Chapter 1 - Chapter1 nation,,anditisbyfarthe...

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Chapter 1 Services in the Economy
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Why study service operations? Service firms constitute and overwhelmingly large  percentage of the economy of every industrialized  nation, the size will only increase, and it is by far the  most likely economic sector in which business school  graduates will be employed. Academic research has largely ignored services. The  relative lack of attention given to services provides a  competitive edge to those students who pursue its study.
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Why study service operations? Many services have characteristics that are  strongly different from goods. Consequently,  specialized and different managerial techniques  are employed in services than are employed in  many manufacturing firms, and what we have  learned from manufacturing settings does not  always transfer to services.
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The Importance of Service sector Historically, economic reports identify activities  as “service producing” that are not “goods  producing”.( manufacturing and construction) Service producing encompasses a wide variety  of industries, including retailing, wholesaling,  transportation, financial services, lodging,  education, government, and entertainment.
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The Importance of the Service Sector Service accounts for roughly 80% of the U.S.  economy in both employment and gross  domestic product.  Your parents faced a very different economic  structure from today’s environment when for  their first job. Figure 1.1 depicts 1900 to 1950 as being the  “industrial society” in which an important activity  is goods production.
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Chapter 1 - Services in the Economy Historical US Employment by  Economic Sector
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The Importance of the Service Sector Since 1950, the U.S. entered “postindustrial”  era. From 1950 to the current time, service  producing industries increased, roughly, from  50% to 80% of the U.S. workforce.  Services such as health, education, and  recreation predominate in the postindustrial  society.  According to government statistics, in 1900”  manual workers” outnumbered “white-collar  workers” two to one.
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The Importance of the Service Sector Today, the situation is entirely reversed, with  twice as many white collar workers as manual  laborers. The ramifications of this postindustrial society to 
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Chapter 1 - Chapter1 nation,,anditisbyfarthe...

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