R Gary Bridge's the future of services #quis2013

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Bridge works at the intersection of competitive strategy, advanced technology, and process re-engineering to solve problems for the world's largest enterprises and governments. …

Bridge works at the intersection of competitive strategy, advanced technology, and process re-engineering to solve problems for the world's largest enterprises and governments.
He continues to consult with multinational companies about innovation processes, and guides Dentech, a startup that connects sensor networks to service actions.

More in: Business , Technology
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  • 1. R. Gary Bridge, PhDCopyright © 2013, G. Bridge. All Rights ReservedThe Future of ServicesTechnology will create more and better servicesin more places at better prices…New winners and losers will emerge
  • 2. What causes change…EconomyTechnologyDemographicsCopyright © 2013 , G. Bridge. All Rights Reserved…the ways in which social groups provide themselveswith the material objects of their civilization
  • 3. Technology matters…Fire used to cook foodSource: www.bronze-age-reenactment.com/page3
  • 4. Technology matters…Gut shrankImage: www.nature.com/.../images/4441009a-f1.2.jpgSource: A. Gibbons, Science, 2007; Gill et al 20061013 – 1014 organisms in gut. Microbiome has100X more genes than human genome(24,500 genes). “Thus, humans aresuperorganisms whose metabolismrepresents an amalgamation of microbial andhuman attributes.” Gill et al , 2006
  • 5. Technology matters…Source: Science, 2007Image: Chloe TamBrain consumes60% of baby’s energyBrain Volume (and Energy required) grew…Source: Cornelia BlinkTIME(MillionsofYearsAgo)Percent of Resting ENERGYDevoted To BrainAdult atrest = 25%2% body mass1350 cc1350 g
  • 6. The Internet is changing our Brains now…Memory for ContentMemory for ContentMemory for Locationof Content• How we use memory is changing, based on search costs• Multi-task switching capabilities are growingHighSearchCostsLowSearchCostsCopyright © 2013 , G. Bridge. All Rights Reserved
  • 7. World PopulationSource: Combines data from two different -1000 to 1950 and 1950 to 2050 Census Bureau databasesPopulation(Millions)Time010002000300040005000600070008000900010000-10000-5000-2000-4002006009001200134016001750190019301960199020202050If population hadfollowed the trendof the last 10,000 years…1 B
  • 8. World PopulationSource: Combines data from two different -1000 to 1950 and 1950 to 2050 Census Bureau databasesPopulation(Millions)TimeActual Forecast010002000300040005000600070008000900010000-10000-5000-2000-4002006009001200134016001750190019301960199020202050INDUSTRIALREVOLUTION+ Source: World Bank Population Clock, July 20117 Billion31 Oct. 2011INFORMATIONAGE
  • 9. The world’s informationdoubles every year…Service innovation depends on information
  • 10. World Storage Capacity (2007)PC Hard DrivesDVD and Blu-rayDigitalTapeServers,MainframesSource: Hilbert and Lopez, Science, 2011AnalogStorageOptimally compressed MBs of Storage2002, first time moredigital information inworld than analog…five years later, digitaldominates knowledge90% data that existstoday was created inthe last 2 years…Source: IBM, Big Data, 2013
  • 11. World Communication Capacity Trendshttp://www.martinhilbert.net/WorldInfoCapacity.html10X
  • 12. Internet Penetration (30 June 2012)Source: www.internetworldstats.com/stats.htm, March 2011No. AmericaOceania/ANZEuropeLatin AmericaMiddle EastWorldwideAsiaAfrica
  • 13. Priorities… if you could have only one,what would you choose?orCopyright © 2013 , G. Bridge. All Rights Reserved
  • 14. Priorities… if you could have only one,what would you choose?Global population about 6.88 B in 2011Source of plumbing statistic: United Nations Human Development Report, 2006Source Mobile phone penetration statistics: mobithinking.com, 201160%4.3 Billion77%5.3 BillionFact:Communication is moreimportant than convenientand safe sanitationCopyright © 2013 , G. Bridge. All Rights Reserved
  • 15. Growing ProductivityRaises Living Standards
  • 16. Book Publishing Value Chain$.06DataCentersServiceProvidersNetworksStore onServerDownloadto DeviceConsumerElectronicsDevicesAuthorcreatesPublisherfinds,editsPrintBooksDistributeBooksRetailerstocks,sellsCustomerreadsPaperIndustryShippingIndustryReal EstateIndustryAuthorcreatesPublisherfinds,editsCustomerreadsCopyright © 2013 , G. Bridge. All Rights Reserved
  • 17. Amazon Sales: e-Books vs. Print Books2007 2008 2009 2010 2011Kindle e-ReaderIntroducede-BooksoutsellPaperbackse-Booksoutsell PrintBooks3 ½Months42MonthsCopyright © 2013 , G. Bridge. All Rights Reserved
  • 18. Market Transitions are underway in almostevery Industry… new winners and losersNewsMusicMoviesBooksTVMEDIAPharmaUtilitiesAutosServiceProvidersHealthcarePublicSectorRetailAirlinesMostStressedLessStressed 1 2 3 5 6 7 8 9 10Copyright © 2013 , G. Bridge. All Rights ReservedInsurance4ManufacturingBankingEducation?
  • 19. Technology-driven Service TrendsAutomation of service tasks, including complex tasksDelivery-at-a-distance -- remote servicesCo-creation of value123Personalization – personal service, mass market prices4Context• Location awareness• Needs / Tasks• Emotional State• Decision Style / Preferences• Health Status / Genetics• Social NetworkMobileMobile andWearablePlatformsGoogle glassHealth Monitors
  • 20. Technology-driven Service TrendsAutomation of service tasks, including complex tasksTechnology drives all five Service trendsPersonalization – personal service, mass market pricesDelivery-at-a-distance -- remote servicesCo-creation of value1234“Servicization” of product companies5
  • 21. Technology fostersServices Productivity andNew Business Models…and disrupts Markets
  • 22. RFID ChipSimple case: Identifying objectsPassportBaggage TagPassive RFID TagInternet of Things (IoT)PassiveRFIDActiveRFIDResponds with code when power appliedCarries own power sourceand actively broadcasts codePoker ChipReaderHitachi RFID.05 mm X .05 mm2000 bytes.05 X .05 mm
  • 23. Managing Beverage Self-ServiceLess labor requiredEnforces meal planentitlements automaticallyCan capture Customer’spreferences…Radio Frequency ID (RFID)
  • 24. Disney World MagicBand+Copyright © 2013, G. Bridge. All Rights ReservedRFID Event ReaderRFID badgeRoom accessPackage entitlementsCapture Customer dataPark accessCashless paymentsReserve ride timesPersonalized experiences
  • 25. Personalized ExperiencesTechnology creates new, highly-valued services…new revenue, higher margins from existing assetsParents’InputTracking visitexperiencesGuestData
  • 26. Internet of Things (IoT)Sense physical parameters-- light, motion, chemicals, proximity, biometricsApply user-defined policy logic-- sampling, summarizing, reporting eventsCommunicate data over a network-- automatic meshing and routingSensorsBattery/PowerMote:MicrocontrollerStorageRadioClockEnclosureCopyright © 2013 , G. Bridge. All Rights Reserved
  • 27. Self-Checkout App: Walmart Scan and GoScanitems withiPhonecameraPay atSelf-checkoutkioskGo!MobilePaymentsNo Credit Cardor Cash NeededSource: WMT CFO Charles Holley, Reuters, 7 March 2013Walmart saves $12 Million p/year for every second cut from mean checkout time.Mobile^Bring your list
  • 28. Progressive Insurance Personalization1. Time of Day2. Speed3. VIN#(No GPS)1. Acceleration2. Braking3. Driving 12 AM–4 AM4. Miles Driven1. Fewer miles2. Safest times3. Smooth starts/stopsInstall under steering wheel in OBD II portSense Calculate Reward30 Days data collection Day 31, get 0 – 30% discount Return device at 6 months
  • 29. Auto Industry earns more from Servicesthan from ManufacturingVEHICLE = 100% car price, earns 1% marginSERVICES = 22% car price, earn 10% marginNetProfitsSales69%31%18%82%Source: Cisco IBSG analysisOEMs capture only25% of these Servicerevenues
  • 30. BMW’s Personnalisation Innovation Build-to-order system, customized6 days before productionSource: Cisco IBSG analysisInnovationBenefitsSolution Higher customer satisfaction,reduced discounts, andreduced inventory costs 100% plant utilization rates Operating margin at 8% vs.~2% industry average Flexible production, e.g. X5 SUVand Z4 Roadster on same line.Globally integrated productionInformation Technology integrates the supplychain, manufacturing and dealers
  • 31. NorthAmericaJapanChinaEuropeOther Asia+ Australia2012 Inventory Multipurpose Industrial Robots1,235,600 Operational Units2012: 1 Robot : 5,668 People 2014: 1 Robot : 3,111 People2012: 1 Robot : 2,428 Workers 2014: 1 Robot : 1,342 Workers
  • 32. Healthcare Robots today and tomorrowHospital robots deliver drugs andmaintain accountabilityBy 2020, robot helpers will understandemotions and provide human-like service
  • 33. Da Vinci Surgery System• Less invasive• More precise• Faster recovery time
  • 34. Surgeon’sExpertiseDelivered ata DistanceRemote Surgery is feasible…
  • 35. When will the firstRemote Surgerybe performed on aEuropean patient?Project Lindberg – 7 September 2001Dr. Jacques Marescaux in New York performeda cholecystectomy on a 68-year-old femalepatient 6,230 km away in Strasbourg, France
  • 36. How much do you trust technology?1Would you ride in a self-driving automobilewith no driver at the controls?YESNO2Would you undergo robotic surgery witha surgeon working a distance away?YESNOWould you ride on a train that had no operatoron-board – a train that was self-driving?YESNO3Would you fly in a plane that had no piloton-board – a plane operated by a pilot onthe ground?YESNO4
  • 37. Mobile phones andTexting involved in23% all US trafficaccidentsSource: National Safety Council, 20111,200,000 Mobile Phones100,000 Texting
  • 38. Google Self-driving CarMartin Cooper, Motorola DynaTAC, 1973,first mobile phone call from NYC street
  • 39. Care-at-a-Distance: HealthPresenceAMD 3700 Telephonic StethoscopeWelch Allyn Spot Vital Signs LxiAMD 2015 ENT ScopeAMD 2500 Examination Camera
  • 40. Ingestible Sensors: Networked PillProteusIngestibleSensor(“raisin”)How do you assuremeds compliance inhigh risk cases? Sends Reportdeliveredto iPhoneBody water activatessensor, transmitselectrical signalthroughout bodyReaderDetectsMed Levels,Med Type1 2 3Source: Proteus BiomedicalMed = Risperidone, anti-psychotic usedto treat schizophrenia, bi-polarCopyright © 2013 , G. Bridge. All Rights Reserved
  • 41. Network Architecture: Med MonitoringHomeNetworkDataCenterContactCenterPatient’sDoctorPatient’sChoiceInternetProviderPayerCopyright © 2013 , G. Bridge. All Rights Reserved
  • 42. Servicization Case: AdobeCreative Suite 6 Creative Cloud subscription serviceAdobe shifts from packaged productsto subscription cloud service$385 - $1184
  • 43. Caterpillar Mining EquipmentSuper Pit gold mine, Kalgoorlie, Western Australia is Australias largestopen-pit mineCAT 930XAutonomous Load, Haul, DumpOne driver on networked siteLoad: 345 TonsTires: $42,500 X 6Copyright © 2013 , G. Bridge. All Rights Reserved
  • 44. Traditional Supply ChainDevice breaksat remote mineDealer shipspart to siteReplenishmentproductionat factory3-7 daysof lost work3-7 daysshippingLostProductivityCopyright © 2013 , G. Bridge. All Rights Reserved
  • 45. Networked Supply ChainSensors monitorperformanceOps Centerpredicts failureand checksinventoryClosest part isshipped to siteproactivelySignals newproductionat factoryInventoryReplenishedMonitoringCopyright © 2013 , G. Bridge. All Rights Reserved
  • 46. Labor requiredto produce theith unitLabor requiredto produce thefirst unitCumulativeunits madeso farThe Learning RateTime PeriodY = a X-bi.iOrganizational Learning (Progress Curves)Scale MattersCopyright © 2013 , G. Bridge. All Rights Reserved
  • 47. Healthcare TransportationManufacturing PharmaEntertainmentFood ServiceRetailPublishingFS Insurance
  • 48. Trends X Cases MatrixBeverage ManagementDisney Magic RFIDWalmart Mobile AppInsurance Claims Mgt.Progressive SnapshotBMW ConfiguratorMilitary robotsHealthcare robotsRobotic surgeryHealthPresenceSelf-driving autoAviation, evolution ofCancer genetic analysisProteus Biomed pillCaterpillar supply chainPersonalizationAdobe SoftwareAutomation Distance ServicizationCo-creation
  • 49. Innovation requires threesuccessful stepsVery few organizations have all three capabilities
  • 50. InventNewConceptAdoptIdeaExecuteInnovation Involves Three Steps . . .Copyright © 2013 , G. Bridge. All Rights Reserved
  • 51. “Fumbling The Future”1973 Xerox Alto IMouse pointing deviceGUITouchpadEthernetHigh Invention+ Low Adoption= FailureCopyright © 2013 , G. Bridge. All Rights Reserved
  • 52. Questions About Your Decision Style• What is your strength – your “naturaltendency?” Invention – create entirely new concepts andways of doing things Adoption – find the best choice Execution and scaling – make it happen• What is your second best skill?• How “fluent” are you in all three phasesof innovation?Copyright © 2013 , G. Bridge. All Rights Reserved
  • 53. Invent Adoption ExecuteWhat Role for Service Researchers?Most failures happen here1. What skills does a successful Adoption leader need?2. Which current discipline, if any, comes closest to theserequirements?3. What training should Adoption leaders complete – whoshould do it, and what curriculum should they follow?Copyright © 2013 , G. Bridge. All Rights Reserved
  • 54. Fundamental Adoption TasksScanning Visioning Experimenting ProtectingKilling BadIdeasEvangelizing Segmenting& TargetingJustifyingSearching for newideas and ways ofdoing thingsPainting a pictureof what is possiblePerfecting the idea indemonstrations,prototypes, andlighthouse accounts“Flying air cover”during development,before the idea isprovenAbandoning poorideas (after fairtesting)Infecting otherswith passion forthe ideaLocating best initialmarkets and liningup the “bowlingpins” for expansionBuilding a businesscase and competingfor investmentCopyright © 2013 , G. Bridge. All Rights Reserved
  • 55. 1. Technology matters in the human journey…2. The future promises:• More and better quality Services• in more places (often a distance from where created)• Lower costs (so more people can participate)3. But to create these future services, one must masterthe three phases of practical Innovation4. Service Researchers have an opportunity to improvethe Adoption phase of Innovation
  • 56. Comments, corrections, amplifications?Please contact:60gary@rgarybridge.com