Business services are activities that benefit a company without delivering a physical product. They are important for a variety of reasons, including marketing, production, safety, cost and convenience. For example, a notary service is a business service, as is the provision of office space. In addition, utilities like water and electricity are considered business services. The term is also applied to miscellaneous help that a company might need, such as animal control or maintenance services.
In most modern economies, business services comprise about 11% of the economy’s gross domestic product (GDP). They are an essential part of a broader economy of service and provide valuable support to manufacturing and other service industries. As a result, they play a significant role in European competitiveness. The services sector is characterized by the presence of many diverse types of companies, and some of these are very large in size. In the past, there were a number of obstacles to growth in this sector, such as low productivity and continuing legal barriers, which are now being removed by EU Internal Market legislation and policy actions.
To be successful, a business must deliver high value and quality to a target group of customers. The most effective way to do this is through an integrated approach that combines customer understanding and management of the critical elements of service design.
These elements include creating a customer experience, developing a service culture and ensuring that employees are trained in these areas. A strong customer focus is also crucial. This is achieved by creating a clear value proposition for the business and communicating it to all employees.
It is also important to remember that service businesses are primarily people-based and therefore have more variation in performance than product-based businesses. In fact, a single person’s behaviour can have a significant effect on how other customers experience the service. This is why it is so important to hire and train the right people for the job.
Having a high level of performance and service delivery is not only good for the bottom line, but it is good for employee morale as well. A satisfied and engaged workforce can be more productive than a dissatisfied one.
Another important element of a high performance is having the right leadership structure. This means having a leadership style that is suitable for the unique challenges of a business services company. In particular, it must be able to balance the competing needs of revenue-generating line managers and shared services managers. If the latter are not given sufficient authority to act independently, they may undermine the performance of the company’s overall service model. Therefore, it is crucial that senior management have the right leadership skills to be able to make decisions that ensure that all four elements of service design are in place. Only then will a successful business be possible. To learn more about Business services, download the GlobalEDGE industry research report.