The Frontiers in Service: a more technological and more human future

The Frontiers in Service: a more technological and more human future

The Frontiers in Service Conference 2017 was held at Gabelli Business School of Fordham University in New York, between the 22nd and 25th last June. As every year this event, the most important worldwide in the field of services included plenary sessions with prestigious academics and successful CEOs who shared their achievements and challenges with more than 400 attendees from more than 40 countries. Likewise, selected papers were presented which have shown an interesting variety of topics that demonstrates the impact of high-caliber of the service research and management practice. This time I will share some central ideas from the presentation of Professor Leonard Schlesinger of Harvard Business School who spoke about «What Great Service Leaders Know and Do: Implications for Services Futures».

Professor Schlesinger reviewed eight key issues about the leadership in services: 1) Leading a breakthrough service is different, they take steps to ensure repeated memorable service encounters, 2) Customers buy results and experiences, not services or products, so leaders focus on the few things that produce results and experiences for the right customers, 3) The best service operating strategies don´t require trade-offs, leaders foster both/and thinking in designing winning operating strategies, 4) Service starts with the frontline employee, leaders hire for attitude, train for skills, 5) Effective operating strategies have to serve employees, customers, and investors, leaders ensure the achievement of the leverage and edge that produce win-win-win results-the service trifecta, 6) The best uses of technology and other support systems create front-line service heroes and heroines, leaders use support systems to elevate important service jobs and eliminate the worst ones, 7) Satisfying customers is not enough, leaders take steps to develop a core of customers who are owners, 8) Their current belief about the future of services are wrong, so they build agile service organizations that learn, innovate and adapt.

In this article we will comment this last issue, as we consider as a priority for contributing with companies and governments to find answers to the new challenges and social needs both locally and globally. We strongly believe that through a better planning and management of services it will be possible to contribute to a more humane and liable society that learns how to face the new demands and cooperate for solving the new problems in this era of digital disruptive speed.

The research team in which Professor Schlesinger participates has identified some issues for reflecting on the future of services, such as: a) Jobs in business and professional services will increasing provide the foundation for a vital middle-class society, assuming the role that manufacturing jobs have played in the past, b) the transfer of jobs across borders will be facilitated by the Internet. Service industries that will be particularly vulnerable to this phenomenon will be remotely performed education and medicine, as well as online retailing, c) Technology will replace the most boring, least value adding service jobs. This will do the following: 1. contribute to continued productivity increases in services, 2. moderate growth in service sector employment, 3. generally raise job-satisfaction levels among service workers.

It is notorious that professional services are meeting the new demands of the markets and creating new jobs. It is good news as this can be consolidating a new and thriving middle-class that is a solid pillar in every society. However, in developing countries there are still gaps that are very difficult to close. It is clear that we need a better education to prepare the new generation of professionals for different fields, as well as the facilities that allow them to progress continuously. One of the great problems is the informality. It is inacceptable to see the provision of professional services with poor service quality that is a high risk for the health and life of human beings, in addition to their frustration and future. The culture of informality, indifferently tolerated, particularly in Latin America, is strongly rooted in various sectors and is enhanced by the corruption of officials and employees, as well by their incapacity to plan the right incorporation and coordination of all the actors in the economy. It is contradiction to argue that it is a social problem and let people to offer services according to their own rules which in particular implies not follow the right standards and norms nor social and ethical principles. This type of informal and/or illegal services that do not contribute to the real, equitable and orderly development that every society requires should not be allowed in this 21st century. In Peru, a number of cases in technological and university education, as well as transportation, health, restoration, construction and commerce services are palpable, but it is more regrettable that the progress made in correcting them is scarce, slow or incomplete. Thus, this sad reality continues and we see facts that show tragic results for our society. The last cases of Las Malvinas, Cerro San Cristobal, besides those already known as Mesa Redonda, Gamarra, among others, are dramatic examples about this situation of informality in both public and private services. Hence the urgent need to change this and it will only be possible by a solid decision of the institutions involved, through the right planned efforts and responsibilities with a strong commitment to build the viable paths for a greater well-being, security and justice for all. A true services management is based not only on an economical vision, but on a social responsibility and an anthropological approach, which precisely must help for solving the problems of society with a solid ethic that enriches human life to make it more grateful and prosperous. The biggest problem for humanity, particularly in Latin America, is corruption, which has been shown throughout the last months through scandals involving several companies and institutions in different countries. While this remains it will be very difficult to sustain high quality services, both public and private, that generate worthy professional jobs and meet the real needs of people.

Undoubtedly, the internet is the key tool to compete in this digital age. It is the way to manage time and costs effectively, two essential variables in any operational strategy. And also it presents the opportunity to reach different types of markets around the world. Education and Health, two representative sectors in service field are taking decisive steps through the internet and so they are attending new needs and strengthening patient loyalty, at the same time obtaining greater efficiency through speed and costs. Likewise, the retail sector has greatly expanded its on-line program, which facilitates the acquisition of products and services with higher speed never before experienced. However, it is necessary that companies and institutions use the internet effectively and honestly, and at the same time, add value to the digital experience to generate trust that is vital through the new technological tools.

On the other hand, the researchers sustain that technology will eliminate the most boring least value adding service jobs. That is true, as we are seeing the presence of robots will soon increase in different types of services around the world. At the last conference in New York, we have had the opportunity to attend various presentations by academics and practitioners related to the use of technologies for replacing service employees and produce mutual benefits for customers and companies. In that sense, there is a long way to walk in order to achieve a suitable mix that ensures a better use of human capacity and higher levels of customer satisfaction through the use of new technologies, artificial intelligence and robotic. It is also evident that the use of technology allows, in general, continued productivity increases, however, it is important to be careful in some cases, since there are no magic formulas and depending on the case and circumstances to face, can produce interferences in customer satisfaction. As Huang and Rust point out, the belief that increases in productivity are always good for any business is a fallacy that is difficult to kill[1]. Therefore, these researchers propose that companies must manage service productivity as a strategic decision variable in order to balance efficiency with customer satisfaction, enhancing the long-term health and profitability of the company.

There is no doubt that the use of technology will produce a reduction in the growth of employment in services, a situation that we are observing already. For this reason, we should reflect about: how should we prepare the new service employees?, what type of learning and development will they require?, If we have to identify the basis of this new training and development for service employees, we would undoubtedly aim to improve their learning capacity in three aspects: 1) creating and designing new services, 2) operating strategies for service futures and, 3) personal-qualitative development[2]. In other words, to identify the new demands and needs of the markets to create new solutions with faster and friendly services, to generate the future operational-technological capacity, and to develop the new employees’ skills and qualities for interacting with a special and original human touch with customers. It is relevant to remark this development in human qualities to which wise philosophers such as Aristotle gave a huge importance for human life within a society. With these pillars, we could contribute to count within the organizations with people more competent, more honest, more liable, in short, really human beings serving human beings. The moment for this change is now as we will increasingly have more people losing jobs or not able to adapt to the new jobs that this new era demands.

Finally, the use of new technology will favor the increase of levels of job satisfaction among service workers. We are in agreement but with one condition: to the extent that this technological use is carried out in an appropriate and precise manner. We have observed in many cases how technological use has led companies back to situations in the past where the excessive control of an exaggerated Taylorism generates worker dissatisfaction and poor motivation. On the other hand, when applying technology according to cultural values, effective policies and coherent ethical principles with the adjustments that the particular situation demands, there is undoubtedly a great opportunity to facilitate communications, high speed for attending requirements and obtaining accurate and timely information. This fosters job satisfaction that allows higher performance and better contribution for generating competitive advantage in companies. This way employees’ motivation can increase since their expectations are met in the accomplishment of their work as in the professional benefits that they are expecting.

The various challenges that this vision of the future of service brings are, therefore, interesting and encouraging. However, we see that this demands a greater collaboration among the academia, businesses and institutions. It is very important to find the moments of dialogue and exchange of ideas to address the problems and propose solutions that consolidate the common good that society needs for a harmonious and prosperous life. I would like to congratulate Dr. Roland Rust, founder of The Frontiers in Service Conference, who had the vision to create this forum 26 years ago and to promote it as the meeting for dialoguing and thinking between academics and practitioners about the crucial role of services for businesses, institutions and the worldwide society. Also for fostering the research in services and look for effective solutions to the various challenges that this multidisciplinary field faces every time. We hope that in a near future we will have organized this conference in Latin America, in order to elevate the interest in the academic, practitioner and institutional communities, and thus take advantage of the fruits that this event can generate to identify the convenient ways to address the most relevant problems in services of this region and plan the necessary improvements in these countries.

[1] Ming-Hui Huang and Roland Rust, Should your Business Be Less productive? (2014).

[2] Lucio Lescano Duncan, Developing a Training Process with Service Orientation for Employees (2014).

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