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Business Impact

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The Experience Economy: Work Is Theatre & Every Business a Stage

Bookstore shelves are filled with management books that stretch good metaphors to the breaking point. Business is school (the “learning organization”). Business is a machine (reengineering). Business is digital information (the “new economy”). But The Experience Economy has a more elastic organizing concept -or at least one that holds up for a few hundred pages. In this era of standardization and mass consumption, consultants Joseph Pine and James Gilmore believe, more and more people are willing to pay for memorable experiences, not just well-made products.

Today’s most innovative and profitable companies, they argue, sell the theatrical rather than the tangible -experiences “rich with sensations, created within the customer, “rather than traditional commodities, goods and services. Starbucks coffeehouses, for example, didn’t become almost as ubiquitous as McDonald’s
because of the coffee; Americans coped for decades without someplace to spend $2.95 on a grande caramel macchiato. Rather, customers at Starbucks are paying for staged experiences, Pine and Gilmore would say. The company treats patrons to poetry on its wallpaper and tabletops, jaunty apron-clad performers
behind the espresso machine, and an interior ambience that’s both cozy and slick, marked by earth tones, brushed steel and retro music (also for sale). Few people leave without feeling a little more affluent, sophisticated or jazzed.

Business as theatre may not be a wholly original metaphor, but Pine and Gilmore present it in an entertaining and usable way. If the workplace is a stage, they point out, effective performances depend on entertaining scripts, expert direction, attractive sets and good acting.”To engage a customer in the Experience Economy, act as if your work depended on it! It is the act of acting that, in the end, differentiates memorable experiences from ordinary human activity.”

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Disney takes these maxims literally; employees are called “cast members” and must stay “in character” in guest areas. But Pine and Gilmore argue that even the most mundane businesses can add value to their products and services by delivering them with panache.

Transformations-experiences that change us-are even more valuable, the authors add. Good multimedia software, for example, creates “imaginary worlds that have a special relationship to reality-worlds in which we can extend, amplify, and enrich our own capabilities to think, feel, and act,” as one expert on human-computer interaction is quoted. The Experience Economy, with its own well-developed theme and enriching examples, may transform more than a few managers.

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