Who is Service Provider

Last updated: 2025-01-21

Definition of Service Provider

A service provider is the one who provides the service to its customers and guarantees its level and quality. The service provider can be:

  • Our organization that provides services to our customers (either other businesses like B2B or to the consumers like B2C)
  • Our organizational unit, the department that provides internal services
  • Another company from which we purchase services
who is service provider

Our Company as a Service Provider

  • A customer is another economic entity on the market to whom our company provides and sells its services as the main product
  • The customer of the service is always outside the company

Organizational Unit as a Service Provider

  • The customers of the service are inside the company
  • Service customers are other organizational units or company employees

External Service Provider

  • The customer is our organization
  • We purchase services from other service providers
  • Such services are always part of supplier chain

Chaining of Service Providers

Often multiple service providers are linked together to deliver a comprehensive service. In this chain, each provider is responsible for a specific part of the service, with the top-level provider ensuring the overall quality and reliability to the customer. 

  • chaining of service providers involves coordinating various external and internal service providers to deliver a seamless service to the end customer.
  • The top service provider, acting as the guarantor, oversees the entire chain, ensuring that each provider meets their obligations and maintains service standards.
  • This approach allows companies to leverage specialized expertise, optimize costs, and focus on their core activities while ensuring high-quality service delivery. 

It might be clearer to use "chain of service providers" with the top service provider acting as the guarantor. This approach makes it more understandable that there is a hierarchy of providers, with the top one ensuring the overall service quality and reliability.