lean management, lean service, mudas, eike boeljes

Lean Lesson 1:

How to Keep Your Services On Fleek

Eike Böljes

When it comes to a nation’s most significant economic output, most people associate leading export countries such as Germany, the US, and Japan with their most famous physical products. Automotive, IT, and apparel are only a few well-known examples. What many people don’t know, however, is that these products don’t actually dominate the economic landscape. It’s the service sector that contributes most to their GDP.

Figures support this: In established high-income countries, the service sector has risen to above 70%, while production dropped to around 25%, and agriculture circles the 1% mark. This trend will continue particularly in emerging countries such as China, Iran, and Saudi Arabia, as their rising quality of life increases demand and the amount of high-skilled knowledge workers.

What does this mean for us? With the global growth of the service sector, service enterprises have to be more aware of challenges specific to this “industry”. Hence, the question: How can you stay sustainably competitive?

Challenges

Service companies face both external and internal challenges.

Interestingly, it’s innovation that leads to new challenges. With new technologies, apps, and online platforms, customers’ demands and expectations aren’t only growing; they are changing faster than ever. People see more, find more, want more. And tomorrow, they’ll expect something else entirely.

The other effect innovation has on service companies shows internally. New technologies ease processes, but they also bring a constant need to adapt and adjust procedures. Training activities for employees lead to additional costs and it won’t be easy to find enough high-skilled workers in the future, considering the current low population growth (more old people and fewer youngsters with the suitable education to serve them).

Even if companies look to target these challenges specifically, managements rarely have enough meaningful data to do so. Due to the intangibility of services, and the future, monitoring processes and enabling accurate time planning becomes difficult.

How to even stay on top of things?

Change

To counter these challenges, we need to change and optimise conventional management behaviour.

Increase your quality
In services, the customer experience is central. Though it may be hard to measure, basic rules such as ensuring constant reliability and friendly interactions with customers can already boost your quality. So be competent, be nice.

Keep your staff qualified
Managers shouldn’t underestimate the importance of staff beyond recruitment. Holding, continuous training, and motivating existing employees are just as essential and worth additional costs.

Innovate traditional service models
Just like manufacturers of physical products, service providers need to invest in R&D. This refers mainly to processes and IT-related measures. Are there possibilities to further integrate R&D in your services?

Flexibility is everything
You have to be able to handle demand fluctuations and still make your customers happy. Learn to expect and learn to adjust. Maybe adopt a line of unique norms to create a competitive advantage?

Essence

With the global growth of service operations, it’s crucial to develop management strategies that focus on service-specific challenges. The future might look more dynamic than ever, but an approach centred on efficiency and constant adjustment can lead to steady success.

In other words, couldn’t lean management be the solution here?

Read Lean Lesson 2.

 

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