ABSTRACT
Quantifying the value of products versus services differs in two important ways. Product performance tends to be more consistent and repeatable. Outcomes from service delivery typically vary much more than product characteristics: services are, of course, co-produced with customers and value is jointly created. In a product world where data show 3% less energy consumption as an example, it probably is based on the person installing it properly, maintaining it, etc. In some countries of the world, real estate agents charge a fee as a percentage of the selling price of the property. A potential solution would be to introduce nonlinear commission structures in contracts to improve incentives. A few takeaways: service value calculations can be done, and they are not that different from product value calculations. It is very important to track what actually happens for clients.
