Bekmirzayev Rashid Service-commodity goods continuum - There has been a long academic debate on what makes services different from goods. The historical perspective in the late-eighteen and early-nineteenth centuries focused on creation and possession of wealth. Classical economists contended that goods were objects of value over which ownership rights could be established and exchanged. Ownership implied tangible possession of an object that had been acquired through purchase, barter or gift from the producer or previous owner and was legally identifiable as the property of the current owner.
- Adam Smith’s book The Wealth of Nations, published in Great Britain in 1776, distinguished between the outputs of what he termed "productive" and "unproductive" labor. The former, he stated, produced goods that could be stored after production and subsequently exchanged for money or other items of value. The latter, however useful or necessary, created services that perished at the time of production and therefore did not contribute to wealth. Building on this theme, French economist Jean-Baptiste Say argued that production and consumption were inseparable in services, coining the term "immaterial products" to describe them.
- Most modern business theorists see a continuum with pure service on one terminal point and pure commodity good on the other terminal point.[2] Most products fall between these two extremes. For example, a restaurant provides a physical good (the food), but also provides services in the form of ambience, the setting and clearing of the table, etc. And although some utilities actually deliver physical goods — like water utilities which actually deliver water — utilities are usually treated as services.
- In a narrower sense, service refers to quality of customer service: the measured appropriateness of assistance and support provided to a customer. This particular usage occurs frequently in retailing.
SYSTEM - In the 19th century the French physicist Nicolas Léonard Sadi Carnot, who studied thermodynamics, pioneered the development of the concept of a system in the natural sciences. In 1824 he studied the system which he called the working substance (typically a body of water vapor) in steam engines, in regards to the system's ability to do work when heat is applied to it. The working substance could be put in contact with either a boiler, a cold reservoir (a stream of cold water), or a piston (on which the working body could do work by pushing on it). In 1850, the German physicist Rudolf Clausius generalized this picture to include the concept of the surroundings and began to use the term working body when referring to the system.
- The biologist Ludwig von Bertalanffy became one of the pioneers of the general systems theory. In 1945 he introduced models, principles, and laws that apply to generalized systems or their subclasses, irrespective of their particular kind, the nature of their component elements, and the relation or 'forces' between them.
- Norbert Wiener and Ross Ashby, who pioneered the use of mathematics to study systems, carried out significant development in the concept of a system.
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