Essays on Service Strategies: Evidence from Banking and Healthcare Industries

The primary objective of this dissertation is to provide insights for service providers in general, and retail bankers and hospital administrators in particular, that will help them improve their operational efficiency and effectiveness. In doing so, this dissertation consists of three essays that develop multiple service operations strategies, that identifies key elements affecting efficiency and effectiveness in two key critical industries: banking and healthcare. We contribute to service operations strategy research and practice by incorporating multi-disciplinary theories and approaches from marketing, economics, and quality management. Although operations researchers and practitioners alike realize the importance of productivity and effectiveness, they are largely unaware of more advanced techniques to achieve this goal. This dissertation fills, in part, this gap and leads one to understand research agendas in service strategy. In particular, this dissertation applies new theories and methods illustrating how bankers can improve efficiency. Moreover, it describes how hospital administrators can better understand the ‘hidden’ costs of quality failures that associated with hospital readmission as well as the impact of the recent Medicare penalty plan on hospitals and patient welfare. We employ different methods (frontier efficiency estimation, econometrics, structural estimation, and principal-agent models) to critically analyze banking and healthcare industries. The first essay deals with banking industry; the second and third essays are