Intellectual service quality: the economic and legal meaning

O.V. Yarmak

The article analyzes consumer-oriented and production approaches to evaluation of intellectual service quality. The author substantiates specific features of intellectual services: consumer perception of quality; resource, process and resultative quality; quality of intellectual labor. Having defined expenses for intellectual services as investments in knowledge resources, the author reveals the content of an investment component of their quality. The author has indicated network, personalized and innovative components of the quality. The author has substantiated institutional criteria, the content and levels of social norms of the quality: international, national, regional, intra-firm, individual and contractual.

Key words: intellectual services, intellectual service quality, the consumer-oriented, production and innovative content of quality, consumer perception of quality, resource, process, resultative, network, personalized quality, institutional criteria and social norms of intellectual service quality.

service intellectual quality consumer

Problem setting. Intellectual services as innovation-based components of infrastructure of regional and national socio-economic development are factors in fluencing formation of competitive advantages of economic entities, industries and the national economy in general. These factors are a requirement of efficient participation of the mentioned actors in the global economic space. Under conditions of reformation of education, health care, scientific and technical activity in Ukraine, which is a component of the general European integration process, there is a need for researching the content and directions of providing a competitive level of intellectual service quality in the national and global markets.

Recent research and publication analysis. Quality of goods (services) is a multi-dimensional and inter-disciplinary category researched by various fields of science, particularly economic, engineering, technological and managerial fields. Scientists examine the content of this category, combining the following approaches:

- the consumer-oriented approach, according to which quality of goods and services is directly related to needs of consumers and stipulated by a level of their satisfaction. Osadchuk (2012) defines quality as the extent of perfectness and conformity of characteristics and properties of a product with requirements and demands of consumers (р. 158). Davydova, Pysarevskyi, and Ladyzhenska (2012) point out that quality “represents total properties of goods and services, which stipulate the extent of their appropriateness to meet demands of a human in accordance with its purpose” (р. 11). The State Standard of Ukraine (hereinafter - SSU) ISO 9000:2015 (ISO 9000:2015, IDT) “Quality Management Systems”, which was adopted on 21 December 2015 and has been in force since 1 January 2017, determines that quality of products and services of an organization is stipulated by the ability to fulfill needs of customers and the expected and unexpected influence on corresponding interested parties. Quality of products and services encompass their inherent functions and characteristics, as well as their perceived value and utility for a customer (DSTU ISO 9000:2015, 2016). Consequently, according to the consumer-oriented approach, quality is a useful effect of a product / service in the form of the ability to fulfill needs of consumers at an appropriate level;

- the production approach, which gives rise to evaluation of quality of a product / service as a derivative of efficiency of technical and technological, economic, managerial and market activities of an enterprise as a producer. Bandyrska (2013) notes, “As for a producer, quality of manufactured products is a manifestation of a high level of production, the rational use of material and labor resources, application of innovations and a high market share” (р. 57). Under the production approach, quality of products / services is referred to as compliance of a production process with technical and technological, professional, socio-economic, managerial requirements, standards and criteria indicated and recognized as mandatory criteria by a society or particular social groups during a certain period.

The consumer-oriented and production approaches may be applied in the process of analyzing intellectual service quality. Nevertheless, on the one hand, it is important to improve the mentioned approaches. On the other hand, it is necessary to substantiate new criteria showing peculiarities of intellectual services and their quality.

Paper objective. The author aims to define the economic and legal meaning of the category of intellectual service quality through indication and description of its criteria and major components.

Paper main body. Nowadays, intellectual services as professional actions oriented towards formation and accumulation of human capital become an important source of professional knowledge and information as factors of economic and human development. They shape education, consulting, scientific and technical, health care, socio-cultural and other services. To determine components of the meaning of these services, firstly, there is a need to adapt the consumer- oriented and production approaches to the specificity of providing intellectual services in some way. Secondly, it is important to substantiate additional criteria in order to substantiate the sense and factors of competitive quality of intellectual services.

According to the consumer-oriented approach, two interrelated aspects characterize intellectual service quality: a) quality as a feature of the consumer value of service - its ability to fulfill some social needs; b) quality as an attribute of utility of an intellectual service determining the extent of fulfilling customer's needs in the process of consumption of a service. Firstly, since intellectual services are intangible and do not exist at the time of conclusion of an agreement with a customer, their quality is appropriate for a customer. This property is an important criterion of determining their value and embodiment of anticipations of a consumer regarding a result of professional actions the consumer may gain in the process of intellectual servicing (Marchenko, 2008). Consequently, consumer perception of quality is a specific component of the content of intellectual service quality. Secondly, the perceived quality transforms into the resultative quality if a process of rendering intellectual services affects a consumer: acquiring new knowledge; solving a problem; improving health; other benefits. This is the resultative quality of intellectual services. Drawing on a classification of consulting results developed by Marchenko and Pronkina (Marchenko, 2008; Marchenko & Pronkina, 2016), the author proposes an algorithm for determination of a result of intellectual servicing: a) an interim result - acquiring essential knowledge and information in the form of professional advices or recommendations a customer may or may not use in the future; b) a final result - real benefits gained by a consumer of intellectual services. Taking into account the mentioned assertions, the author thinks that the resultative quality of an intellectual service may also be interim (quality of a professional advice, project and consultation) and final (estimation of benefits gained from professional actions related to providing particular intellectual services).

According to the production approach, intellectual service quality is quality of a process of intellectual servicing stipulated by the following factors: firstly, a rate of efficiency of using resources of servicing based on a production function of intellectual services (quality of the resource potential of intellectual servicing); secondly, quality of a process of servicing, which encompasses phases such as ordering an intellectual service and conclusion of an agreement; providing the service, which contemplates carrying out particular professional actions directed towards fulfilling needs of a consumer and gaining benefits; completion of the contract relations, estimation of a result of servicing and determination of prospects of further collaboration between a professional and a customer.

Each phase of the process of intellectual servicing should be qualitative, i.e. should conform to criteria of rendering intellectual services established by a society during this period. This is the process quality of an intellectual service. It should be noted that quality of the resource potential and the process quality of intellectual services are embodied in the form of labor of a professional providing these services (a consultant, scientist, lecturer, doctor, etc.). Quality of the educational and professional potential of staff in the sphere of intellectual services is the main factor of quality of labor (Skretinkovsky & Sitar, 2014).

Since intellectual servicing is a process of shifting knowledge from one individual to another individual in certain institutional forms (from a professional to a consumer), components of their quality include quality of a source and receiver of intellectual services. The thing is that intellectual service quality is volatile because it directly depends on: a) source of services (a professional); efficiency of professional actions may vary under particular conditions and factors; b) receiver of services (a consumer), who participates in a process of intellectual servicing passively (when forms conditions for efficient activity of a service's producer) or actively (if a consumer provides resources, information, discusses goals, directions and methods of servicing, uses advices, implements recommendations, etc.). In the sphere of intellectual services, a result to a greater extent depends on the ability of a consumer to acquire and apply obtained knowledge and information, to follow advices and recommendations. This is a personalized component of intellectual service quality.

Thus, intellectual service quality contains specific components: according to the consumer-oriented approach - the perceived and resultative (interim and final) qualities; according to the production approach - the resource and process qualities of activity related to servicing, first of all, quality of labor; combining consumer- oriented and production approaches leads to formation of the personalized quality (a source and receiver). However, an analysis of intellectual service quality directed towards revealing its meaning may be done with the help of the consumer- oriented and production approaches as well as other tools.

Firstly, an investment approach proposed by the author and Marchenko is important for determining components of the content of intellectual service quality (Marchenko & Yarmak, 2016). According to the investment approach, expenses of a consumer for obtaining intellectual services are intellectual investments. Hence, intellectual service quality implies the return of an intellectual investment as a contribution of consumers of intellectual services to an intellectual product (service) existing in various forms, including intellectual property objects. Intellectual service can be commercialized and can function as an investment intellectual good (service), the use of which ensures gaining profit and other benefit in the future.

Secondly, the investment potential of these services as a factor of innovations in various sectors of the social life is another component of intellectual service quality. On the one hand, intellectual services are an important element of facilities for innovative activity of economic entities, a special channel of dissemination of new knowledge as well as information and consultation support of innovators. On the other hand, innovativeness of professional actions and results is an important criterion of intellectual service quality.

Thirdly, in the process of servicing, suppliers use efforts and resources of members of service networks. Efficiency of their collaboration directly affects intellectual service quality. Intellectual networks of members of a single process concerned with servicing are joined by horizontal interrelations and obligations. An integrator of the network directs their activity towards achieving a general objective of enhancing quality and competitiveness of servicing. Intellectual networks enable to effectively use resources of their members, to minimize transactional costs and to achieve a positive synergetic effect of intellectual services (Marchenko &Yarmak, 2012). Therefore, network quality (quality of intellectual service networks) should be referred to as a component of intellectual service quality.

Fourthly, an institutional approach to determining intellectual service quality, which consists in indication legal characteristics of quality, is also important. Katran (2018) defines quality in accordance with the consumer-oriented approach. At the same time, the scientist points out that legal characteristics are inherent to the content of quality: “A set of product properties, which belongs to its ability to meet the social consumer value and anticipated needs of consumers, which are enshrined in national and international normative references or stipulated by terms of a buy-sell agreement” (р. 4). Utekhin (2010) defines service quality as compliance with its name, criteria disclosed in an agreement, legislation or practices of business relations (р. 61).

Professional actions on providing intellectual services are carried out in the institutional space forming current legislation, technical and technological specifications, technical procedures, ecological and consumer conditions and requirements indicated in legislation, standards, manuals, as well as agreements, decrees, orders, customs and traditions recognized by a society or certain social groups, informal rules of consumption of services and requirements to their quality. Consequently, according to the institutional approach, an extent of compliance of the services with established norms and rules of servicing affect and characterize intellectual service quality. A government ensures and protects norms of law while norms of law express the will of a government. These norms are the most prominent among the mentioned rules. The Law of Ukraine “On Protection of Consumer Rights” defines quality according to the institutional approach: “Appropriate quality of a good, work or service is a property of products, which conforms to requirements established for this category of products in normative and legal acts and normative references and to terms of an agreement with a consumer” («Pro zakhyst prav spozhyvachiv», 1991).

Depending on a level of regulatory influence, social norms of quality may be divided into:

- international. The Agreement on Conformity Assessment and Acceptance of Industrial Products (АСАА) is an example of such norm. Conclusion of this agreement will allow achieving conformity of Ukrainian products with the EU requirements. This will enable national enterprises to enter new segments of the European and global markets (Nefedov, 2017). Standards, which have been implemented by the International Organization for Standardization (ISO), significantly influence quality of goods / services. The National Standards for Quality Management, which are harmonized with the international standards of ISO, include a number of standards, e.g. SSU ISO 9001:2015 “Quality Management System. Requirements» (DSTU ISO 9001:2015, 2016), SSU ISO 10001:2013 “Quality Management. Customer Satisfaction. Guidelines for Codes of Conduct for Organization” (DSTU ISO 10001:2013, 2014), SSU ISO 10003:2013 “Quality Management. Customer Satisfaction. Guidelines for dispute resolution external to organizations” (DSTU ISO 10003:2013, 2014) and others;

- national. The legal meaning of quality of goods / services as concordance of quality with norms of law is determined by the following legal acts: the Laws of Ukraine “On Protection of Consumers' Rights” («Pro zakhyst prav spozhyvachiv», 1991), “On Responsibility for Harm Caused by Faults in Products” («Pro vidpo- vidalnist za shkodu, zavdanu vnaslidok defektu v produktsii», 2011); laws underling technical regulation of product quality such as “On Standardization” («Pro stand- artyzatsiiu», 2014), “On Technical Procedures and Compliance Assessment”, according to which assessing compliance is defined as a process of proving a fact that indicated requirements, which are concerned with products, a process, service, system, individual or public body, have been fulfilled («Pro tekhnichni rehlamen- ty ta otsinku vidpovidnosti», 2015), “On Metrology and Metrological Activity” («Pro metrolohiiu ta metrolohichnu diialnist», 2014); laws regulating production of certain types of goods and services, e.g. the Law of Ukraine “On Government Market Supervision and Control of Non-food Products” («Pro derzhavnyi rynkovyi nahliad i kontrol nekharchovoi produktsii», 2010), “On General Safety of Non-food Products” («Pro zahalnu bezpechnist nekharchovoi produktsii», 2010), etc. It is worth mentioning that intellectual services are not subjects to legal regulation in a majority of cases because of their intangible nature;

- sectoral and regional: a) government regulation and self-regulation of professional activity on providing particular types of intellectual services: education, consulting, health care and sectoral standards; b) normative acts of local authorities regarding servicing in a particular region;

- intra-firm: a) internal normative acts of firms providing services, which determine requirements regarding quality of a process of rendering intellectual services. For instance, internal regulations of employment, which are approved by an employer, indicate professional obligations of employees and make a regulatory influence on quality of their labor; b) decrees and orders of managers with various levels of competences and responsibility regarding a process of intellectual servicing; c) technical documentation, manuals, etc.; d) principles and measures for managing intellectual service quality of a firm; e) intra-firm customs, traditions, informal rules of providing intellectual services, which, as formal ones, regulate quality of servicing;

- individual: an agreement on providing intellectual services, which is concluded between a producer and customer, regulate the quality. The agreement contains requirements to a professional, a servicing process and its result, criteria for service evaluation, etc.

In general, formal and informal social norms affect the institutional content of intellectual service quality. These norms establish rules and requirements regarding orientation of intellectual servicing towards fulfilling consumers' needs determined by a society. The legal meaning of quality consists in conformity of intellectual services with requirements of current legislation of a country and international normative documents.

Conclusions

According to the consumer-oriented approach, intellectual service quality is the quality perceived by a consumer and the resultative quality stipulated by consumer estimation of professional advices and recommendations or benefits obtained in the process of servicing. According to the production approach, intellectual service quality encompasses the quality of resource potential, process quality and quality of labour used in the process of intellectual servicing. The quality of a source and customer is the personalized quality of intellectual services. Since providing intellectual services is grounded in the use of internal and external networks of intellectual servicing, the network quality of intellectual services is a component of their quality. The institutional component of intellectual service quality encompasses international, national, sectoral and regional, intra-firm and individual levels of regulation and standardization. The concordance of intellectual service with current legislation stipulates the legal component of the quality. Substantiation of general and specific components of intellectual service quality is the methodological basis for development and implementation of quality management systems, effectiveness of which influences competitiveness of these services in the national and global markets, and improvement of legal regulation of activity related to providing intellectual services.

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