A growing number of companies are finding their service businesses under threat. The culprits are members of a new wave of digital upstarts that capitalize on changes in technology, customer behaviour, and the availability of data to create innovative, customer-friendly alternatives to the services incumbents offer. The review is an attempt to discuss possible implications on service sector faced with the impact of disruptive technology in the context of advent of data science and analytic for competitive advantage and sustainability.
The service sectors of Indian economy that have grown faster than the economy are as follows:
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- Information Technology (the most leading service sectors in Indian economy)
- IT-enabled services (ITeS)
- Financial Services
- Community Services
- Hotels and Restaurants
In the contexts of the background of changing scenario, massive innovation in data science will definitely change the paradigm of doing business and especially for management of service sectors. The present analysis will focus on assessment of the impact of data revolution facilitated by the breakthrough of application of big data for optimization of service sector competitiveness.
New digital upstarts are threatening the bottom lines, growth prospects, and even business models of traditional service providers. It’s time for incumbents to innovate or be left behind.
A growing number of companies are finding their service businesses under threat. The culprits are members of a new wave of digital upstarts that capitalize on changes in technology, customer behaviour, and the availability of data to create innovative, customer-friendly alternatives to the services incumbents offer.
Indeed, the sorts of digital disruptions that began in retailing with the likes of Amazon, two decades ago, are fast coming to an industry near you—if they haven’t already. Examples include Uber and Zipcar in transportation, Airbnb in hotels and hospitality, AngelList in venture capital, and Castlight Health and Healthgrades in healthcare. Attackers such as these may be small now, but they represent a growing challenge to traditional companies.
The attackers also highlight an uncomfortable truth: large companies rarely put as much sustained effort and management attention into transforming services as they do with the products. Imagine the reaction of a patient visiting a hospital before 50 or 20 years ago and visiting a contemporary health care facility now.
The medical devices, tools, and products available to physicians would be largely unrecognizable, but the service experience, in many cases, would be largely the same unless it is redesigned. Change is difficult with a large base of legacy assets optimized for a certain way of working, as well as a large, distributed workforce trying to maintain the status quo. The incremental approach many companies take to improving services doesn’t help; processes that grind out small, steady cost reductions rarely deliver breakthroughs.
Nonetheless, some incumbents are fighting back successfully. These companies are learning from the attackers while mobilizing their own strengths—including scale, superior resources, and access to customers to redefine service offerings, harness digital technology, and improve the customer experience. Some are lowering their costs as well.
While few organizations have mastered the new environment, we can already see that winning approaches will combine three elements:
- A focus on service innovation matching the intensity and attention that product companies bring to R&D
- The ability to personalize the customer experience and to help customers do things themselves
- The will to simplify (and in some cases automate) the way services are delivered
To pull all this off, companies must find more collaborative ways of working to ensure that they remain focused on their customers, not their own internal processes. A closer look at how the environment is changing and what leading companies are doing about it should stir
imaginations of a wide range of organizations struggling to adapt to digital and competitive world.
The new service Sector landscape
The nature of the services and the pace of change have shifted dramatically in recent years, and mastering the traditional aspects of service delivery will no longer be enough. To seize the opportunities, companies must learn to tap the potential for service innovation made possible by four evolving trends:
- In addition, artificial intelligence and robotics represent intriguing developments that appears poised to make their way from manufacturing to services.
- Higher customer expectations. More than ever, consumers demand greater involvement, customization, personalization, and mobility from services with immediate results.
- When they see cutting-edge service innovations in one industry, they expect to find them in others as well;
- Witness the spread of self-service kiosks from airline check-ins to the retailing and hospitality industries. As industry boundaries increasingly blur for customers, companies must look for new ideas beyond their immediate rivals.
Big data presents great opportunities as they help us develop new creative products and services, for example apps on mobile phones or business intelligence products for companies. It can boost growth and jobs but also improve the quality of life. (Rao, Madfanmohon ,2014)
The followings could be examples of service sector sustainability and competitiveness for discussion in the conference:
- A widespread use of big data in the health sector can help doctors make the right choices more quickly, on the basis of information collected by other medical staff. Patients can benefit from more timely and appropriate treatments and be better informed about health care providers. An increased use of data analysis in the health sector can also lead to enormous cost savings through a more precise identification of unnecessary procedures or duplication of tests. The analysis of large clinical datasets can result in the optimisation of the clinical and cost effectiveness of new drugs and treatments.
- The transport sector can clearly benefit from big data collected through sensors, GPS data and social media in particular. A smart use of big data supports governments in optimising multimodal transport and managing traffic flows, making our cities smarter. Citizens and companies can save time through the use of route planning support systems.
- The big data revolution brings about novel ways of understanding and addressing environmental challenges. A better use of globally available national and local datasets helps scientists in their research and enables policy-makers to make informed and evidence-based decisions to fight against climate change and reduce costs. Smart cities also host data centres adapting the power consumption of public buildings to the availability of renewable energy and other useful indicators. At the same time, our mobiles devices become smarter by integrating analytical tools to reduce our energy consumption and save money.
- Big data means the optimisation of operations on a real-time basis for the manufacturing industry. Key benefits of using big data analytics include boosting product quality through improved defect tracking, better manufacturing processes and optimised supply tracking. Big data enables the timely and appropriate delivery of products for consumers and more efficient processes, with cost savings, for business. With big data retail companies better know the needs and interests of costumers and, as a result, offer more personalised products.
- All of which leads back to big data. So far, though, only a small number of customers are investing in big data and trying to make use of it. Big marketing brands like Nike and Red Bull, who are always cutting edge, are investing in big data approaches to analytics and targeted marketing. The vast majority of businesses do not have the benefit of employing data scientists who can shape and model big data to drive better insight and, in turn, make smarter marketing decisions. But it’s clearly something that will gain visibility, underscoring the desire and need to distil more meaningful insight from vast amounts of data.
- These are truly exciting times to be in this industry. Marketing is undergoing a major transformation, as consumers and businesses redefine their relationship. This will help companies’ sustainable strategies. Digital marketing leaders are under increased pressure to stimulate growth through faster and smarter innovation. No one has unlimited resources, so it’s critical to invest in the right technologies and application at the right time.
The service sector is now at the crossroad and it can capitalize by innovating strategy that can make it winners of the next decade for its sustainability.