Progression Of Economic Value (POEV) | Shareef Mahdavi
With the rise of the industrial age in the early 20th century also came automation and factories, whereby manufacturing was the predominant occupation. As farming became increasingly automated, workers migrated from the farm to the factory. At the peak of the industrial economy, 50% of the labor force worked making goods (ie, tangible things) in factories. Although the manufacturing-based economy flourished, it too became subject to increased productivity through automation. Where did those workers go? By the 1950s, the majority of the workforce was involved in a service-based economy, performing intangible activities on demand. With increases in productivity (for which we can thank the computer, among other things) came parallel increases in standards of living. As was the case for the transition from farming to the factory, people were again in a position of paying for services they once did for themselves, including lawn mowing, oil changing, house cleaning, and wedding planning. These few examples illustrate how entire industries emerged to provide services to consumers who were willing to pay for them.
Today, according to Pine and Gilmore, only 3% of the US workforce is involved in farming and just 12% in manufacturing. That means the rest of the United States—85% of the workforce—is part of the service economy. Just as with farming and manufacturing, the service economy is also becoming increasingly automated. How often do you visit a bank teller? Most of our banking is done by an automated teller machine. Voicemail now largely replaces secretaries who once took phone messages. Airplane tickets are purchased over the Internet rather than at travel agencies….
Refractive surgery is already a popular elective procedure; yet, it has more potential for growth. The key for surgeons is to recognize that they need to do a better job in the nonclinical aspects of offering the procedures. The framework and perspective of the Experience Economy brings to light what other retail industries are doing to more effectively compete and earn the consumer’s income. Rather than focus on advertising, refractive surgeons should shift their focus internally, improving their practices so that the experience becomes the marketing.
Date: November 2011 – Length | 9:06 minutes