01 Economy - Role of Services in an Economy Role Welcome to...

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Unformatted text preview: Role of Services in an Economy Role Welcome to Service Management Service Professor James Fitzsimmons University of Texas at Austin Learning Objectives Learning Describe the central role of services in an Describe economy. economy. s Discuss the evolution of an economy from Discuss an agrarian society to a service society. an s Describe the features of preindustrial, Describe industrial, and postindustrial societies. industrial, s Describe the features of the new service Describe economy economy s Service Definitions Service Services are deeds, processes, and performances. performances. Valarie Zeithaml & Mary Jo Valarie Bitner Bitner A service is a time-perishable, intangible experience performed for a customer acting in the role of a co-producer. in James Fitzsimmons Definition of Service Firms Definition Service enterprises are organizations that facilitate the production and distribution of goods, support other firms in meeting their goals, and add value to our personal lives. add James Fitzsimmons James Role of Services in an Economy Role Percent Service Employment for Selected Nations Percent Country United States Canada Canada Israel Israel Japan France France Italy Italy Brazil Brazil China China 1980 67.1 67.2 63.3 54.5 56.9 48.7 46.2 13.1 1987 71.0 70.8 66.0 58.8 63.6 57.7 50.0 17.8 1993 74.3 74.8 68.0 59.9 66.4 60.2 51.9 21.2 2000 74.2 74.1 73.9 72.7 72.7 70.8 62.8 56.5 40.6 Trends in U.S. Employment by Sector Trends 90 Proportation of total employement 80 70 60 50 40 30 20 10 0 18 50 19 10 19 50 19 70 18 70 18 90 19 30 19 90 Service Manufacturing Agriculture Year Stages of Economic Development Stages PrePredominant activity Use of human Unit of labor social life Standard of living measure Subsistence Society Society Game Structure Technology PreAgainst PreIndustrial Nature Industrial Agriculture Raw Extended Mining muscle household power Machine Individual tending Routine Simple hand Traditional tools Authoritative Bureaucratic Machines Hierarchical Industrial Against Goods fabricated production nature nature PostAmong Postindustrial Persons industrial Services Quantity of goods Artistic Community Creative Intellectual Intellectual Quality of InterInformation life in terms dependent of health, Global education, education, recreation The New Experience Economy The Economy Function Nature Attribute Method of supply Seller Buyer Agrarian Extract Fungible Natural Stored in bulk Trader Market Industrial Make Tangible Service Deliver Intangible Experience Stage Memorable Standardized Customized Personal Inventoried Delivered on demand Revealed over time Stager Guest Manufacturer Provider User Client The Four Realms of an Experience The Customer Participation Passive Active Absorption Entertainment Education (Movie) (Language) Environmental Relationship Immersion Esthetic (Tourist) Escapist (ScubaDiving) Experience Design Principles Experience Theme the Experience (Forum shops) s Harmonize Impressions with Positive Cues (O’Hare airport parking garage) s Eliminate Negative Cues (Cinemark talking trash containers) s Mix in Memorabilia (Hard Rock T-shirts) s Engage all Five Senses (Mist in Rainforest) s Source of Service Sector Growth Source s s Innovation Push theory (e.g. Post-it) Pull theory (e.g. Cash Management) Services derived from products (Video Rental) Information driven services Difficulty of testing service prototypes Social Trends Aging of the population Aging Two-income families Growth in number of single people Home as sanctuary Discussion Topics Discussion Illustrate how the type of work he or she Illustrate does influences a person’s lifestyle. For example, contrast a farmer, a factory worker, and a school teacher. worker, s Is it possible for an economy to be based Is entirely on services? entirely s What is the value of self-service in an What economy? economy? s Interactive Class Exercise Interactive s The class breaks into small groups. Each The group identifies service firms that should be listed in the top Fortune 100 and places Fortune them in rank order of estimated annual revenue. revenue. www.fortune.com/lists/F500/index.html ...
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