Kelly Lyons, PhD IBM Toronto Lab Centre for Advanced Studies

1. COSC 6002R:Course Introduction / OutlineIntroduction to Services Sciences, Management, and Engineering (SSME) Kelly Lyons, PhD IBM Toronto Lab Centre for Advanced Studies Adjunct Professor, York University CSE klyons@ca.ibm.com York University COSC6002R Directed Reading Course

2. What you will learn about the topic of SSME This Course is broken into 4 topic sections, each with readings and assignments, plus a final paper and presentation: • Introduction to Services Science, Management and Engineering: Is it real? (2 weeks) • Modeling, analyzing, and optimizing a services business (of your choice) using software tools (specifically WebSphere Business Process Modeler) (3 weeks) • Innovation in services: What new ways of doing business or new business models could be used to enhance your chosen services business? We will look at some interesting case studies as examples. (3 weeks) • Service Oriented Architectures: How are SOA technologies and associated tools helping business people modify the software that implements their business? (2 weeks) We are putting a CS slant on the topic; there are other readings identified that take a more business-view for your reference. York University COSC6002R Directed Reading Course

3. Grading and Expectations The final 2 weeks will be spent having each person present their final paper Grading will be carried out as follows: 5%  Class participation and discussion 25% Assignments 20%  Paper critiques and case facilitation 50%  Final presentation and paper York University COSC6002R Directed Reading Course

4. What You Will Learn (in addition to the topic of SSME) • Critical reading / discussion of papers and case studies • Interdisciplinary research: how computing technology impacts other fields (business) • What companies are saying are important skills for 21st century • Perspectives of business people: me / Ross • Others? York University COSC6002R Directed Reading Course

5. Important Discussion Guidelines • We are all learning together • No one’s ideas are bad • Everyone’s opinion is important • One conversation at a time • Other? York University COSC6002R Directed Reading Course

6. Readings: Critiquing and Discussing • One person will be selected who is responsible for presenting a critique of the papers the following week • The ways in which the critique is presented is up to the individual(s) (ie, could be powerpoint slides, whiteboard, hand-out, or something creative) but it should follow this outline: • Summary of the assigned papers (key points) – briefly (remember: everyone has read the paper) • Critique the papers (what was strong, what was missing, etc.) – this should invoke some discussion among the group • Present other (potential) relevant readings or concepts or thoughts / ideas – this is a key part of the presentation York University COSC6002R Directed Reading Course

7. Wiki • Our goal is to setup a wiki that all class participants can contribute to: • Add papers, critiques, comments • Share information about the course (times, dates, who is doing what, etc.) • Does anyone have wiki experience? York University COSC6002R Directed Reading Course

8. Introduction to Services Science, Management, and Engineering • Motivation: Why is this an important topic? • Definition: What are Services • IBM and SSME • Assignment 1: Debate: Is there a Science of Services? York University COSC6002R Directed Reading Course

9. Motivation: Here are the facts… • All national economies are shifting to services • major industrialized nations are >75% services, developing nations are close behind • To better study, manage, and engineer service systems, new skills are needed • combination of business, organization, technology skills – soft skills enhance hard skills • Educational system is slowly shifting toward services • service management, operations, marketing, and engineering courses and programs exist • At national level, governments can draw investment toward service innovation by • bootstrapping investment in research and education through targeted programs • focusing attention on intellectual property protection for service innovation York University COSC6002R Directed Reading Course

10. Motivation: Put differently… • “Services account for more than 80 percent of the U.S. gross domestic product, employ a large and growing share of the science and engineering workforce, and are the primary users of information technology. In most manufacturing industries, service functions (such as logistics, distribution, and customer service) are now leading areas of competitive advantage. Innovation and increased productivity in the services infrastructure (e.g., finance, transportation, communication, health care) have an enormous impact on productivity and performance in all other segments of the economy. Nevertheless, the academic research enterprise has not focused on or been organized to meet the needs of service businesses. Major challenges to services industries that could be taken up by universities include: (1) the adaptation and application of systems and industrial engineering concepts, methodologies, and quality-control processes to service functions and businesses; (2) the integration of technological research and social science, management, and policy research; and the (3) the education and training of engineering and science graduates prepared to deal with management, policy, and social issues.” • National Academy of Engineering (2003). "The Impact of Academic Research on Industrial Performance" York University COSC6002R Directed Reading Course

11. Motivation: Put more crisply… “… modern economies are both service economies and economies of innovation. Paradoxically, they are not regarded as economies of innovation in services, that is as economies in which service firms' innovation efforts are proportional to their contribution from the major economic aggregates. It is as if service and innovation were two parallel universes that coexist in blissful ignorance of each other.” • Gallouj, F. (2002). Innovation in the Service Economy: The New Wealth of Nations. Cheltenham UK: Edward Elgar. York University COSC6002R Directed Reading Course

12. Motivation: Rise of the Service Economy Japan United States Germany China Russia India York University COSC6002R Directed Reading Course

13. Introduction to Services Science, Management, and Engineering • Motivation: Why is this an important topic? • Definition: What are Services • IBM and SSME • Assignment 1: Debate: Is there a Science of Services? York University COSC6002R Directed Reading Course

14. Definition: So what are Services? In economics and marketing, a service is the non-material equivalent of a good. Service provision has been defined as an economic activity that does not result in ownership, and this is what differentiates it from providing physical goods. It is claimed to be a process that creates benefits by facilitating either a change in customers, a change in their physical possessions, or a change in their intangible assets. By supplying some level of skill, ingenuity, and experience, providers of a service participate in an economy without the restrictions of carrying stock (inventory) or the need to concern themselves with bulky raw materials. On the other hand, their investment in expertise does require marketing and upgrading in the face of competition which has equally few physical restrictions. - from Wikipedia, see http://en.wikipedia.org/wiki/Services York University COSC6002R Directed Reading Course

15. Definition: What really defines Services? • Deed, act, or performance • Berry (1980) • An activity or series of activities… provided as solution to customer problems • Gronroos (1990) • All economic activity whose output is not physical product or construction • Brian et al (1987) • A time-perishable, intangible experience performed for a customer acting as co-producer • Fitzsimmons & Fitzsimmons (2001) • A change in condition or state of an economic entity (or thing) caused by another • Hill (1977) • Deeds, processes, performances • Zeithaml & Bitner (1996) • Application of specialized competences through deeds, processes, and performances to benefit another • Vargo & Lusch (2004) York University COSC6002R Directed Reading Course

16. Another Definition of Services: As systems of relationships A. Service Provider - Individual - Organization - Technology owned by A B. Service Client - Individual - Organization - Public or Private Forms of Service Relationship (A & B co-create value) Forms of Service Interventions (A on C, B on C) Forms of Responsibility Relationship (A on C) Forms of Ownership Relationship (B on C) • C. Service Target: The reality to be • transformed or operated on by A, • for the sake of B • People, dimensions of • Business, dimensions of • Products, technology artifacts & env. • Information, codified knowledge - based on Gadrey (2002) York University COSC6002R Directed Reading Course

17. Introduction to Services Science, Management, and Engineering • Motivation: Why is this an important topic? • Definition: What are Services • IBM and SSME • Assignment 1: Debate: Is there a Science of Services? York University COSC6002R Directed Reading Course

18. IBM and SSME: IBM Revenue Growth is Now Led by Services… York University COSC6002R Directed Reading Course

19. IBM View: From Computer Science to Service Science… York University COSC6002R Directed Reading Course

20. IBM View: From Computer Science to Service Science… Need to hire Computer Scientists York University COSC6002R Directed Reading Course

21. Now IBM is working to Establish Service Science Science & Engineering Business & Management Value Technology Economics & Markets Social & Cognitive Sciences Demand People Need to hire Service Scientists IBM View: From Computer Science to Service Science… Need to hire Computer Scientists York University COSC6002R Directed Reading Course

22. Now IBM is working to Establish Service Science Science & Engineering Business & Management Value Technology Economics & Markets Social & Cognitive Sciences Demand People Need to hire Service Scientists IBM View: From Computer Science to Service Science… Need to hire Computer Scientists York University COSC6002R Directed Reading Course

23. http://www.ibm.com/university/ssme York University COSC6002R Directed Reading Course

24. IBM and SSME: What is SSME, really? • An urgent “call to action” • To become more systematic about innovation in services • Complements product and process innovation methods • To develop “a science of services” • A proposed academic discipline • Draws on many existing disciplines • Aims to integrate them into a new specialty • A proposed research area • Service systems are designed (computer systems) • Service systems evolve (linguistic and social systems) • Service systems have scale-emergent properties (economic systems) York University COSC6002R Directed Reading Course

25. IBM and SSME: Communications of the ACM, July 2006 York University COSC6002R Directed Reading Course

26. Introduction to Services Science, Management, and Engineering • Motivation: Why is this an important topic? • Definition: What are Services • IBM and SSME • Assignment 1: Debate: Is there a Science of Services? York University COSC6002R Directed Reading Course

27. Debate: Can there really be a science of services? “Wherever there are phenomena, there can be a science to describe and explain those phenomena. Thus, the simplest (and correct) answer to “What is botany?” is, “Botany is the study of plants.” And zoology is the study of animals, astronomy the study of stars, and so on. Phenomena breed sciences.” - Newell, A., Perlis, A. & Simon, H. A. (1967). Computer Science, Science,157, 1373-1374. York University COSC6002R Directed Reading Course

28. Possible Objections… to Computer Science • Only natural phenomena breed sciences • The term “computer” is not well defined • Computer Science is the study of algorithms, not computers • Computers are instruments, not phenomena • Computer Science is a branch of another science • Computers belong to engineering, not science - Newell, Perlis, & Simon (1967) York University COSC6002R Directed Reading Course

29. Possible Objections… to Service Science • Only natural phenomena breed sciences • The term “service” is not well defined • Service Science is the study of work, not services • Services are performances, not phenomena • Service Science is a branch of another science • Services belong to engineering (or management), not science - with apologies to Newell, Perlis, & Simon (1967) York University COSC6002R Directed Reading Course

30. Some Thoughts: • Services depend critically on people, technology, and co-creation of value • People work together and with technology to provide value for clients • So a service system is a complex socio-techno-economicsystem • Growth requires innovation that combines people, technology, value, clients Science & Engineering Business & Management Business Innovation Technology Innovation Economics & Markets Social & Cognitive Sciences Social Innovation Demand Innovation York University COSC6002R Directed Reading Course

31. Some SSME Research Areas • Measuring work, service intensity, and service complexity • What are the limits to self-service? How much work can we shift to end-users? • Representing and cataloging skills • How do we organize and breakdown the human skills needed to do work? How can we take this into account in composing and optimizing teams? • Global communication tools • What are the barriers to highly productive human-human coordination? Distance, trust, communication, common ground, culture, technology? • Service workforce management • Application of supply chain methods to service supply chains, which are people-centered • Effective service automation • Understanding tradeoffs in human vs computer effort in creating customized business services York University COSC6002R Directed Reading Course

32. Some More SSME Research Areas • Service scale effects • Take advantage of IBM-scale service data through semantic analysis. Are there scale laws of services? • Computational theory and modeling of service systems • Need computational theories to generate models that help us understand and guide how services associating humans and information and communication technologies (ICT) emerge and how they help organizational structures emerge, interact, evolve and adapt to better meet the needs and aspirations of people, business, and society • problems of data (human behavior, distribution, privacy-transparency-accessibility, trust, quality) • problems of comprehension (e.g. generic problems of modeling, simulation and visualization) • problems of engineering (e.g. computational problems) • Globalization of services • With globalization of services, are there shifts in business models? What will be done differently? What does it take to adopt and benefit from globalization? At some point, everyone will be leveraging global resources and labor arbitrage will be table stakes. Who wins then and why? How does one build and manage this global labor supply chain? York University COSC6002R Directed Reading Course

33. Computer Science & Info. Systems Industrial and Systems Engineering Math and Operations Research Organizational Change & Learning Business Anthropology Science and Engineering Economics and Social Sciences Business and Management Need more T-shaped people – both deep and broad Service Research and Education is Interdisciplinary York University COSC6002R Directed Reading Course

34. Assignment 1: Assign people to debate each side of whether there is a science of services: • The article, “Is There a Science of Services?” will be used to guide the debate • Assigned Readings to be used in the debate / discussion • Chesbrough, H. A failing grade for the innovation academy. Financial Times. 2004. http://www.ft.com/cms/s/9b743b2a-0e0b-11d9-97d3-00000e2511c8,dwp_uuid=6f0b3526-07e3-11d9-9673-00000e2511c8.html • Spohrer, J. and Maglio, P., “The Emergence of Service Science: Toward systematic service innovations to accelerate co-creation of value,” Manuscript available at: http://www.ibm.com/jct09002c/university/scholars/skills/ssme/emergence.pdf • Tien, James M. and Daniel Berg (2003) A case for service systems engineering. The Journal of Systems Science and Systems Engineering. Vol. 12, No. 1. Pp 113-28. March. • Abe, Tadahiko. “What is ‘service science?’” Fujitsu Research Institute. 8 March 2005. Pdf. York University COSC6002R Directed Reading Course

35. Assignment 1: (cont’) • Additional Readings to help with the debate: • Newell, A., Perlis, A. & Simon, H. (September 22, 1967). Computer Science, Science (Vol. 157, Issue 3795, pp. 1373-1374). • D. Khazanchi, B. E. Munkvold, “Is Information Systems a Science? An inquiry into the nature of the information systems discipline” ACM SIGMIS Database, Volume 31 ,  Issue 3  (Summer 2000), Pages: 24 – 42 • Chesbrough, H., “Breakthrough Ideas for 2005: Toward a new Science of Services”, Harvard Business Review, HBS Publishing, Boston, February 2005. • Paulson, Linda D. “Services science: a new field for today’s economy.” IEEE Computer Magazine. August 2006: 18-21. Pdf. • Khazanchi, Deepak, and Bjorn Erik Munkvold. “Is information system a science? An inquiry into the nature of the information systems discipline.” ACM SIGMIS 31.3 (2000): 24-42. Pdf (1.89 MB) • Dedrick, Jason, Vijay Gurbaxani, and Kenneth L. Kraemer. “Information technology and economic performance: A critical review of the empirical evidence.” ACM Computing Surveys (CSUR) 35.1 (2003): 1-28. Pdf (339 KB) • Fein, Louis. “The role of University in computers, data processing, and related fields.” Communications of the ACM 2.9 (1959): 7-14. Pdf (1.10 MB) • Banville, Claude, and Maurice Landry. “Can the field of MIS be disciplined?” Communications of the ACM 32.1 (1989): 48-60. Pdf (1.66 MB) York University COSC6002R Directed Reading Course

36. Volunteers to debate each side next week: York University COSC6002R Directed Reading Course