Business services refer to tasks and activities that help maintain a company, despite not producing any tangible product. Examples include information technology, which supports numerous other business services such as procurement, finance and shipping.
Service Differentiation
While products are often characterized by their unique features, most service businesses develop a reputation for their type of service. This reputation helps to serve as a barrier to entry, because service providers need to build brand names and establish a strong customer base in order to become profitable.
Intangibility
While goods can be stored for future use, services can only be delivered when the need arises. This makes them more difficult to store and manage, as they cannot be easily repurposed or recycled.
Inconsistency
Service processes can be very inefficient if they are not well planned and coordinated. This is particularly true if services are being developed and deployed across multiple organizations.
Inseparability
Because services do not have a physical form, they do not need to be manufactured and produced in the same way as tangible goods. As a result, they are often decentralized and do not enjoy economies of scale.
For this reason, service companies should start with a small set of pilot use cases to quickly define and launch services. These should include one or more typical transactions that customers and/or employees engage in frequently, such as employee office moves or customer order modification.