 New Frontiers of Knowledge Management 499

11.6 Conclusions 500

11.7 References 501

11.8 Questions 503

Chapter 12 Innovations in Services 505

12.1 Introduction 505

12.2 Creativity and Creative Thinking Strategies 505

12.3 Fundamentals of Innovation 519

12.4 Innovation Management 528

12.5 Selected Innovation Practices in the Service Sectors 538

12.6 Conclusions 543

12.7 References 543

12.8 Appendices 546

12.9 Questions 552

Chapter 13 Operational Excellence—Lean Six Sigma, Web-Based Applications, and SOA 554

13.1 Introduction 554

13.2 The New Revolution in Productivity 555

13.3 Lean Six Sigma for Services—The SERVICE Model 558

13.4 Internet-based Applications for Service Management 561

13.5 Web Services 585

13.6 Service-oriented Architecture (SOA) 586

13.7 Conclusions 594

13.8 References 595

13.9 Questions 597

Chapter 14 Globalization 599

14.1 Introduction 599

14.2 Global Trade and Commerce 600

14.3 The Great Philosophical Debate about Globalization 610

14.4 New Opportunities Offered by Globalization 613

14.5 Preparation for Globalization 618

14.6 Past Practices Related to Globalization 630

14.7 Developing Global Strategies for Service Businesses 633

14.8 Future Trends 634

14.9 The Global Challenges Ahead 641

14.10 Conclusions 650

14.11 Summary Remarks for the Text 651

14.12 References 655

14.13 Questions 658

Appendix: Selected Cases Relevant to Service Systems Management and Engineering 661

Index 667