Innovations from various research fields have made modern day life as we see it today possible. As science and technology have brought up novel inventions that can be transferred into marketable products, it is not at all surprising that innovation research has gained more and more recognition in economic sciences. To develop marketable innovations, especially within manufacturing enterprises, is an indicator for business success and is no longer taken lightly within the field. At the same time, changing social structures, new technologies and the rising market competition have made service enterprises more dependent on innovation research. In contrast to manufacturing, service companies’ influencing factors and its approach of generating and ensuring gains are quite different. Thus, this paper will try to tackle the following thesis question: What are the most crucial factors that influence service innovation and how do they differ from innovations that are gained from manufacturing companies? This work is based on a vast list of literature that not only includes the most recent research on innovation in manufacturing and services, but also delineates their similarities and differences. Additionally, a conducted interview of an expert within the field of Austrian service companies, should complement the selected literature and bring in a qualitative aspect into my analysis. Thereby, specific focal points of innovations in terms of service companies will be identified and analyzed according to a current innovation project. The aim of this work is to contribute to the present-day scientific research on innovations within the service sector and to encourage future studies yet to be written.