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Hub and Rim Strategy: A New Framework for Service Systems in the Age of Technology
Authors: Piyush Kumar (Terry College of Business, University of Georgia, USA)
In this paper, we propose a fundamental shift in strategic thinking related to service strategies in response to the dramatic changes in both technology and data processing capabilities. We argue that these changes require us to re-evaluate the distribution of intellectual versus operational capacities across service organization, and propose a new, Hub and Rim Framework to enable organizations to strategize and execute their transition into becoming a modern service system in the digital era. The framework proposes dramatic changes and potential reversals to the current approaches to hiring service personnel, their development and deployment, work definitions, incentive and control systems, and the tradeoff between the roles of technology versus people. It provides a set of prescriptions that stand in stark contrast to existing service management models such as the Service Profit Chain, The Gaps Model, Service Dominant Logic, and a counter-intuitive perspective on the management of a service firm’s customer base. The ultimate goal of the paper is both challenge researchers to revisit the primitives of long-standing models of service strategy and to help practitioners chart a course towards creating smart service systems.