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A growth theory of professional services.

Authors
  • Ribes, Edouard
Publication Date
Feb 03, 2019
Source
HAL-UPMC
Keywords
Language
English
License
Unknown
External links

Abstract

IMost of the current economic literature on growth has focused on products and manufacturing. But professional services differ from manufactured products because their value stems from an interaction with the customer, while products value stems from technology. Therefore, growing a professional service is not about investing in technology but rather about increasing the amount of interactions that can be performed with the same level of quality. This article thus proposes a quality based theory of growth. The proposed theory is shown to explain professional services observed empirical growth patterns with respect to age and size. It also shows that in professional services, growth can either be competition-driven or opportunity-driven depending in the importance of the client interaction in the service delivery. Finally, it is able to capture most of the known growth heterogeneity sources in terms of market and services characteristics.

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