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December 16, 2005
Surviving on personized service
One of the things that the Internet was predicted to do was eliminate the "middle-man." "Friction-less" commerce was how Bill Gates described it. Well, that has and has-not turned out to be the case. Web-based transactions have not replaced the middle-man because the middle-man plays an important role as information-broker. Take the case of travel agents - who were supposed to disappear in the face of the onslaught by Expedia, Travelocity, Orbitz and airline/hotel/car rental direct web-based booking sites. This has not been the case, as the Christian Science Monitor points out in "Travel agents find routes to survival":
So are the nation's 100,000 or so travel agents headed for the same fate as blacksmiths and buggy-whip makers - near extinction? The US Bureau of Labor Statistics expects positions as travel agents to decline through 2012 and warns those considering the profession to expect "keen competition for jobs."
But balancing that are a couple of factors: (1) The travel market in general is expected to continue to grow, and (2) despite growing comfort with the Internet, some people are expected to still want personal service and expertise from another human being. Recognizing this, online travel agencies such as Expedia.com have expanded to offer bookings by contacting a real, live travel agent via its toll-free phone line - no computer needed.
"Service is what makes the industry," says Christopher DeSessa, an associate professor at Johnson & Wales University in Providence, R.I., who teaches courses on travel and tourism. "It's when [customers] start getting to the high-ticket items that they need the expertise of a travel agent."
Expedia adding real live people? What is the Web coming to!
Looks like the travel business is learning the same lesson that the banking industry learned when it thought it could do away with tellers just because of ATMs.
It is the intangible asset of tacit knowledge that is brought to bear in many service transactions - not simply the transaction. As routine information becomes codified and available easily in digital form, the skills and tacit knowledge to navigate and interpret that information become more important.
In the information age, there will always be a need for information brokers. That is what much of the "service" sector is all about.
Posted by Ken Jarboe at December 16, 2005 11:09 AM
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