Robert Vastine, US Coalition Service Industry. CSI, founded 1982, is 45 service companies who collectively have 2.2 million employees and more revenue than Canada. Goal of CSI is to educate about role of services in US economy. www.globalservicesnetwork.com Services role in the US very poorly understood. Developing adequate measures slow but steady effort. BLS' new Quarterly Service Survey, BEA refinement of measures of trade/investment, recent Brookings book on services productivity. The Federal Government thinks service workers are hamburger flippers; more likely they are professionals.

---

Roland Rust, U Maryland. Spurring Service Innovation. Boom in the service sector is attributable to the growing role of information. Manufacturing companines are service businesses. GM woke up when their cars no longer made a profit but their financing arm does. The Business Reality: goods are comodities; service sells the product. Current research (Fornell & Rust 2004) shows that customer satisfaction drives aggregate consumer spending.

The Bottom Line.
Service Innovatoin --> Customer Saisfaction --> Consumer Spending --> GPD. Most service is a longtemr trend.

---

Summaries

Organization, Technology, People. Business and innovation issues: How to make customers effective co-producers? What services can be effectively produced through self-service? How to collaborate effectively within the value chain? Social issues: Where does the time go? What are the human-capacity limits on technology use? What is the impact of services on quality of life?

Growth and Optimization. Need formal ways of studying service creation, predict performance, identify growth opportunities, optimization opportunities. Challenge: two orders of magnitude. What's the low hanging fruit? Productivity isn't the only measure. (How about labor, asets, costs, outsourcing.) Why has KM failed in the past? How much commodity stuff should an IBM bring to the party?

Productivity and Client Satisfaction. How do you meausre performance? How do you improve them? Services is an act of value transfer. A business model in which acgtivites are conducted to exchange values. Services can be both transaction based (facial treatment), on going evolution-based services (a one-year hair-care package), a service over time continuously (an insurance policy). Giant issues: How do you measure the intangible? Manage customer expectations.

Data and Policy. Privacy. Confidentiality. Standards. Fairness. Quality of data. Ethics of data collection. Firewalls. Government intervention.

Models and Decisions. Emerging network of agents. Do models need to be predictive? Or merely useful? Descriptive and explanatory.

Analytics and Metrics. Interest in controlling/improving service delivery. Metrics drive behavior. Wrong metrics drive wrong behavior. Current metric frameworks over-applied.

Strategy and Transformation. Types of service: direct delivery, physical/hands-on, knowledge-worker delivered, information/automation. Aspects of strategy: scope, modeling, goals, value, lifecycle models, barriers to entry and exit, disruptions. Culture. Third-world models.

More to come...but time has run out for today.