The Evolution of Service Research at IBM

Guest article by Jim Spohrer and Hamid R. Motahari-Nezhad

This short article should be viewed as a down payment on a longer, more complete history of the evolution of service research at IBM.   At best this current article is one person’s perspective, edited and sanity checked by my co-author, and including the names of many others who would need to be interviewed and consulted to provide a truly multi-perspective and comprehensive view. Of course, to learn more you can also attend Frontiers in Service July 9-12, in San Jose, CA, and ask an IBMer at that event!

Origins

Paul Maglio, returning from the HICSS conference (Hawaiian International Conference for Systems Sciences) in 2002, suggested the need for a new Human Sciences Research area in IBM Research. He consulted the first author as well as others, and the idea for the Almaden Service Research (ASR) group was born. In December 2002, a group of seven was established, and doubled in size each over several years, spreading to other research labs, until over 10% of IBM Research’s 3000 researchers identified with the area of service science and research, and began contributing to the establishment of SSME (Service Science Management and Engineering) as well as related conferences, journals, courses, and even degree programs at universities around the world.   In 2011, SSME was one of 100 Icons of Progress used in the celebration of IBM’s Centennial.

Impact

The need for a service research group in IBM Research was driven by the tremendous growth and success of IBM’s Global Technology and Global Business Services Groups (GTS and GBS), including the 2002 acquisition of PWC Consulting Group by IBM. IT and business process outsourcing and help desks led to the creation of global service delivery centers around the world, and improving the productivity, quality, compliance, and innovativeness of these global service centers was the clear focus of IBM service research. By 2007, the Almaden Service Research (ASR) group, just one now relatively small arm of the overall IBM Research service research effort, had achieved significant impact,: the Component Business Modeling (Jorge Sanz) tool was being used by thousands of IBM GBS consultants, GTS was using Solution Design Manager (Ruoyi Zhou) to improve productivity on costing and pricing large deals with growing analytics capabilities across deals, Intelligent Document Gateway (Vikas Krishna) was transforming business processes of IBM internal services to employees, Business Insights Workbench (Jeff Kreulen, Scott Spangler, Ying Chen) was being used to help desk productivity as well as intellectual property related process for IBM and IBM customers.  ASR was recognized with 1 exceptional, 4 outstanding, and 11 accomplishment awards by IBM Research, realizing a 10x ROI, and externally stimulating the growth of over 500 SSME-related university courses and degree programs as well as contributing to an estimated $1B in government funding for service research and innovation. In academic community, SSME programs and research were adopted in the academic curriculum of a number of universities including UC Berkeley, Arizona State University and San Jose State.

Framework

The guiding service innovation framework used by ASR is summarized in Figure 1 below. During the formative years, the group was managed to have impact on six major areas of service research, three firm-level and three ecosystem-level: (1) improve existing service offering, both internal and external (2) innovate new service offerings, both internal and external (3) inform firm-level service offering portfolio transformation and optimization, such as outsourcing and insourcing decision-making methods (4) assist customers and partners on their own service transformation journey with lessons learned from activity areas 1,2,3, (5) increase service research intellectual property, scientific publications, professional association and university interactions, (6) influence ecosystem-level dynamics and evolution, including mergers and acquisitions decision-making methods.   The firm, as a service system entity which is part of and constrained by a larger evolving ecology of nested, networked service system entities, is compelled to make decisions that impact the capabilities, constraints, rights, and responsibilities of itself and other entities.

Figure 1: Service research to improve investment decision-making in 6 areas

The service-oriented architecture used to describe an evolving enterprise entity must balance optimization, transformation, and innovation forces, often referred to as run-transform-innovate investment decision-making by IBM’s CIO and business transformation group.   All of this impacts the identity and career paths of people as well. For example, when an IBM customer outsources data centers or business processes to IBM, hundreds of former customer employees may be rebadged as IBM employees.   When IBM acquires a firm, not only does that create a new group of IBM employees, but hundreds of IBMers may be shifted in job roles to align with and help grow the acquired firm as part of IBM. Also, when IBM divests of a business unit or outsources a portion of IBM to another firm, many IBMers are re-badged into different organizations.   These flows of people across organizational boundaries, the changing skills of people, the changing laws and regulatory context, are all as important as the constantly evolving technological capabilities in reshaping IBM – and all of these issues are within the domain of study for T-shaped service scientists, who may have multidisciplinary communication breadth as well as depth in a specific areas such as technology, business, social organizational change, economics and public policy, or other domains of knowledge relevant to decision-making in and about service systems.

Smarter Planet

The growth of service in the GDP of nations and the revenues of IBM has been a long-term process over many decades, and so a vast number of internal and external influences shaped the formalization and growth of service research at IBM.   Nevertheless, the story of ASR has become a noteworthy internal and external inflection point in the evolution of broader story of the evolution of service science and research.   Specifically, because ASR formed in 2002, IBM was one of the first large firms to embrace Vargo and Lusch’s Service-Dominant Logic (S-D Logic) as a foundational worldview and mindset for a science of service in 2004.   The notion of S-D Logic resource-integrators and service system entities is tightly coupled, as well as the importance of value propositions in shaping entity interactions and outcomes.   Also, IBM was one of the first large firms to invest heavily in engaging universities and governments in a dialogue around the need to invest more in service research and innovation, and embracing the work of Neely, Ng, and other European service researchers leading efforts to understand product-service systems, servitization processes of manufacturing firms, outcome-based service contracting, and more (see IBM-Cambridge SSME report [1]). The Handbook of Service Science [2], Research Priorities for a Science of Service Systems [3], and other publications too numerous to mention have had a major impact on the evolution of service science inside and outside IBM.

Nevertheless, the service journey is far from easy and far from over.   Service is still defined in different ways by different disciplines from economics to computer science to marketing and operations.   Rather than use the term service as an adjective meaning value co-creation or the term service system to describe all entities capable of establishing win-win value co-creation interactions with other entities, IBM (wisely) preferred the term smarter systems, and launched a Smarter Planet initiative in 2008.   Smarter government and nations, states, cities, smarter health and hospitals, smarter education and universities, as well as smarter water and utilities, smarter transportation, smarter manufacturing, smarter agriculture – and more became the communications framework for talking about the world as a system of systems, including business and societal systems.   By dropping the word “service” the conversation about systems could more easily include manufacturing and agriculture as system of systems being reconfigured and transformed without confusing a world still largely entrenched in Goods-Dominant Logic (G-D Logic).   After all, except for those embracing S-D Logic, referring to factories (manufacturing) or farms (agriculture) as types of service systems on a servitization journey seems like misuse of the term service. However, the notions of factories and farms, along with all other business and societal systems, on a smarter systems journey largely driven by technological advancements does not raise eyebrows at all.   Still the concept of shifting from mere transactional exchange with customers to a value co-creation relationship with customers and citizens on platforms (e.g., Smarter Cities Intelligent Operation Center) was a clear aspect of a Smarter Planet, described as an increasingly instrumented, interconnected, and intelligent system of systems.

Today

Beginning in 2014, IBM Research was reorganized, followed by a related reorganization of all of IBM in early 2015.   The prior discipline structure of IBM Research (system, electrical, software engineering, computer science, service science) has been replaced with an organizational structure that reinforces the view that all smarter systems innovations require an integration of hardware, software, and service.   So ASR and its service researchers, as well as groups of software researchers and hardware systems research, were reorganized into new research organizations aimed at IT as a Service, Integrated Industry Solutions, and Cognitive Computing (aka Cognition as a Service, or even Integrated IBM as a Service), and a number of focused labs with a system focus including THINKLab. The work of the IBM Research Professional Interest Community (PIC) for Service Science and Service Computing PIC areas continues, as does the broader IBM Service Science and Innovation Technical community, even though ASR as a separate group no longer exists. The Service Science researchers, integrated into new organizations of IBM Research, are investigating novel directions including systematic approaches for creating new value-added services, the study of service systems and ecosystem of services offered due to the proliferation of cloud services, mobile apps and their interconnection with social systems, people, economy and organizations.

Almaden’s THINKLab, which focuses on Accelerated Discovery, is a unique Research experience where clients can work side-by-side with IBM experts on science and data challenges.

A number of Service Science books are published as the result of service science research, and collaboration with academic and industrial partners under the Service Science Innovation short-book series.

A number of Service Science books are published as the result of service science research, and collaboration with academic and industrial partners under the Service Science Innovation short-book series.

Also, externally the service science journey continues with a notable participation from academia and industry including the following three noteworthy threads as representatives:: (1) the International Society of Service Innovation Professionals (ISSIP.org), (2) the Karlsruhe Service Research Institute (KSRI), and (3) other Smarter Service System initiatives. ISSIP was established as a non-profit umbrella professional association by Cisco, HP, IBM and other organizations to promote service innovation for our interconnect world, and to assist in the talent, technology, business, and societal development needs of institutions and individuals as T-shaped service innovators with breadth and depth. Service research leaders at the Karslruhe Service Research Institute in Germany have recently completed a textbook on the fundamentals of service systems that provides entry points for multiple disciplines into an integrated service science view of business and societal system of systems getting smarter.

Smart service system initiatives are diverse and include experimental funding programs by the USA National Science Foundations to boost innovation capacity of universities and industry to collaborate in translational research leading to smarter service systems. [4] Also, the INFORMS Journal of Service Science provides a channel for peer-reviewed articles related to smarter service systems [5]. More broadly, internationally, Service Science is also an active area of research and investigation with communities of interest in Asia (in countries such as China, Taiwan, Thailand, etc.) and in Australia with Australian Services Science Society.

Concluding Remarks

This short article has provided a glimpse at the evolution of service research at IBM.   The story should be expanded to include outcomes and perspectives from other IBM Research labs around the world, IBM GTS and GBS business units, as well as the perspective of business and societal partners. In the research context, there are a number of recent work on defining a research agenda for services science [4,5,6]. The journey continues, and while it is always hard to predict what the future holds, a few items are worth brief mention: (1) in the era of cognitive systems, smart service systems will increasingly include cognitive or digital assistants (e.g., Watson and SIRI-like systems) for all occupations and societal roles. It is forseeable that smart Service Science research focus on leveraging advances in AI, big data-enabled intelligence and cognitive computing, and innovating to enable the creation of intelligent technologies and societies that are integrating well with human societies, (2) in the era of “make a job, not just take a job, “universities will be creating more T-shaped service innovators who can work well on teams to sense customer-needs and rapidly created integrated solutions to address customer opportunities, and (3) all of these changes will have public policy implications, and service science will increasingly be the study of both business and societal systems at the ecosystem level down to the customer-to-customer interaction level on diverse provider platforms.

References

1. IfM and IBM. (2008). Succeeding through service innovation: A service perspective for education, research, business and government. Cambridge, United Kingdom: University of Cambridge Institute for Manufacturing. ISBN: 978-1-902546-65-0.
2. Maglio, P. P., Kieliszewski, C. A., & Spohrer, J. C. (2010). Handbook of service science (p. 143). New York: Springer.
3. Ostrom, AL, Bitner, MJ, Brown, SW, Burkhard, KA, Goul, M, Smith-Daniels, V, Demirkan, H, and Rabinovich, E (2010). Moving forward and making a difference: research priorities for the science of service. Journal of Service Research.
4. Medina-Borja, A, (2015) Editorial Column—Smart Things as Service Providers: A Call for Convergence of Disciplines to Build a Research Agenda for the Service Systems of the Future, Service Science. Volume: 7, Issue: 1, pp. ii-v
5. Maglio, PP, Kwan, SK, and Spohrer, J (2015) Commentary—Toward a Research Agenda for Human-Centered Service System Innovation, Service Science. Volume: 7, Issue: 1, pp. 1-10.
6. Ostrom, AL, Parasuraman, A, Bowen, DE, Patricio, L, Voss, CA (2015) Service Research Priorities in a Rapidly Changing Context. Journal of Service Research. 18(2), 127-159.

Authors

 Dr. James (“Jim”) C. Spohrer is Director IBM Global University Programs and leads IBM’s Cognitive Systems Institute. The Cognitive Systems Institute works to align cognitive systems researchers in academics, government, and industry globally to improve productivity and creativity of problem-solving professionals, transforming learning, discovery, and sustainable development.  IBM University Programs works to align IBM and universities globally for innovation amplification and T-shaped skills.   Jim co-founded IBM’s first Service Research group, ISSIP Service Science community, and was founding CTO of IBM’s Venture Capital Relations Group in Silicon Valley.  He was awarded Apple Computers’ Distinguished Engineer Scientist and Technology title for his work on next generation learning platforms.  Jim has a Yale PhD in Computer Science/Artificial Intelligence and MIT BS in Physics. His research priorities include service science, cognitive systems for smart holistic service systems, especially universities and cities. With over ninety publications and nine patents, he is also a PICMET Fellow and a winner of the S-D Logic award.

Hamid R. Motahari-Nezhad, PhD, is a Research Staff Member, data analytics research lead for services in Computing-as-a-Service Department at IBM Almaden Research Center, and Co-Chair of Service Science Professional Interest Community at IBM Research. His research interest include services science, data analytics, cognitive computing and its applications in the area of business process and services computing. Hamid is a Senior Member of IEEE, a member of ACM and ISSIP (International Society of Service Innovation Professionals).

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