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Pearson Education Service Processes and Manufacturing Processes Manufacturing processes change materials in one or more of the following dimensions: ?Physical properties ?Shape ?Fixed dimensions ?Surface finish ?Joining parts and materials If a process isn’t doing at least one of these, then it is a service (nonmanufacturing) process. 169。 2020 Pearson Education ?Video: service and manufacturing process 169。 2020 Pearson Education ?“ If you drop it on your foot, it won’t hurt you.” (Good or service?) ?“Services never include goods and goods never include services.” (True or false?) 169。 2020 Pearson Education Value Chains ?Value chains are an interrelated series of processes that produce a service or product to the satisfaction of customers. ?Value chains may have core processes or support processes. ?Core processes deliver value to external customers. ?Support processes provide vital inputs for the core processes. 169。 2020 Pearson Education Ratatouille 169。 2020 Pearson Education 169。 2020 Pearson Education 169。 2020 Pearson Education Case: Progressive Insurance ? Grew from $ billion to $11 in 13 years. ? How did they do it? ? Operational Innovation (Designing new processes) ? Immediate Response Claims Handling (24 hours a day). ? Streamlined claims processing, from 710 days to 9 hours. ? Web site for agents only. ? Web site for customer information, inquiries and routine processing. ? Agents quickly go to scene of accident. 169。 2020 Pearson Education Operations as a Set of Decisions (1) Recognize and clearly define the problem. (2) Collect the information needed to analyze possible alternatives. (3) Choose the most attractive alternative. (4) Implement the chosen alternative. Basic Decisionmaking Steps 169。 2020 Pearson Education Productivity ?Productivity is the value of outputs (services and products