Operations Management: Rethinking How We Deliver Services Today and How We Should in the Future with Mark Fagan

Mark Fagan teaching small group
Mark Fagan, lecturer in public policy and former Senior Fellow at the Mossavar-Rahmani Center for Business and Government at Harvard Kennedy School, and faculty chair of the Delivering Public Services: Efficiency, Equity, and Quality executive program.

HKS Exec Ed: As an expert in the area of operations management, what are some of the core areas of your research focus and in the field today?

Professor Fagan: Two aspects of operations have my focus at this time. The first is the use of systems thinking to understand operational performance and find durable improvement opportunities. Traditionally, we look at processes as a linear flow—step one leads to step one, etc. We also often look at our own domain rather than the big picture. While this approach is simple, it fails to address the systemic issues that keep our performance for excelling. Systems thinking allows us to see the entire process and the feedback loops and non-linearities that exist. I have been using the system dynamics framework to operationalize systems thinking. System dynamics not only helps with understanding interrelationship of the factors that impact the system but also quantitatively model impacts of alternative interventions. 

My second research focus in on the psychology of waiting in lines. Lines are a part of life. From the perspective of the operations manager, lines have a cost to the service provider and person receiving the service. No lines are ideal for the delivery of most public services, but that is costly. We have queuing theory to quantitatively balance the cost and benefits of lines. But there is a really interesting psychology of waiting in lines. Years ago, a set of principles for waiting were established such as certain waiting times are perceived to be shorter that uncertain waits. Waiting in a group is less burdensome than waiting alone. The advent of the smartphone calls some of these principles into question. I am looking to understand how long we are willing to wait, amused by our phones, before we become irritated. The cost saving to service providers of a 10-minute wait time versus a 2-minute wait time are substantial, so there is a real economic incentive to understand this psychology. 

woman looking at phone while waiting in line

The impacts and disruptions of the COVID-19 pandemic have been far reaching. What are some of the major issues/concerns, and some positive surprises, you have observed as it relates to operations management and service delivery?

The COVID-19 pandemic has upended the operations management world, as it has for all aspects of our life. Two impacts are of particular importance because they are leading to lasting change. First, we learned that many services can be delivered remotely. While the personal touch is most often a real win, remote/digital delivery generated sizeable cost savings for both provider and receiver. Requesting birth certificate from the city online and receiving via the mail is an improvement over going to city hall. Digital delivery is here to stay. Another example is healthcare where remote appointments/telehealth became the norm during the pandemic. A portion of telehealth will persist as it offers benefits to patients and providers. 

The second key impact is on the design and operation of supply chains. From the shortages of personal protective equipment to toilet paper, operations mangers recognized the vulnerably of their supply chains. For the past 20 years supply chain mangers have wrung costs out of their systems by sourcing globally, concentrating volumes with limited suppliers and assuming aligned incentives between participants. COVID-19 demonstrated the need for balancing cost effectiveness with reliability. The changes we are seeing are a better understanding of supply chain partners and their capabilities, more local sourcing, and more diversity in the supplier base. The costs may be a little higher, but the risks will be substantially lower. 

On a more positive note, the pandemic brought out the best in my students as they shifted their focus to responding to the crisis. Some built staffing software to help ensure medical teams were used most effectively. Others worked on developing a new supply chain to collect, process and distribute COVID-19 Convalescent plasma. Yet others built COVID-19 testing and vaccine delivery capacities. The students illustrated the power of effective operations management. 

We have seen a growing concern about equity issues as it relates to public services, particularly reaching and meeting the needs of vulnerable populations. What are some of the critical areas of focus in your mind to making progress in this area?

As public sector service providers we must deliver equally for all. A major challenge in the operations space is the growing use of digital technology in the delivery of services from healthcare to education to transit cards. Regrettably, many of our most vulnerable to not have access to the technology, be it smartphones or even internet access. Our job as operations managers is to find ways to enable progress but to make sure everyone enjoys the improvements. The starting point for me is education, making sure managers understand who is not advantaged by innovation. I must admit that until the COVID-19 pandemic, I was not aware of the extent of the population without a reliable internet connection. Next, we need to find viable alternatives for those without technology. The same service offering must be available using alternatives such as kiosks, hotspots and landlines/non-smart telephones. Moreover, we need to debias our thinking. Doing so enables us to design/redesign processes that resolve/avoid inequities. The Harvard Implicit Bias Test is a great place to start.  

The pandemic is challenging all of us to rethink how we deliver services today and how we should in the future. Technology is also opening new ways to deliver our services. In short, the opportunity for positive change has never been better. 

You have taught a management operations graduate course at HKS for many years - what prompted you to design your first executive education program, Delivering Public Services?

Each year, I hear from alumni how they are still using the course concepts and generating improvements. This is why I teach. I would like to find a way to enable operational improvements beyond the 70 students who take my degree-program course each year. The new Executive Education program, Delivering Public Services: Efficiency, Equity, and Quality, is a way for me to reach a broader group of those delivering services. I am especially excited about teaching to practitioners because they can immediately put the learning into practice. The timing of the launch of the program could not be better. The pandemic is challenging all of us to rethink how we deliver services today and how we should in the future. Technology is also opening new ways to deliver our services. In short, the opportunity for positive change has never been better. 

Can you tell us a little bit more about the program and what people will take away from the experience?

Delivering Public Services provides practitioners with the frameworks and tools to improve their operations and service delivery. The sessions are designed to illustrate the opportunities for improvement and how they can be tapped. Class discussions and simulations, in the context of real-world issues, are the basis for learning. Participants will work through personal challenges with the cohort and me to reinforce the learning. It will also provide a toolkit for solving operational issues and knowing how to use them. Finally, the program provides an opportunity to build a network for peers who can be a resource now and in the future.