Towards an ontological foundation of service dominant logic


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yfallos Fragidis and Konstantinos Tarabanis

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Towards an ontological foundation of service dominant logic

  1. 1. Towards an Ontological Foundation of Service Dominant Logic Garyfallos FragidisTechnological Education Institute of Serres, Greece Konstantinos Tarabanis University of Macedonia, Greece
  2. 2. ► Service systems and value co-creation are recognized as the two most fundamental concepts of service science ●  “value co-creation is the primary object of study in service systems” ●  “service science is the study of value co-creation phenomena” Spohrer, J., Maglio, 2010; Maglio, Kieliszewski, and Spohrer, 2010► Service-Dominant (S-D) logic is recognized as “one of the corner stones of service science” and “the philosophical foundation of service science” Spohrer, J., Maglio, 2010► Service science was acknowledged to be inconsistent in applying the principles of S-D logic Maglio, Kieliszewski, and Spohrer, 2010 Vargo and Akaka, 2009; Vargo, Lusch and Akaka, 2010
  3. 3. ► The slow development of service science► The concepts of value, value creation and value co- creation, remain still unclear and vague. ●  “Value co-creation is the basic action that take place in the interaction between service systems”. ●  Value co-creation provides a balanced approach and an integrated perspective on the creation of value for the business firm an the customer alike.► A lack of alignment between business and IT approaches in service science ●  Service science and S-D logic function at different levels of analysis and for different purposes
  4. 4. Purpose► Support the deeper understanding of S-D logic and its key concepts (e.g. service, value co-creation, etc.) ●  Provide a common framework of concepts and relations ●  Move beyond a lexicon ●  Contribute in the resolution of inconsistencies and misunderstandings► Contribute in the establishment of S-D logic as the foundational theory of service science ●  Contribute in the assimilation of the concepts of S-D logic► Contribute in the improved communication of experts from different areas in the multidisciplinary field of service science.
  5. 5. Literature Review►  Approaches that set conceptual foundations of service systems ●  Ferrario, R., Guarino, N.: Towards an Ontological Foundation for Services Science. ●  Alter, S.: Service system fundamentals: Work system, value chain, and life cycle. ●  Stanicek, Z., Winkler, M.: Service Systems through the Prism of Conceptual Modeling. ●  OSullivan, J.: Towards a Precise Understanding of Service Properties.►  Approaches that aim at the business modeling of service systems ●  Poels, G.: A Conceptual Model of Service Exchange in Service-Dominant Logic. ●  Weigand, et al.: Value-Based Service Modeling and Design: Toward a Unified View of Services. ●  Andersson et al.: Towards a Reference Ontology for Business Models. ●  Baida, Z.: Serviguration ●  De Kinderen, S., Gordijn, J.: E3service. ●  Scheithauer: Business Service Description Methodology for Service Ecosystems. ●  Sorathia, V., et. al: Towards a Unifying Process Framework for Services Knowledge Management.
  6. 6. Literature Review►  Relationship to service science/ S-D logic ●  Most of them refer to service science (as a research trend) ●  Only two refer to S-D logic ●  Only three are based on input from service science and/ or S-D logic►  The origin of the concept of service ●  Input from the business management or the economics literature ●  a) service as an event, b) service as a process, c) service as a resource►  Customer- orientation►  Co-production and/or value co-creation ●  Included only in two
  7. 7. Methodology► We stay with the concepts of S-D logic ●  10 FP ●  Lexicon ●  The whole literature of S-D logic (by Vargo and/ or Lusch)► Development of an ontological representation of S-D logic ●  as a class diagram ●  at a generic level
  8. 8. Key concepts►  Actor: a generalization of Customer and Provider►  Service: a generalization of Direct Service and Indirect Service►  Value Co-creation: a generalization of Co-production Integration and Customisation►  Value: a generalization of Knowledge and Experience►  Resource: a generalization of Operant Resource and Operand Resource►  Context: a generalization of Situational Context and Idiosyncratic Context.
  9. 9. An ontological representation of S-D logic: the basic concepts
  10. 10. An ontological representation of S-D logic: the complete model
  11. 11. Actor►  It is a general term used to address to the entities that participate in the value co-creation process►  Other options (suboptimal): ●  FP9: “all economic and social actors are resource integrators”. ●  In service science the basic entities are the service systems►  Customer and Provider are the two key roles played by Actors in value co-creation processes. ●  Provider: provides Service ●  Customer: the beneficiary Actor that receives the Service provided. ●  The Customer may receive and integrate Service from many Providers and supplements them with proprietary resources. ●  The customer inherits all the attributes of an Actor
  12. 12. Service & Resource►  Resource: any kind of input used by Actors in value co-creation processes ●  Operant Resource & Operand Resource.►  Service: the application of specialized competences (knowledge and skills) for the benefit of another entity or the entity itself. ●  A process of applying Resources. ●  “Recourcing”: the activity of rendering resources into a specific benefit (the way that value creation occurs) ●  Direct Service & Indirect Service ●  Self-service
  13. 13. Value Co-creation►  Value Co-creation: the service-based collaboration of at least one Provider, who provides Service, and at least one Customer, who integrates and complements it with proprietary Service, for the co-creation of value. ●  network relationships ●  service ecosystem► Value Co-creation is ageneral concept that canbe actualized in manydifferent ways. ●  Co-production ●  Customization ●  Integration
  14. 14. Value►  Value: the output of the Value Co- creation process. ●  Value is related to the customer (“value is always uniquely and phenomenologically determined by the beneficiary”- FP10); ●  “Value-in-use” & “value-in-context” ●  Value is determined “contextually and idiosyncratically” by the customer. ●  Value affects also the Provider (“service is the fundamental basis of exchange” – FP1), namely that “service is exchanged for service”. feedback (direct and indirect).►  Knowledge: learning opportunities for the improvement of Resources.►  Experience: a basic way that the Customer perceives Value.►  Context: the general conditions that exist for the co-creation of value ●  Situational Context: spatial, temporal, social and relational dimensions. ●  Idiosyncratic Context: personal needs and traits of the Customer
  15. 15. Benefits from the ontological representation of S-D logic► The logical analysis of S-D logic: ●  provides insights ●  clarifies concepts ●  singles out inconsistencies► Interpretation & improvement of S-D logic► A basis for transdisciplinary communication► A vocabulary and modeling constructs for the development of “service-based” information systems (or “value-cocreation” information systems)
  16. 16. Service and Value Co-creation
  17. 17. Service and Value Co-creation►  Value Co-creation becomes the result of the direct application of Resources from the Actors ●  It is compliant with S-D logic ●  It is compliant with Service Science
  18. 18. Concepts not included► Exchange (FP1 & FP2)► Competitive advantage (FP4)► Value proposition (FP7)► Solution, dialogue, reciprocity/ interactivity, value-in- use, value-creation network and service ecosystem (possible entries to the S-D logic lexicon).
  19. 19. Concepts not included - exchange► Exchange is a competing concept to Value Co- creation ●  Exchange is included in the Value Co-creation process, with the meaning of contribution of service and resources► Alternative modeling options ●  Replace Value Co-creation with Exchange ●  Add Exchange in the model
  20. 20. Concepts not included► Exchange (FP1 & FP2)► Competitive advantage (FP4)► Value proposition (FP7)► Solution, dialogue, reciprocity/ interactivity, value-in- use, value-creation network and service ecosystem (possible entries to the S-D logic lexicon).
  21. 21. Problems & limitations► The interpretation of S-D logic ●  Subjective interpretation, especially when the concepts are vague and the meaning/ implications unclear. •  E.g. “service is exchanged for service” •  “Value is always uniquely and phenomenologically determined by the beneficiary” ●  Stay with the general concepts, rather than emphasize on the specific words► The ontological form (why an ontology?) ●  Informal vs. formal ontology ●  Generic vs. specific ontologies
  22. 22. Future research►  The elaboration of the foundational ontology of S-D logic with additional concepts, relationships and rules (for example with regard to the types and respective processes of value co- creation, the types of value for the customer and the provider, the contextual parameters, etc.)►  The elaboration of the foundational ontology of S-D logic with partial aspects aspects (e.g. business aspect, customer aspects, etc.).►  Merging concepts between S-D logic and service science. Perhaps the development of a common/ integrated ontology.►  The development of specific ontologies for some business domains or business models.►  The formalization of the ontology.►  The building of consensus.
  23. 23. Questions & comments Thank you!Gary FragidisTechnological Education Institute of Serres62124 Serres, GreeceE-mail: garyf@teiser.grtel.: +30 23 21049310