CHAPTER 28

Continual Improvement: Service Sector

Wealth in the new regime flows directly from innovation, not optimisation, that is, wealth is not gained by perfecting the known, but by imperfectly seizing the unknown

– Kevin Kelly

Background

Service relates to those provided by non-profit institutions as well as those organised as a service industry. Service sector offers a huge opportunity for continual improvement through reduction in the cost of servicing coupled with the increase in the quality of service rendered to customers. Use of information technology (IT) has immense potential to accomplish these two.

There are a number of institutions which provide service to the community and society; for example, temples, churches, mosques, various religious trusts that support the cause of education, community welfare and care for the elderly, terminally sick, destitutes, etc. There are also many voluntary service organisations which serve the society through diverse means according to their area of expertise such as free legal aid to the poor, issues related to rehabilitation and environment, besides seeking redressal through judicial intervention/governmental action. Most of these organisations are non-profit institutions.

Then there is the service industry that encompasses business organisations offering services of diverse types as well as service infrastructure. A few business-type service organisations are banking, education, transport, communication, health care, call centres, hospitality, electricity and water supply, sewerage and garbage collection, etc. Service infrastructure is common to service organisations and manufacturing, marketing, sales, accounting, maintenance, etc. The contribution of service sector to Gross National Product (GNP) is increasing substantially and is a dominant contributor to the all round economic growth of a country like India.

The concepts, approach, tools and techniques, methods discussed in the previous 27 chapters and the managerial aspects covered in Chapters 30 and 31 regarding continual improvement are also applicable to the service sector. But there are certain peculiarities in service sector. These are dealt with in this chapter to ensure that continual improvement is managed well.

Peculiarities—non-profit institution

Clarity of thought is necessary on the listed questions to understand the purpose of a nonprofit institution.

1. What a non-profit institution does?
2. How does its work differ from that of ‘business’ and ‘government’?
3. What are the results unique to it?

Business supplies goods and services. Government controls and enforces statutory measures. The task of a business is properly discharged when the customer who buys the product is satisfied with it. When policies of a government are found effective, the government has fulfilled its task. Therefore, non-profit institution is neither business nor government. Then, what is the product of a non-profit institution?

The product of non-profit institution is a changed human being. Non-profit institutions are ‘human change agents’. For example, in the case of medicine, “Medicine is more than just making a person disease-free. It is also about bringing to him/her a feeling of wellbeing”, said Dr. Motashaw, President of the Indian Association of Gynaecological Endoscopy (The Hindu 2 July 2005). The product of non-profit institution is a cured patient, a destitute living in dignity, an orphaned child who learns and grows into a self-respecting adult, child at risk due to societal cruelty matures into a loving, confident, self-assuring entity, a troubled mind composed by the serene ambience of the place of worship, etc.

Thus, management in a non-profit institution needs to be an instrument to

• Sharpen its mission without ambiguity on the area of change to be brought and a means of measuring the change.
• Define the relevant results and specify a means to measure the results.
• Formulate measures to market the services and obtain the money needed to accomplish the mission and achieve set targets of results.
• Enlist the services of volunteers with diverse talents and interest apart from enthusiasm to serve.
• Handle the volunteers carefully without commanding or controlling them so as to enable them to contribute their best to enhance the results. Command and control are both incompatible and inimical to volunteering. Thus, the role of board of trustees/management of a non-profit institution is to attract and develop volunteers, and manage them for performance; for maintaining harmonious relationship with a number of constituencies of diverse types; to prevent them from getting burnt-out; to motivate them to raise funds and to manage the funds meaningfully and effectively.

All these features of management are not addressed in a number of institutions. This is the reason why many such institutions have remained dormant and the rich ones among them have become entangled in litigations. Thus, CIP has to start from the top level of the management in a non-profit institution in addition to focusing on the conventional areas of continual improvement—wastage, efficiency, delay, etc.

Before going to the next section on peculiarities in service sector as a whole, it is worth noting a point on volunteerism through a case example.

Volunteerism

This is a case example drawn from an industrial organisation with which one of the authors was associated for nearly two decades. In a section of the production department, there was a workman who was good at his work but was indisciplined while on duty, punctuated by frequent absenteeism. He was subjected to disciplinary actions on diverse counts for a long time. One day he requested the author to visit his area of living. The author was curious and agreed to visit. The visit gave a startling picture of the workman. He was living in an area of people with ordinary means, well below the average middle class. They belonged to different castes. He had organised a small community with the help of a few other people into a mutually helping interdependent community, revolving around a prayer hall dedicated to Hanuman, without caste barriers. He was held in high esteem by the community. He was asked why he did not exhibit similar passion to the wage-earning work. His reply was an awakening one and it ran thus ‘here I know what I am doing; I see my contribution; I get a sense of joy and fulfillment’. Creating, integrating, sustaining voluntary spirit in one’s work is what is meant by working environment and it is the root of success at the individual as well as the organisation level. Chapters 30 and 31 bring forth the building blocks of such an organisational culture conducive to continual improvement.

Peculiarities—service sector

Servicing is not the same as manufacturing. There are certain differences termed as peculiarities in this chapter. These peculiarities need to be understood. Once this is accomplished each one of the peculiarities can be surmounted easily. It calls for identifying the peculiarity and addressing it to set right without brushing it under the carpet. Training is the best way of remedying the peculiarity. Various peculiarities listed here can themselves be taken as projects for continual improvement.

1. The typical situation that prevails in service departments is that they have little or no history of using data—in fact, required data may not exist and many people are also not as numerically literate as found among their counterparts in manufacturing sector.
2. In manufacturing, the technology generally enables the processes to lend themselves to be (i) identified easily, (ii) described as a series of logically related activities, (iii) defined as a micro-set of steps in an activity and (iv) captured in a flow chart or any such tool with all the details contained in (i) and (iii). This is not the case in service sector. In our observation, the processes are not clearly identified, demarcated and defined. Most of the processes go by tradition, one’s experience and one’s choice. The status is worsening day by day with increased computerisation that has led to situations whereby a person handling a process is not well aware of it and cannot intervene with the process when it is needed. This is reflected, for example, in several instances of many credit card holders getting payment-due notices month after month even when no such claim is tenable. Use of IT is a must and there cannot be any slackening of efforts on that front. But the use of high-tech IT should go on in a way whereby the one operating a process feels that he/she has no control over it while operating and serving the customer and not feel subordinate to the machine with a sense of helplessness and/or ignorance.
3. In manufacturing sector, waste can be seen, waste attracts attention, impact of waste is felt and all these demand action. In service sector, waste is not even recognised as ‘waste’; it is not even accounted for, leave alone the question of eliminating it.
   

   A patient when admitted to a nursing home has to wait for an hour for the doctor to attend him. This waiting on the part of the patient is not even recognised as a waste. If the patient expresses his anguish he is comforted by the stock answer, ‘this is just the way the work happens’. Thus, there is a need for learning to recognise waste and change the mindset to overcome this is the way here syndrome.

   Thus, waste due to work in process (WIP), defects, equipment, unnecessary expenses, indirect labour and planning in different operations/processes cannot even be assessed and accounted for in service sector. Priority attention should be given to identify the diverse types of waste, their continuous accounting. This basic database has to be built to achieve improvement.

4. Slow process is an expensive one. Manufacturing industry recognises this and does focus on fighting the slowness. This outlook and concern is generally not found in service industry.
5. WIP in manufacturing industry cries out for action. People in the queue waiting to be serviced is also WIP. It represents precious waste of time and energy of people in the queue. It represents social frustration. People rendering the service are generally immune to the sensibilities of the customers. This is another issue to be addressed. It calls for a change of heart and use of better technology. In this context, certain recent changes are noteworthy and similar things need to be multiplied fast to serve a ‘common’ customer (not Internet based); payment of water and electricity bills round the clock on all the days to ‘machine’.
6. WIP as people in queue can be seen. But WIP as pending work is not even seen, accounted and monitored. This is the main cause of inefficiency. This is the status in many service organisations including the government. Monitoring WIP is a key step to speed up the process and bring in transparency.
7. A number of service organisations have departments focused on customers, such as customer relations and customer service support. In reality, the main focus of their work is not on enhancing customer satisfaction and customer delight but on capturing more customers. All their courtesy and pleasant manners are used as persuasive tools to get customers. These melt into thin air with a plastic smile and lips parroting out the well-rehearsed pleasantries, preset replies when a customer lodges a complaint with no solution in sight for months. Here also things should be changed for the better. Feedback forms that we have come across runs into four to six pages with several factors for evaluating on a 1–10 scale. Does this speak of the serious concern to get worthwhile feedback?
8. Service organisations like educational institutions, hospitals and nursing homes are expected to bring about total change in the personality of a customer—physical, emotional, intellectual. This kind of transformational demand is not there in a manufacturing sector. Service sector of the stated type should have new orientation, human concern, greater commitment and dedication to work and the task to acquit itself well as a transformational agent.
9. Tables 28.1 and 28.2 present certain other peculiarities and mode of handling them.
10. Service sector has to be spontaneous to certain emergencies of a unique type. These are listed in Table 28.3 along with the measures to be adopted.

TABLE 28.1 Peculiarities of Service Industry

TABLE 28.2 Action Outline for the Peculiarities Stated in Table 28.1

TABLE 28.3 Peculiarity and Mode of Handling

Service industry: few new features of competitive edge

Fluency, preferably in English, acute sense of timeliness, quick, efficient and courteous response, finger-nail retrieval system for providing the information as and when demanded by a customer, continual ability to be price-effective and ability to come out fast with prototypes to upgrade the models and enter market rapidly are some of the new features of competitive edge that a service provider needs to take note of so as to thrive in the chosen service business. To enhance these competitive aspects, continual improvement projects need to be taken up.

Training

Continual training of employees, continual observation of each employee on his/her sensitivity and ability to handle customers are essential and should be the focus for any correctional programme.

Common programmes compulsorily covering all the employees who have direct contact with customers need to be conducted through skits, role-play and situational problem—analysis games. These should help to build a culture of ‘service’ in the institution.

Those who are found not fit to stand the stress and strain in the difficult task of handling customers need to be weeded out from ‘front office’ where they have a direct contact with the customer.

In all such institutions, in addition to the stated programme, compulsory measures have to be taken to spell out clearly in each type of work, the manner of handling the customer. This has already been explained with illustrative examples in Chapters 9 and 10. With such a system in place and workmen who are also sensitised in terms of their work, duties and responsibilities towards the customer, achieving customer satisfaction becomes a distinct possibility. This renders the creation of an expensive, luxurious and comfortable physical facility in an organisation to please and attract the customer. Organic fusion of worker and his/her work in a service field is reflected as:

• Smile (not plastic, not artificial)
• Courtesy (not inattentive)
• Listening (not slavish)
• Respectfulness (not superficial)
• Attention to details (not reluctant)
• Concern for promptness (not reactive)
• Sense of timeliness (not laid-back attitude)
• State of calm (not reactive)
• State of unruffled face (inspite of unfair humiliating situation)

Continual improvement can focus on issues related to the special features of training relevant to service sector.

Areas of concern

Youngsters are, in recent times, engaged in certain types of service jobs such as call centres and medical transcriptions, which pose serious health hazards for the youngsters. The problem is one of progeria—a rare abnormality marked by premature ageing. Among those who are 25 years of age, the problems observed are obesity, diabetes, blood pressure, heart ailments, peptic ulcer, constant headache, irritability, acidity and even impotency. These need to be examined and measures to counter them are to be addressed without delay. This is a potential area where continual improvement can contribute. Out-of-box thinking has great scope to work out ingeneous solutions to these problems. For example, today a large number of persons suitable for such jobs are available among those who have retired under Voluntary Retirement Scheme. They can be engaged on part-time basis, say 4 hr a day. This reduces the health hazards for youngsters without any risk of increasing such a prospect for the elderly category.

Conclusion

Continual improvement can start to address issues to handle the peculiarities of service industry as well as those issues which are related to establishing a focused, dynamic customer-relations task force.