Defining Professional Services Firms
Many industrial groupings have been used for academic research when looking at professional services firms, making a clear definition hard to attain. Some work has been directed at better defining professional service firms. In particular, Von Nordenflycht generated a taxonomy of professional service firms, defining four types:
- Classic PSFs (e.g. law and accounting firms) - characterised by a high knowledge intensity, a professionalised workforce, and low capital intensity
- Professional campuses (e.g. hospitals) - characterised by a high knowledge intensity, a professionalised workforce, and high capital intensity
- Neo-PSFs (e.g. management consultants) - characterised by a high knowledge intensity and a low capital intensity
- Technology developers (e.g. R&D firms, biotechs) - characterised by a high knowledge intensity and a high capital intensity
Frameworks such as this greatly aid the ability of managers and academics to better understand how such firms manage themselves and how to judge benchmark practices.
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