Professional Documents
Culture Documents
Unit-1
The Service Economy is a relatively new coinage arising out of the popularity of
the service sector. The service sector has gained a lot of importance in the world
economy. Most of the developed countries are earning millions from the service
sector alone. In US, the service sector accounts for a greater percentage of GDP
than it used to a couple of years back. The term Service Economy also known as
Functional Economy is used to refer to the relative significance of service
attached to a product offered by a company. In today’s economy every product has
a service value attached to it. The old dichotomy between product and services has
been reduced and a service-product continuum has been established. In
management this phenomenon is referred to as the Servitization of Products. When
a company proceeds from maximizing its sales towards customer satisfaction it
puts emphasis on the aspect of service. It helps the company to enhance its
goodwill in the market.
The size of the service sector is increasing in virtually all countries around the
world. In emerging economies, the service output is growing rapidly and often
represents at least half of the GDP. Thus, Service economy is growing. As a
national economy develops, the relative share of employment between agriculture,
industry (including manufacturing and mining).The service economy in developing
countries like India is mostly concentrated in financial services,
health, and education.
PROS OF PRIVATIZATION:
2. SOCIAL CHANGES: Now a day there is a drastic change, two members are
working, which requires to hire individuals to perform tasks that used to be
performed by a house hold member.
4. ADVANCES IN IT: Changes come from the integration of computers and tele-
communication.More powerful software enables firm to create databases that
combine information about customers with details of all their transaction, so that
they can be used to predict new trends, segment the market, new marketing
opportunities. The creation of wireless networks and transfer of electronic
equipments such as cell phones to lap tops and scanners, to allow sales and customer
service personnel to keep in touch.
Service operations managers face many hurdles daily. They must ensure that the
service is delivered according to the agreed-upon standards while meeting the
customer’s needs. Additionally, they need to motivate employees to provide
excellent service and meet targets. They also need to monitor and improve the
quality of the service continuously.
Some of the challenges faced by service operations managers include:
Interacting with various departments that are frequently not in the office
Ensuring that all parties have easy access to essential information and data
Providing feedback and updates in real-time
Capturing and reporting on metrics around the teams they support
Creating long-term, efficient working procedures to improve performance