In today’s economy every product has a service value attached to it. The old dichotomy between product and services has been reduced and a service-product continuum has been established. In management this phenomenon is referred to as the Servitization of Products. When a company proceeds from maximizing its sales towards customer satisfaction it puts emphasis on the aspect of service. It helps the company to enhance its goodwill in the market.
The concept of service economy will eventually give rise to a decentralized means of producing skilled jobs.
IBM is an unique example. In spite of being a manufacturing company it tends to call itself a services company. This has been the scenario since it realized that the price elasticity of demand for business solutions is less elastic than for hardware. The company now benefits from the revenue of the elongated contracts rather than receiving payment in a single mode.
Studies reveal that service economy jobs can enjoy double productivity through the better application of information technology. Intranets can also produce double employee productivity. Usability is the key to enhancing the productivity of service economy. By analyzing which job is more useful than the other we humans might be able to create more jobs and save billions as well.