1. Chapter – 1 Role of Service in an Economy
Service Management (5e)
Operations, Strategy, Information Technology By
Fitzsimmons and Fitzsimmons
Chapter – 1
Role of Service in an Economy

2. Learning Objectives
Describe the central role of services in an economy.
Discuss the evolution of an economy from an agrarian society to a service society.
Describe the features of preindustrial, industrial, and postindustrial societies.
Describe the features of the new service economy

3. Service Definitions Services are deeds, processes, and performances.
Valarie Zeithaml & Mary Jo Bitner
A service is a time-perishable, intangible experience performed for a customer acting in the role of a co-producer.
James Fitzsimmons

4. Definition of Service Firms
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.
James Fitzsimmons

5. Role of Services in an Economy

6. Percent Service Employment for Selected Nations

7. Trends in U.S. Employment by Sector

8. Stages of Economic Development

9. The New Experience Economy

10. The Four Realms of an Experience

11. Experience Design Principles
Theme the Experience (Forum shops)
Harmonize Impressions with Positive Cues (O’Hare airport parking garage)
Eliminate Negative Cues (Cinemark talking trash containers)
Mix in Memorabilia (Hard Rock T-shirts)
Engage all Five Senses (Mist in Rainforest)

12. Source of Service Sector Growth
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 Two-income families Growth in number of single people Home as sanctuary