The multi-unit issues that arise from ubiquitisation

In considering ubiquitisation, it is useful to remind oneself of the service life cycle (SFLC) – discussed in chapter 3 (pages 72-72).  Sasser et al. (1978) proposed this model based on the product life cycle, i.e. it is the typical S-shape curve.  They argued that service firms are in effect the same as a product, at least as far as their behaviour over time in the marketplace.  Thus the SFLC has five stages – introduction, multi-site rationalisation, growth, maturity and decline.  They also argue that at each stage of the cycle service firms face different challenges and issues and should respond in different ways.  It follows from this, if the same logic is applied, that strategy in service firms is as much about the organisation as it is about operations per se.  Operations such as hotels, restaurants, shops and banks have historically expanded through geographical dispersion. Hence complexity increases and a whole set of organisational issues emerge in managing such multi-unit businesses.

The issues that uniquely result from such multi-unit operations are:

  • inability to directly supervise subordinate managers at operational level;
  • lack of direct control over day-to-day operational processes and procedures;
  • multiple and frequent customer transactions conducted by relatively “low level” employees;
  • location of physical plant a key success factor;
  • employment of workforce from a range of local labour markets with different regional socio-cultural attitudes and behaviours;
  • dislocation of informational flow upward and downward through organisation due to dispersion of operational units; and
  • potential fragmentation of organisational culture into sub-units.

The major implication of these issues is that operations managers above unit level – so-called ‘multi-unit managers’ – assume an important role in service firms.  Typical job titles of such managers are area manager or district manager, each of whom has responsibility for anything between 5 and 30 operations.

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This entry was posted in Chap 11 Jobs and people, Sector: Entertainment & Sport, Sector: Financial Services, Sector: Hospitality & Tourism, Sector: Public Services & Charities, Sector: Retail and tagged , . Bookmark the permalink.

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