This document discusses progress and directions in service science research. It outlines several "mega-topics" for IT-enabled service research including super-colleague applications, intelligent home health systems, manufacturing/agriculture service systems, and crowd-sourced city service systems. It also discusses holistic service systems research focusing on smart cities with universities at their core. The document provides an overview of IBM's university programs and outlines a framework for advancing service science through interdisciplinary research.

1. Service Science:Progress & Directions Mega-Topics for IT-Enabled Service Research Jim Spohrer, IBM See http://www.slideshare.net/spohrer

2. Why Service Matters to IBM Revenue Growth by Segment

3. Why Universities Matter to IBM

4. IBM UP & “5 R’s” 1. Research Awards focus on grand challenge problems and big bets https://www.ibm.com/developerworks/university/research 2. Readiness Access to IBM tools, methods, and course materials to develop skills https://www.ibm.com/developerworks/university/academicinitiative 3. Recruiting Internships and full-time positions working to build a smarter planet http://www.ibm.com/jobs 4. Revenue Public-private partnerships build great universities and strengthen regions http://www.ibm.com/services/us/gbs/bus/html/bcs_education.html 5. Responsibility Community service provides access to expertise/resources http://www.ibm.com/ibm/ibmgives/

5. Research: Award Programs

6. What improves Quality-of-Life? Service System Innovations 20/10/10 A. Systems that focus on flow of things that humans need (~15%*) 1. Transportation & supply chain 2. Water & waste recycling/Climate & Environment 3. Food & products manufacturing 4. Energy & electricity grid/Clean Tech 5. Information and Communication Technologies (ICT access) B. Systems that focus on human activity and development (~70%*) 6. Buildings & construction (smart spaces) (5%*) 7. Retail & hospitality/Media & entertainment/Tourism & sports (23%*) 8. Banking & finance/Business & consulting (wealthy) (21%*) 9. Healthcare & family life (healthy) (10%*) 10. Education & work life/Professions & entrepreneurship (wise) (9%*) C. Systems that focus on human governance - security and opportunity (~15%*) 11. Cities & security for families and professionals, non-profits (property tax) 12. States/regions & commercial development opportunities/investments (sales tax) 13. Nations/NGOs & citizens rights/rules/incentives/policies/laws (income tax) 2/7/4 * = US Labor % in 2009. 2/1/1 7/6/1 1/1/0 5/17/27 1/0/2 24/24/1 2/20/24 7/10/3 5/2/2 3/3/1 0/0/0 0/19/0 1/2/2 Quality of Life = Quality of Service + Quality of Jobs + Quality of Investment-Opportunities “61 Service Design 2010 (Japan) / 75 Service Marketing 2010 (Portugal)/78 Service-Oriented Computing 2010 (US)”

7. Smarter Planet/SSME Awards (Sample of 192) Column’s Explained in More Detail on Previous Slide

8. US National Academy of Engineering Grand Challenges A. Systems that focus on flow of things humans need 1. Transportation & Supply Chain Restore and enhance urban infrastructure 2. Water & Waste/Climate & Green tech Provide access to clear water 3. Food & Products Manager nitrogen cycle 4. Energy & Electricity Make solar energy economical Provide energy from fusion Develop carbon sequestration methods 5. Information & Communication Technology Enhance virtual reality Secure cyberspace Reverse engineer the brain B. Systems that focus on human activity & development 6. Buildings & Construction (smart spaces) Restore and enhance urban infrastructure 7. Retail & Hospitality/Media & Entertainment (tourism) Enhance virtual reality 8. Banking & Finance/Business & Consulting 9. Healthcare & Family Life Advance health informatics Engineer better medicines Reverse engineer the brain 10. Education & Work Life/Jobs & Entrepreneurship Advance personalized learning Engineer the tools of scientific discovery C. Systems that focus on human governance 11. City & Security Restore and improve urban infrastructure Secure cyberspace Prevent nuclear terror 12. State/Region & Development 13. Nation & Rights

10. Many team-oriented service projects completed (resume: outcomes, accomplishments & awards) Many disciplines (13) (understanding & communications) Many systems (13) (understanding & communications) Deep in one discipline (analytic thinking & problem solving) Deep in one system (analytic thinking & problem solving) Skills for 21st Century: T-Shaped Innovators Ready for T-eamwork SSME(D) = Service Science Management Engineering (and Design)

11. Systems that focus on flows of things Systems that govern Systems that support people’s activities transportation & supply chain healthcare & family retail & hospitality ICT & cloud city secure food & products education &work state scale nation laws energy & electricity water & waste building & construction banking & finance behavioral sciences Customer Provider Authority Competitors People Technology Information Organizations resources stakeholders e.g., marketing management sciences Stackholders (Customers, Providers, etc.) e.g., operations political sciences e.g., public policy learning sciences e.g., game theory and strategy cognitive sciences e.g., psychology system sciences Resources (People, Technology, etc.) e.g., industrial eng. information sciences e.g., computer sci organization sciences e.g., knowledge mgmt social sciences History (Data Analytics) Future (Roadmap) change Change (History, Future) e.g., econ & law decision sciences e.g., statistics run professions Run Transform (Copy) Innovate (Invent) e.g., knowledge worker value Value (Run, Transform, Innovate) transform professions e.g., consultant innovate professions e.g., entrepreneur Service Systems & Current Academic Disciplines

12. Jobs: Expert Thinking & Complex Communications Increasing usage of job descriptive terms Expert Thinking (deep) Complex Communication (broad) Routine Manual Non-routine Manual Routine Cognitive Based on U.S. Department of Labor’ Dictionary of Occupational Titles (DOT) Levy, F, & Murnane, R. J. (2004). The New Division of Labor:How Computers Are Creating the Next Job Market. Princeton University Press.

13. Pervasive Force: Leveraging Technology to Advance Service Strategy Priorities Development Priorities Execution Priorities Stimulating Service Innovation Fostering Service Infusion and Growth Effectively Branding and Selling Services Enhancing Service Design Improving Well-Being through Transformative Service Enhancing the Service Experience through Cocreation Creating and Maintaining a Service Culture Optimizing Service Networks and Value Chains Measuring and Optimizing the Value of Service Priorities: Research Framework for the Science of Service Source: Global Survey of Service Research Leaders (Ostrom et al 2010)

14. Mega-Topics Super-Colleague Humanitarian and labor productivity (augmentation) applications of Watson technology E.g., Intelligent assistant that has read everything you should have read & can talk with you about it Super-Service Beyond self-service (toward invisible super-colleagues and intelligent environments) e.g, https://www.youtube.com/watch?v=44f5A8PCWiU Home Health Technology-enabled home health systems (invisible super-doctor-nurse intelligent environments) e.g., http://www.youtube.com/watch?v=6Cf7IL_eZ38 ManAg Servitization Manufacturing & Agriculture factory of the future service system with customer co-creation e.g., https://www.youtube.com/watch?v=nd5WGLWNllA) Crowd Sourcing Instrumented people and city service systems (fun read – World Wide Mind, Collective Intelligence) e.g. https://www.youtube.com/watch?v=anKiEoxkpxM Whole-Service Sustainability IT-enabled smart cities with universities at the core as living labs (Holistic Service Systems research) City, University Sci-Tech Parks & Incubators, University, K-12 & Neighborhoods E.g., http://www.service-science.info/archives/1056

15. Holistic Service Systems Nation State/Province City/Region Luxury Resort Hotels University Colleges K-12 Hospital Medical Research Family (household) Person (professional) Examples: Nations, States, Cities, Universities, Luxury Hotels, Cruise Ships, Households Subsystems: Transportation, Water, Food, Energy, Communications, Buildings, Retail, Finance, Health, Education, Governance, etc. Definition: A service system that can support its primary populations, independent of all external service systems, for some period of time, longer than a month if necessary, and in some cases, indefinitely Balance independence with interdependence, without becoming overly dependent For-profits start-ups Non-profits ~25-50% of start-ups are new IT-enabled service offerings

16. World Population & Service System Scaling

17. Thank-You! Questions? “Instrumented, Interconnected, Intelligent – Let’s build a Smarter Planet.” – IBM “If we are going to build a smarter planet, let’s start by building smarter cities” – CityForward.org “Universities are major employers in cities and key to urban sustainability.” – Coalition of USU “Cities learning from cities learning from cities.” – Fundacion Metropoli “The future is already here… It is just not evenly distributed.” – Gibson “The best way to predict the future is to create it/invent it.” – Moliere/Kay “Real-world problems may not/refuse to respect discipline boundaries.” – Popper/Spohrer “Today’s problems may come from yesterday’s solutions.” – Senge “History is a race between education and catastrophe.” – H.G. Wells “The future is born in universities.” – Kurilov “Think global, act local.” – Geddes Dr. James (“Jim”) C. Spohrer Innovation Champion & Director, IBM University Programs (IBM UP) WW spohrer@us.ibm.com

19. Net Income - $ 14.8B

20. EPS - $ 11.52

21. Net Cash - $11.7B21% of IBM’s revenue in growth market countries; growing at 13% in late 2010 More than 40% of IBM’s workforce conducts business away from an office IBM operates in 170 countries around the globe Number 1 in patent generation for 18 consecutive years ; 5,896 US patents awarded in 2010 Smarter Planet 5 Nobel Laureates 9 time winner of the President’s National Medal of Technology & Innovation - latest award for Blue Gene Supercomputer

22. Service Growth: The World World’s Large Labor Forces A = Agriculture, G = Goods, S = Service US shift to service jobs 2010 2010 (A) Agriculture: Value from harvesting nature 40yr Service Growth S % G % A % Labor % WW Nation 142% 29 22 49 25.7 China 35% 23 17 60 14.4 India (G) Goods: Value from making products 23% 76 23 1 5.1 U.S. 34% 39 16 45 3.5 Indonesia (S) Service: Value from IT augmented workers in smarter systems that create benefits for customers and sustainably improve quality of life. 61% 66 14 20 3.0 Brazil 64% 69 21 10 2.4 Russia 45% 67 28 5 2.2 Japan 19% 20 10 70 1.6 Nigeria 37% 26 11 63 2.1 Bangladesh 42% 64 33 3 1.4 Germany CIA Handbook, International Labor Organization Note: Pakistan, Vietnam, and Mexico now larger LF than Germany

23. Priorities: Succeeding through Service Innovation - A Framework for Progress (http://www.ifm.eng.cam.ac.uk/ssme/) Source: Workshop and Global Survey of Service Research Leaders (IfM & IBM 2008) 1. Emerging demand 5. Call for actions 2. Define the domain 3. Vision and gaps 4. Bridge the gaps Stakeholder Priorities Education Research Business Government Service Systems Customer-provider interactions that enable value cocreation Dynamic configurations of resources: people, technologies, organisations and information Increasing scale, complexity and connectedness of service systems B2B, B2C, C2C, B2G, G2C, G2G service networks Service Innovation Growth in service GDP and jobs Service quality & productivity Environmental friendly & sustainable Urbanisation & aging population Globalisation & technology drivers Opportunities for businesses, governments and individuals The white paper offers a starting point to - Service Science To discover the underlying principles of complex service systems Systematically create, scale and improve systems Foundations laid by existing disciplines Progress in academic studies and practical tools Gaps in knowledge and skills Develop programmes & qualifications Skills & Mindset Encourage an interdisciplinary approach Knowledge & Tools Develop and improve service innovation roadmaps, leading to a doubling of investment in service education and research by 2015 Employment & Collaboration Policies & Investment Glossary of definitions, history and outlook of service research, global trends, and ongoing debate

24. COMMUNICATIONS PRODUCTS WORKFORCE TRANSPORTATION SUPPLY CHAIN BUILDINGS Evolution: SSME+D (for Design) for a Smarter PlanetWhat is Smarter Planet? Harmonized smarter systems. INSTRUMENTED We now have the ability to measure, sense and see the exact condition of practically everything. INTERCONNECTED People, systems and objects can communicate and interact with each other in entirely new ways. INTELLIGENT We can respond to changes quickly and accurately, and get better results by predicting and optimizing for future events. IT NETWORKS

25. What is a Service System? What is Service Science?…customers just name <your favorite provider>…researchers just name <your favorite discipline> Design/ Cognitive Science Systems Engineering “service science is the interdisciplinary study of service systems & value-cocreation” “a service system is a human-made system to improve customer-provider interactions, or value-cocreation” Marketing Computer Science/ Artificial Intelligence Operations Economics & Law

26. Time 14B Big Bang (Natural World) 10K Cities (Human-Made World) bees (social division-of-labor) transistor 60 200M Where is the “Real Science” in SSME+D? In the interdisciplinary sciences that study the natural and human-made worlds… Unraveling the mystery of evolving hierarchical-complexity in new populations… To discover the world’s structures and mechanisms for computing non-zero-sum writing (symbols and scribes) ECOLOGY written laws money (coins) Sun Earth bacteria (uni-cell life) sponges (multi-cell life) universities clams (neurons) printing press (books) trilobites (brains) steam engine

27. Service System Ecology: Conceptual Framework Resources: People, Technology, Information, Organizations Stakeholders: Customers, Providers, Authorities, Competitors Measures: Quality, Productivity, Compliance, Sustainable Innovation Access Rights: Own, Lease, Shared, Privileged

28. Value Configuration Density Resource Integrator/Beneficiary Resource Integrator/Beneficiary (“Firm”) (“Customer”) Value Co-creation Service-dominant logic Service is the application of competences for the benefit of another entity Serviceis exchanged for service Value is always co-created Goods are appliances for delivery Alleconomies are service economies All businesses are service businesses Vargo, S. L. & Lusch, R. F. (2004). Evolving to a new dominant logic for marketing. Journal of Marketing, 68, 1 – 17.

29. What is value? Value depends on the capabilities a system has to survive and create beneficial change in its environment. Taking advantage of the service another system offers means incorporating improved capabilities. Value can be defined as system improvement in an environment. All ways that systems work together to improve or enhance one another’s capabilities can be seen as being value creating. Vargo, S. L., Maglio, P. P., and Akaka, M. A. (2008). On value and value co-creation: A service systems and service logic perspective. European Management Journal, 26(3), 145-152.

31. Organization

33. Organization

35. Business, dimensions of

36. Products, goods and material systems

37. Information, codified knowledgeGadrey, J. (2002). The misuse of productivity concepts in services: Lessons from a comparison between France and the United States. In J. Gadrey & F. Gallouj (Eds). Productivity, Innovation, and Knowledge in Services: New Economic and Socio-economic Approaches. Cheltenham UK: Edward Elgar, pp. 26 – 53. What is a service system? Service involves at least two entities applying competences and making use of individual and shared resources for mutual benefit. We call such interacting entities service systems. Spohrer, J., Maglio, P. P., Bailey, J. & Gruhl, D. (2007). Steps toward a science of service systems. Computer, 40, 71-77.

38. Rights No-Rights 2. Technology 1. People Physical 4.. SharedInformation 3. Organizations Not-Physical Resources are the building blocks of service systems First foundational premise of service science Service system entities dynamically configure four types of resources The named resource is Physical or Not-Physical (physicists resolve disputes) The named resource has Rights or No-Rights (judges resolve disputes within their jurisdictions) Formal service systems can contract Informal service systems can promise/commit Trends & Countertrends (Evolve and Balance): Informal <> Formal Social <> Economic Political <> Legal Routine Cognitive Labor <> Computation Routine Physical Labor <> Technology Transportation (Atoms) <> Communication (Bits) Qualitative (Tacit) <> Quantitative (Explicit) Spohrer, J & Maglio, P. P. (2009) Service Science: Toward a Smarter Planet. In Introduction to Service Engineering. Editors Karwowski & Salvendy. Wiley. Hoboken, NJ..

39. Value propositions are the building blocks of service system networks Second foundational premise of service science Service system entities calculate value from multiple stakeholder perspectives A value propositions can be viewed as a request from one service system to another to run an algorithm (the value proposition) from the perspectives of multiple stakeholders according to culturally determined value principles. The four primary stakeholder perspectives are: customer, provider, authority, and competitor Value propositions coordinate & motivate resource access Spohrer, J & Maglio, P. P. (2009) Service Science: Toward a Smarter Planet. In Introduction to Service Engineering. Editors Karwowski & Salvendy. Wiley. Hoboken, NJ..

41. Access to resources that are owned outright (i.e., property)

42. Access to resource that are leased/contracted for (i.e., rental car, home ownership via mortgage, insurance policies, etc.)

43. Shared access (i.e., roads, web information, air, etc.)

44. Privileged access (i.e., personal thoughts, inalienable kinship relationships, etc.)Spohrer, J & Maglio, P. P. (2009) Service Science: Toward a Smarter Planet. In Introduction to Service Engineering. Editors Karwowski & Salvendy. Wiley. Hoboken, NJ..

45. Rights No-Rights 2. Technology 1. People Physical 4.. SharedInformation 3. Organizations Not-Physical A S P C Premises of service science: What service systems do Service system entities dynamically configure (transform) four types of resources Service system entities calculate value from multiple stakeholder perspectives Service system entities reconfigure access rights to resources by mutually agreed to value propositions Spohrer, J & Maglio, P. P. (2009) Service Science: Toward a Smarter Planet. In Introduction to Service Engineering. Editors Karwowski & Salvendy. Wiley. Hoboken, NJ..

48. By James Teboul, INSEAD

49. Reaching the Goal: How Managers Improve a Services Business Using Goldratt’s Theory of Constraints

54. Interoperable ProcessesECONOMIC ALIGNMENT Systemic View of Education Vision for the Educational Continuum: Individuals & Institutions Learning The Educational Continuum http://www-935.ibm.com/services/us/gbs/bus/html/education-for-a-smarter-planet.html 34

55. Fun: CityOne Game to Learn “CityInvesting” Serious Game to teach problem solving for real issues in key industries, helping companies to learn how to work smarter. Energy, Water, Banking, Retail http://www.ibm.com/cityone

56. Priority 1: Urban Sustainability & Service Innovation Centers A. Research: Holistic Modeling & Analytics of Service Systems Modeling and simulating cities will push state-of-the-artcapabilities for planning interventions in complex system of service systems Includes maturity models of cities, their analytics capabilities, and city-university interactions Provides an interdisciplinary integration point for many other university research centers that study one specialized type of system Real-world data and advanced analytic tools are increasingly available B. Education: STEM (Science Tech Engineering Math) Pipeline & LLL City simulation and intervention planning tools can engage high school students and build STEM skills of the human-made world (service systems) Role-playing games can prepare students for real-world projects LLL = Life Long Learning C. Entrepreneurship: Job Creation City modeling and intervention planning tools can engage university students and build entrepreneurial skills Grand challenge competitions can lead to new enterprises

57. Population Challenges Opportunities Careers Cities as Holistic Service Systems: All the systems A. Flow of things 1. Transportation: Traffic congestion; accidents and injury 2. Water: Access to clean water; waste disposal costs 3. Food: Safety of food supply; toxins in toys, products, etc. 4. Energy: Energy shortage, pollution 5. Information: Equitable access to info and comm resources B. Human activity & development 6. Buildings: Inefficient buildings, environmental stress (noise, etc.) 7. Retail: Access to recreational resources 8. Banking: Boom and bust business cycles, investment bubbles 9. Healthcare: Pandemic threats; cost of healthcare 10. Education: High school drop out rate; cost of education C. Governing 11. Cities: Security and tax burden 12. States: Infrastructure maintenance and tax burden 13. Nations: Justice system overburdened and tax burden Example: Singapore

58. Universities as Holistic Service Systems: All the systems A. Flow of things 1. Transportation: Traffic congestion; parking shortages. 2. Water: Access costs; reduce waste 3. Food: Safety; reduce waste. 4. Energy: Access costs; reduce waste 5. Information: Cost of keeping up best practices. B. Human activity & development 6. Buildings: Housing shortages; Inefficient buildings 7. Retail: Access and boundaries. Marketing. 8. Banking: Endowment growth; Cost controls 9. Healthcare: Pandemic threat. Operations. 10. Education: Cost of keeping up best practices.. C. Governing 11. Cities: Town & gown relationship. 12. States: Development partnerships.. 13. Nations: Compliance and alignment.

59. Understanding the Human-Made World Also see: Symbolic Species, Deacon Company of Strangers, Seabright Sciences of the Artificial, Simon See Paul Romer’s Charter Cities Video: http://www.ted.com/talks/paul_romer.html

60. Where are the opportunities? Everywhere!