Service Sourcing

The government sector is, to a large degree, a service sector, where a high proportion of the external sourcing concerns services. Purchasing of services in public sector is becoming an increasingly important issue, thanks to an emerging service industry context, the deregulation of public service sectors, and a general trend of increased outsourcing in both the private and the public sectors. Services have some peculiar features, which can be assumed to have implications for the organization of the purchasing function. Exclusion has long been identified as a necessary characteristic for services to be supplied under market conditions. Market arrangements can be used to deliver either private services or services where exclusion is feasible. The services were funded through the public budgets, infrastructures and plants were acquired as public properties, monopolies were protected against competition, and the main decisions were defined by means of administrative procedures. In the control of service delivery, there is also a management control dimension.