Fixing our service sector

LAHORE: The services sector is the largest component of Pakistan’s economy, contributing over 50 per cent to GDP and employing a significant portion of the urban workforce. Yet, for the average Pakistani, this dominance seldom translates into satisfaction.

Whether one is dealing with a public utility, financial institution or hospital, frustration often outweighs convenience. Poor service delivery, lack of empathy and an indifferent workforce characterise the customer experience -- particularly in the public sector.

Consider public service providers such as electricity distribution companies, municipal bodies and passport offices. Despite repeated complaints, delays, bureaucratic red tape and lack of responsiveness continue to erode public trust. Similarly, services in public hospitals and education institutions often fail to meet even basic expectations, despite being essential for human development.

This stands in stark contrast to a few pockets of excellence. Certain multinational banks operating in Pakistan have made commendable progress by automating systems, reducing turnaround times, and investing in customer service training. Some local telecom operators have also improved their call centre responsiveness and now offer digital apps for bill payments and service requests. These examples show that improvement is possible -- but it requires intent, investment and a long-term vision.

In today’s economy, service expectations are evolving rapidly. Customers -- both retail and corporate -- are better informed, more vocal and less forgiving. This shift puts pressure on service providers to move beyond outdated models and low-skilled labour. But here lies the problem: many Pakistani service organisations -- public and private alike -- are ill-equipped to meet rising expectations due to an untrained and under-motivated workforce.

Some firms have responded by outsourcing support services to professional call centres, enabling round-the-clock availability and helping reduce operational costs. While this may yield short-term efficiency gains, it is no substitute for internal capability-building.

Capability development must be at the heart of any service sector reform. This means training personnel not only to perform routine tasks efficiently, but also to understand the variability in customer needs, respond promptly to complaints, and provide real solutions. In financial institutions, for instance, quicker processing times and fewer errors are not just desirable -- they are essential. A single delay in loan processing or an error in a bank statement can prove costly for both customer and institution.

Investing in human resource development and embedding service quality into organisational culture offers long-term dividends. Companies that prioritise service excellence are more likely to anticipate emerging customer needs, adapt quickly, and create lasting value. Capability-building, when aligned with an organisation’s culture, market realities and core strengths, becomes a strategic differentiator.

To reform Pakistan’s service sector, the government must lead by example. Introducing measurable performance indicators for public service providers, linking promotions to service outcomes, and digitising service interfaces are crucial first steps. At the same time, private sector players must realise that poor service is not a cost-saving strategy -- it is a silent killer of long-term profitability.

In a services-led economy, value is not just created in factories or farms -- it is created every time a customer is heard, a complaint is resolved, or a service is delivered seamlessly. Pakistan still has a long way to go, but the path forward is clear: invest in people, build capabilities and hold service providers accountable. Only then can the sector fulfil its true potential.