Are you prepared to handle these 3 critical service management challenges?

Economic growth, globalisation and changes in demography all represent critical service management challenges. Are you prepared to handle them?

A greater diversity (in generation, culture, gender, values etc.) in a more global workforce and an expansive consumer pool is leading to new user segments, each with their own set of service requirements and expectations. It also means that much of the growth in the size of the service economy will not be driven by high income countries, but by middle and low income countries, whose middle classes will soon have the disposable income to seek experiences and fulfil their immaterial needs as the middle classes in high income countries have done already.

While the global population grows wealthier, it will also grow older – requiring an expansion of services tailored to elderly populations around the world.

Service Management Challenge #1: Economic growth

Emerging regions will transition from a commodity or industrial economy to a service and experience-based economy as GDP and citizen purchasing power both continue to rise. Near 2030, the aggregate purchasing power of the E7 economies (Brazil, China, India, Indonesia, Mexico, Russia and Turkey) will overtake that of the G7 (United States, Canada, France, Germany, Italy, Japan and the United Kingdom).

The growing global middle class will more than double by 2030, reaching 4.9 billion. This represents opportunities for service providers to further expand to new markets internationally, both in B2C and B2B (B2B2C) contexts.

Asia is projected to have the biggest growth (84%) om the global middle class, followed by Middle East and Africa, with the North American middle class projected to decline by 5% towards 2030.

Service Management Challenge #2: Globalization

A growing global population with increased migration and mobility will create service challenges around language and cultural alignment. These challenges create opportunities to develop new culture-based service concepts and improve service outcomes through cross-cultural learnings. The service managers who successfully develop solutions to these challenges will have opportunities in urban centres and megacities around the world.

With increased globalization also comes new human resource challenges – and a more culturally-dense international workforce will require service managers to reconcile differences within and across offices to achieve social symbiosis and operational efficiency.

Service Management Challenge #3: Demographic development

Further challenges reside in effectively managing, engaging and motivating a multigenerational workforce. More workers will also past the age of 65 and this is something to be considered in Service Management. Different generations bring different values and expectations to the workplace and their decisions around consumption. As a result, organizations will be forced to find a way to create organizational co-existence and balance between the needs of more diverse and individual-oriented workforces and the inherited industrial logic that demands standardized solutions to reduce costs.

The challenge resides in facilitating a synergy between several generations with different interests, motivations and values. This requires shaping work and designing work processes according to the tendencies and predisposition of different generations, all while keeping within the strategic mission and vision of the organization in question. Likewise, an ageing population in advanced economies will come to demand both improvements in the accessibility of certain existing services and new accessibility services altogether.

Would you like to learn more about the Future of Service Management? Download our white book on the topic below.

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