The Journal of 2020 Foresight

Reports from the Knowledge Labs about our recent findings, research topics, and interviews with lifestyle leaders who are creating their own futures.

How to stimulate your own powers of foresight. Consider the following thought provokers. Ask yourself, in these categories what are the brand new trends and forces? Which are the ones growing in importance? Which current forces are loosing their steam? Which have peaked or are reversing themselves? Which are the "wildcards" about to disrupt us in the future? POLITICAL AND TECHNICAL thought for food: Electronics, Materials, Energy, Fossil, Nuclear, Alternative, Other, Manufacturing (techniques), Agriculture, Machinery and Equipment, Distribution, Transportation (Urban, Mass, Personal, Surface, Sea, Subsurface, Space), Communication (Printed, Spoken, Interactive, Media), Computers (Information, Knowledge, Storage & Retrieval, Design, Network Resources), Post-Cold War, Third World, Conflict (Local, Regional, Global), Arms Limitation, Undeclared Wars, Terrorism, Nuclear Proliferation, Weapons of Mass Destruction, Governments (More/Less Power and Larger or Smaller Scale), Taxes, Isms: Nationalism, Regionalism, Protectionism, Populism, Cartels, Multinational Corporations, Balance of Trade, Third Party Payments, Regulations (OSHA, etc.) Environmental Impact, U.S. Prestige Abroad. SOCIAL AND ECONOMIC Food for thought: Labor Movements, Unemployment / Employment Cycles, Recession, Employment Patterns, Work Hours / Schedules, Fringe Benefits, Management Approaches, Accounting Policies, Productivity, Energy Costs, Balance of Payments, Inflation, Taxes, Rates of Real Growth, Distribution of Wealth, Capital Availability and Costs, Reliability of Forecasts, Raw Materials, Availability and Costs, Global versus National Economy, Market versus Planned Economies, Generations: Y, X, Boomers, Elderly, Urban vs. Rural Lifestyles, Affluent vs. Poor, Neighborhoods and Communities, Planned or Organic Growth. Got Knowledge?

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Friday, September 08, 2006

The Intangibles of Service Staged as Memorable Experiences

Chapter Four: The Tribal Territories

By Steve Howard, CKO
The Knowledge Labs

Table of Contents
Chapter One: Basecamp
Chapter Two: The Ridge
Chapter Three: The Outpost
Chapter Four: The Tribal Territories

"We are in a world that has a system that now allows convergence among many billions of people, and we had better step back and figure out what it means."

Thomas Friedman, “The World is Flat”

DOUBLE NICKEL RANCH. Today the third progression of economic value – as an era – is in full swing. Unlike during the agrarian and the product economies, in the service economy intangible services are customized and delivered. The four success factors for creating value -- origination, execution, improvement and application shift to support service operations.

Journal of 2020 Foresight: One of the biggest differences I notice with the service economy is that there are no products to be inventoried.

Explorer: That’s true. Instead, the method of supply for service providers is to deliver on demand to clients who crave benefits instead of just features.

J2020F: Sell product features and benefits to potential customers is the mantra I can still hear in sales courses around the world.

Explorer: Here, the emphasis has to be on benefits.

J2020F: Why?

Explorer: Because services are intangibles. The offering is no longer a material or a product.

J2020F: How is it “produced” then?

Explorer: Through an operation that ensures delivery with new procedures.

J2020F: What your talking about is different than inventing, mass-producing, continuously improving and mass commoditizing.

Explorer: But it follows the same steps of developing, linking, modularizing and renewing since we are customizing.

J2020F: Remind us what the steps are.

Explorer: Sure. Exploring, experimenting, packaging and personalizing.

J2020F: When a problem arose in manufacturing, a solution to a problem in the manufacturing process was sought. How about in the service economy?

Explorer: A correction by service providers doesn't involve searching for a new commodities source, or fixing a product mistake. Instead, it triggers a response in a direct interaction with clients.

J2020F: And the goal is to eliminate and further prevent customer sacrifice?

Explorer: Yes. And from that “experience” of customization, customers who demand premium, high margin services usher in the next era.

J2020F: Which is the experience economy, right?

Explorer: Yes. Through further customization the progression of economic value moves from commodities, goods, and services to experiences.

J2020F: How is an experience different from service?

Explorer: The experience economy is all about staging memorable personal experiences revealed over the duration of the event.

J2020F: Rather like a vacation to Cabo San Lucas, or Buffalo Bill’s Wild West Show?

Explorer: Definitely yes on the first part, I suppose on the second part.

J2020F: Buffalo Bill Cody took advantage of his reputation -- or his brand -- as made up in the dime novels written about him and the exaggerations he promoted.

Explorer: Wasn’t it Ned Buntline who figured out it was more profitable to spin yarns and easier to manufacture stories about “heroes” in melodramas crafted for Eastern newspaper readers?

J2020F: Yes. Cody’s Wild West Show touched the hunger for the Old Wild West experience – a romanticized nostalgia that no longer could exist for urban industrialized audiences – or for anyone else after the 1890s.

Explorer: Excellent example.

J2020F: These are staged experiences, right?

Explorer: Yes. The seller manages the mix of sensations demanded by the guest, in contrast to a provider selling a benefit to a client.

J2020F: Hmm. As each new season came around Cody had to come up with new attractions or story lines.

Explorer: How so?

J2020F: He began with a core theme that resonated with his audiences, according to Louis S. Warren’s “William Cody and The Wild West Show.”

Explorer: Which was?

J2020F: The triumph of civilization over savagery and all of the other sub-themes operating almost subconsciously in his audiences.

Explorer: Like?

J2020F: Like the triumph of domestic order, the salvation of the settler's cabin, so the melodrama's core plot was the rescue of the virtuous woman and her restoration to the home.

Explorer: So, saving white women from Indians represented the triumph of civilization before the Industrial Revolution commoditized the Agrarian Age?

J2020F: And something else. The real life hero’s appearance – Sitting Bull, Wild Bill Hickok, Annie Oakley, and Calamity Jane, in these theatrical performances authenticated the collective fantasy already bubbling up, according to Warren-- even before the audience “saw'” them stage “famous” battles in the show.

Explorer: It sounds almost as if the audience was in collusion with Cody who easily evoked a memorable experience. That’s a fine example of what separates staging experiences from providing services.

J2020F: It does?

Explorer: Yes, Service operations produce new procedures for delivering services while the stager of experience events develops new scripts.

J2020F: So following the same process for customization in products and services – developing, linking, modularizing and renewing …

Explorer: Buffalo Bill would have improvised, created a platform theater production, matched the shows acts to cheering fans, and come up with new practiced bits as further opportunities arise to engage, amaze and get paid.

J2020F: Well, for thirty years he traveled throughout the United States and Europe doing just that. And, each time his troupe passed through a community his former customers would return for one more show.

Explorer: So his enduring or flagging appeal hinged on how well he succeeded in the customized experiences method of correction -- forgetting triggers a memory preserved. Repeat business hinges on it.

J2020F: Warren says the show company came to represent “America itself, its dazzling mix of races sprung from a frontier past, welded into a thrilling performance, and making their way through the world via the modern technologies of railroad, portable electrical generator, telephones, and brilliantly colored publicity -- an entrancing vision of the frontier-born, newly mechanized, polyglot United States in the Gilded Age.“

Explorer: By the way, was Cody really a pony express rider?

J2020F: Well, according to Warren even during his lifetime it was hard to determine if he was a hero or a charlatan – in fact part of Cody’s genius was to promote the blurred line so the audience would want to pay to see him so they could decide for themselves.

Explorer: So, I guess no matter how truthful his branded entertainment was, he became a savvy entertainer.

J2020F: And Warren says what seems to have been overlooked is his show “provided a means for rural westerners, including cowboys, cowgirls, and especially Lakota Sioux Indians, to claim a new future for themselves by reenacting a version of the past.“

Explorer: So it appears he stepped back and saw the opportunities driven by the convergence of the Industrial Age.

J2020F: During the “Flat Earth” challenge of his day, the subject of Larry McMurty’s novels -- an unromantic look at the real West in transition -- he figured out how to provide venues for the “Trapped and Permanently Temporaries” to get paid for their obsolete skills in higher margin markets.

Explorer: Contrast that to a service reaction triggers a response, or a product problem triggers fixing a mistake, or for a commodity business -- depletion launches exploration at a new site.

J2020F: Buffalo Bill Cody was a man well ahead of his times. Even Mark Twain penned a fan letter and according to some sources encouraged Cody to tour Europe.

Explorer: Both Cody and Twain demonstrated what the application of an experience is all about in a new era.

J2020F: An encounter that connects with a guest in a memorable way?

Explorer: Right. In terms of a dominant economy, experiences are only now emerging as customized services, but expect experiences to also become commoditized in the decades ahead.

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