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.
He continues to consult with multinational companies about innovation processes, and guides Dentech, a startup that connects sensor networks to service actions.

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R Gary Bridge's the future of services #quis2013

  1. 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. 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. 3. Technology matters…Fire used to cook foodSource: www.bronze-age-reenactment.com/page3
  4. 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. 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. 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. 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. 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. 9. The world’s informationdoubles every year…Service innovation depends on information
  10. 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. 11. World Communication Capacity Trendshttp://www.martinhilbert.net/WorldInfoCapacity.html10X
  12. 12. Internet Penetration (30 June 2012)Source: www.internetworldstats.com/stats.htm, March 2011No. AmericaOceania/ANZEuropeLatin AmericaMiddle EastWorldwideAsiaAfrica
  13. 13. Priorities… if you could have only one,what would you choose?orCopyright © 2013 , G. Bridge. All Rights Reserved
  14. 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. 15. Growing ProductivityRaises Living Standards
  16. 16. Book Publishing Value Chain$.06DataCentersServiceProvidersNetworksStore onServerDownloadto DeviceConsumerElectronicsDevicesAuthorcreatesPublisherfinds,editsPrintBooksDistributeBooksRetailerstocks,sellsCustomerreadsPaperIndustryShippingIndustryReal EstateIndustryAuthorcreatesPublisherfinds,editsCustomerreadsCopyright © 2013 , G. Bridge. All Rights Reserved
  17. 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. 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. 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. 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. 21. Technology fostersServices Productivity andNew Business Models…and disrupts Markets
  22. 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. 23. Managing Beverage Self-ServiceLess labor requiredEnforces meal planentitlements automaticallyCan capture Customer’spreferences…Radio Frequency ID (RFID)
  24. 24. Disney World MagicBand+Copyright © 2013, G. Bridge. All Rights ReservedRFID Event ReaderRFID badgeRoom accessPackage entitlementsCapture Customer dataPark accessCashless paymentsReserve ride timesPersonalized experiences
  25. 25. Personalized ExperiencesTechnology creates new, highly-valued services…new revenue, higher margins from existing assetsParents’InputTracking visitexperiencesGuestData
  26. 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. 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. 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. 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. 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. 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. 32. Healthcare Robots today and tomorrowHospital robots deliver drugs andmaintain accountabilityBy 2020, robot helpers will understandemotions and provide human-like service
  33. 33. Da Vinci Surgery System• Less invasive• More precise• Faster recovery time
  34. 34. Surgeon’sExpertiseDelivered ata DistanceRemote Surgery is feasible…
  35. 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. 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. 37. Mobile phones andTexting involved in23% all US trafficaccidentsSource: National Safety Council, 20111,200,000 Mobile Phones100,000 Texting
  38. 38. Google Self-driving CarMartin Cooper, Motorola DynaTAC, 1973,first mobile phone call from NYC street
  39. 39. Care-at-a-Distance: HealthPresenceAMD 3700 Telephonic StethoscopeWelch Allyn Spot Vital Signs LxiAMD 2015 ENT ScopeAMD 2500 Examination Camera
  40. 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. 41. Network Architecture: Med MonitoringHomeNetworkDataCenterContactCenterPatient’sDoctorPatient’sChoiceInternetProviderPayerCopyright © 2013 , G. Bridge. All Rights Reserved
  42. 42. Servicization Case: AdobeCreative Suite 6 Creative Cloud subscription serviceAdobe shifts from packaged productsto subscription cloud service$385 - $1184
  43. 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. 44. Traditional Supply ChainDevice breaksat remote mineDealer shipspart to siteReplenishmentproductionat factory3-7 daysof lost work3-7 daysshippingLostProductivityCopyright © 2013 , G. Bridge. All Rights Reserved
  45. 45. Networked Supply ChainSensors monitorperformanceOps Centerpredicts failureand checksinventoryClosest part isshipped to siteproactivelySignals newproductionat factoryInventoryReplenishedMonitoringCopyright © 2013 , G. Bridge. All Rights Reserved
  46. 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. 47. Healthcare TransportationManufacturing PharmaEntertainmentFood ServiceRetailPublishingFS Insurance
  48. 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. 49. Innovation requires threesuccessful stepsVery few organizations have all three capabilities
  50. 50. InventNewConceptAdoptIdeaExecuteInnovation Involves Three Steps . . .Copyright © 2013 , G. Bridge. All Rights Reserved
  51. 51. “Fumbling The Future”1973 Xerox Alto IMouse pointing deviceGUITouchpadEthernetHigh Invention+ Low Adoption= FailureCopyright © 2013 , G. Bridge. All Rights Reserved
  52. 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. 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. 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. 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. 56. Comments, corrections, amplifications?Please contact:60gary@rgarybridge.com

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