Operations Management: An Integrated Approach, 5th Edition

SUPPLY CHAINS FOR SERVICE ORGANIZATIONS

Up till now, the discussion has focused on supply chains for manufacturing organizations rather than supply organizations. However, service organizations can also benefit from supply chain management. A supply chain for a service organization is similar to that for manufacturing organizations since external suppliers, internal operations, and external distributors can be needed. In the case of an e-tailer, supply chain management can be used to integrate external suppliers (usually providing better demand forecast information to its suppliers, thus reducing uncertainty within the chain); it has internal operations with regard to order processing, order picking, and so on; and it can have external distribution done by a third-party provider (such as FedEx, UPS, or DHL).

FIGURE 4-4 Supply chain for a travel agency

Let's look at an example of a supply chain for a full-service travel agency as shown in Figure 4-4. The agency arranges a wide variety of trips for its customers. The service can be as simple as making airline, train, hotel, cruise, car rental, or personal tour arrangements for the customer. A customer can require a single type of service or have a highly complicated travel request.

Internal Operations

The internal operations at the travel agency are split into two parts: Travel Enablement and Travel Billing.

Travel Enablement begins ...