Service Science, Management and Engineering

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Service Science, Management, and Engineering (SSME) is a term introduced by IBM to describe Services Sciences, an interdisciplinary approach to the study, design, and implementation of services systems – complex systems in which specific arrangements of people and technologies take actions that provide value for others. More precisely, SSME has been defined as the application of science, management, and engineering disciplines to tasks that one organization beneficially performs for and with another.

Today, SSME is a call for academia, industry, and governments to focus on becoming more systematic about innovation in the service sector, which is the largest sector of the economy in most industrialized nations, and is fast becoming the largest sector in developing nations as well. SSME is also a proposed academic discipline and research area that would complement – rather than replace – the many disciplines that contribute to knowledge about service.

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[edit] What is Service?

In national economic statistics, the service sector is often defined as whatever is not agriculture or manufacturing (SERVICE SECTOR – TERTIARY SECTOR OF THE ECONOMY (Colin Clark)). Intuitively, services are processes, performances, or experiences that one person or organization does for the benefit of another – such as custom tailoring suit, cooking a dinner to order, driving a limousine, mounting a legal defense, setting a broken bone, teaching a class, or running a business’s information technology infrastructure and applications. In all cases, service involves deployment of knowledge, skills, and competences that one person or organization has for the benefit of another (LUSCH & VARGO), often done as a single, customized job. And in all cases, service requires substantial input from the customer or client (SAMPSON) – how else could your steak be customized for you unless you tell you waiter how you want it prepared? In general there are so-called front-stage and back-stage activities in any business transaction – front stage being the part that comes in contact with the customer and back stage being the part that does not (TEBOUL). Service depends on having a high degree of front-stage activities to interact with the customer, whereas traditional manufacturing requires very little customer input to the production process and depends almost entirely on back-stage activities.

There are many definitions of service in the literature. Here are a few:

  • Services are economic activities offered by one party to another, most commonly employing time-based performances to bring about desired results in recipients themselves or in objects or other assets for which purchasers have responsibility. In exchange for their money, time, and effort, service customers expect to obtain value from access to goods, labor, professional skills, facilities, networks, and systems; but they do not normally take ownership of any of the physical elements involved. LOVELOCK & WIRTZ, "Services Marketing: People, Technology, Strategy," 6/e; (Upper Saddle River NJ: Prentice Hall 2007).
  • A service is a time-perishable, intangible experience performed for a customer acting in the role of a co-producer. FITZSIMMONS & FITZSIMMONS “Service management.” (New York, NY: McGraw-Hill 2003).
  • Service [is] the application of specialized competences (knowledge and skills), through deeds, processes, and performances for the benefit of another entity or the entity itself. LUSCH & VARGO, “The Service-Dominant Logic of Marketing.” (Armonk, NY: ME Sharpe. 2006).

Historically, service scholars emphasized customization, but the world is changing. One of the contributions of SSME may be to help service managers to achieve standardization and its more sophisticated sibling, assembly of standardized modular service elements in several "customizable" but highly predictable permutations. Many customers seek and value standardization because it reduces variability and usually helps bring prices down. Services in the digital economy employ standardization and mass customization. A new service definition might focus on the technical nature of modern day service, rather than on explaining away why service productivity is not doing as well as manufacturing, so that we can do something to advance the service economy.

Not all services require substantial input from the customer--one of the motivations for outsourcing in electronic commerce contexts (both b2b and b2c) is to hire another person or organization to do work that an individual or corporate entity doesn't want to do (or lacks the skills, knowledge, physical capabilities or equipment to perform). Particularly in areas such as maintenance, cleaning, and repair, the customer's goal may be to become involved as little as possible, preferring to leave it to the experts to determine what needs to be done. In such instances, the front-stage is pretty small. Yet when teaching service, there's a risk of spending too much time on discussing the high-contact, customizable services that we enjoy using ourselves and not nearly enough in studying and researching the more "boring" but fast growing areas in b2b where much of the action is highly repetitive, often substantially automated, and takes place primarily behind the scenes.

[edit] What is a Service System?

Service system is a term that frequently appears in the service management, service operations, services marketing, service design, and service engineering literatures.

Service involves both a provider and a client working together to create value. A doctor interviews a patient, does some tests, and prescribes some medicine – the patient answers the questions, cooperates with the tests, and takes the medicine faithfully. Perhaps technologies and other people are involved in the tests or in the assignment and filling of prescriptions. Together, doctor, patient, others, and technologies co-create value – in this case, patient health. These relationships and dependencies can be viewed as a system of interacting parts. In many cases, a service system is a kind of complex system – a system in which the parts interact in a non-linear way. As such, a service system is not just the sum of its parts, but through complex interactions, the parts create a system whose behavior is difficult to predict and model. In many cases, a main source of complexity in a service system is its people, whether those at the client, those at the provider, or those at other organizations.

Service systems are designed and constructed, are often very large, and as complex systems, they have emergent properties. This makes them a kind of engineering system (in MIT’s terms – see http://esd.mit.edu). Large-scale service systems include, for instance, major metropolitan hospitals, highway or high-rise construction projects, or large IT outsourcing operations in which one company takes over the daily operations of IT infrastructure for another. In all these cases, systems are designed and built to provide and sustain service, yet because of their complexity and size, operations do not always go smoothly, and all interactions and results cannot be anticipated.

[edit] Toward a Science of Service

There is a long history of academic and industrial interest in the service sector – starting with Adam Smith and continuing right up to the present day. Yet most such interest in service has focused narrowly on marketing or management or economics. With the rise of technology-enabled services, many traditionally manufacturing-based companies have begun to see more and more revenue generated by service operations. So in industry, there was a growing recognition that service innovation is now as important – if not more important than – technology innovation. Yet, service innovation is generally unknown (save for a few economists studying the relationship between investment and innovation in service industries; e.g., GADREY & GALLOUJ).

The key to service science is interdisciplinarity, focusing not merely on one aspect of service but rather on service as a system of interacting parts that include people, technology, and business. As such, service science draws on ideas from a number of existing disciplines – including computer science, cognitive science, economics, organizational behavior, human resources management, marketing, operations research, and others – and aims to integrate them into a coherent whole. In fact, IBM relabeled its initiative in this area Service Science, Management, and Engineering to highlight the interdisciplinary nature of the effort. HP has created the Centre for Systems and Services Sciences for the same reason. Oracle Corp. working with IBM, joined in creating an industry consortium called the Service Research and Innovation Initiative focused on establishing what it calls "service science" as both a key area for investment by companies and governments and as a full-blown academic discipline.

The NESSI (Networked European Software and Services Initiative) group in the European Union has established a Services Sciences Working Group.

Definitions of 'services sciences' can be misleading. An analogy can be made with Computer Science. The success of CS is not in the definition of a basic science (as in physics or chemistry for example) but more in its ability to bring together diverse disciplines, such as mathematics, electronics and psychology to solve problems that require they all be there and talk a language that demonstrates common purpose. Services Science may be the same thing - just bigger - as an interdisciplinary umbrella that enables economists, social scientists, mathematicians, computer scientists and legislators (to name a small subset of the necessary disciplines) to cooperate in order to achieve a larger goal - analysis, construction, management and evolution of the most complex systems we have ever attempted to construct.

Universities have begun to act on the need or service science or SSME as well. For instance, UC Berkeley created an SSME program. And North Carolina State University created an MBA track for service and a computer engineering degree for services well. In both cases, the schools recognize the interdisciplinary character of the field and incorporate content from a variety of disciplines. Other schools with interdisciplinary interests in SSME include Carnegie Mellon University, University of Maryland,Arizona State University,Northern Illinois University,UC Santa Cruz, Utah State University, RPI, University of Manchester, Helsinki University of Technology,The University of Sydney, Karlsruhe Institute of Technology and Singapore Management University.

Academic publications in SSME are also starting to appear. For instance, see the special issue of the Communications of the ACM focused entirely on service science and IEEE Computer Steps Toward a Science of Service Systems.

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