A Service Process Positioning Framework for Co-Productive Services

Abstract

In manufacturing, process positioning frameworks are useful mental maps for guiding process reengineering. In contrast, there is no equivalent analytical framework for services despite their importance in today's economy. One reason might have been a lack of clear understanding of what truly defines a service -- until the emergence of the joint-production paradigm. In this paper, we develop a process positioning framework for co-productive services based on an analytical model of joint production between a service provider and a customer. We show that, as a task becomes more routine, it is desirable to decouple efforts, i.e., to make the provider's and the customer's efforts more substitutable, and to shift the service boundary to either the customer or the provider, whoever is the most efficient. Conversely, as a task becomes less routine, it is optimal to make efforts more complementary and to involve both parties in the service delivery. Based on our model, we offer prescriptions to improve service delivery efficiency and effectiveness.

Keywords: operations strategy, service operations, joint production, monotone comparative statics

JEL Classification: D20, L80