Service Management, Student Workbook: An Integrated Approach to Supply Chain Management and Operations

2. The Nature of Services and Service Encounters

2.6. Summary of the Chapter

A productive system is defined as a set of elements that works together toward the common goal of creating value through conversion of inputs into outputs. There are five kinds of productive systems: extraction, biological growth, tangible output conversion, intangible output conversion, and hybrid conversion systems. Services fall into the last two categories. Services exhibit some important characteristics that differentiate them from goods: Services are intangible and perishable. Service output exhibits much variability due to the involvement of humans and their varied needs, perceptions, moods, and expectations. Service production and consumption are inseparable ...