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Service Operations Management

Executive Summary of Service Operations Management

This report uses advertising as BBDO international central service concepts. This report reflects the outcomes of online literature review of services provided by BBDO. Outcomes of this report shows that BBDO customers want to raise sales by increasing brand awareness. Integrating BBDO technology has been a process over the years and helps to achieve better results. It is also the main force of the company in the market. Reports indicate that developing competition in advertising industry is a major drawback of BBDO international. In the process of providing customers with the concept of advertising services, the business faced the problem of international coordination with the choice of media and its corresponding content.


The concept of service.

Focus of selected operations and supply chain issue.


Recommendations to managers.



Introduction and Background Information of Service Operations Management

In this study Selected topic is“Service Operations Management: Potentials, Challenges and Future Research Directions” to properly evaluate this topic a case study of BBDO International organization is selected which is one of the most famous advertising industries in the whole world. The advertising business has made great strides in the 21st century. Due to fierce competition, many industries are looking for the advertising companies services. The company’s creativity in marketing goods verifies the number of sales the company makes (Hu, Du and Damangir, 2014). Hence, the company needs the services of some industries as BBDO Worldwide to survive in the present competitive environment. This report is depends on an audit of the BBDO Worldwide literature and its promotional services to customers. The report discusses the concept of BBDO Worldwide advertising service and how an industry utilizes technology to advance this concept of services.

The Concept of Service

BBDO Worldwide provides the company with promotional services, the essence of which is market development. Due to the emergence of new companies, the industry is becoming more competitive. These companies are required to increase the level of awareness of their brands in order to motivate the number of clients to their products. BBDO must remain suitable for the market in order to maintain its dominant position. The advertising market is growing and competition between companies is also intensifying. Global expansion is one of the best strategies for companies to deal with stress. However, BBDO is constantly changing its culture to reflect the immediate needs of its customers and thus maintain its dominant position. The promotional services obtained from BBDO Worldwide can help them achieve higher stock targets in the market.

BBDO Worldwide takes orders from customers for the promotion of various products. The business has 1,500 workers, consisting of individuals as well as talented persons in various areas of the product marketing (Channel Report, 2019). BBDO international offer advertising design and offers customers the most relevant advertising. For customers served by BBDO Worldwide, the best customer experience is the status of their product. BBDO international uses a strategic approach to make sure that a large number of people understand the brand being promoted for their consumer (Beneito-Montagut, 2015). Customers who utilize BBDO services expect results for example the growth of sales.

That’s why promotion is the major service that the BBDO Worldwide offers to its consumers. The business employs a group of extremely qualified staff to create advertising designs depend on customer requests (Athey & Gans, 2010). This company helps the brand of its customers to become more popular. Ultimately, customers are expecting an increase in sales of their brand. Many companies seek out advertising services from the different provider in the marketplace (Fajfar, Campitelli & Labollita, 2012). Therefore, BBDO Worldwide needs to expand a unique advertising model for its customers (Appendix 1).

Operations management

It is the management of the business practices and aims to make the maximum level of efficiency within the association. It’s related to converting materials moreover labor into services and goods as competently as probable to increase the profits of the organization. OM generally involves the planning, association furthermore supervision of the production, service or manufacturing provision. Hence, it is focused on delivery, ensuring that the association effectively converts input into output in an effective ways. The investment itself can represent anything from technology, equipment and materials to human resources (eg employees or workers). The types of the responsibilities and expert positions include purchasing (acquiring goods or services from external sources), managing relationships with process-associated personnel, furthermore improving the sustainability of the business utilize of resources.

Focus of Selected Operations and Supply Chain Issue

Service Operations Management and Literature in Service Operations Management

Service operation management is associated to delivering services to service customers. It involves understanding the service needs of the target customer, managing the process of delivering the service, ensuring that the target is achieved, and paying attention to the continuous improvement of the service. The service industry views services as intangible products, services as customer experience, and services as a package of convenient goods and services. Service as an important aspect of products is the basis for guiding service operation managers to make decisions. The extent and types of service industries where operations managers make decisions provide a background for decision-making. Technology integration is one of the key procedures of BBDO Worldwide, which contributes to the promotion of the concept of promotion services. BBDO Worldwide is one of the world's first advertising companies. The business was founded in 1891, at a time when technology in the workplace was not advancing so rapidly (Gatignon, 1984). Nevertheless, the most significant process that dominates the business in market is the integration of technology.

Over the years, as the dynamics of the company's services have changed, the industry has undergone some technological changes. For example, advances in technology have facilitated mass communication using appropriate technical means. BBDO has entered into a process to ensure that all significant technical changes affect its services. The changes that BBDO Worldwide has undergone over the years are in line with provisions of the media rich theory. Rich media theory is a theoretical framework that describes the effectiveness of using relevant media to deliver messages to recipients. In the age of digital technology, BBDO international is facing the challenge of finding effective media. The company needs a wide range of media alternatives to disseminate projected brand information to potential consumers. Thus, the integration of advanced communication technology has become the only way to choose a company to serve customers. Technology helps to convey the ambiguity of content in advertising to consumers (Harvey, Heineke & Lewis, 2016). Extremely advanced technology has the capability to guess market value based on trends in changing consumer behavior (. Organization uses technologically advanced forms for example data analysis to maintain a leading position in making the best advertising decisions.


The challenges in the service sector are BBDO’s capability to coordinate consumers around the world. The advertising design developed by the company for the customer should reflect its unique experience. Customers are looking for a different experience in finding their leading position among market competitors. Therefore, before offering the design to the customer, the company has to coordinate all the designs through the central office. Choosing the right advertising tools for customers is also a major challenge in working on the concept of services. BBDO should choose an exchange tool for its customers, which depends on the duration of the promotion. For example, when social media is a better choice, BBDO can promote specific brands to customers through social media.

A common issue encountered when utilizing service concepts is the relationship of the ad to the messages the brand sends. The function of the BBDO is to ensure the compatibility of the two elements. If the advertising information and brand information do not match, the service is not so important in this case. The company also has a conflict of interest with customers. Transparency and coherence are important for companies to deal with all customers. Due to existing advertising companies and emerging companies, BBDO Worldwide is also facing competition. Intense competition is a major weakness of the BBDO. The corporation is located in competitive businesses in the whole world. Each company is looking for a top advertising agent who can promote their brand (Lummus, 2006). Due to the merger of many companies, this huge demand has led to fierce competition in the promotion business. High competition means that BBDO can enter smaller markets. Conflict theory shows that resource competition is a major cause of conflict. The reason people are dissatisfied is that everybody needs to share the partial resources of the world. In the field of advertising, customers are an significant resource for BBDO Worldwide as well as other industries. Therefore, customer effort in the market is a weakness of the company’s development plan as it creates more competitors. In the future, the company must defeat competitors in the fight for market stability.

Recommendations to Managers on Service Operations Management

Today, the company is moving towards a more networked economy. As the development of information and communication technologies has achieved world-renowned achievements and in the conditions of intense competition in the global market, the company is changing its production structure and restructuring its business structure to simplify its processes. Different trends have made their development environment more complex, such as outsourcing, mergers or acquisitions, leading to the development of virtual enterprises with temporary relationships, price pressures, and so on. Moreover, the company is at the bottom of the volatility more prone to mistrust. Customer needs and superior information about the reliability of supplier processes or, in general, information about the reliability and adequacy of information exchange.

New ways of doing business and supply chain management need to be developed. The goal of supply chain managers is to enable their companies to succeed in completing key processes to achieve results. To achieve this goal, traditional vertical integration is not enough to create added value and a good core business position. The challenge for supply chain managers is to ensure the level of integration of the levels of integration needed for network efficiency and effectiveness (Horsky, 2006). They need to work with suppliers to not only ensure cheap, high-quality and timely delivery, but also to participate in the company’s plans and meet the needs of the customers accordingly. This means developing new collaborative practices among business partners and using coordinated operational planning methods to address these challenges and uncertainties, thereby optimizing supply chain processes and reducing costs.

Evaluate how well the implementation of the advertising service concept works

The key advantage of BBDO international is that it is at a stage of rapid technological development. The 21st century is a period of the most technological progress in history. Thanks to technological advances, there are now means of communication available, such as social media. Media allows the business to find a wide range of consumer groups that promote the intentions of BBDO brands to its customers. Many people around the world interact with media everyday (Hume, Sullivan Mort, Liesch & Winzar, 2005). Hence, the use of media as a means of data exchange brings better results. The fame of the BBDO Worldwide brand around the globe is a vital factor for its development. High brand awareness helps build consumer loyalty over time (Shugan, 2005 p.185). Contact with a wider consumer base has allowed BBDO to expand the range of services offered.

All companies need to grow. This is very important, and it forces the company to develop innovative products or services, enter innovative regions or develop new businesses. As they increase, they inevitably become very complex. Their organizational structure developed at one level, their reporting lines became chaotic, and people from top management to the first line made it harder to get the job done. When resources, energy and time are spent on joint activities and collaborations that do not make value, complexity damages the business operations. But complexity is not a bad thing. When we analyze potential perception creation drivers, we see that some important trends tend to create complexity and value. 1 Number of consumers you have; number of services or products you offer; the degree of collaboration moreover the multitasking of people within the association, the country / region where you work, and the number of employees you hire not only increase the company’s difficulty, it also helps you make money. Proper use of this complexity helps instead of disrupting the company's operations. On other hand, certain factors destroy value or raise complexity. The amount of rules and the pace of change in firm industry, the degree of repetition of activities, responsibilities and roles in the association; frequency of changes in the aaociation; entry rates and competitive strategies to reduce firm company’s profits. You may find firmself tempted to have this problem (Nie & Kellogg, 2009).

Many companies have successfully replaced their mining, research and development, and other business functions in order to improve performance and reduce costs. Although this can have a significant impact on customer acquisition and retention, few people can optimize their service operations. If the costs and levels are balanced or optimized properly for the service, they can provide a huge or sustainable competitive benefit, and it will be difficult to compete with each other.

In fact, service operations are usually labor intensive furthermore difficult to handle. Copying and consistency are signs of a high level of service, and they can compete with companies that are gradually improving processes and behaviors. In addition, managers in many industries have found that while maintaining service levels, the problem of maintaining service costs (particularly labor costs, the most expensive part of operations) is increasing. Recent technological advances (e.g., self-service kiosks, which are common in airports, hotels, and banks) have contributed to increased overall productivity; nevertheless technology is the only solution.

The design of a custom service model based on a client base is a precondition for providing the required services with no collateral. Whether the company is a trader trying to optimize the sales, hospital to get better care through a better distribution of nursing or beds, a hotel to speed up the rest, and a manufacturer that provides technical support in the global market, Leading Organizations need to strictly and comprehensively control the factor that affect the service or the cost of the service.

Six key drivers of service quality and cost

The person in charge of service operations must be able to identify and take advantage of improvement opportunities. To help, Company & Booz has developed a framework that incorporates key factors of service cost and quality.

  1. Process and Product design: The basis for good-quality, low-cost workings is established above product design and, in the case of a service company, the process design. Design has a major impact on quality and overall cost of service. Particularly, it can decrease the cost of service at the product life stage by decreasing defects and the overall cost of service by shortening the time to enter a stable and mature stage from childhood. For example, simplification of architecture and product configuration can have a positive impact on services. The computer hardware company only needs to install its own hard drive in each sales unit to cover the cost of maintenance, order processing, and technical support. Quality analysis at the product level can also help identify issues that could lead to increased service expenses By identifying a significant difference between failure time (frequency of product failure) and repair time (product repair time) between internal product and third-party product, other computer manufacturer was capable to design a low-quality product and train technical staff to eliminate it. This shortcoming needs to be improved. Incorporating remote diagnosis or repair functions into processes and products can simultaneously decrease service costs (correct parts, correct location) and increase consumer satisfaction or loyalty.
  2. Service-level labor needs.Often, labor is the most expensive cost of service operations moreover the main engine of consumer satisfaction. The first priority is to match the service needs to the needs, expectations of the customers. Some customers may require a large number of transactions, while others might be satisfied with the self-service options, such as ATM, self-payment or automated technical support, offered online or by phone. Compatibility of consumer expectations with method of service delivery can reduce revenue and reduce the cost of service. The person in charge of service operations analyzes how they are used and reviews them based on the company's goals (for example market share or revenue targets) to make sure correct coverage of services (Sofat, 2011). The company, which conducted such an analysis in a large mailbox of the event, found that the inadequacy of its service coverage led to needless time at certain times of the day, while others caused delays. By adjusting the coverage on demands, the business was capable to reduce the incoming demands in the agreed services and decrease labor expenses by reducing coverage in slower periods. This change will allow the business to enhance overall productivity or consumer satisfaction, and thus increase revenue.
  3. Service network structure: Over time, as trade and financial development rates change, acquisitions and mergers occur, and as a company changes its mix of products and market concentration, the cost of services can become smoother. Management becomes excessive, process standardization is reduced, workload is not commensurate with staff levels, and excessive costs are incurred. Sometimes it is necessary to reconsider the structure of the service delivery network. The service outsourcer maintains two independent organizations for the supply and installation of equipment in one geographical area. In the past, the model has received immediate responses, but due to the reduction in service requests (partly due to improved design and quality), merging the two organizations makes more sense. The efficiency of service operations in many cases varies greatly from geographic location. By implementing appropriate tracking or reporting processes, industries can bridge differences or get better overall service performance. In addition, industries can use collaborative service models to decrease overhead costs. Outsourcing can usually save short-term costs; nevertheless if it negatively affects consumer satisfaction and business competitiveness, outsourcing will be more effective in the future. A proper procurement mix can improve a company’s competitive advantage and thus strike a balance between low cost and quality of service.
  4. Service process management: They vary according to the requirements of the company and its consumers. In this case, they want to constantly monitor and monitor cost reforms and maintain their efficiency. Continuous development is a common idea; however in several industries this culture is not simply supported. In addition, service processes require gatekeepers and gatekeepers have the power to make decisions about changes and are responsible for their implementation. At the same time, companies can use it to identify any stages of the process that can be consistent between consumers and regions. Process standardization (as much as possible automation) can decrease labor needs and increase consumer satisfaction. Such as, one regional hospital decreased the waiting time for innovative admissions from four furthermore a half hours to one and a half hours through a standardization process to confirm their admission.
  5. Workforce management.Employee productivity is a key consideration in all the service operations. To improve worker productivity, decision maker must primary calculate the overall work required for each location (by identifying workforce drivers and creating models that determine the timing and frequency of tasks) or by up-and-down. One way, one is to compare operational indicators with working time. Both methods are acceptable, but the “top-down” approach offers the added benefit that the runtime can be easily adjusted when the input driver changes. For example, the company has built a detailed model based on a unique model of store demand to calculate the number of employees needed to operate a truck wheel center, thereby saving 12% of labor costs. Once the working hours in each location have been determined, management can consider how to divide the working time among part-time and full-time workers and how to manage these workers to meet the needs of customers and complete operational operations. Such as, when the hotel studied the check-in process, it became clear that the waiting time for guests had exceeded 20 minutes. The large number of guests waited so long that they said they no longer wanted to stay at this hotel. Nevertheless, during the peak period, only five full-time staff were added, which is an additional cost to the hotel budget, so more than 89% of guests can enter in less than 15 minutes of waiting time (Nie & Kellogg, 2009).
  6. Measurement and compensation. Unfortunately, a small number of operators and structural companies have complex compensation and measurement structures. Most of them fall into one of the following three categories: those that track performance at all levels sequentially, but do not match their compensation systems with indicators; those who follow indicators but are identified as non-compliant at all levels; Advertising indicators. Unnecessary, inconsistent, or inconsistent metrics can lead to missed opportunities for improvement; insufficient understanding of whether process changes are effective and decisions are not effective. At the same time, most service associations, particularly those in the retail sector, are collecting more and more information every day, but still want to gain insight. To overcome this issue, the company must recognize the information related to the operational activities of its services and ensure the proper collection and use of information. Collection of non-financial data (for example consumer profitability or consumer satisfaction) and key economic or operational indicators is important. The next step is to adapt the compensation and remuneration system to employee expectations. By accurately determining wages and rewards, as well as by showing the indicators that determine rewards and rewards, service operations can motivate employees and provide public clarity for behavior change.

The advantages of probability theory, even its limitations and disadvantages

Probability theory is a mathematical description of a random phenomenon. Probability plays a growing role in all fields of engineering and science. Potential research in ORFE varies from theory to application, especially stochastic analysis and its application in various fields such as financial mathematics, random networking and sequencing, signal processing and imaging, and randomization control. The practical use of theprobability distribution and scenario analysis in a business is to forecast future sales levels. It’s not possible to predict the exact value of future sales, but industries still want to plan for future events. Using an analysis of the distribution-based scenario can help industries determine their future value based on potential sales levels and the worst-case scenario. In this way, companies can base their business plans on a possible solution, but at the same time focus on other probabilities. Additionally to predicting future sales levels, probability distribution can also be a risk assessment tool. For example, consider a company that wants to enter a new business area. If a company earns $ 500,000 to achieve failure and its potential distribution tells them that the probability of making less than $ 500,000 is 10%, then the company generally knows whether to make a business decision (Harvey, Heineke & Lewis, 2016).

Conclusion on Service Operations Management

The literature review shows that BBDO Worldwide offers its customers the perception of advertising services. The business designs various forms of advertising according to customer requirements. The company offers customers a wide selection of brand-related products. For many years, technical integration at BBDO has been a key process for advancing its service concept. BBDO was faced with the choice of choosing the right media to deliver the message in the ad. The business also faces significant issues where the content of the ad should match the intentions of the customers. BBDO also faces challenge of the coordinating the delivery of service concepts to customers around the world.

References for Service Operations Management

Athey, S., & Gans, J. (2010). The Impact of Targeting Technology on Advertising Markets and Media Competition. SSRN Electronic Journal. doi: 10.2139/ssrn.1535325

Beneito-Montagut, R. (2015). Encounters on the Social Web. Sociological Perspectives, 58(4), 537-553. doi: 10.1177/0731121415569284

Fajfar, P., Campitelli, G., & Labollita, M. (2012). Effects of immediacy of feedback on estimations and performance. Australian Journal Of Psychology, no-no. doi: 10.1111/j.0004-9530.2011.00048.x

Gatignon, H. (1984). Competition as a Moderator of the Effect of Advertising on Sales. Journal Of Marketing Research, 21(4), 387. doi: 10.2307/3151465

Harvey, J., Heineke, J., & Lewis, M. (2016). Editorial for Journal of Operations Management special issue on “Professional Service Operations Management (PSOM)”. Journal Of Operations Management, 42-43(1), 4-8. doi: 10.1016/j.jom.2016.03.005

Horsky, S. (2006). The Changing Architecture of Advertising Agencies. Marketing Science, 25(4), 367-383. doi: 10.1287/mksc.1060.0198

Hume, M., Sullivan Mort, G., Liesch, P., & Winzar, H. (2005). Understanding service experience in non-profit performing arts: Implications for operations and service management. Journal Of Operations Management, 24(4), 304-324. doi: 10.1016/j.jom.2005.06.002

Lummus, R. (2006). The role of APICS in professionalizing operations management. Journal Of Operations Management, 25(2), 336-345. doi: 10.1016/j.jom.2006.11.004

Nie, W., & Kellogg, D. (2009). HOW PROFESSORS OF OPERATIONS MANAGEMENT VIEW SERVICE OPERATIONS?. Production And Operations Management, 8(3), 339-355. doi: 10.1111/j.1937-5956.1999.tb00312.x

Sofat, Y. (2011). Changing Conditions in Personnel Department of Advertising Agencies in India. Prabandhan: Indian Journal Of Management, 4(12), 34. doi: 10.17010/pijom/2011/v4i12/62661

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