18- Delivering Services on the Web

Introduction:

The world’s high-technology business community has experienced exceptionally high growth and overwhelming optimism during the last two decades, which appears to have transformed into either stagnation or deterioration. In information and communications technology (ICT) and biotechnology, markets have been increasing at double-digit yearly rates. The spread of the World Wide Web, which began in 1989 and peaked in the mid-1990s with the emergence of electronic commerce (EC) and the resulting avalanche of small start-up IT firms pursuing success and fortune, gave ICT a turbo-boost. Later, biotechnology began in 1980 with Genentech’s first initial public offering (IPO) and enjoyed its first wave of success throughout the early 1980s, only to see its first drop towards the end of the decade before resuming its upward trend by the mid-1990s. Both sectors are currently in crisis, owing to an overestimation of what technology can achieve on its own and a basic underestimating and ignorance of market dynamics, such as customer needs, wants, fears, and expectations.

Delivering Services on the Web:

Technology is how a business converts inputs (labour, knowledge, capital, and raw materials) into outputs (goods, ideas, or services). It refers to knowledge that can be used. Thus, a bank has its technology for transforming capital, ideas, and labour into various banking services; Google, the search engine, employs its technology to deliver much faster and more effectively than its competitor’s search and access services for Internet users.

It has long been assumed that technology would speed up corporate processes, eliminate repetitive tasks performed by humans, and cut the cost of production and transactions as salaries rise. Following liberalisation, Indian businesses are more willing to use technology strategically. Other controllable and non-controllable elements, such as increased hiring of junior personnel in Indian banks, further diminish the overall effect despite a significant drop in the strength of officers and clerical staff. Despite the widespread adoption, there has been little research on the success of the strategic shift or its influence on competitiveness in India. There was no link between IT spending in services and productivity or profitability. Indeed, the term “information technology paradox” was coined due to the slower development in service productivity compared to manufacturing with comparable IT expenditure.

The following are some of the reasons why information technology hasn’t had the anticipated influence on services:

• Inefficient and wasteful use of technology: Technology was being used to automate inefficient systems and processes without corrective procedures in place. There was no guarantee that the IT systems were being managed by competent staff. This was exemplified in India by the classic scenario of PSUs investing in IT without updating their workforce’s capabilities.
• Lagged effect: If there were any beneficial effects from IT, they took time to manifest.
• Outdated productivity methods: Current measuring procedures for services with unique characteristics were unreliable, which makes quality assessments difficult.
• Other issues may impact:  IT, which may be just one of several reasons affecting service productivity.
• Aggregation level: IT effectiveness should not be measured in isolation from any department but in connection to the entire service organisation.

The socialists were outspoken in their criticisms, claiming that management’s adoption of technology was only a deception to evade accountability to stakeholders and that more research is needed to understand the trend and its influence on competitiveness. This unit examines worldwide and Indian enterprises’ technology adoption trends in the service sector and their efficacy and impact on their respective competitiveness. The goal is to emphasise the following:

• The Indian labour, management, and bureaucrats’ previous attitudes and perceptions regarding technology adoption
• Technology as a productivity and competitiveness
• A paradigm shift among PSU stakeholders in terms of technology’s utility
• Technology as the final leveller in global competitiveness for Indian enterprises
• The dangers of technology’s “over-expectation.”

The motivations for the service industry’s adoption of technology are numerous and varied:

• Increasing or maintaining market share, presence, and size are common performance indicators and benchmarks for a service firm’s power, which can be used in supply agreements.
• Lowering or avoiding risks or alternative costs: High technology improves the accuracy of many judgments and the quality of service.
• Creating a more “enabling” atmosphere for internal clients: Climate controls, speedier computer tools, and connectivity are examples of ergonomic (comfort science) workspaces or comfortable work environments (Internet, cell phones, V-SAT, etc.).
• Improving the quality of services and interactions with customers (Moments of Truth): Reliability, consistency, accuracy, and speed of service are factors of customer satisfaction and quality service.
• Creating flexibility for a changing business environment: With elements such as government regulations, the economy, the complexity of operations, and changing consumer tastes all changing rapidly, IT investments will help service organisations better cope with change.
• There has been a paradigm shift in Indian labour, management, PSU stakeholders, and officials’ attitudes and perceptions of technology use.

Labour saw it as a threat to their jobs, while management saw it as a way to decrease costs and increase output. Following nationalisation, public sector banks (PSBs) experienced militant labour fighting mechanisation tooth and claw. The labour unions opposed the introduction of high-speed Sulzer looms in textile mills, while the labour unions at the Food Corporation of India opposed the introduction of forklifts that would aid in effectively stacking sacks of food grains, and so on. PSB management, the government, and the Indian Banks Association (IBA), the nodal agency for PSBs, had a tumultuous time negotiating for the computerization of banks during the turbulent 1980s, causing them to lose a decade and a half of lead time that would later come back to haunt them, proving costly and weakening their competitiveness. For similar reasons, the Life Insurance Corporation of India (LIC), the country’s only life insurance firm, has been unable to introduce microprocessors into its offices for almost half a century. In just four years, they have already lost 13 percent of their market share, critical talent, and innovation leadership.

Many intellectuals (Nani Palkhivala), industrialists (Ratan Tata), professionals, bureaucrats, and sociologists have publicly admitted that India has missed many buses and “lost the eighties.” There has been a paradigm shift in the Indian workforce’s public sector undertaking stakeholders’, decision-makers, and other opinion leaders’ attitudes on technology adoption and other thorny topics like business process outsourcing over the previous decade and a half. The State Bank of India, the Life Insurance Corporation of India, and the Punjab National Bank substantially invest in IT. Among all PSUs, PNB is the greatest user of the PeopleSoft system.

Indian Online Retailing/E-tailing Scenario:

In the coming years, the Indian economy is expected to develop at around 6% per year, among the greatest of any large rising country. And domestic consumption of goods and services would account for a large portion of this rise. Given that organised retail is still not omnipresent across the country, with huge retail chains accounting for less than 10% of the market, e-commerce is proving to be a tremendous leveller.

E-commerce allows residents in India’s smallest villages access to the same high-quality items and services as those in larger cities. By the end of this year, over 60% of internet buyers are expected to originate from outside the top eight metropolitan cities.

India has between 50 and 100 million internet users, growing roughly 30% annually. In 2011, 17 million people bought something online, up from 10 million in 2010. With an increasing number of people eager to purchase online, India is on its way to becoming one of the most essential e-commerce hubs in the world, attracting competition from various online retailers. It’s been a month since Amazon, the world’s largest online retailer, launched in India. Online retailers like Flipkart and eBay are anticipated to go to great lengths to maintain their dream run in India. Still, the million-dollar issue of who will win the race remains unanswered.

Junglee.com was Amazon’s first foray into the Indian market. This was the case due to FDI restrictions in the multi-brand market. “Online shopping served by Amazon,” according to the website, “enables customers to find and discover products from online and offline stores in India, as well as through Amazon.com.” There have been speculations that Amazon wanted to buy Flipkart, but the deal fell through due to Flipkart’s intense demands.

Flipkart, founded by Sachin Bansal and Binny Bansal, two former Amazon workers, is one of India’s top 30 websites and the country’s largest online bookseller. Since its establishment in 2007, the company claims to have grown at a rate of around 100% each year. They began by selling books, but as their marketing techniques proved successful, they expanded their product line to include CDs, DVDs, mobile phones, cameras, home appliances, and various other items in 2010. Flipkart is expected to surpass the 500 crore sales barrier this year, thanks to increased Internet usage and people becoming more accustomed to purchasing online. Flipkart is India’s preferred online shopping destination due to its simple payment process, user-friendly website interface, and simple login procedure. On practically all books, one may get a discount of 15-20%, and sometimes even 40%, which makes one think twice about travelling to a bookstore and spending valuable time and effort. There are only a few problems in its business plan, which was designed with the conventional money-minded, overcautious, and over-concerned attitude of Indians in mind, who are relatively new to internet purchases. With this in mind, they recently launched a 30-day replacement guarantee, which will undoubtedly attract more users shortly.

EBay differs from Flipkart in several ways. Unlike Flipkart, it is not only a shopping site but also allows users to auction a wide range of products and services. It is one of the few websites that come to mind when someone mentions online shopping. It all began in 1995 and is undoubtedly one of the dot com bubble’s great success stories. It first entered India in 2004, paying 230 crore for Mumbai-based bazee.com. By creating an online account, vendors can sell their things at their price, which Flipkart does not allow. There isn’t a single website that compares to their product selection. The PaisaPay policy, which assures that merchants do not get payment from eBay until the consumer is totally satisfied with the condition and quality of the product, is the best element of all their policies. Aside from that, subscribing to their daily mailings provides access to a plethora of coupons and vouchers. The issue with eBay is that the return process is lengthy and complicated. Furthermore, because anyone can sell their things on eBay, there is a risk of being deceived by untrustworthy vendors.

Amazon began as an online bookshop in 1994 but has expanded to include many goods and services. It is not an auction website like eBay. Initially, they considered auctioning things, but because eBay had already established its dominance in that market, they had to devise a new approach. As a result, at the moment, one can only buy or sell things at Amazon for a predetermined price. This option is not available on Flipkart, therefore comparing it here is worthless. Amazon appears to be the future leader due to its outstanding customer service. Customer response on eBay is not as good as on Amazon because the number of staff on eBay is far lower than on Amazon and Flipkart.

Regarding trustworthiness, Amazon and Flipkart are far superior to eBay because there are far fewer scammers there.

By 2026, India’s e-commerce business is predicted to have grown from US$38.5 billion in 2017 to US$200 billion. By 2034, it is predicted to be the world’s second-largest. On the other hand, India’s e-commerce business is expected to grow to about 300 to 350 million shoppers in the next five years, bringing online GMV to $100 to 120 billion by 2026. India’s retail market, at $850 billion, is the world’s fourth largest.

The increasing number of first-time internet and smartphone users, a result of the government’s “Digital India” programme, is fueling the industry’s massive expansion. As of August 2020, India had 760 million internet connections.

Along with the rising online community, the unorganised nature of the home essentials market has also contributed to the expansion of these industries. It has created new opportunities for e-retail/ e-tail/ e-commerce enterprises that can not only comprehend the consumer psyche but also curate high-quality products and services that are in line with the needs of today’s new-age customers, bringing them into the organised sector. As businesses continue to innovate and onboard millions more customers, it’s worth looking into the big themes that will dominate this industry in 2021:

Why Augmented Reality Will Enhance Online Purchasing: In online shopping, augmented reality (AR) will be a game-changer because it will significantly reduce the gap of uncertainty. It will assist clients in visualising and selecting the product they wish to purchase. They can determine whether the furniture they are purchasing will look good in their home before pushing the “Buy Now” button. This will take shopper comparison to a whole new level, allowing them to overcome the barrier of not seeing the goods in person.

• A Large Number of Consumers Will Use Voice Search: People use voice assistants like Google Assistant and Amazon Alexa for everything from checking the weather to setting an alarm to purchasing things online. As a result, one thing we’ll all see in the future is people ordering groceries with a simple voice command, which will save a lot of time on browsing, especially if it’s a repeat order because they won’t have to enter the brand, address, payment, and shipping information over and over. As a result, many unexplored potentials exist for businesses wishing to get in on the ground floor.
• Chatbots Will Improve the Shopping Experience: In the future, chatbots will function as a virtual storefront, a greeting, and a salesperson. They will be of great assistance to the firm since they will be able to contact hundreds of customers and provide them with a sense of personal attention and insightful recommendations based on their responses. According to a study, people prefer to communicate with bots and other digital self-serving tools because they respond faster. They will significantly impact how consumers shop online and become one of the most essential marketing strategies available.
• A Subscription Plan to Keep Consumers Coming Back: Subscription plans have various benefits for retailers, including making it easier to estimate fulfilment demands and allowing customers to be maintained and retained for a higher long-term value. As a result, in the coming years, more businesses will provide a subscription service or a monthly payment option for their sales.
• In the coming years, one of the main focuses will be sustainability: One topic that is gaining a lot of traction, and which hopefully will not be a passing trend, is that more and more people are becoming aware of their impact on the earth’s limited resources as a result of their shopping habits. As a result, brands must now figure out how to include their marketing and fulfilment methods in their products. Brands that try to improve their operations by implementing measures such as biodegradable packaging, going paperless, employing recyclable supplies, and promoting environmental awareness will significantly impact customer purchasing decisions.

Apart from the aforementioned, the industry anticipates increased export income and exchequer tax collection in 2021. Furthermore, these industries have not only expanded independently but have also had a cascade effect on related industries, particularly MSMEs. E-tailers have benefited from partnering with MSME businesses.

One development method might be to try to personalise each customer’s experience. The Indian consumer is still largely need-driven, rather than impulse-driven or deal-driven, as their American counterparts are. As a result, it might make sense to regularly design genuine consumer-centric promos that add actual value to the Indian consumer. In India, this is happening slowly but steadily.

There have been horror stories about receiving defective or incorrect merchandise, delayed deliveries, and no reaction from the company, all of which contribute to a lack of faith in online sellers. Because of automation and technical integration, things are changing — albeit slowly.

Focus on the following points:

1. The Customer Is King: E-tailers provide excellent customer care 24 hours a day, seven days a week, via email, chat, and toll-free phone. Resolving customer complaints—whether it’s late delivery, poor product quality, or the wrong product provided—will undoubtedly contribute to long-term customer retention and acquisition.
2. Supply Chain: Most customer complaints and delivery returns may be traced back to vendors or merchants in the supply chain. In reality, they are the most essential internal clients. It is critical to have well-integrated supply chain vendors or merchants in the system, both technically and strategically.
3. New Business Models: E-tailers constantly look for new and inventive business models to implement. For example, Power Reviews, based in the United States, offers free review technology to e-tailers in exchange for the reviews collected on the retailer’s website being syndicated and aggregated on Buzzillions.com, its sister website. Some Indian websites merely collect orders over a week, order in bulk from the vendor, and then ship to customers at a discounted rate. Of course, the customer is informed about the delivery date.
4. Comparison Shopping and Customer Reviews: Ensuring that all E-tailers are represented on comparison shopping sites is critical, especially because many individuals now consult these sites before placing an order. Being on well-known websites like compareindia.com and wize.com is a fantastic idea. These websites also encourage users to post product reviews because nothing authenticates a company’s offering to a potential buyer like a positive product review.

Role of Internet in Services:

With the rise in popularity of the Internet, e-commerce has become one of the most frequent business methods. Even though e-commerce was once linked with larger corporations, small businesses have recently benefited from jumping on board.

The Internet serves as a storefront for your business, allowing customers to browse and purchase your product(s) / service(s) from the comfort of their own homes.

The Internet can also be utilised as a marketing tool solely to promote your items and increase sales through other distribution channels. Although consumers may find it more convenient to buy from within their own country, the Internet may let you target customers worldwide (due to the cost of postage or feasibility of using the service). The initial set-up and ongoing maintenance, as well as the administration, are the apparent costs of using the Internet for sales. Some small businesses are solely focused on the Internet, offering services and products only through their website, with no actual contact with customers at any time.

Distribution, purchase, sale, promotion, and providing supplemental information on items or services via the Internet are the primary components of e-commerce. E-commerce also refers to the exchange of data between businesses. E-commerce began in the late 1970s as a method of sending and receiving electronic documents such as invoices. As the process progressed, it covered actions such as online purchases of products and services using various forms of payment cards, such as credit and debit cards. E-commerce is leading the way in a new way of purchasing and selling things online today.

Business-to-business (B2B), Business-to-Customer (B2C), and other e-commerce activities can be categorised into distinct categories:

1. Business-to-Consumer (B2C): This is the direct exchange of goods and services between businesses and their customers. It is Internet-based direct selling. For example, items can be sold directly to customers, and anyone can purchase any product from the supplier’s website. This mode, often known as business-to-consumer, is designed to benefit consumers. E-commerce functions as an online retail store.
2. B2B (Business-to-Business): B2B stands for Business-to-Business. E-commerce has been a part of marketing since the beginning. It is the exchange of goods and services between businesses. B2B E-commerce is often coupled with terms like offshoring and outsourcing. It would be considered outsourcing if I delegated my company’s payroll duties to another accounting firm. Offshoring is a phrase that determines the outsourcing word. Offshoring is when work is outsourced to a company that is located outside the geographical boundaries of the country where the outsourcing company is located.
3. Consumer-to-Business (C2B): In today’s E-commerce world, customers increasingly demand specific items or services from businesses. For example, I use their website to contact a tour and travel operator about purchasing a vacation package. Consumer-to-business (C2B) E-commerce is rapidly expanding, which is expected to continue.
4. Consumer-to-Consumer (C2C) E-commerce: This sort of E-commerce typically operates as Consumer to Business to Consumer (C2B2C) (C2B2C). This means that a customer would contact a firm to see whether or not they would be a good fit. This methodology is used by the majority of auction websites (such as eBay) and matrimony websites. For example, Quikr is an internet classifieds site (similar to Times of India classifieds) designed to act as a free, city-based community classifieds website that allows people in the same city to meet, trade, discuss ideas, and trade. Customers can submit their classified ads for free on the website.

In today’s globalised society, there are a variety of hybrid forms of e-commerce in addition to the categories outlined above.

Role of Technology in Service Marketing:

The practice of service marketing is being influenced by technology. As a result, there is a lot of room for new service offers. It reshapes the service industry by allowing customers and employees to receive and give personalised services. The driving element behind service innovation has been technology. Only new technology allows for automated voice mail, interactive voice response systems, fax machines, ATMs, and other services.

1. Market Gap:

Market-oriented thinking and the role of marketing in the company are not new concepts. Peter Drucker and Theodore Levitt, two well-known academics, released classic works on these topics in 1974 and 1975, respectively. According to Drucker (1974), the sole aim of a firm is to develop a customer, which is accomplished through marketing and innovations. According to Myopia, marketing is frequently disregarded since senior management is wholly enamoured with the profit potential of technological R&D. Levitt also contends that product-orientedness in high technology works effectively when companies are pushed into new frontiers where they are required to fill rather than find markets. It’s almost odd that these remarks virtually serve as specific characterizations of what we can see in ICT and biotech a quarter-century later.

2. Innovation:

It is commonly known that different types of innovative activity have diverse contextual origins. Since Schumpeter’s work, significant effort has been made to define common aspects of a wide range of innovations. Different innovations, such as product, process, business concept, incremental, radical, architectural, disruptive, and value innovations, have all been explored.

The relationship between business size and R&D productivity has been investigated to determine a firm’s innovation ability. However, the results are contradictory and limited. Henderson and Cockburn claim that while there are considerable returns to size in areas like pharmaceutical research, only a tiny fraction of these returns come from economies of scale. That proximity between R&D organisations has a favourable impact on R&D performance. In R&D, evidence showing declining returns concerning scale was discovered, which is practically the opposite of the previous finding. Suggestion: Extremely tiny and large businesses were proportionally more innovative than medium-sized businesses. Management typically justifies technological mergers and acquisitions by wanting to distribute expenses over a more extensive base and obtain control of R&D in competitor enterprises rather than enhancing R&D productivity in their own business. Whatever the case, the reality remains that R&D is a source of firm-specific expertise with tremendous competitive advantage potential.

3. Research and Development as Knowledge Management:

R&D has been linked to knowledge management and organisational learning in recent years. R&D and inventive activities are considered complicated search, learning, and problem-solving processes that rely on current and new knowledge. The emphasis on coordination within the business, its consequences for firm and industry structure, and the role of management in promoting innovations are all examples of innovations in the context of knowledge management. Grant outlines key aspects of knowledge that demand more attention from management, if not the entire organisation. Information is one of the most critical success aspects in a company’s ability to produce, develop, gather, and disseminate specialised knowledge. This shows that knowledge management is an inter-firm and intra-firm activity in innovation management, with significant managerial responsibility.

R&D as a System: The importance of networks in creating high-growth businesses has long been recognised. Firms find needed resources such as

1. R&D,
2. financial resources,
3. management,
4. distribution, and
5. markets through these networks.

The significance of networking in the context of innovation is that it refers to producing, developing, and exchanging information. Innovation networks are a system of unfixed, flexible, informal, and sometimes even implicit interrelationships that are decomposable and can be joined and recombined in several necessary configurations. The networks make knowledge generation, sharing, and the purchase and sharing of other resources easier.

Product Development as R&D: R&D has always been considered a function closely tied to product development or production in the traditional corporate value chain. However, there are signs that this is changing, thanks to the emergence of information management and the fact that R&D is increasingly being done in networks spanning traditional organisational borders. Researchers are concentrating their efforts on the interaction of marketing and R&D. Customers are also emerging as potential innovators who should be included as early as feasible in the R&D process.

Relationship Marketing as R&D: Based on the above debate, we propose that a more market- and customer-oriented approach to R&D can be achieved by taking a radically new approach to R&D activities. We recommend that R&D processes be approached from the standpoint of service management. More precisely, we propose a relationship marketing strategy based on the Nordic school of thinking and technical advancements that, in our opinion, have contributed to the relational nature of R&D and innovation management.

4. Changes of Technology:

For the past two decades, high-tech advancements have surged ever-increasingly. Rather than talking about high technology vs. low technology, it’s more useful to talk about high knowledge intensity vs. low knowledge intensity. With high knowledge intensity, we imply that developments in knowledge have occurred rapidly within particular industries that cutting-edge knowledge – which is often a source of competitive advantage – has become obsolete within a year or even a few months. The life cycle of new knowledge in ICT has been measured in months, whereas the life cycle in biotechnology is getting increasingly short and, in some cases, can be as short as half a year or one year. As a result, having access to new information and the ability to create new information has become a primary source of competitive advantage, but it has also gotten more expensive. In the early 1990s, for example, the ICT industry began a significant outsourcing movement, with the industry credo focusing on core skills and outsourcing all non-essential operations. In every capital-intensive industry, this still appears to be a worldwide business slogan. Many other sectors have outsourced their IT functions, creating new business opportunities. Simultaneously, the World Wide Web (WWWW) arose as a new and very powerful infrastructure and a foundation for commercial growth. The ICT industry was busy developing new technologies and applications to meet market gaps. They didn’t pay much attention to creating good client relationships or asking fundamental questions, such as, “Who needs this?” Who requires this? Is the customer truly in need of what we’re offering?

The Changing Scenery: The party came to an end all of a sudden. Consumers have developed, and the entire ICT sector was faced with finding new markets. Only a few businesses that began in the 1990s have managed to stay afloat. It was becoming less and less about inventing new technology and more about discovering new applications. Customers were in desperate need of specific applications. Those organisations that survived did so because they prioritised client relationships from the start. Perhaps this is one of the reasons why eBay is still the only e-commerce company with a big profit margin. In the field of information technology, this could imply creating user-friendly and functional products and services. Firms can earn from the value they provide for customers if this is accomplished.

5. Changing Responses:

Recent scientific advances have increased the demand for highly specialised abilities in new fields such as genetics, genetic engineering, biomedical engineering, and molecular biology. Not enough people in the world possessed such abilities, and science continually discovered discoveries, boosting the demand for ever-more advanced skill sets. Biotechnology advancements allowed new tiny businesses to establish themselves as providers of fresh scientific knowledge to existing pharmaceutical companies. Suddenly, the R&D process was dissolved, and the field had to learn to do collaborative R&D beyond company boundaries. The creation of networks and an R&D method based on client relationships began. The ICT industry has to figure out a way to learn how to identify markets by learning how to cultivate client relationships while also inventing new technology. The biotechnology industry was faced with learning to run their business using a new method based on boundary-crossing cooperation, in which partners were essentially regarded as customers. These collaborations took place at all phases of the R&D process. R&D and innovation management had become relational, and success hinged on the ability to generate new knowledge and manage relationships among partners. Relationship management has become a critical component of success in both industries. (Because buyer-seller interactions have always been at the centre of marketing, it seems logical that marketing would be able to offer some answers for relationship management within technology companies.) Relationship marketing, often known as the Nordic School of thought, is a stream of marketing that is not surprising. However, to our knowledge, no one in ICT or biotechnology has ever attempted to use this concept as a foundation for managing high-tech breakthroughs in a relational environment.

6. Technology as a ‘Viagra’ for Productivity and Competitiveness:

Usages:

• Technology can be used in four ways in the service industry:
• Dealing with the customer
• Taking care of the customer’s belongings
• Information processing

Development of new services such as:

• Processing the customer: Technology can be used to process customer information. This occurs when customers desire personal services such as healthcare, entertainment, transportation, or even shopping. Customers might be processed either before or after the primary service interaction. In healthcare, checking a patient’s financial capability and insurance coverage is an example of the former, whereas waiting in line to pay at the POS counter in a department store or supermarket is an example. In either situation, the consumer is frustrated by having to wait. The service marketer’s challenge is to reduce any waiting time.
• Processing the customer’s possession: Technology can process a customer’s material or equipment. DHL/Air Freight package delivery business uses computers, trackers, V-SAT systems, and Global Positioning Systems to trace customers’ items during their delivery trips.
• Processing information: Data processing and conversion into useful information is one of the most important areas of technological application. Technology is used by marketing research organisations, banks, insurance companies, stock market experts, and others to process data and make informed decisions. Consultancy organisations such as Tata Consultancy Services, McKinsey & Co., and Avalon (via its marketing research analytics subsidiary Ugam) have massive information repositories known as Knowledge Management Centers that handle data for them or their clients.
• Creating new services: The adoption of new technology has resulted in the creation of entirely new services. A good example is the Internet. E-commerce services such as shopping (amazon.com for books, dell.com for computers), auctions (eBay), and communication (Yahoo!, Hotmail, and others) have become popular in addition to websites. While VCRs introduced canned home entertainment, VCDs and DVDs elevated the experience, and satellite broadcast technology made it accessible and available 24 hours a day, seven days a week.
• Information systems: Different information systems exist within a service firm for different organisational levels and functional areas, such as marketing, finance, and human resources, among others. The following are examples of information systems created for various organisational levels:
• Operational-Level Systems
• Knowledge-Level Systems
• Management-Level Systems
• Strategic-Level Systems
• Operational-level systems: Operational-level systems, or transaction processing systems, provide information regarding payroll, cash deposits, sales, and receipts to operational-level management. When an existing house loan customer requests a top-up loan for repairs and reconstruction, the operation manager examines the customer’s profile and past transaction history to evaluate whether he meets established requirements. The information system’s data collection, processing, and interpretation capabilities assist managers in making decisions. At this stage, the business process is much regimented.
• Knowledge-level systems: Knowledge-level systems, also known as knowledge work systems, serve internal clients such as software programmers, university faculty members, research laboratory scientists and technicians, engineers, design scientists, economists, and others. Knowledge workers apply their knowledge to solve problems, tasks, and assignments in the organisation and produce new knowledge.
• Management-level systems: Middle managers are served by management-level systems, often known as Management Information Systems (MIS) and Decision Support Systems (DSS). Managers need information and models to carry out their primary responsibilities, such as planning, controlling, and making decisions. While MIS provides decision makers with periodic (weekly, yearly, etc.) performance data, DSS assists in solving structured and semi-structured problems using mathematical models and other information. DSS assists the manager in scenario development and ‘what-if’ analysis.
• Executive support systems: Executive support systems and service senior management staff are other names for strategic-level systems. These systems include powerful visuals, communication software, and precise data about the company’s external and internal environment variables. Top executives make long-term strategic decisions that impact the company’s fortunes across its entire length and breadth.

There is a scarcity of research in the Indian service industry on the relationship between technology adoption and increased competitiveness.

The following industries have been investigated:

• Government
• Banking
• Retailing
• Education
• Insurance
• Travel
• Logistics

This unit could be a starting point for more profound research in the indicated field, focusing on finding further correlations and patterns through in-depth research, particularly in highly specialised industries. Through technology adoption, there is room for comparison of the influence on competitiveness between Indian and foreign corporations, private and public enterprises, profit and non-profit organisations, and across sectors.

The following are some of the technological advancements that have had a significant impact on the worldwide competitiveness of service firms:

1. Universal Product Code (UPC)
2. Radio Frequency Identification Documentation (RFID)
3. Credit cards technology
4. Electronic Data Capture (EDC)
5. Quick Response Inventory Management System (QRIMS)
6. Enterprise Resource Management Systems (ERMS)
7. Supply Chain Management Systems (SCMs)
8. ATMs with V-SAT
9. The Internet
10. Data mining and data warehousing technologies
11. Imaging technologies
12. Computerised Reservation Systems (CRS)
13. Customer Relationship Management Systems (CRMS)
14. Telecommunication (satellite, cellular phone, Wi-Fi, broadband, etc.) technologies.

The following are examples of technology adoption trends in specific industries that have improved competitiveness and changed the market’s nature:

1. Government:

The central government and various state governments have increased their productivity and efficiency by judiciously implementing information technology. In the early 1980s, NRI telecom guru Sam Pitroda aided the Centre in getting the Telecom Commission up and running. Through the National Informatics Centre Network, the latter is primarily responsible for obtaining the incredible teledensity of 12.73 by April 2006 and connecting the nation’s 600 districts with personal computers, landlines, and satellite networks (NICNET). The network provided state and federal governments with the most up-to-date demographic and revenue records. The states of Madhya Pradesh and Andhra Pradesh set up information kiosks in every district to ensure a transparent system for land and income records and effective monitoring of government programmes. In the second part of 1979, Psychologist Prannoy Roy utilised a powerful ICIM computer to translate massive amounts of Election Commission data to forecast Mrs. Indira Gandhi’s phoenix-like comeback to power correctly. He subsequently employed the high-quality visuals created by his software firm Stat Art to distinguish his popular weekly news programme, The World This Week, which has been broadcast on Doordarshan every Friday since 1998. NDTV used NICNET in the 1990s to obtain polled data from its headquarters for the most up-to-date analysis! He went on to work as a content consultant for Star News before launching his satellite television channel, NDTV.

2. Retailing:

Retail is a technology-intensive industry where distribution and information technologies can help businesses gain a competitive edge. Through two new logistics approaches – cross-docking and electronic data exchange – Indian merchants can cooperate closely with their vendors to predict consumer demand, decrease lead times, reduce inventory holding, and so save money. The following are some examples of technological adoptions that have significantly improved the industry’s competitiveness:

UPC (Universal Product Code) – The universal adoption of the ‘bar code’ by manufacturers and retailers in 1972 transformed the power imbalance in retailing, and it would similarly favour Indian merchants. The following data is encoded in the bar code:

• Product classification (say, shampoo)
• Specifications of the brand (say, Lux)
• Unique particulars (say, pink colour, and in 250 gm.)
• Manufacturing batch number
• Information about the expiration date
• Information about the price
• Information about the manufacturer, etc.

The UPC was created to simplify sales registration and congestion at checkout/payment counters in retail stores. The shops cleared their counters swiftly and gained access to a massive amount of data by firing scanner beams at the bar codes. Before 1972, companies like Unilever and Procter & Gamble were powerful because they owned the brands and were continuously in touch with consumers through market research. The brands drew customers to retail stores, where they could then try on other items. The corporations pressed shops for higher margins and the stocking of new, unknown brands.

After 1972, retailers were the only ones who could determine with deadly accuracy, especially after combining sales data from their chain stores, which products in which variant formats were moving when and where. Even still, the stores lacked two critical pieces of information:

• Who were the people who purchased the merchandise, and
• Why did they purchase it?

Mega stores like Wal-Mart were fortunate enough to have the initial information through the widespread acceptance — this time by customers – of another concept: credit cards. Retailers accessed client data — name, address, occupation, income, family size, educational qualification, and so on – with every credit or charge card purchase. They may follow brands and analyse customers’ purchasing patterns and habits. The second information came from frequent market research and the creation of a Customer Satisfaction Index (CSI). Wal-Mart gained a decisive competitive advantage due to this information, and they used it to their advantage in inventory management and hard bargaining with vendors. They reduced the cost of items acquired and passed the savings on to customers in the form of lower prices.

Wal-Mart made great strides after learning about customer preferences. They sought out private label brands (Wal-Mart-owned brands) from their vendors. The transformed scenario since 1972 has a subtle irony: nowadays, Unilever and P&G are the most prominent captive providers of Wal-Mart-owned products! The balance of power had altered.

Due to their technical embrace, they have experienced such rapid expansion and strength. Indian retailers now thoroughly understand the market and can stock the items their customers desire. This data aids them in warehousing, shelf-space management, inventory control, and the most efficient use of space, products, and money. Hindustan Lever and P&G will transition from antagonistic to collaborative roles, requesting retail data from organised retailers for use in their marketing programmes, as has happened elsewhere. HLL took a step ahead by entering the e-retail market through SangamDirect to gain constant insight into customer psychology and purchasing patterns.

• QRIMS:

IT integration can be a development tool for Indian retailers, such as the Quick Response Inventory Management System (QRIMS), which connects stores to vendors via computers and satellites. Vendors may get the most up-to-date information on goods movement in stores and avoid extra inventory and stock by planning their deliveries ‘just in time.’ Indian merchants and suppliers do not have to wait for time-consuming order inquiries, processing procedures, or consignment-to-consignment negotiations. They can now be partners in a classic win-win situation, guaranteeing each other long-term commitments and avoiding narrow-mindedness. Finally, Indian retailers can make vendors a significant shareholder in their success, but this can only be done with the right technology, which may be used to gain a significant competitive edge.

Due to superior technology and knowledge management, Wal-Mart has become the world’s most valuable firm (with a turnover of $245 billion). Wal-headquarters Mart’s in Bentonville, Arkansas, employs around 1,000 software “techies” that work exclusively for the company. Its superior technology, which it utilises for supply chain management, customer tracking, inventory control, logistics management, and other functions, allows it to keep operating costs around 15% of revenues — much below competitors like K-Mart. Sales inventory and shelf movements are tracked using barcode scanners. There is computer communication between regional warehouses in the form of a Local Area Network (LAN) and a Wide Area Network (WAN), through which merchandise managers place their orders. The warehouse computers are linked by satellite to over 200 vendors, allowing supplies to be made with the shortest possible lead time. Wal-Mart has kept its shipping costs half of its closest competitors, providing a significant competitive edge.

Indian merchants have yet to implement such vendor collaboration platforms.

• RFID (Radio Frequency Identification Devices):

RFID (Radio Frequency Identification Devices) is a type of device that uses radio waves. Sanjay Sarma, 35, a robotics expert and engineering professor at the Massachusetts Institute of Technology’s AutoID Centre, is the inventor of this technology, fundamentally transforming the face of shopping. The RFID technology is based on radio frequency chips that may be read remotely via wireless Internet connections. Radiofrequency ID systems, which will soon replace bar codes, are now being used to tag merchandise. It can track soaps, fruit juices in tetra packs, shampoo, and pickles from the production through the warehouse to the supermarket shelves.

Linda Dillman, Wal-Chief Mart’s Information Officer, is deploying Sarma’s technology throughout the retailer’s huge supply chain. By 2005, she had pushed Walmart Mart’s 100 suppliers to use RFID tags on all their products. Retailers and their vendors can better track inventory, keep shelves always filled, and reduce pilfer loss and inventory expenses. It has become the technology standard for the $2.7 trillion retailing business in the United States.

“Online purchases are rapidly translated into radio signals that tell Dell’s robotic parts-picking machines to round up the components for each PC,” says Michael Dell of Dell Computers. RFID transmitters beam assembly plans to workers and track finalised product shipments, allowing Dell managers to track the entire process online. Michael Dell pioneered the concept of “mass customisation” by using a toll-free telephone order-receiving system and, eventually, the Internet. It now sells over $ 19 billion in PCs and servers over the internet, compared to $30 billion in total sales. It has 60 process patents and has eliminated 120 human hand operations. Its whole focus has been on implementing technology that can process orders, guide its bespoke manufacturing process, and deliver computers quickly. As a result, it could complete the task in less than 24 hours, and the model was the envy of its competitors. It has employed technology to fine-tune its supply chain, reduce inventory, and minimise obsolescence, the industry’s nightmare.

Other technology applications in the retail industry include:

1. CRM (Customer Relationship Management):

CRM (Customer Relationship Management) or OLAP (On-Line Analytical Processing) software to run on top of the company’s existing database. This can assist businesses in gaining a better knowledge of their customers and demands. The following customer-facing applications are included:

• SFA (Sales Force Automation): SFA’s meaning expanded to include opportunity management – supporting sales methodologies and interconnection with other company functions such as production. It was initially designed to assist salespeople in managing their touch points and providing them with event calendars about their customers. A service firm benefited from SFAs in the following ways:
• Contact Management: Track existing customers’ information and contact histories. You can incorporate a point in the sales cycle as well as a customer’s replenishment cycle.
• Activity Management: Provide individual salespeople with a calendar and schedule.
• Management of Communication: Use e-mail and fax to communicate.
• Forecasting: Assist with sales goals, targets, and projections in the future.
• Lead and Potential Lead Management: Manage new customer leads and potential leads.
• Obtain online quotes and convert inquiries into orders with order management.
• Document Management: Create and retrieve standard management reports and presentation documents that can be customised.
• Sales Analysis: Examine sales figures.
• Product Configuration: Assemble a variety of different product specifications and prices.
• Marketing Encyclopedia: Provide up-to-date information about items, prices, and promotions, as well as soft data on individuals (e.g., effect on purchasing decisions) and competition information.

2. Customer Services (CS):

This after-sales activity satisfies customers by rapidly and effectively resolving internal and external customer concerns. By giving quick and accurate replies, a corporation can save money and boost customer loyalty and income. Call centres, field service, and help desk management are examples of customer service.

Customer Services Capabilities

Call Centre Management:

• Provide automated, end-to-end call routing and tracking
• Capture customer feedback information for performance measurement, quality control, and product development

Field Service Management:

• Allocate, schedule, and dispatch the right people with the right parts at the right time
• Log materials, expenses, and time associated with service orders
• View customer history
• Search for proven solutions

Help Desk Management:

• Solve the problem by searching the existing knowledge base
• Initiate, modify, and track problem reports
• Provide updates, patches and new versions

Dot. coms

Indian e-retailers can emulate Amazon.com’s technology drive to be distinct and significant with the first advantage. Movers It is the inventor of numerous Web-based processes and has the patents for the contentious “one-click purchase” procedure. It has five massive barns that cost the non-store bookseller $ 200 million each. These warehouses are linked by satellite to process client requests. The request-processing / order-handling centre delivers the needs to the person in charge near the book stacks via walkie-talkie. The book is placed on a conveyor belt along with the order information and transported to the order processing centre. If a request contains numerous titles, they are all collected at the centre and mailed to the consumer at a discounted rate and within 48 hours.

ERP and SCMs:

Enterprise Resource Systems like SAP and Baan have enabled Indian businesses to plan better and utilise their resources, something they were previously infamous for failing to accomplish. Supply Chain Management Systems, such as those offered by i2 Technologies, have enabled businesses to connect their manufacturing processes with their suppliers better and benefit from “just-in-time” advantages.

Banking:

ATMs, VSATs, and EDC are examples of how Indian banks can leverage technology to reduce personnel expenses while expanding their market presence. Citibank was the first retail bank in India to use technology to accelerate growth, increase productivity, and reach a larger market. Citibank invested in technology long before others did, whether microfilm, microfiche, scanning, data mining, data warehousing, satellite communication systems, etc. Citibank Overseas Software Limited (COSL), a financial technology and software development division, was created solely for the captive market. In the early 1980s, it relocated its whole card operation to Chennai and served its customer base over satellite-linked telephones. It was one of the first companies to use eServe to move toward captive business process outsourcing. Citi Bank reduced its staffing costs while expanding its market coverage because of technological advancements.

ICICI Bank followed Citi Bank’s lead by deliberately employing technology to expand its reach drastically, grow at a breakneck pace, and raise its profile. It has about 1800 ATMs, 5.5 million Internet banking accounts, and almost a million mobile banking customers. V-SAT technology was employed to connect all of its ATMs to its branches. Customers can now use any ATM in ICICI Bank’s specialised ATM network or through arrangements with other banks’ ATMs to manage their accounts. It uses note-counting machines in its branches, which saves the bank a lot of time. Other banks have started using automatic ledger-posting machines as well. Similarly, HDFC Bank has quickly embraced net banking and online share trading.

Migrating consumers to lower-cost channels: HDFC Bank has successfully leveraged technology to shift nearly half of its banking transactions to low-cost channels such as ATMs (50%) and net and mobile banking (10%), as well as phone banking (5%). Similarly, ICICI Bank has shifted most of its transactions away from its branches (from 95% two years ago to 40% now); 45% of transactions have been shifted to ATMs, with the remaining 15% using Internet and phone banking. HSBC branches handle 25% of all transactions among international banks, while Citibank branches handle only 5–7% of all transactions in terms of volume. The internet accounts for 15% of the total, while telephones and ATMs account for roughly 80%.

There are numerous benefits for banks as a result of technology adoption:

1. Economical: It helps to keep costs down. Compared to a branch transaction, the cost per transaction at an ATM is only 30%. Due to cheaper real estate housing expenses for ATMs, savings are more significant in smaller cities and towns. HDFC Bank has tripled the number of active net banking customers to over 3 lakh. On the internet, there are approximately 6.5 lakh transactions monthly, with non-financial transactions accounting for the majority (85%).
2. Force multiplier: Technology can assist in generating business leads that can subsequently be followed up on by bank employees. When customers of other banks use their credit or debit cards at an ATM, it might generate new revenue. UTI Bank has been eyeing this market, focusing on customers of international banks that lack sufficient branches or off-site ATMs to serve a large customer base. The bank had previously formed an arrangement with BNP Paribas (which had halted its retail operations) and is in contact with other financial institutions. Non-UTI Bank clients make up 10-12 per cent of ATM transactions that accept Visa and MasterCard at UTI Bank locations. After ICICI Bank, UTI Bank has India’s second-largest ATM network, with over 600 ATMs across 70 cities (1100- plus). In addition to its approximately 18,000 manned locations, SBI is already the largest ATM-networked bank (including the branch network of its seven Associate banks). This offers Indian banks an enviable reach across the country.
3. “Hub-and-spoke system”: UTI Bank’s ATM networks follow a hub-and-spoke format, with branches seldom more than 2-3 kilometres from an ATM in a city like Mumbai and more than 5 kilometres in smaller cities. They are effective instruments for acquiring and keeping customers.
4. ATM Locations: ICICI Bank has deliberately placed its ATMs to provide the best possible service. It has targeted many clients at petrol stations, key commercial districts, and corporate campuses such as Infosys.
5. Value-added services: Customers can pay their taxes and utility bills online and use multilingual services. The information displayed on ICICI Bank ATMs is available in six languages: English, Hindi, Kannada, Tamil, Malayalam, and Marathi.
6. Workload reduction: In mass banking, paperwork and volume overwhelmed good public sector banks like SBI. As a result, they were seen as inefficient and unable to devote adequate time and attention to striving for middle- and high-net-worth clients. ATMs, bar code and Magnetic Ink Character Recognition (MICR) scanners, Automatic Ledger Posting Machines (ALPM), and other technologies have lowered workloads at banks worldwide, including in India. Additionally, additional features are being introduced.
7. Cross-selling: Banks can take advantage of cross-selling their various products through their various channels. Embedded technology also aided them immensely in this aspect. Customers can, for example, use their ATMs to inquire about ICICI Bank’s other products. Home loans, automobile loans, credit cards, life insurance, mutual funds, and internet trading are the six possibilities currently available to the robots (icicidirect.com). Any information request made by a consumer at an ATM, such as for life insurance, is immediately logged, and the lead is forwarded to ICICI-Prudential marketing employees for follow-up.

Cost Drivers:

Cost drivers can be divided into three categories:

1. Dimensions:

The cost driver is determined by the number of work units (e.g., orders). As more units are processed, the activity’s cost rises.

2. Time:

The cost driver determines how long it takes to execute an activity. The expense of the task rises in proportion to the amount of time it takes to finish it. It makes no difference how many things are made (e.g., when retooling machines, the cost driver is the time required to complete the retooling of machines).

3. Charge:

The total cost of the activity is charged to the cost object (e.g., all costs associated with the retooling of machines for a product are charged directly to the end product).

A charge-type cost driver is utilised very rarely in general. Volume and time are the most typical drivers. The type of driver utilised is determined by the activity. The cost of the activity may rise in proportion to the number of units handled or the amount of time it takes to accomplish it. It could also be a mix of these two types of drivers. For example, the time it takes to test a product may vary depending on the product being tested and the quantity of units to be evaluated. As more products are examined, the expense of testing rises. In addition, the time spent testing will vary depending on the intricacy of the items (e.g., a complex software program takes longer to test a simple software program). Assume that testing a basic programme takes four hours and testing a sophisticated programme takes ten hours and that all other costs for testing the two types of programmes are the same. Testing two basic programmes (i.e., two programmes * 4 hours/programme = 8 hours) costs less than testing one complex programme (i.e., one complex programme * 10 hours/programme = 10 hours).

Measure the Cost Drivers:

Once the cost drivers for the various operations have been identified, they must be quantified. The count for the activity driver must be determined for the same period the expenditures were gathered. If purchase orders are the driving force behind the purchasing process, determine the number of Purchase Orders handled within the time for which expenses have been captured.

Look at current systems for cost driver measures. For example, determining the number of purchase orders executed in a particular period should be pretty simple if the purchasing department employs a computer system.

 Internet Service Design:

It thrives in ecosystems and strives for positive outcomes. It isn’t easy to pinpoint, but it’s becoming increasingly significant. So, why is service design more important to organisations and brands now than ever? There are four causes for this:

1. Digitally enabled services are becoming increasingly common:

Aren’t we all familiar with the Internet of Things, also known as Ubiquitous Computing? Both concepts refer to the proliferation of connectivity in our daily devices. From your TV to your automobile to your bathroom scale, everything we possess is being networked. This connectivity is excellent, but it’s just the hardware; the digital functions emerge as services, which necessitate user interfaces and design.

2. Services and products must exist in ecosystems and be built and thought of in terms of a holistic brand experience:

Okay, we’ll develop those services as we’ve constantly developed websites and applications, right? The challenging thing about products and services these days, compared to the websites we established in 2000, is that they must operate as part of a much bigger digital ecosystem, not as separate experiences. A kiosk system on an aeroplane must work in tandem with its mobile app, and an in-store digital retail experience must be compatible with the iPod shopping software. They are all components of the brand’s entire consumer experience.

3. Well-designed services are marketing differentiators, reasons for customers to purchase your product:

Nike+ is a compelling argument for investing in Nike running shoes. There’s a reason to get their bathroom scale from Withings. Twelpforce may or may not be a reason to shop at Best Buy on a regular basis. Digital services are gradually being included in the goods we use, not as an afterthought or a nice-to-have but as an integral component of the product offering. They are the reason you would choose product X over product Y, and their design becomes vital to business.

4. Poorly designed services can sabotage consumer pleasure and referrals:

When a service is at the heart of your product experience, getting it wrong may be disastrous. The My Ford Touch in-car telematics system was cited as the key factor in Ford’s drop from 5th to 23rd place in the 2011 JD Power & Associates satisfaction survey. Ford isn’t just selling a car; it is also an experience. And the service that was at the centre of that experience was inadequate, leading to a publicly dissatisfied client base. The service layer has surpassed the importance of the product.

In conclusion, product firms are evolving into service and experience companies.

All of this leads us to the final point. Many corporations had a clear distinction between product firms (such as Fiat or Samsung) and service companies (like, say, Geek Squad). Except that now your Fiat has EcoDrive, and your Samsung TV has an app store. These organisations, which were formerly product-oriented, are now becoming service-oriented, necessitating a different attitude, approach, and skill set to succeed. It can be a big market differentiation if done correctly. And, as the story of Ford demonstrates, getting it wrong has extremely serious implications. The era of ubiquitous computing has arrived, and it is up to us to create services and experiences that take advantage of it.