With the recently legislated increase in the minimum wage law in the United States and the current economic downswing in Europe, service system managers in Western economies can look forward to continued pressure to run their operations more efficiently. While most managers are aware of the success stories of companies in a few industries (notably fast foods), there is little in the way of theory to help them decide how far they should go in altering their products, technologies, work forces, and work methods in attempting to achieve the nebulous goal of an efficient production system for services.

A version of this article appeared in the November 1978 issue of Harvard Business Review.