chap 1 the role of service operations
TRANSCRIPT
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Role of Services in an Economy
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What is a service?
An idea?
A circumstance?
A convenience?
A physical thing?
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Goods vs. Services
Good: tangible physical object; created and
transfered; existence over time
Service: intangible and perishable; created
and used simultaneously; only the effect has
an existence over time
Book, restaurant, TV
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Challenge to managers
Identify appropriate techniques developed
in manufacturing that are applicable to
service operations
Initiate the innovative use of information
systems
Recognise the consumer as a productiveresource
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Service Definition
A Service is a Time-perishable, Intangible
Experience Performed for a Customer
Acting in the Role of a Coproducer.
James Fitzsimmons
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Definition of Service Firms
Service Enterprises are Organizations that
Facilitate the Production and Distribution of
Goods, Support Other Firms in MeetingTheir Goals, andAdd Value to Our Personal
Lives.
James Fitzsimmons
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Taxonomy of services
Domestic services
Trade and Commerce
Services that refine and extend human
capacities
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Role of Services in an Economy
INFRASTRUCTURE SERVICE
Communications
Transportation
Utilities
Banking
PERSONAL SERVICES
Healthcare
Restaurants
Hotels
CONSUMER(Self-service)
GOVERNMENT SERVICES
Military
Education
Judicial
Police and fire protection
DISTRIBUTION
SERVICES
Wholesaling
Retailing
Repairing
FINANCIAL SERVICES
Financing
Leasing
Insurance
MANUFACTURING
Services inside company:
Finance
Accounting
Legal
R&D and design
BUSINESS SERVICES
Consulting
Auditing
Advertising
Waste disposal
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Stages of Economic
Development
Features
Pre- Use of Standard
dominant human Unit of of living
Society Game activity labor social life measure Structure Technology
Pre- Against Agriculture Raw Extended Sub- Routine Simple hand
Industrial Nature Mining muscle household sistence Traditional tools
power Authoritative
Industrial Against Goods Machine Individual Quantity Bureaucratic Machines
fabricated production tending of goods Hierarchical
nature
Post- Among Services Artistic Community Quality of Inter- Information
industrial Persons Creative life in terms dependent
Intellectual of health, Global
education,
recreation
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The New Experience Economy
Economy Agrarian Industrial Service Experience
Function Extract Make Deliver Stage
Nature Fungible Tangible Intangible Memorable
Attribute Natural Standardized Customized Personal
Method of
supply
Stored in
bulk
Inventoried Delivered
on demand
Revealed
over time
Seller Trader Manufacturer Provider Stager
Buyer Market User Client Guest
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The Four Realms of an Experience
Customer Participation
Passive Active
Environmental
Absorption Entertainment
(Movie)
Education
(Language)
Relationship Immersion Esthetic(Tourist)
Escapist(Skydiving)
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Source of Service Sector Growth
Information Technology (e.g. Internet)
InnovationPush theory (e.g. Post-it)
Pull theoryServices derived from products
Exploiting information (e.g. Auto part sales)
Difficulty of testing service prototypes
Changing Demographics
Aging of the populationTwo-income familiesUrbanisation
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Role of the Service Manager
Entrepreneurial Innovation
Capitalizing on Social Trends
Management Challenges
Economies of Scale (MRI scanner)
Economies of Scope(Convenience store)
Complexity (Yield Management)Boundary Crossing (Bank vs Brokerage)
International Competitiveness( Cultural
Diversity)
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Discussion Topics
Illustrate how the type of work he or she doesinfluences a persons lifestyle.
Is it possible for an economy to be based entirelyon services?
Speculate on the effect that the Internet will haveon the delivery of services.
What is the value of self-service in an economy? Comment on the role that marketing plays in the
service innovation process.