1. The Information Society and the Service Economy Ian Miles PREST and CRIC University of Manchester

2. The Service Economy

What are services?

Whats special about them?

The Rise of Services

Services and Information Technology

Services Innovation and IT

Knowledge Intensive Business Services in the Information Society

3. Insights

Service Economy is not just service sectors (Giarini): service functions pervasive and many grow in significance

Gershuny ( New Service Economy ) focus on servicefunctionsand informal economy - goods versus services.

Service laggards

Role of IT

Self-services: role of service clients

Business Services

4. Service Sectors

ISIC

• • Trade, restaurants and hotels

• • Transport, storage and communications

• • Finance, insurance, real estate and business services

• • Community, social and personal services

NACE

• • Wholesale and Retail Trade; Repairof Motor Vehicles, Motorcycles and Personal and Household Goods

• • Hotels and Restaurants

• • Transport, Storage

• • Financial Intermediation

• • Real estate, Renting and Business Activities

• • Public Administration and Defence; Compulsory Social Security

• • Education

• • Health and Social Work

• • Other Community, Social and Personal Service Activities

5. Hill, Riddle, and beyond:

• • Primary sector : extracting raw materials from the environment.

• • Secondary sector : transforming these raw materials into material artefacts (goods, buildings, etc).

• • Tertiary sector : effecting changes in states of:

• • • environments- waste management, pollution clean-up, park-keeping;

• • • artefactsproduced by the secondary sector - repair and maintenance, goods transport, building services, wholesale and retail trade;

• • • people- health and education services, hospitality and consumer services such as hairdressing, public transport;

• • • symbols- entertainment; communication; consultancy; professional services; finance

6. Services Characteristics

Features

LESS ABOUT MATERIAL PRODUCTION OF TANGIBLE ARTEFACT

MORE PRODUCTION OF SERVICE: SUPPLIER - CLIENT INTERACTION

Diversity

OPERATIONS ONPHYSICAL, HUMAN AND SYMBOLIC PROCESSES TO CHANGESTATES

VARIETY OF TYPES OF, AND PARTIES TO, INTERACTIONS

7. The Rise of Services Three Sectorand Continuous Models Multi Sector and Discontinuous Models Post-Industrial Theory (Services as Advanced) Service Economy Theory (Services as Backward) Deindustrialisation Theory (Services as Parasitic) Information Society Theory (Some Services as Vanguard) Demand change Centrality of Knowledge New sectors IT revolution debate Productivity Differences Price Changes Unproductive Services Externalisation & outsourcing 8. Services across the Economy Sectors Sectors Occupations Occupations Service sectors grow as a share of the whole economy; Service occupations grow as a share of most sectors 9. OECD Service Employment 10. Producer Service Sector Growth source: T Elfring, "An International Comparison of Service Sector Employment Growth" UNECE Discussion Papers, vol. 2 (1992) no 1 Personal and Collective Services: an International Perspective (UN Economic Commission for Europe) 11. Services and IT

Services are major investors in IT equipment - c 80% - major users of IT labour (c 50% of software staff)

This is uneven - financial services very IT intensive, consumer services not.

IT as industrial revolution in services.

New IT services - software, computer services, telematics services, new media...

12. Services as Innovative Laggards

Discounted in Innovation Analysis

Passive latecomers

IT use forces rethink

R&D and innovation surveys: services as active innovators, as agents of innovation across economy

Attempts to explain, classify

13. 14. Theories of Service Innovation

Contingencies differ

Richard Barras - reverse product cycle

servuction

Soete & Miozzo

15. Service Firms in an Innovation Taxonomy Science-based firms;Scale-intensive firms;Specialised equipment producers;Supplier-dominated firmsSupplier dominated sectors (a) Production-intensive scale-intensive sectors (b) network sectors Specialised technology suppliers and science-based sectors Pavitt Soete & Miozzo 16. Peculiarities of Services

SERVICE PRODUCTIONTechnology and Plant; Labour; Organisation of Labour Process; Features of Production; Organisation of Industry

SERVICE PRODUCTNature of Product; Features of Product; Intellectual Property

SERVICE CONSUMPTIONDelivery of Product; Role of Consumer; Organisation of Consumption

SERVICE MARKETSOrganisation of Markets; Regulation; Marketing

Influences on Services Innovation? Shape strategies of Services Innovation? Convergence in Manufacturing and Services? 17. "Pure Services" "Pure Manufacturing" Manufacturing SectorsService Sectors 18. 19. Services and Information Society

Intangibles

Varieties of Knowledge

New Technology Based services

Rise of KIBS

Beyond KIBS?KICS??

Modes of Governance

Services Trade

Roles of IT

20. Services as Users, as Sources, and as AGENTS of Innovation...

Knowledge-Intensive Business Services (KIBS)

• • Rely heavily upon professional knowledge. Employment structures heavily weighted towards scientists, engineers, experts of all types. Tend to be leading users of Information Technology to support their activities.

• • Eithersupply products which are themselves primarily information and knowledge resources;Oruse their knowledge to produce intermediate inputs to their clients' knowledge generating and information processing activities.

• • Have as their main clients other businesses (including public services and the self-employed).

21. KIBS include:

• Accounting and bookkeeping

• Management consultancy

• Specific building services (e.g. architecture, surveying, construction engineering, etc.)

• Facility management services

• Technical engineering services

• Research and development services; R&D consultancy services

• Design (not only concerning new technologies)

• Environmental services (e.g. env. law, elementary waste disposal services, remediation, env. monitoring, scientific / laboratory services, etc.)

• Computer and information-technology-related services (inc. software)

• Legal services

• Marketing & advertising

• Exploitation and trade in real estate

• Training

• Specific financial services (e.g. securities and stock-market-related activities)

• Temporary labour recruitment services

• Press and news agencies

22. KIBS roles:

Translation

Transfer

Transposition

Transformation

Of Knowledge Resources Fusions of Generic, Sectoral and Local Knowledge to solve client problems 23. Standardised and Specialised Services in the German Survey 24. Crucial Element of IS -Information Society and Innovation Systems

Intermediaries between Ultimate suppliers and users

Fusing various types of knowledge resource

Coproducing knowledge and sometimes innovations with clients

New knowledge infrastructure - problems of public goods and quality control