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Emerald Group Publishing Limited
Copyright © 2001, MCB UP Limited
Service alchemy service transformation
Service alchemy – service transformation
The attempt of many service organisations to gain market leadership by instilling a quality culture has frequently resulted in policies and practices that invariably stifle the initiative of the people that constitute the enterprise and limit the true opportunity of their contribution – the contribution of the mind. Traditional business wisdom continues to inhibit the ability of many managers to visualise beyond the obvious or the conventional norm. Innovation, one of the primary differentiating components in the competitive market, is the outcome of the creative ability of the mind, that renders possible the impossible. Recognised service leaders are indeed creative innovators. They successfully introduce products and services to the market far in advance of customer expectation. Moreover in the customer's mind, they maintain their market leadership position by continuing to operate at the cutting edge and extending conventional parameters. Service firms today are expected to delight customers with their creativity and innovation. Thus on operational terms, innovation can be translated as a firm's foresight to think for the customer by creating services that "drive" the market place (offer superior value to the customer). However, successful creativity is determined by the ability to capture a customer's loyalty. Service leaders thus effectively gain recognition from both customers and eventual emulators, with the result that their service innovations emerge as a legitimate new sector or industry, for example Disney, Federal Express, CNN, Microsoft, etc.
Services literature recognises technology, networks and knowledge as some of the key factors that contribute to the make up of service innovation. The transition from the twentieth century to the new millennium has rendered "mind over matter" 'increasingly applicable to the world of business. Indeed, as Drucker (1993, p. 38) points out, knowledge constitutes the only meaningful "resource" today. It is this unlimited resource (mind) – the so called creativity – that can proffer a firm the ultimate leverage over the competition. Morita (1988, p. 165) the founder and past chairman of Sony, believed that it is not the manual labour of employees that allows a firm to dominate the global market, but the contributions of the employees' minds. Medieval scientists or alchemists were renowned for their attempts to convert lead into gold. However, as Pilzer (1990) points out, those medieval chemists were involved in a quest, not to create gold, but essentially to create something of greater value. Service innovation may thus similarly be defined as any process designed to transform something of little value to something of significantly greater value. In today's global arena, where customers' ever increasing expectations and holistic requirements frequently extend beyond the capabilities of a single firm, adding value may warrant external expertise, with the establishment of alliances and various other business relationships. Service innovations, it may thus be argued, emanate when service firms think as alchemists.
Jay KandampullyE-mail: firstname.lastname@example.org
ReferencesDrucker, P.F (1993) Post-Capitalist Society, HarperCollins, New York, NY.Morita, A. (1988) Made in Japan: Akio Morita and Sony, Signet Books, New York, NY.Pilzer, P. (1990), Unlimited Wealth, The Theory and Practice of Economic Alchemy, Crown Publishers, New York, NY.