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center for design + innovation
cD+i
digital innovation, reversed
semiotics and generative
economics:
how is service eating...
“Uber, the world’s largest taxi
company, owns no vehicles.
Facebook, the world’s most popular
media owner, creates no cont...
center for design + innovation
cD+i
© copyright, youngjin yoocenter for design + innovation
cD+i
2.0
center for design + innovation
cD+i
three logics of
economics
© copyright, youngjin yoocenter for design + innovation
cD+i
2.1
center for design + innovation
cD+i
industrial
economics
the age of
physical machine
center for design + innovation
cD+i
automation
center for design + innovation
cD+i
capital intensive
asset
center for design + innovation
cD+i
managerial challenge


maximizing asset
utilization
center for design + innovation
cD+i
vertical integration
diversification
center for design + innovation
cD+i
managerial logic



economy of size and scale
center for design + innovation
cD+i
organizational forms


m-form hierarchy
center for design + innovation
cD+i
management tools



scientific management
© copyright, youngjin yoocenter for design + innovation
cD+i
2.2
information
economics
the age of
smart machine
information as
by-product
(production, distribution, and use)
center for design + innovation
cD+i
managerial challenge



complexity

information overload
center for design + innovation
cD+i
management logic



modularization (design rules)

horizontal coordination
center for design + innovation
cD+i
organizational forms



network of distributed org.
center for design + innovation
cD+i
management tools



outsourcing

virtualization
© copyright, youngjin yoocenter for design + innovation
cD+i
2.3
generative
economics
© copyright, youngjin yoocenter for design + innovation
cD+i
the age of
generative machine
center for design + innovation
cD+i
digital technology
center for design + innovation
cD+i
separation of
form & function





(universal machine of von Neumann computing archite...
center for design + innovation
cD+i
separation of
contents & media



(universal network of Claude Shannon)
center for design + innovation
cD+i
walled garden of products
hardware
network	
  -­‐	
  	
  
distribu1on
contents
so3ware...
center for design + innovation
cD+i
re-configuration of
new products
network -
distribution
hardware
software
contents
netw...
highly evolutionary
products that produce
user-generated trace data
center for design + innovation
cD+i
technology constantly
evolves beyond the
original design
center for design + innovation
cD+i
managerial challenge



deconstruction of products

reconfiguration of value system
co...
center for design + innovation
cD+i
managerial logic



mutation

recombination

open innovation

center for design + innovation
cD+i
organizational forms


ecosystem of open
platform
3.0
reversed semiotics
reference vs referent
information as
representation
of the real
center for design + innovation
cD+i
information as the
genetic materials
of the real
4 types of
reversed semiotics
center for design + innovation
cD+i
which one is real?
center for design + innovation
cD+i
which one is real?
center for design + innovation
cD+i
which one is real?
center for design + innovation
cD+i
which one is real?
center for design + innovation
cD+i
physical goods as avatar
of “real” digital products
flipping the value
economic proposition
information economics:
dissimulate
immaterial representation
non-rivalry of consumption
generative economics:
simulate
metabolism of information
generative recombination
center for design + innovation
cD+i
industrial
economics
information
economics
generative
economics
strategic use of
infor...
3.1
what is a firm?
what is a product?
Center for Design
cD+iTransforming ideas into actions
and Innovation
Center for Design
cD+iTransforming ideas into actions
and Innovation
Center for Design
cD+iTransforming ideas into actions
and Innovation
center for design + innovation
cD+i
rawmaterials
products&services
activities technology knowledge
a firm: a classic model
marriage of
form and function
to render service
designer’s struggle
with material
domestication of
materials
product vs. service
product as a fossil of activities
frozen in time and space
through production value chain
product as a performative
enactment of a network of activities
at the point of consumption
liquidation of product
product as a delivery platform of
contents and service activities
center for design + innovation
cD+i
procrastinated
binding
“value is created after the product was purchased”
center for design + innovation
cD+i
resolution of transactions
“creating Moor’s law in physical world to reduce frictions
...
power shift
musicians are poorer
than ever before!
3.2
center for design + innovation
cD+i
Internet of
things
Mobile
Internet
Big Data
Analytics
Cloud Service
Quad Core of Compu...
characteristics of hybrid
sociomaterial world
• digitally enabled complex socio-technical
phenomena
• no central governing...
Actor	
  à Action
Actors	
  à Action
Actors	
  à Actions
design decision
live algorithmic
disposable permanent
big data with an
evolutionary ontology
the rise of
algorithmic reality
forget about
B2B and BC2
think about
A2C and A2A
Inspired by Karl Lang @ Baruch College
6.0
concluding thoughts
seeking new theories on
[sociomaterial, computed,
algorithmic, generative, or digital, but
definitely not just social or te...
beginning with a
hybrid agency
actors
matter
data
algorithms
thank you
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Ssf2015 venice

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This is a keynote presentation that I gave at Service Systems Forum in Venice 2015.

Published in: Technology
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Ssf2015 venice

  1. 1. center for design + innovation cD+i digital innovation, reversed semiotics and generative economics: how is service eating up the world? Youngjin Yoo Harry A. Cochran Professor in MIS Temple University WBS Distinguished Research Environment Professor Warwick Business School Service Systems Forum 2015
  2. 2. “Uber, the world’s largest taxi company, owns no vehicles. Facebook, the world’s most popular media owner, creates no content. Alibaba, the most valuable retailer, has no inventory. And Airbnb, the world’s largest accommodation provider, owns no real estate. Something interesting is happening.” (Tech Crunch, March 3, 2015)
  3. 3. center for design + innovation cD+i
  4. 4. © copyright, youngjin yoocenter for design + innovation cD+i 2.0
  5. 5. center for design + innovation cD+i three logics of economics
  6. 6. © copyright, youngjin yoocenter for design + innovation cD+i 2.1
  7. 7. center for design + innovation cD+i industrial economics
  8. 8. the age of physical machine
  9. 9. center for design + innovation cD+i automation
  10. 10. center for design + innovation cD+i capital intensive asset
  11. 11. center for design + innovation cD+i managerial challenge 
 maximizing asset utilization
  12. 12. center for design + innovation cD+i vertical integration diversification
  13. 13. center for design + innovation cD+i managerial logic
 
 economy of size and scale
  14. 14. center for design + innovation cD+i organizational forms 
 m-form hierarchy
  15. 15. center for design + innovation cD+i management tools
 
 scientific management
  16. 16. © copyright, youngjin yoocenter for design + innovation cD+i 2.2
  17. 17. information economics
  18. 18. the age of smart machine
  19. 19. information as by-product (production, distribution, and use)
  20. 20. center for design + innovation cD+i managerial challenge
 
 complexity
 information overload
  21. 21. center for design + innovation cD+i management logic
 
 modularization (design rules)
 horizontal coordination
  22. 22. center for design + innovation cD+i organizational forms
 
 network of distributed org.
  23. 23. center for design + innovation cD+i management tools
 
 outsourcing
 virtualization
  24. 24. © copyright, youngjin yoocenter for design + innovation cD+i 2.3
  25. 25. generative economics
  26. 26. © copyright, youngjin yoocenter for design + innovation cD+i the age of generative machine
  27. 27. center for design + innovation cD+i digital technology
  28. 28. center for design + innovation cD+i separation of form & function
 
 
 (universal machine of von Neumann computing architecture)
  29. 29. center for design + innovation cD+i separation of contents & media
 
 (universal network of Claude Shannon)
  30. 30. center for design + innovation cD+i walled garden of products hardware network  -­‐     distribu1on contents so3ware TV phone book music hardware network  -­‐     distribu1on contents so3ware hardware network  -­‐     distribu1on contents so3ware hardware network  -­‐     distribu1on contents so3ware
  31. 31. center for design + innovation cD+i re-configuration of new products network - distribution hardware software contents network - distribution hardware software contents network - distribution hardware software contents network - distribution hardware software contents
  32. 32. highly evolutionary products that produce user-generated trace data
  33. 33. center for design + innovation cD+i technology constantly evolves beyond the original design
  34. 34. center for design + innovation cD+i managerial challenge
 
 deconstruction of products
 reconfiguration of value system convergence
  35. 35. center for design + innovation cD+i managerial logic
 
 mutation
 recombination
 open innovation

  36. 36. center for design + innovation cD+i organizational forms 
 ecosystem of open platform
  37. 37. 3.0
  38. 38. reversed semiotics
  39. 39. reference vs referent
  40. 40. information as representation of the real
  41. 41. center for design + innovation cD+i information as the genetic materials of the real
  42. 42. 4 types of reversed semiotics
  43. 43. center for design + innovation cD+i which one is real?
  44. 44. center for design + innovation cD+i which one is real?
  45. 45. center for design + innovation cD+i which one is real?
  46. 46. center for design + innovation cD+i which one is real?
  47. 47. center for design + innovation cD+i physical goods as avatar of “real” digital products
  48. 48. flipping the value economic proposition
  49. 49. information economics: dissimulate immaterial representation non-rivalry of consumption
  50. 50. generative economics: simulate metabolism of information generative recombination
  51. 51. center for design + innovation cD+i industrial economics information economics generative economics strategic use of information as by product strategic use of information as simulacra deconstruction of traditional organizations deconstruction of traditional industrial systems products noun platform verb things experiences creativity generativity craftsmanship procrastinated binding
  52. 52. 3.1
  53. 53. what is a firm?
  54. 54. what is a product?
  55. 55. Center for Design cD+iTransforming ideas into actions and Innovation
  56. 56. Center for Design cD+iTransforming ideas into actions and Innovation
  57. 57. Center for Design cD+iTransforming ideas into actions and Innovation
  58. 58. center for design + innovation cD+i rawmaterials products&services activities technology knowledge a firm: a classic model
  59. 59. marriage of form and function
  60. 60. to render service
  61. 61. designer’s struggle with material
  62. 62. domestication of materials
  63. 63. product vs. service
  64. 64. product as a fossil of activities frozen in time and space through production value chain
  65. 65. product as a performative enactment of a network of activities at the point of consumption
  66. 66. liquidation of product product as a delivery platform of contents and service activities
  67. 67. center for design + innovation cD+i procrastinated binding “value is created after the product was purchased”
  68. 68. center for design + innovation cD+i resolution of transactions “creating Moor’s law in physical world to reduce frictions in economic transactions”
  69. 69. power shift
  70. 70. musicians are poorer than ever before!
  71. 71. 3.2
  72. 72. center for design + innovation cD+i Internet of things Mobile Internet Big Data Analytics Cloud Service Quad Core of Computed Experience place time things peopleexperiences atoms bits B2BB2C (c) Youngjin Yoo, 2014
  73. 73. characteristics of hybrid sociomaterial world • digitally enabled complex socio-technical phenomena • no central governing body or design rules • evolve beyond the original designers • non-linear emergent behaviors • leaves large-scale digital trace data
  74. 74. Actor  à Action
  75. 75. Actors  à Action
  76. 76. Actors  à Actions
  77. 77. design decision live algorithmic disposable permanent
  78. 78. big data with an evolutionary ontology
  79. 79. the rise of algorithmic reality
  80. 80. forget about B2B and BC2
  81. 81. think about A2C and A2A Inspired by Karl Lang @ Baruch College
  82. 82. 6.0
  83. 83. concluding thoughts
  84. 84. seeking new theories on [sociomaterial, computed, algorithmic, generative, or digital, but definitely not just social or technical] reality
  85. 85. beginning with a hybrid agency actors matter data algorithms
  86. 86. thank you

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