From CEOpedia | Management online

Frequently a service has been described as an act, a progress and a performance. More widely definition can described it as economic activities that create "added value" and provide benefits for customers or organizations.

The definition and scope of this idea is widespread and could mean all of the following:

  • Service as an organization, that is the full business resides within the service sector.
Examples: restaurant, insurance company
Examples: holiday, insurance service
  • Service as a product augmentation - it is made to improve the core product.
Example: special hairdresser's offer
  • Service as a product support - here we can mention all customers oriented activities which take place after the delivery.
Example: repair service

The main service industries are: hospitality, tourism, health services, education, financial

  • Intangibility

Even thought a lot of services contain some tangible aspects the service performance leading to a customer’s experience is intangible.

  • Inseparability

Services are some kind of processes. We can mention that customers take part in the production of service. Mostly in act of service there should be present in the same place and at the same time the buyer and the seller.

  • Perishability

Because of intangible nature of services there cannot be stored, inventoried or re-used.

  • Heterogeneity

Standardization and quality are amazingly difficult to control, moreover it is hard to measure quality of services. Each person can have totally different expectations and opinions.

See also:

Servicerecommended articles
CustomerCore productPerceived qualityBasic productQualityProductCertificate of approvalSERVQUALImportance of brand


Author: Weronika Winkowska