The Future of Service:An Extrapolation of the Present
or a Paradigm Shift?
P. K. KannanRalph J. Tyser Professor of Marketing Science
The Robert H. Smith School of BusinessUniversity of Maryland
The Distant Past…
An ancient toll boothPorta Borsari, Verona, Italy
The Past….
The Near Past.. and the Present!
A Mechanical Solution…
A Digital Solution…
Digital Technology Creates “Super-Service”
Technology eliminates service variabilityVariability due to technologyVariability due to customer skill-levelMakes service very efficient
A paradigm shift in service levelsCo-production of effort minimal!Traffic is smooth, congestion minimized,
community benefits!(Maglio 2011)
The rise of digital services…..
Media VisualAudio Gaming
Personalization/Add-on Services
Software/Apps
Software-as-ServiceUGC
E-Learning E-Health
Success of Technology….not quite uniform
Significant impact on individuals, firms, governments and societyEnormous productivity gains…In general, much improved outcomes…
Despite infusion of technology, some sectors have not seen significant gains in outcomeEducation expenses have been increasingHealthcare costs have explodedExpensive government services are the norm
Digital networks and services will come to the rescue..
Personal Services – A network of devices and apps
www.fastcodesign.com
Wearable computing…
Customization/Personalization Services Networking Apps
Networking of the apps personalizes the suite of service for an individual – apps to talk to each other…
Digital services will allocate “screen space” in as much as a retailer decides the “shelf space”
Renting will become fashionable….
Enabler is vast digital networksAirbnbUber, Lyft
Software as a ServiceDigital Services rather than Software ProductsEducation as a Digital ServiceTele-medicineOutcome based measures of success
Using customer as assets – co-creation using digital networks
Citizens/Customers
Institution Government/Business
Design InputEffort
Benefit/Value
REALMOF
SELF-SERVICE
Citizens/Customers Institution Government/Business
Effort
Community Benefit
CITIZENSERVICE
FORCOMMON
GOOD
Citizens/Customers Institution Government/Business
CITIZENSHELPINGOTHER
CITIZENSANDFOR
COMMONGOOD
Design Input
Effort
Value
Value
• Citizens are resources and assets• Defining value based on social outcomes• Building social networks• Building reciprocal relationships
Co-delivery is an active, creative and social process, based on collaboration between governments and
citizens, and/or between citizens and citizens that is initiated by the governmentto generate value for citizensthrough innovative “digital” services
Based on Ref: Prahalad and Ramaswamy (2004) Ref: www.promisecorp.com/newpathways
Co-Delivery of Services
Citizens participating in the development of a new policy or serviceTime-boundedCitizen groups
ExamplesConsulting CanadiansNew South Wales Education Department
Co-Design of Public Services
Co-production is anew way of thinking about public services;has the potential to deliver a paradigm shift in
providing services such ashealth, education, policing, etcto make them more effective, efficient, and
more sustainable
Ref: Boyle and Harris (2009)
Co-Production of Public Services
Big Data to Benefit the Small Guy…
Using the big data to benefit the customersProcessed information to help customersHealth indicatorsNutrition informationUtility consumptionPersonalized Financial Services
Visualization services for easy digestion of data
Learning from the aggregate data to aid the individual customerrecommendation services
Necessity for services to be real-time…
Services will need to become more real timeConsider advertising services…
Expanding media and formats Digital media, social media, print, TV, radio, mobile
Ever expanding number of devices Desktop, laptop, tablets, smartphones,…
When and where should customers be targeted Reaction times are in nanoseconds
More algorithmic servicesService quality issues, metrics and
measurement
In conclusion…
The changes brought about by digital servicesWill be significant and paradigm shiftingReal focus on reducing inefficienciesWill change the nature of service provisionWill change the nature of service providers
Challenges for firms and governmentsKeeping up with digital technologiesShorter time frame for recouping investments
and realizing ROIWill require new management skills