Service characteristics
Service characteristics commonly include intangibility, heterogeneity, inseparability of production and consumption, and perishability of unused capacity. They can make quality, output and inventory measurement harder than in standardised goods production. The strength of each feature differs by service and technology. Performance systems should reflect customer experience, capacity use, access and reliability rather than apply manufacturing measures mechanically. These are analytical characteristics, not a claim that every service has no physical component.
Worked example
An unused hotel room-night cannot be stored for next week, and customer experience depends partly on how staff deliver the service.
Common mistake
Do not use one unit-cost measure without considering variation in service complexity and quality or assume all services are identical.
Where it appears in your exams
| Qualification | Exam | Relationship | Period |
|---|---|---|---|
| ACCA | APM | Direct | September 2026–June 2027 |
| ACCA | MA | Direct | September 2026–June 2027 |
| ACCA | PM | Direct | September 2026–June 2027 |
| FIA | FMA | Direct | September 2026–June 2027 |
