In this paper, we extend concepts from the failure modes and effects analysis of tangible and manufacturing systems to services. We use an event-based process model to facilitate service design and represent the relationships between functions and failures in a service. The objective of this research is to propose a method for determining a service operation strategy based on service reliability and processes using fuzzy failure mode and effects analysis (FMEA) and grey theory in manufacturing and operating systems. We define the failure mode of service as interaction ways that can be failed in a service delivery process. The fizzy set theory is used to characterize service reliability based on linguistic terms during FMEA. Grey theory is employed to determine the degree of relation and ranking among risk factors that are represented as potential failure causes. To demonstrate implementation of the proposed method, we use a case study involving a typical automotive service operation.