Purchasing business services

The purchase of business services is a growing activity among firms but with little appreciation that the purchase of a service requires a modification of the decision process developed for the purchase of material goods. A taxonomy for purchasing business services is developed to create a matrix with importance of service and focus of service as dimensions. Business services are classified according to their focus on three aspects of the firm: property, people, and process. A number of propositions are formulated based on insights derived from this taxonomy. The taxonomy results in six business service cells: facility support, equipment support, employee support, employee development, facilitator, and professional. Implications for managers considering a purchase in each category are explored. The paper concludes with a research agenda to test the propositions and validity of the taxonomy for purchasing business services.