Proceedings of 20th International Business Research Conference
4 - 5 April 2013, Dubai, UAE, ISBN: 978-1-922069-22-1
Service Management for Sustainable Economic
Development
Lady Patty N. Ibik
This paper showcases the importance of service delivery in
ensuring sustainable economic development. It examines some
of the key challenges affecting service management delivery.
The major research instruments used in collecting data were
questionnaires. The respondents were chosen from public and
private employees engaged in service related government
parastatals and some private firms.
The paper also made use of conceptual distinctive features of
understanding service operations, designing services and
managing operations services.
The major message of this paper is that effective service
management that cuts across all segments of an economy is a
panacea for sustainable national economic development.
1.0
INTRODUCTION
Every society has an organized way of delivering services that meet the needs of its citizens.
These service delivery systems ensure that the needs of clients are anticipated and met in a way
that yields maximum satisfaction to the client. Without such service delivery systems, the needs
of customers will not be met in a way that yields maximum satisfaction, hence the customers or
citizens will look elsewhere to satisfy their needs.
Companies, state-run institutions, as well as parastatals are quickly realizing that there is a strong
need to anticipate and meet the needs of clients through effective service management
techniques.
Thus over the years, service delivery institutions have made serious efforts to envisage and
subsequently meet the needs of their clients. However, most of the techniques employed by
these institutions are either unethical or unsustainable; hence the reason for their failure. This
paper, therefore explores the various ways through which service management may be practiced
in a sustainable manner. For clarity, the paper is divided into several sections and sub-sections.
Section one introduces the paper, while section two reviews relevant literature in the field of
service management. Section three presents the data and methodology of the research, while
section four summarizes the research findings. Finally, section five contains the
recommendations, conclusion and limitations of the research.
2.0
LITERATURE REVIEW
2.1
Meaning of Service Management
Service management can be said to be derived from the word “servant”. Hence in the olden time,
service was only regarded as the occupation of being a servant. This later gave way to the idea of
people engaged in intangible products (i.e. products that can’t be held in your hand). Even
though, we know now that service are virtually involved in every field of human endeavour be it
manufacturing or service based industries, this paper however concentrates treating services as
intangible products such as education, health care, insurance, communication, recreation and
travel and then transportation.
_____________________________
Lady Patty N. Ibik (Hdimt, Mba,Msc), Department Of Business Administration And Management,
Institute Of Management And Technology (Imt) Enugu, Nigeria
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Proceedings of 20th International Business Research Conference
4 - 5 April 2013, Dubai, UAE, ISBN: 978-1-922069-22-1
In the past, world-wide the dominant industries produced goods such as cooking utensils,
machine tools, household goods etc. Today the major industries and firms are service related
such as legal, telecommunications, entertainment, financial, hospitality, tourism etc.
It therefore becomes a fact that service sector industries remain the largest area of growth in
most countries’ economies.
2.2
SUSTAINABLE DEVELOPMENT
The World Commission on Environment and Development (WCED) also known as Brundt Land
Commission (named after Prime Minister of Norway), defined sustainable development as
“Economic and Social Development that meets the needs of the current generation without
undermining the ability of future generations to meet their own needs”.
Meeting human needs have various implications such as satisfying;
I.
Economic needs including access to an adequate livelihood of productive assets.
II.
Socio-Cultural and health needs including shelter which is healthy, safe, affordable and
secure within a neighbourhood with provision for piped water, drainage, transport, health
care, education, child development and protection from environmental hazards.
Achieving this implies more equitable distribution of income between nations and, in most
cases within nations.
III
Political needs including freedom to participate in national and local politics and decisions
regarding the management and development of one’s neighbourhood.
2.3
SERVICE CLASSIFICATION
James A. Fitzzimmons Etel (p19) maintain that the “concepts of service management should be
applicable to all service organizations. For example, hospital administrations would learn
something about their own business from the restaurant and hotel trade. Professional services
such as consulting. law and medicine have special problems because the professional is trained
to provide a specific clinical service (to use a medical example) but is not knowledgeable in
business management.
To demonstrate that management problems and programmes are common across service
industries Roger Scmenner proposed the service process matrix as depicted below.
2.4
THE SERVICE PROCESS MATRIX
Degree of interaction and customization
LOW
- Service factory
- Airlines
- Trucking
- Hotels
- Resorts and Recreation
HIGH
Service Shops
Hospitals
Auto Repairs
Other Repair Services
-
Professional Service
Physicians
Lawyers
Accountants
Architects
Mass Service
Retailing
Wholesaling
Schools
Commercial Banking
In this Matrix services are classified according to two dimensions that significantly affect the
character of the service delivery process. The vertical dimension measures the degree of laborintensity which is defined as the ratio of labor cost to capital cost. Thus capital intensive services
such as airlines and hospitals are found in the upper row because of their considerable
investment in plants and equipment relative to labor costs.
Legal intensive services such as schools and legal assistance are found in the bottom row
because their labor costs are high relative to their capital requirements.
The horizontal dimension measures the degree of customer interaction and customization which
is a marketing variable that describes the ability of the customer to affect personally the nature of
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Proceedings of 20th International Business Research Conference
4 - 5 April 2013, Dubai, UAE, ISBN: 978-1-922069-22-1
the service being delivered. Little interaction between customers and services provider is needed
when the service is standardized rather than customized. For example a meal in a standard
restaurant like McDonalds in USA or Mr. Bigs in Nigeria which is assembled from prepared items
is low in customization and served with little interaction occurring between the customer and the
service providers. In contrast, a doctor and patient must interact fully in the diagnostic and
treatment phases to achieve satisfactory results.
2.5
CHALLENGES FACING SERVICE MANAGEMENT DELIVERY
The nature of challenges depends on the level of development of an economy. For the
underdeveloped and developing nations, most of the problems of service delivery come in the
form of;
Unemployment
Lack of Good Road Network
Lack of Good Potable Water
Inability to Generate sufficient power
Nepotism and corruption
Lack of Visionary leadership.
Talking about these problems generally, service deliveries in these countries are held down by
lack of good road network. Where roads exist they are in total state of disrepair. This greatly
impedes transportation service in terms of movement of goods and services.
There is also a huge gap between the portable water needs of the people and what is available.
This lack of water greatly affects the sanitation of the communities concerned, resulting in most
cases to poor delivery of health services. But even most challenging is the inability of these
countries to generate sufficient electricity to power existing industries for tangible and intangible
goods and services. Power is the engine of all economic activities and therefore lack of it will
greatly impeded service delivery and economic development.
Unemployment is also a great threat to delivery of services. This phenomenon cuts across both
the advanced and developing countries of the world. The only different is that in most developed
economies conscious efforts are made to curb the malady which includes provision of stipends to
the unemployed to reduce their frustration
The all-embracing nature of service delivery is aptly demonstrated in the diagram below:
A DIAGRAM DEPICTING THE NATURE OF SERVICE DELIVERY
Value Added Service
Financing
Leasing
Insurance
Manufacturing Service inside coy
Finance
Accounting
Legal
R&D and Design
Infrastructure Service
Communications
Transportation
Utilities
Banking
Distributing Service
Wholesaling
Retailing
Repairing
Personal Service
Health Care
Restaurants
Hotels
Consumer
(Self Service)
Business Services
Supporting Manufacture
Consulting
Auditing
Advertising
Waste Disposal
Government Service
Military
Education
Judicial
Police and fire protection
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Proceedings of 20th International Business Research Conference
4 - 5 April 2013, Dubai, UAE, ISBN: 978-1-922069-22-1
The above diagram also illustrates the interdependency of the service and manufacturing sectors
of the economy. Many service industries provide transportation, banking, advertising, repair or
communication in support of the distribution of manufactured goods. Also the success of
profitability of manufacturing depends on the proper exploitation of value added services. For
example automobile company is very capital intensive and therefore requires loans from the
bank. Even after manufacturing, advertising services come in to help sales.
2.6
CHARACTERISTICS OF SERVICE OPERATIONS
James and Monex Fitzimmons posited that in services a distinction must be made between inputs
and resources. For services, inputs are the customers themselves, and resources are the
facilitating goods, employee, labor and capital at the command of the service manager. So for
operation to take place, the service system must interact with the customers as participants in the
service delivery process.
Customer Participation in Service Delivery
Participation of the customer is very imperative in most service delivery process. Here the first
impression of the customer in the service process matters a lot. That is why proper attention
should be paid in the facility design of the frontal offices or the reception areas of service delivery
systems. The desk officers who interact first with the customers are most often well trained in the
use of good public relations.
Simultaneity of services; A critical feature in the management of services is that they mostly
come simultaneously. Unlike goods that can be stored as inventory, service just come and go in
form of customer waiting or queuing for services.
Perishability of service; A service is a perishable activity as it cannot be stored. So when it is
provided and it is not used or utilized, it is lost forever. For instance empty seats in a commercial
passenger bus that departs when it is time to do so, has lost revenue accrued to those empty
seats. So the manager has to device means of dealing with this characteristic either by using
reservation or appointments as the case may be.
Intangibility of Service; Service come in form of ideas and concepts unlike products that are
things can be seen and touched. When a customer wants to buy a product, he or she is able to
see it or even test it before purchase but for a service, the customer may simply rely on the
reputation of the service firm to patronize it. This is one of the reasons why government regulates
and grants licenses to services providers to ensure standard practice.
3.0
DATA PRESENTATION AND METHODOLOGY OF THE RESEARCH WORK
The following data presentation and analysis is based on the data collected from questionnaire
distributed to senior staff employees of Enugu State Ministry of Works and Infrastructure, Enugu
State University of Science and Technology Nigeria, GLOBACOM Nigeria PLC – and First Bank
of Nigeria PLC – and oral personal interviews conducted to cross check facts obtained from other
data sources.
Out of the 80 (Eight) questionnaires distributed, 60 (Sixty) were recovered in tact, 13 (Thirteen)
were defective and the remaining 7 (Seven) were not returned. The analysis is therefore based
mainly on the number of the questionnaire that were successfully completed and returned.
Results of the questionnaire were analysed using the Chi-square analysis technique, and were
used to make conclusions.
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Proceedings of 20th International Business Research Conference
4 - 5 April 2013, Dubai, UAE, ISBN: 978-1-922069-22-1
QUESTIONNAIRE DISTRIBUTION AND FINDINGS
Question No. 1
How long have you been in the service of this establishment?
Table 1.
Response
(a) 1 – 5 years
(b) 6 – 10 years
(c) 10 years and above
Total
Respondents
10
16
34
60
Percentage
17%
27%
56%
100%
Responses to question number 1 show that most of the respondents are senior staff.
Question No. 2
Have you undergone any training since you started work?
Table .2
Response
Respondents
Yes
52
No
8
Total
60
Percentage
86.6
13.4
100
The above table shows that most of (86.6%) the respondents had undergone training.
Question No. 3
How adequate was the training programme?
Table 3.
Response
Respondents
Percentage
V. adequate
5
8.4%
Adequate
20
33.3%
Not adequate
35
58.3%
The above table shows varied answers but on the whole, the training was not quite adequate.
Question 4
Are you convinced that job performance or your services improved after the training?
Table 4.
Response
Respondents
Percentage
Yes
58
96.9%
No
2
3.4%
The table shows that performance improved after training.
Question No. 5
Job rotation, on the job training and seminar by purpose and workshop are all part of the training
embarked by your organization. Do you agree that taking part in these trainings make your
workers versatile and effective?
Table 5.
Response
Yes
No
Not quite
No of Respondents
45
6
9
Percentage
75%
10%
15%
The table above shows that job rotation and other forms of training make workers versatile and
effective towards service delivery.
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Proceedings of 20th International Business Research Conference
4 - 5 April 2013, Dubai, UAE, ISBN: 978-1-922069-22-1
Question No. 6
Based on your experience do you think that adequate provision of infrastructure such as power
(electricity) water supply, telecommunication and good roads will enhance your services.
Table 6
Response
No of Respondents
Percentage
Yes
56
93.3 %
No
Not quite
4
6.7%
The above table un-contestably shows that provision of infrastructure enhances service delivery.
Question No 7
Do you agree that good government policies and regulation will contribute to the growth and
development of service industries and national economy?
Table 7.
Response
No of Respondents
Percentage
Yes
60
100%
No
The above table shows that good government policies surely lead to growth and development of
service industries and national economy.
Question No. 8
Do you believe that service oriented businesses are capable of reducing the present
unemployment problems in the country and thereby promote economic development?
Table 8.
Response
Yes
No
No of Respondents
60
-
Percentage
100%
-
The table above indicates totally that service industries can help in reducing unemployment and
also promote economic development.
Question No 9.
Do you consider the use of Automated Teller Machines (ATM) to dispense cash in bank
transactions and other new technological innovations as tool for improvement of services in
organizations?
Table 9.
Response
No of Respondents
Percentage
Yes
50
83.3%
No
3
5%
Not Quite
7
11.7%
The above table shows that service delivery can be improved through use of technological
innovations.
Question No 10
Is inadequate provision of security of life and property in a country, a threat to provision of
services by government and private organizations?
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Proceedings of 20th International Business Research Conference
4 - 5 April 2013, Dubai, UAE, ISBN: 978-1-922069-22-1
Table 10
Response
No of Respondents
Percentage
Yes
60
100%
No
The above table indicates that security is very paramount to provision of services generally.
Question No 11
Do you agree that corrupt practices such as embezzlement, favoritism, partiality etc can in any
way affect effective delivery of services?
Table 11
Response
No of Respondents
Percentage
Do not agree
5
Completely agree
52
Do not quite agree
3
The above data shows that corruption is highly detrimental to effective service delivery.
Question No 12
Do your employers or top management set service delivery objectives in your organization?
Table 12
Response
No of Respondents
Percentage
Yes
24
40%
No
28
46.5%
Some How
8
13.4%
The table shows varied answers, some top management set service objectives while others don’t.
Question No 13
Are these objectives imposed on the subordinates?
Table 13
Response
No of Respondents
Percentage
Yes
34
56.6%
No
8
13.7%
Some How
18
30%
The table shows that service objectives are obviously imposed on the subordinates.
Question No 14
Do the subordinates try hard to achieve objectives imposed on them if applicable?
Table 14
Response
No of Respondents
Percentage
Yes
36
60%
No
4
6.7%
Some How
20
33.3%
This shows that subordinates endeavour to achieve the objectives imposed on them.
Question No. 15
Is service management used as weapon of control in your organization?
Table 15
Response
Yes
No
Some How
No of Respondents
7
48
5
Percentage
11.7%
80%
8.3%
This clearly shows that service management is not used as a weapon of control.
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Proceedings of 20th International Business Research Conference
4 - 5 April 2013, Dubai, UAE, ISBN: 978-1-922069-22-1
4.0 FINDINGS
In the course of this research work, the following findings were recorded:
I.
II.
XI.
XII.
XIII.
Service related industries are the dominant firms all over the world.
Most service organizations embark on training of employees as a way of enhancing their
service.
There are a lot of rooms for improvement in the various training programmes of service
organizations.
Staff training programmes improve performance.
Job rotation, on the job training and seminar by purpose and workshop as part of training
embarked upon by firms make workers to be versatile and more effective in service
deliver.
There is a relationship between provision of infrastructure such as power, water supply,
good roads etc and good service delivery.
Adequate provision of such infrastructure assist in better delivery of services.
Service oriented businesses are capable of reducing unemployment and thereby promote
better economic development.
Good government policies enhance good service delivery and promote growth of national
economy.
Technological innovations contribute massively to the promotion of services and
economic development.
Lack of security of life and property is big threat to provision of good service delivery.
Corruption negatively affects service delivery management.
Employees try by all means to live up to set objectives of their organization.
5.0
CONCLUSION, RECOMMENDATIONS AND LIMITATIONS OF THE STUDY
III.
IV.
V.
VI.
VII.
VIII.
IX.
X.
5.1 CONCLUSION
In this paper, conscious efforts have been made to identify the challenges militating against
effective service delivery management. Based on the various submissions made and findings in
this write-up which includes factual views of various authors, it is indisputable that service delivery
is the dominant factor in the affairs of all nations of the world. The phenomenal rise in service
among all the other sectors of the national economies of countries is unprecedented. It is
therefore imperative that proper attention to it by government, agencies and peoples concerned
will no doubt ensure a steady and sustained growth in the economies of various countries.
5.2 RECOMMENDATIONS
The following recommendations are therefore put forward here as ways of using effective service
management to ensure sustainable economic development.
1.
Reduction or Total Elimination of Corruption and Corrupting Tendencies. Just as it
is the duty of the people’s government to provide basic amenities that form the pedestal for
economic development, it is also the duty of every government to fight corruption with every
available tool. When corrupt leaders in government persistently embezzle public funds rather than
produce proper policies, the result will always be a stagnant economy and its attendant human
misery in form of high unemployment and massive poverty. Government should therefore
strength the apparatus that check corruption such as the law courts and the police. Government
should take tough actions against corrupt officials.
2.
Removal of Racial or other Forms of Discrimination. All forms of discrimination by
government or its agencies should be totally eliminated. Every sector of provision of services
should be given adequate and proper recognition and treatment. For example, in Nigeria, Health
Workers Bill currently undergoing reading at the National Assembly is brewing discontent among
healthcare professionals with pharmacists alleging that the bill confers undue privileges and
advantages to medical Doctors over other health workers. Such discriminatory practices could be
counter-productive to delivery of services.
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Proceedings of 20th International Business Research Conference
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3.
Learning From Experience And Applying Same To Other Areas. The history of
economic development has always based on learning from experience and applying this
knowledge to improve productivity. For example, in Nigeria, the privatization of the telecommunication industry brought an unprecedented progress in that industry in terms of massive
employment and delivery of various services. This has now encouraged the government to begin
the process of applying the same policy on power (electricity) and the oil sectors of the economy.
These efforts are already yielding positive effects.
4.
Reduction in Customer Waiting Line; In manufacturing process, efforts are made to
eliminate over-stocking of inventory or having inventory to lie waste. But in the service industry
this could be in the form of customer waiting lines or allowing staff to stay idle. So service
managers should design work places in a way to eliminate customers waiting to be attended
leaving the staff with having anything to do.
5.
Continuous Improvement to be Made an Integral Part of Organization Policy;
Continuous improvement in productivity and quality should be made a culture of any serious
minded service firm. This could come in the form of Research and Development and eagle-eye
observation of areas of continuous improvement. For example in a bank branch if it is observed
that customers are waiting, the platform personnel could be drafted to open additional front line
letter windows. In most Nigerian Banks, part of the efforts to decongest the banking halls are the
encouragement of the use of Automated Teller Machines (ATMs).
6.
Cross-training of Employees; To maintain flexibility in provision of service in a service
organization, the staff should be trained in several aspects of the organization’s work. This will
allow some fluidity in operation to permit the redeployment of all personnel to meet fluctuations in
customer’s demand.
7.
Elimination of Insecurity; Security is one of the major basic things of life. Lack of it
therefore jeopardizes any genuine efforts at economic development through service delivery. A
deeper look into security especially in the less developed countries reveals that it chiefly comes
from long deprivation and poverty. While it is true that government cannot do it alone, it still rests
squarely on her to provide the enabling environment by reducing frustration through the provision
of basic infrastructure and raising the economic power of the citizens to sufficiently enable them
to thrive. For instance Britain distributed free milk to all its inhabitants well into the late 1970s to
counteract malnutrition. All developed countries have social benefits in place to look after their
vulnerable citizens. This could be in form of giving some stipends to the unemployed to reduce
anxiety and insecurity in the nation.
6.3 LIMITATIONS OF THE STUDY
This research on service management for sustainable economic development is not an exception
to certain constraints associated with research work of this nature. The major constraints are as
follows:
I.
Time factor; this has been a major constraint that has militated against the realization
of the objectives of this research especially as the researcher had to carry it out in the
mist of other regular pressures of work in her place of employment.
II.
Negative Attitude of Respondents; Negative attitude of some of the people
interviewed or approached for completion of questionnaire some how affected the
morale of the researcher. Some were not ready, delayed or had misgivings in
releasing information to the researcher.
III.
Degree of objectivity: This applies to survey research generally. In other words
because this study is non experimental, reliance was primarily on what the
respondents said and the data from government offices, private firms and individuals.
There is no doubt that this raises the question of the degree of objectivity of these
respondents and other data.
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Proceedings of 20th International Business Research Conference
4 - 5 April 2013, Dubai, UAE, ISBN: 978-1-922069-22-1
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1.
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Growth, Trade and Employment, Washington D.C, National Academy Press 1988 p214.
2.
Fitzsimmons James & Mona: Service Management, Forth Edition Mc Graw Hill
Companies Inc. 2004.
3.
Ode Ojowu: The Economy, Newswatch Special Anniversary Edition, October 6 , 2008.
page 17.
4.
Okpata Fidelis O. (Phd), Policy Failure in National Development: The challenge of
public Bureaucracy: Journal of Business and Management Technology (Special
Conference Edition) page 212.
5.
Okereocha Chikodi, The Amazing World of Telecoms, Tell-Nigeria’s Independent
th
Weekly, June 18 , 2012 Edition p.18.
6.
Pride M. et al, Business, 9 Edition, Houghton Mifflin Company, Boston, New York, USA
2008 p.280.
th
th
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