services science
TRANSCRIPT
Service Research and Innovation | Almaden Research Center © 2007 IBM Corporation1
Service Research and InnovationJuly 13th, 2007
Jim SpohrerDirector Almaden Services Research
Service Science
Management, andEngineering (SSME)
Emerging
IBM Service Research
© 2007 IBM Corporation2 Service Research and Innovation | Almaden Research Center
“Service science is just ___<name your discipline>____”
OR/IEMS
CS/AIMultiagent Systems
Economics & LawGame Theory
MIS Anthropology& Psychology
OrganizationTheory
A ServiceSystem is Complex
ServiceOperationsMarketing
ManagementQuality
Supply ChainHuman Factors
DesignInnovation
EngineeringSystems
ComputingEconomics
Science
InformationScience
(i-schools)
© 2005 IBM Corporation3 Service Research and Innovation | Almaden Research Center © 2007 IBM Corporation
Worldview: Service systems emerging, reconfiguring, interactingto (normatively) co-create value as judged by stakeholders/roleholders
Dynamic, emerging populations ofservice systems…
New types (creation)New instancesLife cycles
Reconfiguring resources and…Owned resourcesAccessed resourcesResources with rightsand/or as propertyCan be inputs (+/-IHIP) to production processes
Interacting to (normatively) co-create value
Value propositionsRelationshipsISPAR descriptive model
ISPAR model of service system interaction episodesISPAR model of service system interaction episodes
Goal Integrate: Lovelock & Gummeson, Sampson & Froehling,Vargo & Lusch, as well as Chase, Bitner, Rust, and many other pioneers, etc. (Ricardo, Pigou&Braess, Williamson)
© 2005 IBM Corporation4 Service Research and Innovation | Almaden Research Center © 2007 IBM Corporation
© 2005 IBM Corporation5 Service Research and Innovation | Almaden Research Center © 2007 IBM Corporation
Nation Labor%
A %
G%
S%
ServiceGrowth
China 21.0 50 15 35 191%
India 17.0 60 17 23 28%
U.S. 4.8 3 27 70 21%
Indonesia 3.9 45 16 39 35%
Brazil 3.0 23 24 53 20%
Russia 2.5 12 23 65 38%
Japan 2.4 5 25 70 40%
Nigeria 2.2 70 10 20 30%
Bangladesh 2.2 63 11 26 30%
Germany 1.4 3 33 64 44%
Ten NationsTotal 50% of World Wide Labor
A = Agriculture, G = Goods, S = Services 1980-2005PC Age
2005United States
The largest labor force migration in human history is underway, driven by global
communications, business and technology growth, urbanization and low cost labor
(A) Agriculture:Value from
harvesting nature
(G) Goods:Value from
making products
(S) Services:Value from enhancing the
capabilities of things (customizing,distributing, etc.) and interactions between things
Where science and engineering demand is growing…
International Labor Organization
US Employment History & Trends
© 2005 IBM Corporation6 Service Research and Innovation | Almaden Research Center © 2007 IBM Corporation
Growing demand for new information and complex organization (business & societal) services….
Services
Material
Information& Organization
11%
9%
30%
50%
Products
-Based on Uday Karmarkar, UCLA(Apte & Karmarkar, 2006)
US Gross Domestic Product
© 2005 IBM Corporation7 Service Research and Innovation | Almaden Research Center © 2007 IBM Corporation
“The IBM SSME Palisades event was the biggest and most diverse gathering ever in support of service education.” – Roland Rust
What IBM is doing…
© 2005 IBM Corporation8 Service Research and Innovation | Almaden Research Center © 2007 IBM Corporation
A new breed of innovator – the service scientist
Social ScienceSchools (People)
ManagementSchools
(Business)
EngineeringSchools
(Technology)
Core Field of Study
Communication Skills Across Other Fields
Tower of Babel“Biggest problem in businessis people don’t know how to
talk to other people in thelanguage they understand.”Charles Holliday, CEO Dupont
© 2005 IBM Corporation9 Service Research and Innovation | Almaden Research Center © 2007 IBM Corporation
Impact: Component Business Model
Business Services
Work Practices
Technical Architecture
© 2005 IBM Corporation10 Service Research and Innovation | Almaden Research Center © 2007 IBM Corporation
Quadruple Loop Learning of Service Systems
Invest
Relationships Goals Plans Actions
Development(WorldModel Validity)
Versatility
Deeper(Ecology)
Sustainability
Differentiate(Exploration)Effectiveness
Delivery(Exploitation)
Efficiency
Outcomes(Expectation)
Evaluation
Adapting to the world of shareholders, customers, competitors, and employees.
123
4
Performance,Health & Cost
Measures
Relevance& Value
Measures
Reputation& Trust
Measures
Risk& Reward Measures
Rationality& MaturityMeasures
© 2005 IBM Corporation11 Service Research and Innovation | Almaden Research Center © 2007 IBM Corporation
Impact: Business Insights Workbench
Valium (Trade Name)
Diazepam(Generic Name)
CAS # 439-14-5(Chemical ID #)Valium has > 149
“names”
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Impact: Intelligent Document Gateway
Digitization
Business Logic
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Impact: Call Centers
Analytics
Dashboard
Performance
© 2005 IBM Corporation14 Service Research and Innovation | Almaden Research Center © 2007 IBM Corporation
Explore: Some future services
Augmented worlds &smart sensor services
Virtual worlds &practice studio
Semantic webservices
© 2005 IBM Corporation15 Service Research and Innovation | Almaden Research Center © 2007 IBM Corporation
0 25 50 100 125 150
Automobile
75Years
50
100TelephoneElectricity
Radio
Television
VCR
PC
Cellular
Inte
rnet
% A
dopt
ion
Question: What limits growth rates?
Invention
Customeradoption
Servicesystemgrowth
AccessLawsSkillsROI
© 2005 IBM Corporation16 Service Research and Innovation | Almaden Research Center © 2007 IBM Corporation
Service System1. People 2. Technology3. Shared Information4. Organizations
connected by value propositionsComputational System
More transistors, more powerful More win-win interactions, more value
What would a service science breakthrough look like? How about a Moore’s Law of Service Systems? Why not?
© 2005 IBM Corporation17 Service Research and Innovation | Almaden Research Center © 2007 IBM Corporation
18 Service Research and Innovation | Almaden Research Center © 2007 IBM Corporation
SSME - Service Science, Management, and EngineeringDiscipline Classification System DRAFT v 0.2
(send updates to Claudio Pinhanez, IBM Research)
A. General1. SSME Education2. Research in SSME3. SSME Policy4. History of Services5. Services Market6. Miscellaneous
B. Service Science1. Service Theory2. Economics of Services3. Mathematical Models of Services4. Services as Value Co-Creation Systems5. Services as Dynamic Systems6. Services as Multi-agent Systems 7. Services as Customer-Intensive Systems8. Service Complexity Theory 9. Service Innovation Theory10. Service Science Education
C. Service Engineering1. Service Operations 2. Service Optimization 3. Service Systems Engineering 4. Service Supply Chains5. Service Engineering Management6. Service Systems Performance 7. Service Information Systems8. Service Standards9. Assetization of Services10. Service Engineering Education
D. Service Management1. Service Marketing 2. Service Operations 3. Service Management 4. Service Innovation Management5. Service Leadership6. Service Quality7. Service Lifecycle 8. Human Resources Management 9. Customer Relationship Management 10. Service Accounting11. Service Sourcing12. Services Law13. Globalization of Services14. Service Management Education
E. Human Behavior in Service Systems1. Service Systems Evolution2. Behavioral Models of Services3. Decision Making in Services4. People in Service Systems5. Organizational Change in Services6. Measurement and Incentive in Services7. Customer Psychology
F. Service Design1. Service Design Theory 2. Service Design Methodology 3. Service Representation 4. Aesthetics of Services 5. Service Design Education
G. Service Arts 1. Service Arts Theory 2. Services-Inspired Art3. Traditional Service Arts4. Contemporary Service Arts5. History of Service Arts
H. Service Industries1. The Service Industry2. Information Services3. Business Services4. Professional Services5. Business Consulting6. Customer Relations7. Maintenance and Repair8. Public Services9. Social Services10. Health11. Hospitality12. Transportation13. Retail and Wholesale14. Financial15. Entertainment and Media16. Religious and Spiritual Services17. Other Service Industries
IBM Service Research
© 2007 IBM Corporation19 Service Research and Innovation | Almaden Research Center
Getting beyond processes to interactions
Manufacturing processes– Provider-centric
Service processes– Customer-centric
Service system interactions– Provider is co-creator– Customer is co-creator– Value co-creation
centric– Sustainability & versatility
From Claudio Pinanez ([email protected]), IBM Service Research
inputs outputs
manufacturer
customer
capital labor knowledge facilities
criticalaudience
customer
outputsinputs
service provider
labor capital
knowledge facilities
material inputs critical audience
user
inpu
t int
ensi
ty
IBM Service Research
© 2007 IBM Corporation20 Service Research and Innovation | Almaden Research Center
Towards a Science of Service Systems &The Service System is the Basic Abstraction of Service Science
First article introduces service systems (examining universitiesand business outsourcing examples). Second article develops the abstraction further. The worldview is populations of service systems (people, businesses, government agencies) interacting. To the mutual benefit of the interacting service systems, value propositions -- proposed, agreed, realized – co-create value. Vargo&Lusch’s Service-Dominant (S-D) Logic defines service as “the application of resources for the benefit of another entity.” In contrast, the producer-consumer roles of Goods-Dominant (G-D) Logic lead to a worldview of producers-of-value and consumers-of-value. The notion of one entity being the creator of value and the other being destroyer is inconsistent with S-D Logic; even “prosumer” is G-D Logic. Thus, another, abstraction of the entity is required - “service system.”Not all service system interactions qualify as service. Our Interact-Serve-Propose-Agree-Realize (ISPAR) model is one possible descriptive model with ten possible outcomes (R), (K), (W), (J), and (-P), (-A), (-D), (-K), (-C), (-J); normative path ISPAR:Definitions– Service science studies application of resources for mutual benefit of
systems (value co-creation via resource application).– Normative service science studies how one system can and should
apply resources for mutual benefit.– Service Science, Management, and Engineering (SSME) applies
normative service science to problems of business and society.
References: IEEEComputer Jan2007, Spohrer, Maglio, Bailey, Gruhl; HICSS 2007 submission, Vargo, Spohrer, Caswell, MaglioReferences: IEEEComputer Jan2007, Spohrer, Maglio, Bailey, Gruhl; HICSS 2007 submission, Vargo, Spohrer, Caswell, Maglio
ISPAR model of service system interaction episodesISPAR model of service system interaction episodes
IBM Service Research
© 2007 IBM Corporation21 Service Research and Innovation | Almaden Research Center
Six Things to Know about Service Systems (DRAFT)1. Service system = value co-creation system, based on both tangible and intangible value– Differentiation: Economics looks primarily at the pricing system and hence value in monetary terms is the focus
2. System of systems: Type of complex adaptive social system (sociotechnical, socioeconomic)– Differentiation: Social science does not focus on value co-creation (win-win changes as judged by people)
3. Example Service Systems: Business, Hospital, Global Economy (Largest), Person (Smallest)4. Dynamics: Origins, Behavior, Learning/Evolution, Growth/Decline, Death/Extinction– Lens on key behaviors: design win-win value proposition, agree (contract), realize value, resolve disputes (learn)
5. Integrates Key Components: People, Organizations, Shared Information, Technology– People: How many people? What do they think about, talk about, do?
• Division of labor, multitasking, adaptation; hazards from bounded rationality, opportunism and human condition (health, death, emotions)• People possess mental models of the world and capabilities& needs of other service systems; Judgments of tangible and intangible value• People are physical entities with legal rights & responsibilities
– Organizations: What is being valued? What division of labor, risk, safeguarding, etc.?• In general, other service systems (organizations and economic institutions with win-win value co-creation as their purpose)• System of systems connected by value propositions, associated coordination and governance mechanisms to deal with risks & hazards• Organizations are mental/social-constructed (not physical) entities with legal rights & responsibilities (virtual person)
– Shared Information: What is everyone expected to know? Have access to?• Language, Laws, and Measures• Promises (informal) and Contracts (formal); Incomplete contracting in its entirety• Shared information is mental/social-constructed (not physical) entity that can be property (owned by a person or organization)
– Technology: What types of technology? What processes supported?• Augmentation (capability expansion) & automation (labor substitution); Application of new knowledge to create new capabilities• Engineered systems (control built environment and network infrastructures) and Managed systems (incentive alignment & hazards)• Technologies are physical entities that can be property (owned by a person or organization)
6. Research & Practice Goals: Understand, Design, Continuous Improvement, Scaling Up & Down
IBM Service Research
© 2007 IBM Corporation22 Service Research and Innovation | Almaden Research Center
Quadruple Loop Learning of Service Systems
Invest
Relationships Goals Plans Actions
Development(WorldModel Validity)
Versatility
Deeper(Ecology)
Sustainability
Differentiate(Exploration)Effectiveness
Delivery(Exploitation)
Efficiency
Outcomes(Expectation)
Evaluation
Adapting to the world of populations of interacting service systems.(1. employees, 2. competitors, 3. customers, 4. shareholders & self)
123
4
Performance,Health & Cost
Measures
Relevance& Value
Measures
Reputation& Trust
Measures
Risk& Reward Measures
Rationality& MaturityMeasures
Invest to maintain, operate, and changeInvest to maintain, operate, and change
http://www.financialdashboard.comhttp://www.financialdashboard.com
IBM Service Research
© 2007 IBM Corporation23 Service Research and Innovation | Almaden Research Center
A Moore’s Law for Service Systems? Why not?
Service System1. People 2. Technology3. Shared Information4. Organizations
connected by value propositionsComputational System
More transistors, more power More win-win interactions, more value
IBM Service Research
© 2007 IBM Corporation24 Service Research and Innovation | Almaden Research Center
A brief history of engineering – what comes next?Antiquity
– Military Engineering
1852 ASCE – Civil Engineering
1880 ASME– Mechanical Engineering
1884 AIEE (later IEEE) – Electrical Engineering
1907 ASAE (later ASABE) – Agriculture & Biological Engineering
1908 AICE – Chemical Engineering
1948 ASIE (later IIE) – Industrial Engineering
1948 ACM– Computing Machinery
1954 ANS – Nuclear Engineering
1955 AAEE – Environmental Engineering
1963 AIAA– Aerospace Engineering
1968 BMES– Biomedical Engineering
1985 AGT – Genetic Technologists
1992 IAFE – Financial Engineering
1993 JCESEP – Software Engineering
2007 SR&II – Service Science, Management, and
Engineering (SSME)– Service Enterprise Engineering (SEE)– Service Systems Engineering (SSE)
© 2005 IBM Corporation25 Service Research and Innovation | Almaden Research Center © 2007 IBM Corporation
SSME: Service Science, Management & Engineering
Operations Research and Industrial EngineeringMore realistic models of people
Computer Science and Electrical Engineering, Information Systems
Software and systems that adaptively change with business strategy
Economics and Business Strategy, Service Management and Operations
Better models of scaling and innovation
Law and Political EconomyBetter models of social innovation – in what way is passing a law innovation
Complex Systems and Systems EngineeringBetter model of robustness and fragility of service systems (sustainability)
Service systems are value co-creation configurations of people, technology, internal and external service systems connected by value propositions, and shared information (such as language, laws, measures, models, etc.).
Still feels like a foreign language to you?
This is a multidisciplinary approach in understanding, defining, creating and delivering service systems
© 2005 IBM Corporation26 Service Research and Innovation | Almaden Research Center © 2007 IBM Corporation
Another perspective of service… systems of relationships
Service providers and clients co-produce value in and through their interactions with one another
Many services require the participation of the receiver of the service
hair stylist – clientdoctor – patientteacher – studentIT service provider – business client
Relationships matter!“… the important distinction is that the relationship has become a resource in itself… thus the returns have now more to do with extending the scope, content and process of the relationship.”
Bryson, Daniels and Warf – from Service Worlds
A. Service Provider
• Individual• Organization• Public or Private
C. Service Target: The reality to be transformed or operated on by A, for the sake of B
• People, dimensions of• Business, dimensions of• Products, goods and material systems• Information, codified knowledge
B. Service Client
• Individual• Organization• Public or Private
Forms ofOwnership Relationship
(B on C)
Forms ofService Relationship(A & B co-create value)
Forms ofResponsibility Relationship
(A on C)
Forms ofService Interventions
(A on C, B on C)
- Based on Gadrey (2002)
© 2005 IBM Corporation27 Service Research and Innovation | Almaden Research Center © 2007 IBM Corporation
What makes SSME hard is that it is multidisciplinary…
Services depend critically on people, technology, and co-creation of valuePeople work together and with technology to provide value for clientsSo a service system is a complex socio-technical system Growth requires innovation that combines people, technology, value, clients
Science & Engineering
Business &Management
Social & CognitiveSciences
Economics & Markets
BusinessInnovation
TechnologyInnovation
SocialInnovation
DemandInnovation
© 2005 IBM Corporation28 Service Research and Innovation | Almaden Research Center © 2007 IBM Corporation
Food for thought: Impact that matters
Business ImpactTechnical innovation & inventionInternal relationshipsRevenue/Profit
Personal DevelopmentContinued educationRelationship buildingCommunity involvement
Scientific AchievementPublishingScientific or technical innovationExternal relationships
Team AchievementCommunicationCo-productionInnovationCommunity
Individual AchievementTechnical knowledgeExperiential knowledgeRelationship building
© 2005 IBM Corporation29 Service Research and Innovation | Almaden Research Center © 2007 IBM Corporation
Projected US service employment growth, 2004 - 2014
US Bureau of Labor Statistics. http://www.bls.gov/opub/ooq/2005/winter/art03.pdf
© 2005 IBM Corporation30 Service Research and Innovation | Almaden Research Center © 2007 IBM Corporation
Why understanding service innovation matters to IBM
Fundamental Service Science Challenge:Scaling & learning curves are different for IT manufacturing and IT services How to invest to make progress (efficiency, effectiveness and sustainable growth)?
© 2005 IBM Corporation31 Service Research and Innovation | Almaden Research Center © 2007 IBM Corporation