Ibm Service Research

Service Science
Management, and
Engineering (SSME)
Emerging
Service Research and Innovation

July 13th, 2007
Jim Spohrer
Director Almaden Services Research
Service Research and Innovation | Almaden Research Center
2007 IBM Corporation
IBM Service Research
Service science is just ___<name your discipline>____
A Service
System is
Complex
OR/IE
MS
Service
Operations
Marketing
Management
Quality
Supply Chain
Human Factors
Design
Innovation
Engineering
Systems
Computing
Economics
Science
Information
Science
(i-schools)
Economics & Law

CS/AI
Multiagent Systems Game Theory
2
MIS
Anthropology
& Psychology
Organization
Theory
Worldview: Service systems emerging, reconfiguring, interacting

to (normatively) co-create value as judged by stakeholders/roleholders
Dynamic, emerging
populations of
service systems
ISPAR
ISPAR model
model of
of service
service system
system interaction
interaction episodes
episodes
New types (creation)

New instances
Life cycles

Reconfiguring resources and

Owned resources
Accessed resources
Resources with rights
and/or as property
Can be inputs (+/-IHIP) to
production processes

Interacting to (normatively)
co-create value
Value propositions
Relationships
ISPAR descriptive model

Goal Integrate: Lovelock & Gummeson, Sampson & Froehling,

Vargo & Lusch, as well as Chase, Bitner, Rust, and many
other pioneers, etc. (Ricardo, Pigou&Braess, Williamson)


Where science and engineering demand is growing
Ten Nations
US Employment History & Trends
Total 50% of World Wide Labor

A = Agriculture, G = Goods, S = Services
Nation
Labor
%
A
%
G
%
S
%
Service
Growth
China
21.0
50
15
35
191%
India
17.0
60
17
23
28%
U.S.
4.8
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
25
70
40%
Nigeria
2.2
70
10
20
30%
Bangladesh
2.2
63
11
26
30%
Germany
1.4
33
64
44%
International Labor Organization
1980-2005
PC Age
United States
2005
(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
The largest labor force migration in human

history is underway, driven by global
communications, business and technology
growth, urbanization and low cost labor

Growing demand for new information and complex

organization (business & societal) services.
US Gross Domestic Product
Products
Services
Material
11%
30%
Information
& Organization
9%
50%
-Based on Uday Karmarkar, UCLA

(Apte & Karmarkar, 2006)

What IBM is doing
The IBM SSME Palisades event was the biggest and most diverse
gathering ever in support of service education. Roland Rust

A new breed of innovator the service scientist

Management
Schools
(Business)
Communication Skills Across Other Fields
Social Science
Schools
(People)
Engineering
Schools
(Technology)
Tower of Babel
Biggest problem in business
is people dont know how to
talk to other people in the
language they understand.
Charles Holliday, CEO Dupont
Core
Field of
Study

Impact: Component Business Model
Business Services
Work Practices
Technical Architecture

Quadruple Loop Learning of Service Systems

Adapting to the world of shareholders, customers, competitors, and employees.
Invest
4
Development
(World
Model
Validity)
Versatility
Rationality
& Maturity
Measures
10
Relationships
Goals
Plans
Deeper
(Ecology)
Sustainability
Differentiate
(Exploration)
Effectiveness
Delivery
(Exploitation)
Efficiency
Reputation
& Trust
Measures
Relevance
& Value
Measures
Performance,
Health & Cost
Measures
Actions
Outcomes
(Expectation)
Evaluation
Risk
& Reward
Measures
Impact: Business Insights Workbench
Valium
(Trade Name)
Diazepam
(Generic Name)
CAS # 439-14-5
(Chemical ID #)
Valium has > 149
names
11

Impact: Intelligent Document Gateway
Digitization
Business Logic
12

Impact: Call Centers
Analytics
Dashboard
Performance
13

Explore: Some future services
Augmented worlds &

smart sensor services
Virtual worlds &

practice studio
Semantic web
services
14

Question: What limits growth rates?

Invention
Television
100
Customer
adoption
Electricity
Telephone
Radio
Automobile
% Adoption
VCR
Service
system
growth
15
50
Access
Laws
Skills
ROI
Cellular
Int
ern
et
PC
25
50
75
Years
100
125
150

What would a service science breakthrough look like? How

about a Moores Law of Service Systems? Why not?
Service System
Computational System
More transistors, more powerful
16
1. People
2. Technology
3. Shared Information
4. Organizations
connected by value propositions
More win-win interactions, more value

17

SSME - Service Science, Management, and Engineering

Discipline Classification System DRAFT v 0.2
(send updates to Claudio Pinhanez, IBM Research)
A. General
1.
2.
3.
4.
5.
6.
D. Service Management
SSME Education
Research in SSME
SSME Policy
History of Services
Services Market
Miscellaneous
B. Service Science
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
Service Theory
Economics of Services
Mathematical Models of Services
Services as Value Co-Creation Systems
Services as Dynamic Systems
Services as Multi-agent Systems
Services as Customer-Intensive Systems
Service Complexity Theory
Service Innovation Theory
Service Science Education
C. Service Engineering
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
18
Service Operations
Service Optimization
Service Systems Engineering
Service Supply Chains
Service Engineering Management
Service Systems Performance
Service Information Systems
Service Standards
Assetization of Services
Service Engineering Education
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
13.
14.
Service Marketing
Service Operations
Service Management
Service Innovation Management
Service Leadership
Service Quality
Service Lifecycle
Human Resources Management
Customer Relationship Management
Service Accounting
Service Sourcing
Services Law
Globalization of Services
Service Management Education
E. Human Behavior in Service Systems

1.
2.
3.
4.
5.
6.
7.
Service Systems Evolution

Behavioral Models of Services
Decision Making in Services
People in Service Systems
Organizational Change in Services
Measurement and Incentive in Services
Customer Psychology
F. Service Design
1.
2.
3.
4.
5.
G. Service Arts
1.
2.
3.
4.
5.
Service Arts Theory

Services-Inspired Art
Traditional Service Arts
Contemporary Service Arts
History of Service Arts
H. Service Industries
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
13.
14.
15.
16.
17.
The Service Industry

Information Services
Business Services
Professional Services
Business Consulting
Customer Relations
Maintenance and Repair
Public Services
Social Services
Health
Hospitality
Transportation
Retail and Wholesale
Financial
Entertainment and Media
Religious and Spiritual Services
Other Service Industries
Service Design Theory

Service Design Methodology
Service Representation
Aesthetics of Services
Service Design Education
Getting beyond processes to interactions

Manufacturing processes
manufacturer
capital labor knowledge facilities
Provider-centric
inputs
outputs
customer
Service processes
Customer-centric
service provider
facilities
knowledge
Service system interactions

Provider is co-creator
Customer is co-creator
Value co-creation
centric
Sustainability & versatility
labor
capital
user input intensity
critical
audience
customer
material inputs
inputs
outputs
critical audience
From Claudio Pinanez (pinhanez@us.ibm.com), IBM Service Research
19
Towards a Science of Service Systems &

The Service System is the Basic Abstraction of Service Science
References:
References: IEEEComputer
IEEEComputer Jan2007,
Jan2007, Spohrer,
Spohrer, Maglio,
Maglio, Bailey,
Bailey, Gruhl;
Gruhl; HICSS
HICSS 2007
2007 submission,
submission, Vargo,
Vargo, Spohrer,
Spohrer, Caswell,
Caswell, Maglio
Maglio
First article introduces service systems (examining universities

and 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&Luschs 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 GoodsDominant (G-D) Logic lead to a worldview of producers-ofvalue 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
20
ISPAR
ISPAR model
model of
of service
service system
system interaction
interaction episodes
episodes
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.
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
21
Quadruple Loop Learning of Service Systems

Adapting to the world of populations of interacting service systems.
(1. employees, 2. competitors, 3. customers, 4. shareholders & self)
Invest
4
Development
(World
Model
Validity)
Versatility
Rationality
& Maturity
Measures
22
Invest
Invest to
to maintain,
maintain, operate,
operate, and
and change
change
Relationships
3
Deeper
(Ecology)
Sustainability
Goals
Plans
Differentiate
(Exploration)
Effectiveness
Delivery
(Exploitation)
Efficiency
Actions
Outcomes
(Expectation)
Evaluation
Risk
Relevance
Performance,
Reputation
& Reward
& Value
Health & Cost
& Trust
Measures
Measures
Measures
http://www.financialdashboard.com
Measures
A Moores Law for Service Systems? Why not?
Service System
1. People
2. Technology
3. Shared Information
4. Organizations
connected by value propositions
Computational System
More transistors, more power
23
More win-win interactions, more value
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
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)
Nuclear Engineering
24
SSME: Service Science, Management & Engineering

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
Operations Research and Industrial Engineering
More 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 Economy

Better models of social innovation in what way is passing a law
innovation
Complex Systems and Systems Engineering

Better model of robustness and fragility of service systems
(sustainability)
25

Another perspective of service systems of relationships

Service providers and clients coproduce value in and through
their interactions with one another
Many services require the
participation of the receiver of the
service
stylist client
doctor patient
teacher student
IT service provider business
client
Forms of
Service Relationship
(A & B co-create value)
A. Service Provider
Bryson, Daniels and Warf from Service Worlds
Individual
Organization
Public or Private
Individual
Organization
Public or Private
hair
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.
B. Service Client
Forms of
Service Interventions
(A on C, B on C)
Forms of
Responsibility Relationship
(A on C)
Forms of
Ownership Relationship
(B on C)
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
- Based on Gadrey (2002)
26

What makes SSME hard is that it is multidisciplinary

Services depend critically on people, technology, and co-creation of
value
People work together and with technology to provide value for clients
So a service system is a complex socio-technical system
Growth requires innovation that combines people, technology, value,
clients
Science &
Engineering
Social & Cognitive

Sciences
27
Technology
Innovation
Social
Innovation
Business
Innovation
Demand
Innovation
Business &
Management
Economics
& Markets

Food for thought: Impact that matters

Team Achievement
Business Impact
Technical
Communication
innovation &
Co-production
invention
Internal relationships
Revenue/Profit
Personal Development
Innovation
Community
Individual Achievement
Continued
education
Relationship building
Community involvement
Technical
knowledge
Experiential knowledge
Relationship building
Scientific Achievement
Publishing
Scientific
or technical
innovation
External relationships
28

Projected US service employment growth, 2004 - 2014
US Bureau of Labor Statistics.

http://www.bls.gov/opub/ooq/2005/winter/art03.pdf
29

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)?
30

31

32


Ibm Service Research

Încărcat de

Informații document

Drepturi de autor

Formate disponibile

Partajați acest document

Partajați sau inserați document

Opțiuni de partajare

Vi se pare util acest document?

Este necorespunzător acest conținut?

Drepturi de autor:

Formate disponibile

Ibm Service Research

Încărcat de

Drepturi de autor:

Formate disponibile

Service Science

Service Research and Innovation

Service Research and Innovation | Almaden Research Center

2007 IBM Corporation