Provider involvement in business service definition:a typology

Selviaridis, Kostas and Spring, Martin and Araujo, Luis (2013) Provider involvement in business service definition:a typology. Industrial Marketing Management, 42 (8). pp. 1398-1410. ISSN 0019-8501

Abstract

This paper proposes a typology for provider roles in defining business services. The starting point of the study is the underlying rationale of much of the service purchasing literature – buyers have or can easily access the necessary know-how to procure business services. If this does not hold, the implication is that buying firms would shy away from buying complex services. An alternative perspective recognizes that purchasing business services requires its own set of sourcing capabilities and that such capabilities may be lacking. Indeed, buying firms may have limited know-how in terms of defining and articulating their requirements or not be fully aware of them in the first place. However, the buyer’s lack of sourcing capabilities need not be an injunction to internalize the service. In these circumstances, service providers often step in, help buying firms specify their needs and requirements and play a key role in defining what is procured and how. We build on this interactive view of service definition to undertake a comparative case analysis of four business service contracting situations arrayed along two dimensions – buyer perceived uncertainty and provider’s buyer-specific experience. We conclude that service providers play different roles in each case. These are classified as translating, re-engineering, developing and fine-tuning roles.