Service science progress and directions 20100620

Service Science:
Progress and Directions
Dr. James (“Jim”) C. Spohrer Director, IBM University Programs (IBM UP) WW spohrer@us.ibm.com Porto, Portugal For: AMA ServSIG June 18, 2010

Outline
Overview of IBM University Programs (IBM UP) WW
Investing in people and planet to improve talent and infrastructure
Five R’s – Research, Readiness, Recruiting, Revenue, Responsibilities
Quality of Life: Our growing dependence on networks of interconnected service systems
Local optimization does not equal global optimization
Local problems can cascade into global significance
Ecology: The study of the abundance and distribution of entities in an environment, and their interactions with each other and their environment over successive generations
Natural World
Human-Made World
Holistic Service Systems: Cities and universities
Fundamental building blocks (resource integrators) to get right
Beyond customer-provider dyad, toward networks of stakeholders

Profitable growth by investing in people and planet.
Projects that improve global talent and infrastructure.
Working with universities to build smarter cities and improve quality of life.
IBM University Programs (IBM UP) WW Research Recruiting Skills People Talent Government Industry Education Planet Infrastructure

Partnership Executive Program (PEP) JoAnn Winson, GUP
Client Executives & Senior Location Execs S&D
Public Private Partnerships Kevin Reardon, Research
Industry-Academic IP Collaboration Dawn Tew, GUP
Revenue & Responsibility Value creation, sales, and revenue generation
PhD Fellowship Program Jeff Brody, GUP
Global Recruitment Campaign (led by HR) HR
Global University Sourcing (led by HR) HR
Extreme Blue Internship Program (led by HR) HR
Recruiting Acquiring top talent
Academic Initiative Program (led by SWG) Kevin Faughnan, SWG
SSME/Smarter Planet Skills for 21 st Century Dianne Fodell & Wendy Murphy, GUP
LA Grid Initiative (Hispanic Focus) Juan Caraballo, GUP
Student Contests / Competitions (e.g., ACM)
Innovation Centers and Developer Relations Mark Hanny, SWG
Volunteerism/Corp Citizenship (with CC&CA) Shannon Thrasher, GUP
Readiness Building the skills pipeline
Shared University Research Awards (SUR) Lilian Wu, GUP
Faculty Awards Jeff Brody, GUP
Open Collaborative Research Awards (OCR) Dawn Tew, GUP
Centers for Advanced Study (CAS) Andy Rindos, SWG
World Community Grid (with CC&CA) Robin Wilner, CCCA
Research Collaboration in areas of mutual interest & value Programs & Initiatives Five R’s

IBM University Programs (IBM UP): 2010 Focus “5 R’s”
1. Research
Awards that connect university and IBM researchers/professionals to work on grand challenges
https://www.ibm.com/developerworks/university/research/index.html
2. Readiness
Access to IBM tools, methods, and course materials to develop skills
https://www.ibm.com/developerworks/university/academicinitiative/
3. Recruiting
Jobs on global teams working to build a smarter planet - nation by nation, system by system
http://www.ibm.com/jobs
4. Revenue
Public-private partnerships that build great universities, great cities, and improve quality of life
http://www.ibm.com/services/us/gbs/bus/html/bcs_education.html
5. Responsibility
IBM employees share their expertise, time, and resources with universities in community service
http://www.ibm.com/ibm/ibmgives/

IBM University Programs (IBM UP): 2010 Focus “6 Priorities”
1. Smarter Cities & Service Innovation
A. Holistic Modeling & Analytics, B. STEM Education Pipeline, C. Jobs & Entrepreneurship
Establish Urban Sustainability and Service Innovation Centers (start with http://cityforward.org)
2. Cloud Computing & Analytics
IBM Cloud Academy, IBM Academic Cloud, Massive Analytics
3. Ecosystem Alignment
Internal and external coordination and collaborations (win-win relationships)
4. IBM on Campus
IBM Centers for Advanced Study, IBM Innovation Centers, IBM Research Collaboratories
5. Growth Markets
Enablement, Twin Cities, Sister Cities
6. Awards Programs
Shared University Research, Open Collaborative Research, Faculty Awards, PhD Fellowships

Priority 1: Urban Sustainability & Service Innovation Centers
A. Research: Modeling & Analytics of Holistic Service Systems
Modeling and simulating cities will push state-of-the-art capabilities for planning interventions in complex system of systems (holistic 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
City simulation and intervention planning tools can engage high school students and build STEM skills
Role-playing games can prepare students for real-world projects
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
Note: Universities are mini-cities within cities (building blocks to get right).

Technology immersion of today’s students Innovations in the consumer marketplace are driving rapid adoption of new technologies for communication, entertainment and learning Over 4 billion individuals now have access to mobile technologies worldwide – representing over 60% of the population Social networking sites, virtual worlds, and mass collaboration technologies allow crowd sourcing to gain insights

Vision for the Educational Continuum The Educational Continuum Any Device Learning TECHNOLOGY IMMERSION PERSONAL LEARNING PATHS Student-Centered Processes KNOWLEDGE SKILLS Learning Communities GLOBAL INTEGRATION Services Specialization ECONOMIC ALIGNMENT Systemic View of Education
Intelligent
Aligned Data
Outcomes Insight
Instrumented
Student-centric
Integrated Assessment
Interconnected
Shared Services
Interoperable Processes
Continuing Education Higher Education Secondary School Primary School Workforce Skills Individual Learning Continuum Education System Continuum Economic Sustainability

Learning is changing…. Formal is a small fraction Informal is dominant Signposts show wall breaking down

Changing Nature of STEM Education Teach as a single integrated transdiscipline (2D = 2-Design improved SP service systems ) Teach as four disciplines Study confirms effectiveness of challenge-based learning designing and implementing improvements to real-world systems (http:// www.nmc.org/pdf/Challenge-Based-Learning.pdf ) “… by the end of their respective projects 80% of participating students reported that they had made a difference in their schools or communities by addressing their challenge.” Management Mathematics Engineering Technology (physical) Natural Sciences Environment, Economics & Law Technology (social) Social Sciences STEM 2D Mathematics Engineering Technology Science STEM

SSME Design Lab Virtual Summits
Annual Global Challenges
Example Transportation
Congestion Challenge
http://www.itsa.org/challenge/
Best Ideas Could Create New Businesses
Potential Telepresence Play-offs with VCs for Advice
Two Half-day SSME Design Lab Network Virtual Summits: West – August 11, 2009 – 16 Academic Leaders from 8 Universities in 6 locations East – August 14, 2009 – 15 Academic Leaders from 7 Universities in 7 locations Productivity Sustainable Innovation Regulatory Compliance N a t i o n s I n d u s t r i e s Quality

Sam Palmisano, CEO IBM
“We need highly skilled people. So we say we need to help in the school systems. We’ll go in and create a services-as-a-science curriculum in Vietnam, or in Bulgaria, or in Indonesia.”
Wall Street Journal, February 14, 2008
At IBM, we know something about systems. As must be obvious by now, I don't mean simply "computer systems." I mean the economic, logistical and societal systems by which our world operates.
National Governors Association, July 9, 2010

Quality of life: We depend on service systems…
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) (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 (property tax)
12. States /regions & development opportunities/investments (sales tax)
13. Nations /NGOs & rights/rules/incentives/policies/laws (income tax)
(Quality of Service & Jobs & Investment Opportunities) Measure -> Quality, Productivity, Compliance, “Smarter” “ Smarter” = Sustainable Innovation (continuously reduce waste, expand capabilities) 10 19? 7 1 6 1 17 0 24 20 10 2 3 0 2

Our planet is a complex, dynamic, highly interconnected $54 Trillion system-of-systems (OECD-based analysis) Communication $ 3.96 Tn Transportation $ 6.95 Tn Leisure / Recreation / Clothing $ 7.80 Tn Healthcare $ 4.27 Tn Food $ 4.89 Tn Infrastructure $ 12.54 Tn Govt. & Safety $ 5.21 Tn Finance $ 4.58 Tn Electricity $ 2.94 Tn Education $ 1.36 Tn Water $ 0.13 Tn Global system-of-systems $54 Trillion (100% of WW 2008 GDP) Same Industry Business Support IT Systems Energy Resources Machinery Materials Trade Legend for system inputs Note: 1. Size of bubbles represents systems’ economic values 2. Arrows represent the strength of systems’ interaction Source: IBV analysis based on OECD This chart shows ‘systems‘ (not ‘industries‘)  Our planet is a complex system-of-systems 1 Tn

Economists estimate, that all systems carry inefficiencies of up to $15 Tn, of which $4 Tn could be eliminated How to read the chart: For example, the Healthcare system‘s value is $4,270B. It carries an estimated inefficiency of 42%. From that level of 42% inefficiency, economists estimate that ~34% can be eliminated (= 34% x 42%).  We now have the capabilities to manage a system-of-systems planet Source: IBM economists survey 2009; n= 480 Global economic value of $4 Trillion 7% of WW 2008 GDP Improvement potential $15 Trillion 28% of WW 2008 GDP Inefficiencies $54 Trillion 100% of WW 2008 GDP System-of-systems System inefficiency as % of total economic value Improvement potential as % of system inefficiency Education 1,360 Building & Transport Infrastructure 12,540 Healthcare 4,270 Government & Safety 5,210 Electricity 2,940 Financial 4,580 Food & Water 4,890 Transportation (Goods & Passenger) 6,950 Leisure / Recreation / Clothing 7,800 Communication 3,960 Analysis of inefficiencies in the planet‘s system-of-systems Note: Size of the bubble indicate absolute value of the system in USD Billions 42% 34% This chart shows ‘systems‘ (not ‘industries‘)

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

NAE’s 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

Why 13 types of service systems? K-12 STEM and the human-made world “ Imagine a better service system, and use STEM language to explain why it is better” STEM = Science, Technology, Engineering, and Mathematics See NAE K-12 engineering report: http://www.nap.edu/catalog.php?record_id=12635 See Challenge-Based Learning: http://www.nmc.org/news/nmc/nmc-study-confirms-effectiveness-challenge-based-learning
Challenge-based Project to Design Improved Service Systems
K - Transportation & Supply Chain
1 - Water & Waste Recycling
2 - Food & Products (Nano)
3 - Energy & Electric Grid
4 – Information /ICT & Cloud (Info)
5 - Buildings & Construction
6 – Retail & Hospitality/Media & Entertainment (tourism)
7 – Banking & Finance/Business & Consulting
8 – Healthcare & Family Life (Bio)
9 - Education & Work Life/Jobs & Entrepreneurship (Cogno)
10 – City (Government)
11 – State /Region (Government)
12 – Nation (Government)
Higher Ed – T-shaped teamwork, deep & broad education
Professional Life – T-shaped teamwork, series of projects
Systems that focus on Governing Systems that focus on Human Activities and Development Systems that focus on Flow of things

Transportation Split: How did you get to school today?

T-Shaped Professionals: Ready for T-eamwork! SSMED = Service Science, Management, Engineering & Design Many disciplines (understanding & communications) Many systems (understanding & communications) Deep in one discipline (analytic thinking & problem solving) Deep in one system (analytic thinking & problem solving) Many team-oriented service projects completed (resume: outcomes, accomplishments & awards)

Time ECOLOGY 14B Big Bang (Natural World) 10K Cities (Human-Made World) Sun writing (symbols and scribes) Earth written laws bacteria (uni-cell life) sponges (multi-cell life) money (coins) universities clams (neurons) tribolites (brains) printing press (books) steam engine 200M bees (social division-of-labor) 60 transistor

Natural: Physics (Atoms) Natural: Chemistry (Molecules) Biology (Uni-Cell Organisms) Biology (Multi-Cell Organisms) Natural: Biology (Neural & Social Organisms) Human Made: Anthropology (Informal Service System Entities) Human Made: Economics & Law (Formal Service System Entities) Human Made: Network Theory (Globally Integrated Service System Entities) Systems Science Service Science Explain Evolution of Hierarchical Complexity Gray Area Social Sciences Sciences of the Natural and Human Made Worlds Natural Sciences Microscopic Structures Living Organisms Service System Entity Physics Atoms Chemistry Chemicals Biology Uni-cellular Biology Multi-cellular Biology Neural & Social Natural Anthropology Informal Economics & Law; Political Science Formal Network Theory Globally Integrated Human-made Science Domain

Systems & Hierarchy of Complexity Microscopic Structures Living Organisms Service System Entity Physics Atoms Chemistry Chemicals Biology Uni-cellular Biology Multi-cellular Biology Neural & Social Natural Anthropology Informal Economics & Law; Political Science Formal Network Theory Globally Integrated Human-made Science Domain

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

Population growth per hour in major cities

Urban-Age.Net Currently, the world’s top 30 cities generate 80% of the world’s wealth. The Urban Age For the first time in history more than 50% the earth’s population live in cities - by 2050 it will be 75% The Endless City

Edu-Impact.Com “ When we combined the impact of Harvard’s direct spending on payroll, purchasing and construction – the indirect impact of University spending – and the direct and indirect impact of off-campus spending by Harvard students – we can estimate that Harvard directly and indirectly accounted for nearly $4.8 billion in economic activity in the Boston area in fiscal year 2008, and more than 44,000 jobs.”

Example: San Jose, California (USA)

Nation’s % of Global GDP and Nation’s % of Top 500 Universities Correlation becomes stronger when we consider (in the graph) USA and its data: % of Top 500: 30,3 % % global GDP: 23,3 % Source: http://www.arwu.org/ARWUAnalysis2009.jsp

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
Cities as Holistic Service Systems (Mini-Nations) Example: Singapore Population Challenges Careers Opportunities

Universities as Holistic Service Systems (Mini-Cities)
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.

A Vital Partnership: Cities and universities
Citizens are demanding more urban services
Larson & Odonoi (MIT) Urban Operations Research.
Citizens are demanding more urban services, by type, quantity, and quality. Yet the ability of most cities in the United States and elsewhere to pay for additional services has been severely strained … For our purposes, a decision is an irrevocable allocation of resources. Thus, this book will deal with the allocation or deployment of the resources of urban service systems, including personnel, equipment, and various service-improving technologies. From this viewpoint, urban operations research can be thought of as a decision-aiding technology, one to assist urban managers in improving the deployment of their resources. Most deployments occur spatially throughout the city, so much of our work will have a strong spatial component.
Higher education can respond
Urban Serving University Coalition (USU) A Vital Partnership: Great Cities, Great Universities
Higher education can respond to the challenges facing our cities and metropolitan regions, becoming the R&D partners of cities that evaluate and deploy potential innovations. Never before has this agenda had greater urgency for our nation. For example, demographic changes within the United States have been dramatic, with nearly eight in ten Americans now living in cities . According to the Brookings Institution, while the top 100 metropolitan areas make up only 12% of the land mass, they produce fully 75% of the gross domestic product, generate 78% of competitive patents, and account for 68% of the nation’s jobs. Increasingly, the prosperity of our cities and metro areas is inextricably linked to our national prosperity.
Demographic projection: By 2050 over 75% of the world’s population will live in cities Stimulus Response

University Trend: Growth of Disciplines & Centers
University sub-systems
Disciplines in Schools (circles)
Innovation Centers (squares)
E.g., CMU Website (2009)
“ Research Centers: where it all happens – to solve real-world problems”
Disciplines in Schools
Award degrees
Single-discipline focus
Research discipline problems
Innovation Centers (ICs)
Industry/government sponsors
Multi-disciplinary teams
Research real-world systems
D D D D D D Engineering School Social Sciences, Humanities Professional Studies Business School water & waste transportation health energy/grid e-government Science & Mathematics I-School Design food & supply chain

City Trend: Sister Cities “Think Global”
World as System of Systems
World (light blue - largest)
Nations (green - large)
Regions (dark blue - medium)
Cities (yellow - small)
Universities (red - smallest)
Cities as System of Systems
Transportation & Supply Chain
Water & Waste Recycling
Food & Products ((Nano)
Energy & Electricity
Information /ICT & Cloud (Info)
Buildings & Construction
Retail & Hospitality/Media & Entertainment
Banking & Finance
Healthcare & Family (Bio)
Education & Professions (Cogno)
Government (City, State, Nation)
Nations: Innovation Opportunities
GDP/Capita (level and growth rate)
Energy/Capita (fossil and renewable)
IBM UP WW: Tandem Awards: Increasing university linkages (knowledge exchange interactions) Developed Market Nations (> $20K GDP/Capita) Emerging Market Nations (< $20K GDP/Capita)

University & City Trend: Tight Local Coupling & Global Brand UNIVERSITIES: THE INNOVATION CENTERS OF GREAT CITIES CITIES: THE LIVING LABS FOR UNIVERSITIES IBM UP Connect Universities To Their Cities let’s work towards smarter cities let’s start with smarter education

IBM University Programs (IBM UP) WW

Priority 1: Urban Sustainability & Service Innovation Centers
A. Research: Holistic Modeling & Analytics of Service Systems
Modeling and simulating cities will push state-of-the-art capabilities 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
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
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

Luxury Hotels as Holistic Service Systems (Mini-Cities)

Smarter = Sustainable Innovation (reduce waste, expand capabilities) Computational System Building Smarter Technologies Requires investment roadmap Service Systems: Stakeholders & Resources 1. People 2. Technology 3. Shared Information 4. Organizations connected by win-win value propositions Building Smarter Universities & Cities Requires investment roadmap

However, Disciplines Still Debate Definition of Service Economics Design & Psychology Systems Engineering Operations Computer Science/ Artificial Intelligence Marketing

Many Definitions of Service
Economics
Service 1 = economic activities that are not agriculture or manufacturing
Service 3 = a transformation that one economic entity performs with the permission of a second entity, that transforms the second entity or a possession of the second entity
Service 4 = an exchange between economic entities that does not transfer ownership of a physical thing.
Service Science
Service 2 = human-made value-cocreation phenomena, specifically a mutually beneficial outcome proposed, agreed to, and realized by two or more service system entities interacting. Service system entities can be people, businesses, nations, and any other economic entities with legal rights, such as the ability to own property, enter into binding contracts, etc. Quantifiable measures associated with service system entity interactions over the life-time of the entity, include quality, productivity, compliance, and sustainable innovation measures. Service system entities configure four types of resources, accessible by four types of access rights, and reason about four types of stakeholders when designing value-cocreation interactions, and evaluating them via their processes of valuing.
Both collaboration and competition can both be/not be forms of value-cocreation, depending on context
Operations
Service 5 = a production process that requires inputs from a customer entity
Computer Science
Service 6 = a modular capability that can be computationally accessed and composed with others
Systems Engineering
Service 7 = a system (with inputs, outputs, capacity limits, and performance characteristics) which is interconnected with other systems that may seek to access its capabilities to create benefits, and in which local optimization of the system interactions may not lead to global performance improvements
Design and Psychology
Service 8 = an experience of a customer entity that results from that customer entity interacting with provider entities’ offerings
Marketing
Service 9 = the application of competence (e.g., resources, skills, capabilities) for the benefit of another entity
Service 10 = a customer-provider interaction that creates mutual benefits

Thank-You!
Dr. James (“Jim”) C. Spohrer Director, IBM University Programs (IBM UP) WW spohrer@us.ibm.com Porto, Portugal For: AMA ServSIG June 18, 2010 “ 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/invent it.” – Moliere/Kay “ Real-world problems may not respect discipline boundaries.” – Popper “ 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

How do we involve universities? How do weave a “total solution” that includes universities?

IBM’s Smarter Planet Grand Challenge: Smarter Systems
Traffic, Rail
Water
3. Food & Products
Food, Products
Energy, Oil
Intelligence, Telecom, Cloud Computing
Buildings, Infrastructure
Retail
Banking, Stimulus
Healthcare
Education, Work
11. City & Security
Cites, Public Safety, Infrastructure
12. State /Region & Development
13. Nation & Rights
Government, Stimulus

Nations’ Grand Challenge: Quality of Life (how to define?) Smarter Systems = “We expect more” – Dawson
Climate and geography
3. Food & Products
Material well being
Material well-being
Material well-being
Material well-being
Health & Family Life
Job security
Gender equality
11. City & Security
Community Life
Political stability and security
12. State/ Region & Development
Climate and geography
13. Nation & Rights
Political freedom
Gender equality
Political stability and security
Economist.com Example Only

A. Holistic Modeling & Analytics Example: FIU’s Terrafly

C. Entrepreneurship & Job Creation
Transportation
Water and waste
Energy and electricity
Buildings
Healthcare/Education
Cities/Government
General Methods & Techniques Specific Technologies Specific Systems Cross Industry Competencies Industry Specific Competencies Jobs Systems Engineering/ Analytics/BAO/SSME Research to improve systems fuels
Model Systems
Connect/capture Data
Analyze, Improve
Optimize, Automate
Discipline Specialists
Run Transform Innovate
Synapsense, SensorTronics
Infosphere Streams, ILOG, COGNOS, SPSS
WS, Tivoli, Rational, DB2, etc.
BAO, Green Sigma
Specialists Consultant Project Manager Sales Architect Operations

IBM Jobs: Project teams focus on customer needs
1. Consultant
(trusted advisor to customer)
a value proposition to address problems or opportunities and enhance value co-creation relationships
2. Sales
a signed contract that defines work, outcomes, solution, rewards and risks for all parties
4. Project Manager (often with co-PM from customer side) a detailed project plan that balances time, costs, skills availability, and other resources, as well as adaptive realization of plan
3. Architect
(systems engineer, IT & enterprise architect)
An elegant solution design that satisfies functional and non-functional constraints across the system life-cycle
5. Specialists
(systems engineer, Research, engineer,
Industry specialist, application, technician,
data, analyst, professional, agent)
a compelling working system (leading-edge prototype systems from Research)
~10% ~10% ~5% ~5% ~45% 6. Enterprise Operations Administrative Services, Other, Marketing & Communications Finance, Supply Chain, Manufacturing, Human Resources, Legal, General Executive Management ~25%
IBM Employees
~10% Consultant
~10% Sales
~5% Architect
~5% Project Manager
~45% Specialists
~25% Enterprise Operations
Project Work: 90% B2B – Business to Business 10% B2G – Business to Government (i.e., “Smarter Planet” projects)

The Big Trend: “The future is service 1 ” Physical: mostly interact with things Social: mostly interact with others Service 2 growth as IT-enabled division of labor Service 1 growth as intangible outputs -1000K -10K -100 -1 +100 Hunter Gatherer (physical) Agriculture (physical) Manufacturing (physical) Service (social) Human Labor 100% Time (years)

The Big Trend: “The future is service 2 ”
More population (people & organizations) creates opportunity for specialization
Specialization (division of labor – Adam Smith) can improve productive capacity
More specialization (outsourcing) creates need for coordination mechanisms
Local interactions become distributed across space, time, and scale (transaction costs – Coase)
Local optimization may not lead to global performance improvements
More coordination (IT can lower costs) creates service growth (value-cocreation)
IT integrates across space, time, and scale improving global and local performance
Increase the ratio of productive interactions to unproductive interactions with others
Service Growth (Value-Cocreation) increase mutually beneficial interactions decrease unproductive interactions T-shaped people to lower coordination costs Population (People & Organizations) entities interacting Specialization (Outsourcing) space, time, scale distribution Coordination (Information Technology) space, time, scale integration Service 2 growth as IT-enabled division of labor

Thank-you! And… “ 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 “ Cities learning from cities learning from cities.” – Fundacion Metropoli “ Think global, act local.” – Geddes “ The future is born in universities.” – Kurilov “ The best way to predict the future is to create/invent it.” – Moliere/Kay “ The future is already here. It is just not evenly distributed.” – Gibbons “ Real-world problems may not respect discipline boundaries.” – Popper “ Today’s problems may come from yesterday’s solutions.” – Senge “ History is a race between education and catastrophe.” – H.G. Wells let’s focus smarter education on… … sustainable innovations for smarter cities … helping to build a smarter planet instrumented+interconnected+intelligent (http://www.ibm.com/think)

Service Science: Progress and Directions
Dr. James (“Jim”) C. Spohrer Director, IBM University Programs (IBM UP) WW spohrer@us.ibm.com Porto, Portugal For: AMA ServSIG June 18, 2010 “ 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/invent it.” – Moliere/Kay “ Real-world problems may not respect discipline boundaries.” – Popper “ 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

http://www.ibm.com/think Dr. James (“Jim”) C. Spohrer Director of IBM University Programs (IBM UP) since 2009, Jim founded IBM's first Service Research group in 2003 at the Almaden Research Center with a focus on STEM (Science Technology Engineering and Math) for Service Sector innovations. He led this group to attain ten times return on investment with four IBM outstanding and eleven accomplishment awards over seven years. Working with service research pioneers from many academic disciplines, Jim advocates for Service Science, Management, Engineering, and Design (SSMED) as an integrative extended-STEM framework for global competency development, economic growth, and advancement of science. In 2000, Jim became the founding CTO of IBM’s first Venture Capital Relations group in Silicon Valley. In the mid 1990’s, he lead Apple Computer’s Learning Technologies group, where he was awarded DEST (Distinguished Engineer Scientist and Technologist) Jim received a Ph.D. in Computer Science/Artificial Intelligence from Yale University and a B.S. in Physics from MIT. Sustainable Innovation: Aligning Urban and University Service Systems Gibbons said “The future is already here. It's just not very evenly distributed.". What if walking onto a university campus was like walking into the future. In a way it is, because the students at universities will someday fill roles in business and society – they are the future doers in all systems. Also, some of the important ideas from university research centers will someday become commonplace. More and more universities, especially urban serving research universities, are like living labs for the cities that host them. Universities are in fact small cities within larger cities. Many universities today have more students than the populations of some cities in past centuries, and the students have much better technologies for sharing and building knowledge. There is more and more demand for Science Technology Engineering and Math (STEM) driven service innovations that can continuously improve the reliability of complex systems that serve customers in modern societies (UK Royal Society "Hidden Wealth: Science in Service Innovations" report, July 2009). Service innovations that improve reliability should also improve (a) the quality of service as judged by customers, (b) the productivity of provisioning service as judged by providers, and (c) the compliance as judged by regulatory or governing authorities as well as society as a whole. Furthermore, service innovations are what keep business systems competitive in a dynamic world characterized by globalization, driven in part by business model and technological change. Therefore, service innovations need to be sustainable innovations, both from an environmental perspective as well as an investment roadmap perspective that leads to continuous opportunities for individuals, businesses, and institutions. IBM University Programs (IBM UP) is working to align cities and universities on two important topics: Sustainability and Innovation. Service science is a global initiative to improve service system sustainable innovation tools and methods. Service science may someday lead to a Moore’s Law for service system improvement. This will require a Computer-Aided Design (CAD) tool that can be used by T-shaped professionals to plan and implement more service innovation projects. Improved service systems that continuously improve locally and globally can help achieve the vision of a Smarter Planet.

Most Wanted: A CAD for service systems (CAD = Computer Aided Design Tool) IEEE Computer, Jan 2007 CBM: Component Business Model WBM and RUP: Work Practices & Processes SOA: Technical Service-Oriented Architecture Key Performance Indicators (KPIs) IBM IBV: Component Business Models

How many entities to study? ~10B service systems - modular value creation systems
Nations (~100)
Regions (~1000)
Cities (~10,000)
Educational Institutions (~100,000)
Healthcare Institutions (~100,000)
Other Enterprises (~10,000,000)
Largest 2000
>50% GDP WW
Families (~1B)
Persons (~10B)
Balance/Improve
Quality of Life
GDP/Capita
Quality of Service
Customer Experience
Quality of Jobs
Sustainability
GDP/Energy-Unit
% Fossil
% Renewable
Nation Region (e.g., State) City Educational Institution Healthcare Institution Other Enterprises (job roles) Family (customers ) Person (providers)

How entities (service systems) learn and change over time History and future of Run-Transform-Innovate investment choices
Diverse Types
Persons (Individuals)
Families
Regional Entities
Universities
Hospitals
Cities
States/Provinces
Nations
Other Enterprises
Businesses
Non-profits
Learning & Change
Run = use existing knowledge or standard practices (use)
Transform = adopt a new best practice (copy)
Innovate = create a new best practice (invent)
March, J.G. (1991) Exploration and exploitation in organizational learning. Organizational Science. 2(1).71-87. exploit explore Technology Technology Technology Technology Technology Technology Technology Technology Technology Technology Technology Technology Technology Technology Transform Innovate Invest in each type of change Ru n

How entities (service systems) interact Incentives & Rules Resources: People, Technology, Information, Organizations Stakeholders: Customers, Providers, Authorities, Competitors Measures: Quality, Productivity, Compliance, Sustainable Innovation Access Rights: Own, Lease, Shared, Privileged Ecology (Populations & Diversity) Entities (Service Systems) Interactions (Service Networks) Outcomes (Value Changes) Value Proposition Based Interactions (Incentives) Governance Mechanism Based Interactions (Rules) Access Rights (Relationships) Measures (Rankings of Entities) Resources (Roles in Processes) Stakeholders (Perspectives) win-win lose-lose win-lose lose-win Identity (Aspirations/Lifecycle) Reputation (Opportunities/Variety)

Reports: 3 Nations
UK Royal Society
Germany MARS
US ASU CSL

Fitzsimmons & Fitzsimmons
Graduate Students
Schools of Engineering
Teboul
Undergraduates
Schools of Business
Busy execs (4 hour read)
Ricketts
Practitioners
Manufacturers In Transition
And 200 other books…
Zeithaml, Bitner, Gremler; Gronross, Chase, Jacobs, Aquilano; Davis, Heineke; Heskett, Sasser, Schlesingher; Sampson; Lovelock, Wirtz, Chew; Alter; Baldwin, Clark; Beinhocker; Berry; Bryson, Daniels, Warf; Checkland, Holwell; Cooper,Edgett; Hopp, Spearman; Womack, Jones; Johnston; Heizer, Render; Milgrom, Roberts; Norman; Pine, Gilmore; Sterman; Weinberg; Woods, Degramo; Wooldridge; Wright; etc.
Teaching…
Reaching the Goal: How Managers Improve a Services Business Using Goldratt’s Theory of Constraints
By John Ricketts, IBM
Service Management: Operations, Strategy, and Information Technology
By Fitzsimmons and Fitzsimmons, UTexas
Service Is Front Stage: Positioning services for value advantage
By James Teboul, INSEAD
For details: http://www.cob.sjsu.edu/ssme/refmenu.asp

Teaching: IBM SSME Website: Creating T-shaped people http://www.ibm.com/developerworks/spaces/ssme

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

A Service System Innovation Framework “ The Ten Types of Innovation” by Larry Keeley, Doblin Inc. Innovate (inside and outside) systems that create value

Many definitions of service
Economics
Service 1 = economic activities that are not agriculture or manufacturing
Service 3 = a transformation that one economic entity performs with the permission of a second entity, that transforms the second entity or a possession of the second entity
Service 4 = an exchange between economic entities that does not transfer ownership of a physical thing.
Service Science
Service 2 = value-cocreation phenomena, specifically a mutually beneficial outcome proposed, agreed to, and realized by two or more service system entities interacting. Service system entities can be people, businesses, nations, and any other economic entities with legal rights, such as the ability to own property, enter into binding contracts, etc. Quantifiable measures associated with service system entity interactions over the life-time of the entity, include quality, productivity, compliance, and sustainable innovation measures. Service system entities configure four types of resources, accessible by four types of access rights, and reason about four types of stakeholders when designing value-cocreation interactions, and evaluating them via their processes of valuing.
Both collaboration and competition can both be/not be forms of value-cocreation, depending on context
Operations
Service 5 = a production process that requires inputs from a customer entity
Computer Science
Service 6 = a modular capability that can be computationally accessed and composed with others
Systems Engineering
Service 7 = a system (with inputs, outputs, capacity limits, and performance characteristics) which is interconnected with other systems that may seek to access its capabilities to create benefits, and in which local optimization of the system interactions may not lead to global performance improvements
Design and Psychology
Service 8 = an experience of a customer entity that results from that customer entity interacting with provider entities’ offerings
Marketing
Service 9 = the application of competence (e.g., resources, skills, capabilities) for the benefit of another entity
Service 10 = a customer-provider interaction that creates mutual benefits

Service science progress and directions 20100620

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