Companies today are interested in gaining the lifetime value of the consumer. In this dynamic world of information technology, organizational strategies are focusing on customer service as a competitive advantage. Where lean manufacturing, low price, and cost cutting logic was once a primary approach of operation managers, these same firms have determined that by utilizing a Service Dominated Logic approach or (SDL), they are gaining competitive advantages that prove to have a longer lasting effect on the consumer, and maintaining a lifetime loyalty from these customers. These loyal customers then provide the number one form of marketing which is “word of mouth”. Brand awareness is also heightened and return on investment (ROI) is gained by shareholders. This paper will first discuss an overview of SDL, describing the overall theory and components, while providing a brief historical background of SDL. Next, it will identify critical foundational literature in the development of service theory. This document will then compose a timeline analyzing changes in service theory linking these changes to important developments in service industries. Finally, it will identify critical components of service theory. Service Dominated Logic Theory and Historical Background Adam Smith (1776/1904) who is commonly known as “the father of economic thought” developed modern day economics not by his intention. According to Vargo, Lusch, & Morgan, 2004 Chapter 2: Smith’s purpose was to integrate and explore the preceding views into a model of the normative economics of national wealth creation. In so accomplishing this objective, he created bifurcations in the treatment of the concepts of ‘productive’ services and ‘value’ that t... ... middle of paper ... ... Sheth, Jagdish and A. Parvatiyar (2000), “Relationship Marketing in Consumer Markets: Antecedents and Consequences,” in Handbook of Relationship Marketing, Jagdish Sheth and A. Parvatiyar, eds. Thousand Oaks, CA: Sage Publications. Shoestack, G. Lynn (1977). Breaking Free from Product Marketing. Journal of Marketing, 41(April), 73-80. Retrieved from Jstor.org Web site: http://www.jstor.org/discover/10.2307/1250637?uid=3739256&uid=2129&uid=2&uid=70&uid=4&sid=21103723085277 Vargo, S., & Lusch, R. (2004). Evolving to a New Dominant Logic for Marketing. Journal of Marketing, 68(1), 1-17. Retrieved from sdlogic.net Web site: http://sdlogic.net/JM_Vargo_Lusch_2004.pdf Vargo, S., Lusch, R., & Morgan, F. (2004). Historical Perspectives on Service- Dominated Logic (Vol. 1). Retrieved from sdlogic.net Web site: http://www.sdlogic.net/historical_persp_on_sd_logic.pdf
In the Humanistic Tradition the author, Gloria Fiero introduces Adam smith as a Scottish moral philosopher, pioneer of political economy, and a key figure in the Scottish Enlightenment. Smith also known as the Father of Political economy, is best known for one of his two classic works An Inquiry into the nature and causes of the Wealth of Nations. Fiero looks at Smith’s work because the division of labor is important. One thing Smith thinks is even more important for creating a wealthy nation, is to interact and have open trade with different countries. Fiero states,“It is necessary, though very slow and gradual, consequence of a certain propensity in human nature which has in view no such extensive utility; the propensity to truck, barter,
Let’s get started with Adam Smith and his second coming. Adam smith was one of the greatest economics minds that have ever existed, teaching us that our wealth is not just in gold and silver but in the products that we produce and commerce we engage in! Much like today we can understand the idea of Gross National Product and how we can better adjust our habits and ourselves. Smith unlike most economists of that age understood the value in hard work and social aspect behind our decisions.
Kotler, Philip, and Kevin Lane Keller. Marketing Management 12e. Upper Saddle River: Pearson Prentice Hall, 2006.
Adam Smith is often considered to be the father of modern economics or the first world’s free market capitalist and. As Smith was living in the middle/late 18th century his works were written in the early stage of industrialization in Great Britain. Because of the development of a factory system there was a demand for more sophisticated capital investment planning and distribution, organization of production process and management of employee performance. Smith was interested in new producing system and he noticed that the expanding market and labor specialization plays a major role in increasing the life standards of citizens. Therefore, he has developed a model in which the user 's material well-being has been defined as a goal; assets are
Armstrong, Gary, and Philip Kotler. Marketing: an introduction. 11th ed. Upper Saddle River, NJ: Pearson Prentice Hall, 2013. Print.
Adam Smith is widely regarded as the father of modern economics and one of the greatest economists throughout the course of history. He is mainly famous for two books that he wrote, these two books are considered the base and infrastructure of the world of economics. The two books he wrote were, “The Theory of Moral Sentimental” and “The Wealth of Nations”. But although Adam Smith was such a great economic philosopher, he wasn’t a very good forecaster or future predictor. The economic scenario now is very different from the economic landscape of the 1700’s.
Smith and Marx both have diverse theories as to what would lead nations to a stable and efficient economy. Smith wrote his famous “Wealth of Nations” in 1776, which became one of his greatest works. The changes in the European economy and industrialization had an impact on Smith which is reflected in his writings. The complex formation of today’s economy throughout the world is highly influenced by Smiths take on capitalism. Despite the fact that Smith’s approach might have a more conclusive stance in the
Adam Smith and Karl Marx are undoubtedly two of the finest economic minds of the eighteenth
Marketing is not a static construct, but it grows and develops over time to become what is known as marketing today. “The marketing revolution divides neatly into four separate eras’, eras’ which parallel rather closely the classic pattern of development in the marketing revolution.” (Keith, 1960). The first of these 4 eras was until the 1930’s and was production and profit orientated, and are considered to be outdated. During this era “the new product decision was product oriented not marketing orientated.” (Keith, 1960). “The second era was a sales oriented era, whereby marketing was seen as a series of activities designed to produce profit through ascertaining, creating, stimulating, and satisfying the needs/wants of a selected segment of the market.” (Eldridge, 1970, p. 4). The 3rd and 4th eras are a representation of what
Kotler, P & Keller, L (2009). Marketing Management (Thirteenth ed). New Jersey: Pearson Prentice Hall.
Adam Smith had many views that helped in making the world what it is today. I can’t imagine what the world would be like if there weren’t thinkers like Adam Smith. Our career as Pharmacists is a great example of this. What would we be working so hard for if we made the same amount of money as a trash man? He had many other views that were just as important.
—— 2002, 'Relationship Marketing in the New Economy', Journal of Relationship Marketing, vol. 1, no. 1, pp. 37-57.
Petty Ross D. Editor's Introduction: The What and Why of Marketing; American Business Journal, Vol. 36, 1999
Cravens, D. W., & Piercy, N. F. (2009). Strategic marketing (9th ed.). New York, NY: McGraw-Hill.
A service encounter is defined as a moment when a customer interacts with a service or product for the first time. It is the customer’s actual interaction with a service company. It is identified as a key component of the current agenda for service marketers. More than half of the world’s multinational corporations employ in providing services, thus the scrutiny of service encounters is becoming increasingly significant. Research evidence indicates that customers generally compare their expectations with the performance of service industries and they are influenced by the quality of service they receive. The scope of this essay is to discuss about the view that customers don’t buy products they focus on solutions and also about the consumer’s behaviour pattern regarding services provided. Further, it will be noted how businesses are trying to improve the service quality to attract customers leading to an increase in the economic competitiveness.