Measuring and Improving Productivity in Services

Measuring and Improving Productivity in Services

Issues, Strategies and Challenges

Services, Economy and Innovation series

Faridah Djellal and Faïz Gallouj

The definition and measurement of productivity in services raises important conceptual, methodological and strategic problems. This book aims to provide a critical review of the main debates on productivity in the domain of services. The first part examines the theoretical consequences of services specificities on the concept of productivity and reviews the attempts to measure it. The second part is devoted to the main determinants of productivity growth and the strategies to increase productivity in service firms and organisations.

Chapter 6: Productivity Factors in Services

Faridah Djellal and Faïz Gallouj

Subjects: economics and finance, industrial economics, services


INTRODUCTION As was noted in Chapter 2, the specific characteristics of service activities influence the definition and measurement of productivity. Those same characteristics also affect the nature of the levers of productivity and the productivity strategies that firms adopt. The literature in this area is particularly extensive. We propose, therefore, to offer a simplified survey, focusing on the theoretical analyses and attempting to identify some general principles and results. We begin by examining, from an essentially theoretical perspective, some generic productivity levers in services (particularly technical and human levers). We then go on to identify some more general strategies (that is strategies based on a number of different levers) that are deployed in service activities. Thus three groups of generic strategies are identified, which differ in the levers used, the way in which the different levers are incorporated into the strategy and the place occupied by productivity in the strict sense. The first group is made up of productivity strategies that attempt to eliminate the specific characteristics of services (we will call them assimilation strategies), while the second consists of specific rationalization strategies that seek to take account of the specificities of services (we will call them particularist or differentiation strategies). The third group includes strategies that attempt, within the same company, to strike a balance between the two previous objectives (we will call them integration strategies). SOME PRODUCTIVITY LEVERS IN SERVICES In recent years, much...

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