Digital Delivery of Business Services

Abstract

The business services examined in this study include software and information services, R&D and technical services, advertising and marketing, business consulting, recruitment and human resource development services. Digital delivery includes contracted out electronically mediated services supply (outsourcing) and digitally facilitated distributed work within firms, in which business services inputs are supplied electronically to support the business activities of firms. Digital delivery allows business services suppliers to combine richness and reach (i.e. to combine greater market reach with the ability to engage in richer interactions with clients). Business services activities are a significant and growing part of all OECD economies. Services are often dominated by small firms, although there are large players in most market segments. Demand for business services is strongly pro-cyclical. Innovation and high levels of competition counter market dynamics leading to concentration. Hence, new players emerge and there is considerable churn among market leaders.

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