Optimizing services — Strategy, tactics and control

In the service industry, only one thing is certain - next year will be different from this year. Every service operation must therefore continually reallocate resources, reconfigure and reoptimise. Strategy is about where to invest - balancing capital investment against future operating costs. With the resources more or less fixed, the tactical question is how best to allocate and schedule them. Finally, on the day of operation, resources must be reconfigured to meet client requirements, typically imbalanced by various disruptions. Though strategy, tactics and operational control are often handled quite separately, they are mutually interdependent. We discuss ways in which operational control impacts medium term tactical planning, which in turn impacts long term strategy. We show by example how this understanding can improve overall customer service and minimise costs.