The business services industry includes all activities that benefit companies without supplying them with physical products. Its components include marketing, consultation, logistics (including travel and facilities services), waste handling, staffing services, shipping, administrative support and security services. These activities are essential for companies because they provide flexibility, productivity and safety to meet changing work demands. They also help companies reduce costs and improve efficiency by providing access to expertise and specialized equipment that would be cost-prohibitive for them to produce themselves.
The term “business service” has several definitions, but the most basic is an exchange of work for payment. The business service sector is considered the third tier in economic theory, following the primary and secondary sectors, which deal with the production and sale of tangible goods.
Business services can be divided into three categories: business-to-business, business-to-consumer and personal services. Business-to-business, or B2B, services are offered by businesses to other businesses at a flat or hourly rate to help them operate their business more effectively or reduce operating expenses. These services might include technical or engineering support, financial consulting, accounting and tax preparation, and advertising, marketing and public relations.
Other business services might include facility maintenance, information technology support and translation and interpretation. Translation and interpretation services are useful for companies that serve customers with different languages, or that want to encourage inclusion of employees from various backgrounds. In facility maintenance, companies might hire a service to remove trash from company property on a regular basis, repair appliances and handle routine cleaning tasks.
Many service companies offer support in the form of software applications that can automate and streamline certain processes, or manage data. These apps are designed to be user-friendly, so that they can be used by non-technical as well as technical employees. This allows employees to focus on critical issues and new projects, while freeing up resources that can be directed toward other areas of the company’s operations.
As companies look to increase their competitiveness and respond to customer demand, they will seek out a wider variety of business services. This will lead to more partnerships, which in turn will create a greater number of opportunities for entrepreneurs to start their own business.
The success of a service business usually hinges on four critical elements: creating a customer-centric experience, building relationships with key stakeholders, developing employee competencies and designing the right technology to support the service process. While much has been written about each of these aspects, it is only recently that the idea of crafting a complete tool kit for managing a service business has emerged. This article outlines an approach for achieving this, based on the ideas of Harvard Business School professor John Zysk and his colleagues. By combining these ideas with a practical understanding of the ways that businesses use business services, it is possible to create effective strategies for running a successful service business. The future of the service economy lies in its ability to bring together diverse groups of people with a common purpose: making their lives and work better.