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Section Five
Business services
5.1 Description of the sector
Business services has been one of the fastest growing sectors of the
economy over recent years and is a significant employer of skilled labour.
Combined with property services, business services sector expenditure in
1997–98 was $56.1 billion, or around 10.8 per cent of Australia’s GDP.
In May 1999, the sector employed just under one million people. 14
The business services sector covers an array of professional services,
including: architectural services; surveying services; consulting
engineering services; technical services; computer services (including
information storage and retrieval, computer maintenance, and computer
consulting services); legal and accounting services; and marketing and
business management services.
The sector is undergoing a phase of conglomeration, as large firms
increasingly offer accounting, legal and other business services under the
banner of a ‘one-stop-shop’. The industry is now made up of several
multi-disciplined global firms with a number of smaller domestic niche
players that focus on a single expertise.
The main advantages of e-commerce to the business services sector, also
frequently referred to as ‘knowledge industries’, are in accelerating
knowledge transfer and improving the quality of data transfer. The
characteristics of the business services sector explain the rapid takeup of
e-commerce in the sector:
• it is comprised of many activities that have a high reliance
on information;
• many business services (e.g. accounting or legal advice) are
easily virtualised;
• generally, there is a need for information to be delivered quickly; and
• the sector is already well supported by information infrastructure.
5.2 Cost savings
Cost savings to the sector can be realised from e-commerce as either:
• improvement in the efficiency of internal processes—in the same way
that efficiency gains are being made in firms right across the economy
in ordering business inputs, transferring data and billing systems; or
• savings in the cost and time of delivery of products to clients—gains
that are specific to industries that are able to distribute their product
electronically, such as the ‘knowledge’ and entertainment industries,
and rely less on physical data storage units.
With respect to the latter point, essentially these savings are due to the
increased speed of transferring data (efficiency gains) and the
improvements in the quality of data transfer (less need to rework data and
fewer mistakes). Use of electronic mail and the Internet generates
opportunities for business services organisations to provide more
time-critical services to customers.
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