Microsoft PowerPoint Bài giảng Unit 1 The Service Economy Kinh tế dịch vụ Nguyen Manh Tuan Roles of Service in an Economy Economy Evolution More on Service sector Experience economy Service definitions Emergence of Service Sience
Unit The Service Economy Nguyen Manh Tuan 5/18/2020 nguyen manh tuan – internal use AGENDA Roles of Service in an Economy Economy Evolution More on Service Sector Experience Economy Service Definitions Emergence of Service Science 5/18/2020 nguyen manh tuan – internal use Learning Objectives Describe the central role of services in an economy Identify and differentiate the stages of economic activity Identify the features of preindustrial, industrial, and postindustrial societies Identify the features of the experience economy Describe the definitions of service Note the emergence of service science 5/18/2020 nguyen manh tuan – internal use Roles of Services in an Economy Services are NOT peripheral activities but rather integral parts of economy Service: crucial force for today’s change toward a global economy Interdependency between manufacturing and service sectors Services in support of the distribution of manufactured goods Integration of downstream services Exploiting value added services Service Definitions Fitzsimmons & Fitzsimmons 2006 5/18/2020 nguyen manh tuan – internal use 1.Roles of Services in an Economy (cont’) Fitzsimmons et al 2014 5/18/2020 nguyen manh tuan – internal use 1-5 1.Roles of Services in an Economy (cont’) Teboul 2006 Teboul 2006 5/18/2020 1.Roles of Services in an Economy (cont’) Bryson & Daniels 2008 5/18/2020 nguyen manh tuan – internal use 1.Roles of Services in an Economy (cont’) Spohrer & Maglio 2008 macro level The economies of the world are becoming one large service 5/18/2020 nguyen manh tuan – internal use system 1-8 Roles of Services in an Economy (cont’) Spohrer & Maglio 2008 micro level 5/18/2020 nguyen manh tuan – internal use Economic Evolution The three-sector hypothesis is an economic hypothesis which divides economies into three sectors of activity: extraction of raw materials (primary), manufacturing (secondary) and services (tertiary) The increase in quality of life, social security, blossoming of education and culture, higher level of qualifications, humanization of work, and avoidance of unemployment 5/18/2020 nguyen manh tuan – internal use 10 Experience Economy (cont’) Gilmore & Pine 1999 Agrarian Economy Parents made cakes from scratch, mixing inexpensive ingredients from their farm Industrial Economy Parents paid a few dollars to buy premixed ingredients in a box thus showcasing the goodsbased industrial revolution Service Economy Busy parents paid significantly more, ten to fifteen times the ingredients’ price, to order a cake from a bakery or grocery store 5/18/2020 nguyen manh tuan – internal use 24 Experience Economy (cont’) Experience Economy Parents outsourced the entire birthday event at a local venue that creates a memorable experience for kids They spend hundreds of dollars for the experience and the venue includes the cake for free Social/ Social Experience Economy ??? The birthday kid crowdsources with friends where their experience should be held Their friends have more influence over their decisions than their family does During the experience, the birthday kid’s friends take pictures and videos, posting them online and tag the celebratory guest Gilmore & Pine 1999 5/18/2020 nguyen manh tuan – internal use 25 Experience Economy (cont’) Experience Economy Social/ Social Experience Economy ??? Parents are not left out of the Social Economy Parents now live stream the entire experience to family members that cannot attend They take pictures and videos that they immediately upload to their social networks People carry their friends in their pockets and are always sharing their experiences with them They text, chat, share digital “face time,” and showcase visual images whether through video or pictures The sharing and connecting with others about the experience becomes the product Gilmore & Pine 1999 5/18/2020 nguyen manh tuan – internal use 26 Experience Economy (cont’) Gilmore & Pine 1999 5/18/2020 nguyen manh tuan – internal use 27 Experience Economy (cont’) Typologies of Services in 21st century C C E E E E E I I P Q R 5/18/2020 P A P E C E A F A I E F M W S C H I R D E E A T Fitzsimmons et al 2014 nguyen manh tuan – internal use 28 Service Definitions Defining services is not easy: an activity or series of activities provided as solution to customer problems (Gronroos 1990); all economic activity whose output is not physical product or construction (Baruch et al 1987); intangible and perishable created and used simultaneously (Sasseret al 1978); a time-perishable, intangible experience performed for a customer acting in the role of co-producer (Fitzsimmons & Fitzsimmons 2005); a change in condition or state of an economic entity (or thing) caused by another (Hill 1977) deeds, processes, and performances (Zeithaml & Bitner 1996); application of competencies for the benefit of another entity (Vargo & Lusch 2004) Spohrer & Maglio 2008 5/18/2020 nguyen manh tuan – internal use 29 Service Definitions (cont’) Spohrer & Maglio 2008 Defining services is not easy: pay for performance: what the provider does for the client is essential, as opposed to exchange of an artifact or a good being essential pay for performance in which value is coproduced by client and provider at least types of performance to providers: high talent performance (trained chef), high technology performance (ordering dinner from a website), and routine performance supported by superior environment (service personnel with average abilities, a good cookbook, and a well-equipped kitchen) 5/18/2020 nguyen manh tuan – internal use 30 Service Definitions (cont’) Spohrer & Maglio 2008 Defining services is not easy: pay for performance in which value is coproduced by client and provider: Firms can invest in talent, invest in technology, or provide a superior environment for performance: Talent allows for the opportunity to provide the widest range of services for a client with the greatest levels of unique customization Technology allows for the greatest efficiencies to be achieved for highly standardized or well-scoped alternative configurations Environmental supports allow for the greatest flexibility on the part of the provider in finding employees who can perform well for clients with some degree of customization 5/18/2020 nguyen manh tuan – internal use 31 Service Definitions (cont’) Spohrer & Maglio 2008 Defining services is not easy: Considering a teacher telling a student to read a book and work a problem set (exercises) or a doctor instructing a patient to eat certain foods and exercise more Providers perform certain activities, but clients must also perform activities that transform their own states or else the benefit/value of the service will not be fully attained In business services, if client does not install the new IT systems and train the necessary people in the reengineered process, client will not receive the benefit of the service 5/18/2020 nguyen manh tuan – internal use 32 Service Definitions (cont’) Spohrer & Maglio 2008 Defining services is not easy: The provider must negotiate to monitor and assess that the client is performing adequately on the client’s responsibilities, and, of course The client needs to determine that the provider is likewise applying satisfactory effort and quality controls in the performance of the provider’s tasks A time-perishable, intangible experience performed for a client who is acting as a co-producer to transform a state of the client The client plays a key role in co-production activities (the client has responsibilities) and in the co-creation of value (transformed state of the client) 5/18/2020 nguyen manh tuan – internal use 33 Emergence of Service Science (cont’) Academic interest in services has been growing slowly and steadily, with more and more disciplines rethinking their curricula and research agendas in light of the growth of services Nevertheless, most academics and government policy makers are still operating in a manufacturing paradigm rather than in a service paradigm The content of course shifts over the last 100 years - toward more balance among human, technical, and business concerns 5/18/2020 Spohrer & Maglio 2008 nguyen manh tuan – internal use 34 Emergence of Service Science (cont’) 2000s, IBM’s effort to advance the research and teaching of service, identified as service science, management, and engineering (SSME), or Service Science for short IBM had played a major role in helping to establish the discipline of computer science in the 1950s Service Science, Management and Engineering (SSME) or, SSMED with the inclusion of Design to take into account factors important to the user experience of services 5/18/2020 nguyen manh tuan – internal use 35 Emergence of Service Science (cont’) Vargo & Lusch (2004): a service-dominant logic (SDL) in marketing to replace the goods-dominant logic “Service" as the application of competences for the benefit of another entity “Service" (singular), which is a process >> “Services“ (plural) which implies "intangible goods" “Operant resources" (value in use, verbs) >> “Operand resources" (value in property, nouns) Marketing with (relational) >> marketing to (transactional) Value is always co-created (blurring the goods-service/producer-consumer divide) All economies are service economies, and all businesses are service businesses 5/18/2020 nguyen manh tuan – internal use 36 Emergence of Service Science (cont’) Vargo, Lusch & Akaka 2010 5/18/2020 nguyen manh tuan – internal use 37 THE END 5/18/2020 nguyen manh tuan – internal use 38 ... Fitzsimmons et al 2 014 5 /18 /2020 nguyen manh tuan – internal use 1- 5 1. Roles of Services in an Economy (cont’) Teboul 2006 Teboul 2006 5 /18 /2020 1. Roles of Services in an Economy (cont’) Bryson... Pine 19 99 5 /18 /2020 nguyen manh tuan – internal use 26 Experience Economy (cont’) Gilmore & Pine 19 99 5 /18 /2020 nguyen manh tuan – internal use 27 Experience Economy (cont’) Typologies of Services... peoples 2 013 nguyen manh tuan nmt – internal use 1- 19 19 More on the service sector (cont’) Service career - Advantages of new work: 5 /18 /2020 More career opportunities for