Services Dominate Economy in Most Nations Most New Jobs are Generated by Services

Fastest Growth Expected in Knowledge-Based Industries Many New Jobs are Well-Paid Positions Requiring Good Educational Qualifications

Source : The World Factbook, Central Intelligence Agency

Its current participation in export (service) accounts for 2.45% in the world trade activities.
Contribution of service countrys GDP is 54.6%. sector in

Businesses, government agencies, nonprofit organizations. Organized and unorganized sector.

Companies of any size--from huge global corporations to local small businesses

Limited companies to individual run organizations/set up. High technology content to very low technology inter- phase organizations. Jobs range from high-paid professionals and technicians to minimum daily wage earners.

Sub sectors 1. Trade and hotels, tourism services 2.Transpot, storage and communication. 3. Banking, insurance and other financial services

GDP contribution

14.3 % 16.0% 9.3%

4. Public administration & defense

5. IT , ITES and other services TOTAL

7%
8% 54.60%

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Tourism and Travels Hospitality( Hotels, Motels , Resorts). Catering And Restaurant Industry. Consultancy Services. Insurance . Health care and Hospital management. Housing and Construction Industry. Burial permission and dispose off agencies. Communication. Entertainment. Banking Services. Transportation and Logistics. Theme parks. Leisure activities industry.

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Legal Agencies. Maintenance Services. Information Technology Services. Research and Development. Investment Advisers. Accounting and Tax Services. Electricity, Gas and Sanitary Services. Real Estates. Personnel Services. Social Organizations. Other Service Providers.

 Financial

services banks, insurance . Telecommunications Health services Tourism Travel & transport Information technology Retailing

Social Changes Government Policies

Business Trends

Advances in IT Globalization

New markets and product categories Increase in demand for services More intense competition

Innovation in service products & delivery systems, stimulated by better technology

Customers have more choices and exercise more power

Success hinges on: Understanding customers and competitors Viable business models Creation of value for customers and firm

Social Changes Government Policies

Business Trends

Advances in

IT
Globalization

Changes in regulations Privatization New rules to protect customers,

employees, and the environment

New agreement on trade in services

Social Changes Government Policies

Business Trends

Advances in

IT
Globalization

Rising consumer expectations More affluence Personal Outsourcing Increased desire for buying experiences vs.
things

Rising consumer ownership of high tech

equipment

Easier access to more information Immigration Growing but aging population

Social Changes Government Policies

Business Trends

Advances in

IT
Globalization

Push to increase shareholder value Emphasis on productivity and cost savings Manufacturers add value through service and
sell services

More strategic alliances Focus on quality and customer satisfaction Growth of franchising Marketing emphasis by nonprofits

Social Changes Government Policies

Business Trends

Advances in IT
Globalization

Growth of Internet Greater bandwidth Compact mobile equipment Wireless networking Faster, more powerful software Digitization of text, graphics, audio, video

Social Changes Government Policies

Business Trends

Advances in

IT
Globalization

More companies operating on transnational

basis

Increased international travel International mergers and alliances Offshoring of customer services Foreign competitors invade domestic markets

Services involve a form of rental, offering benefits without transfer of ownership Services are an act or performance offered by one party to another. (Performances are intangible, but may involve use of physical products.)

Services are an economic activity that does not result in ownership.

A process that creates benefits by facilitating a desired change in customers themselves, physical possessions or intangible assets.

Five broad categories within non-ownership framework:

1.

Rented goods services

2.
3. 4.

Defined space and place rentals

Labor and expertise rentals Access to shared physical environments

5.

Systems and networks: access and usage

Based on differences in nature of service act (tangible/intangible) and who or what is direct recipient of service (people/possessions), there are four categories of services:

People processing Possession processing Mental stimulus processing Information processing

 People Processing
Customers must:
physically enter the service factory

co-operate actively with the service operation

Managers should think about process and output from customers perspective
to identify benefits created and non-financial costs: - Time, mental, physical effort

Possession Processing
Customers are less physically involved compared to people processing services Involvement is limited Production and consumption are separable

 Mental Stimulus Processing Ethical standards required when customers who depend on such services can potentially be manipulated by suppliers Physical presence of recipients not required Core content of services is information-based
Can be inventoried

 Information Processing Information is the most intangible form of service output, But may be transformed into enduring forms of service output Line between information processing and mental stimulus processing may be blurred.