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Chapter 4

The needs of services

Five key characteristics of service organisations:

1 Intangibility – output not a physical product

Heterogeneity – high level of human intervention/demand for
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customised service

3 Simultaneity – service produced and consumed at the same time

4 Perishability – can’t hold inventory

5 No transfer of ownership – customers use service for a limited period

These differences will result in different objectives and CSFs.

Hence performance measures may focus on areas such as:

 speed of service

 flexibility

 consistent quality

 attitude and helpfulness of staff

 ambience of premises

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