Business services are a broad sector of the economy. They include many sectors such as information technology, consulting and logistics. Businesses use services to improve their operations and keep up with the demands of their customers.
These services help them to meet their strategic internal goals and the needs of their clients without having to hire an in-house workforce. They offer companies flexibility and convenience and are often less expensive than hiring an in-house staff.
The business services industry is a large and important part of the EU economy, contributing 11% to GDP. It is a key sector for the competitiveness of European firms and plays a central role in the’servitisation’ of the economy by enabling new combinations of goods and services.
Almost every company requires some form of business support services, whether to run its day-to-day operations or to handle its customer service. This can range from office cleaning and maintenance, to food delivery, to transportation, or security.
Some services may be provided by the same firm, while others can be provided by several different firms. For example, a plumber may provide both residential and commercial plumbing services. Similarly, a carpet cleaner may provide both commercial and residential cleaning.
There are two main markets for many service-oriented businesses: individual consumers and other businesses or organizations. A pet grooming establishment will focus its marketing efforts on individual consumers; a company providing security personnel will concentrate on commercial establishments.
A key challenge for service-oriented managers is to make the right choices in how they market their products and services, and in deciding which customers should buy what they sell. For example, a TV repair person might offer to go to the customer’s home or store to repair their television rather than to their shop.
To do this, they need to examine how their products and services can meet customers’ specific needs and desires in a way that differentiates them from competitors. This is particularly true in the case of customer-facing services, like customer service, where it is important to be able to make a positive impression on customers and build trust.
The design of a service must also reflect the needs of customers, who are typically more comfortable with the idea of having someone else perform tasks that they can do themselves. For this reason, service designers often pay more attention to how customers interact with their products than product-focused designers do.
This approach to designing a service is based on four critical elements: (1) the design of the offering, (2) the management of people and resources, (3) the experience that customers want, and (4) the creation of value for customers. Managers who understand these four areas can develop a sound and effective service-business strategy that will last for years to come.
The business service sector is a large, fast-growing, and dynamic industry that is increasingly being driven by technological innovation. In particular, startups are reshaping this industry to respond to transforming needs and expectations.