Service innovation 20130611 v1

Service Innovation
Jim Spohrer
Director IBM University Programs
June 11, 2013

Questions
• What is ISSIP?
• What is a service platform?
• What is service science?
• What is a T-shaped professional?
• How is this related to your work at IBM with universities?
• What are the important future trends you see?

IBM University Programs
What is ISSIP?
• Pronounced I-ZIP
• International Society
of Service Innovation
Professionals
• SIG Education &
Research
– T-shapes
– Service Science
6/11/2013
© IBM 2013 IBM University Programs worldwide
accelerating regional development (IBM UPward)
3

What is a service platform?
• Access Places & Entities
– Scale benefits
– Of new knowledge
– Globally & rapidly
• Smart Phones & Watson
• Smarter City IOC
• Franchises
6/11/2013
4

Service Science
• Emerging Discipline
– Service Science,
Management, and
Engineering (SSME)
• Service
– Not sector (ECON)
– Not capability (CS)
• Value Co-Creation
• Service System Entities
6/11/2013
5
IBM SSME Centennial Icon of Progress

What is a T-shaped Professional?
6/11/2013
6
Many disciplines
Many sectors
Many regions/cultures
(understanding & communications)
Deepinonesector
Deepinoneregion/culture
Deepinonediscipline

How do universities fit in?
• Best way to predict
the future is to inspire
the next generation to
build it better
• The future is already
here at universities it
is just not well
distributed
6/11/2013
7

8
What are the trends?
Digital Immigrant
Born: 1988
Graduated College: 2012
Digital Native
Born: 2012
Enters College: 2030

9
Transportation: Self-driving cars
Steve Mahan:
Test “Driver”

10
Water: Circular Economy

11
Manufacturing: Circular Economy
Ryan Chin:
Urban Mobility
Baxter: Building the Future
Maker-Bot: Replicator 2

12
Energy: Artificial Leaf

13
Technology: Cognitive Computing

14
14
Example: Leading Through Connections with…
Universities Collaborate with IBM Research to Design Watson
for the Grand Challenge of Jeopardy !
Assisted in the development of the Open
Advancement of Question-Answering Initiative
(OAQA) architecture and methodology
Pioneered an online natural language question
answering system called START, which provided the
ability to answer questions with high precision using
information from semi-structured and structured
information repositories
Worked to extend the
capabilities of Watson, with a
focus on extensive common sense
knowledge
Focused on large-scale
information
extraction, parsing, and
knowledge inference
technologies
Worked on a visualization component to visually
explain to external audiences the massively parallel
analytics skills it takes for the Watson computing
system to break down a question and formulate a
rapid and accurate response to rival a human brain
 Provided technological advancement enabling a
computing system to remember the full
interaction, rather than treating every question like
the first one - simulating a real dialogue
Explored advanced machine learning
techniques along with rich text
representations based on syntactic and
semantic structures for the Watson’s
optimization
Worked on information retrieval
and text search technologies
http://w3.ibm.com/news/w3news/top_stories/2011/02/chq_watson_wrapup.html

15
Buildings: Circular Economy
China Broad Group:
30 Stories in 15 Days

16
Retail & Hospitality: Social Media

17
Finance: Crowd Funding

18
Health: Robotics & 3D Printing

19
Education: Challenge-Based Sport

20
Government: Parameterized Meta-Rules
• Innovativeness
• Equity
– Improve
weakest
link
• Sustainability
• Resiliency

21
Competitive Parity – Achieved.
• The NFL touts parity—the idea
that any team can win on any
given Sunday. But this
year, parity has truly run wild.
• Through six weeks, 11 of the
NFL's 32 teams are 3-3.
• The Journal asked the statistical
gurus of Massey-Peabody
Analytics to run a coin-flip
simulation…

22
2030 and Beyond…. Government, Health, Education, Finance, etc.

6/11/2013
23

6/11/2013
accelerating regional development (IBM UPward) 24
IBM operates in 170 countries
around the globe
Acquisitions contribute significantly
to IBM’s growth ; ~120 acquisitions in
last decade
2012 Financials
Revenue - $ 104.5B
Net Income - $ 17.6B
EPS - $ 15.25 (10 yrs of
EPS d/digit growth)
 Net Cash - $18.2B
24% of IBMs revenue in
Growth Market countries;
growing at 7% ( @cc) in
2012
Number 1 in patent
generation for 20
consecutive years ;
6,478 US patents
awarded in 2012
More than 40% of IBMs
workforce does
business away from an
office
5 Nobel Laureates10 time winner of the
President’s National
Medal of Technology &
Innovation – latest for
LASIK laser refractive
surgical techniques
The Smartest Machine On Earth
100 Years of Business &
Innovation in 2011
New Era in IBM’s Leadership
IBM Growth Initiatives
IBM has
~425,000
employees
worldwide
Context: IBM 101

IBM Platforms for Entrepreneurs
• Smarter Cities Intelligent Operations Center Platform
• IBM helping university startups to scale up (growth)
6/11/2013
25

26
University: Four Missions
• Knowledge
– 1. Transfer (Teaching)
– 2. Creation (Research)
– 3. Application (Benefits)
• Commerce/Entrepreneurship
• Governance/Policymaking
– 4. Re-Integration (Challenge)
• Innovativeness, Equity
• Sustainability, Resilience
• Nested, Networked Holistic Service Systems
– Flows
– Development
– Governance
Nation
State/Province
City/Metro
University
College
K-12
Cultural &
Conference
Hotels
Hospital
Medical
Research
Worker
(professional)
Family
(household)
For-profits
Non-profits
U-BEE
Job Creator/Sustainer
Third Mission (Apply to Create Value)
is about U-BEEs =
University-Based
Entrepreneurial Ecosystems

IBM University Programs Universities Matter #1
6/11/2013
27
Japan
China
Germany
France
United KingdomItaly
Russia SpainBrazil
Canada
India
Mexico AustraliaSouth Korea
NetherlandsTurkey
Sweden
y = 0,7489x + 0,3534
R² = 0,719
0
1
2
3
4
5
6
7
8
9
0 1 2 3 4 5 6 7 8 9
%globalGDP
% top 500 universities
Nation’s % WW GDP and % Top 500 Universities (2009 Data)

6/11/2013
28
…But it can be costly, American student loan debt is over $900M

6/11/2013
29
“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.”

6/11/2013
30
What is a U-BEE? A local job creator/sustainer
Innovating “whole service” in all regions worldwide
http://www.service-science.info/archives/1056
Nation
State/Province
City/Region
University
College
K-12
Cultural &
Conference
Hotels
Hospital
Medical
Research
Worker
(professional)
Family
(household)
For-profits
Non-profits
U-BEE
Job Creator/Sustainer
U-BEEs = University-Based Entrepreneurial Ecosystems
“The future is already
here (at universities),
it is just not evenly
distributed.”
“The best way to
predict the future
is to (inspire the next
generation of students
to) build it better.”

IBM University Programs On Campus IBMers
6/11/2013
3131
Up-Skill
Cycle
University-Region1
University-Region2
= New Venture
= Acquisition
= High-Growth
Acquisition/
New IBM BU
(Growing)
= High-Productivity/
Mature IBM BU
(Shrinking)
= IBMer moving from
mature BU to acquisition
= IBMer moving into
On Campus IBMer role
(help create graduates
with Smarter-Planet skills,
help create Smarter Planet
oriented new ventures;
Refresh skills
= Graduates with
Smarter Planet skills
IBM

32
Measuring Quality-of-Life?
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 & sports (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 & commercial development opportunities/investments (sales tax)
13. Nations/NGOs & citizens rights/rules/incentives/policies/laws (income tax)
0/19/02/7/4
2/1/1
7/6/1
1/1/0
5/17/27
1/0/2
24/24/1
2/20/24
7/10/3
5/2/2
3/3/1
0/0/0
1/2/2
Quality of Life = Quality of Service + Quality of Jobs + Quality of Investment-Opportunities
* = US Labor % in 2009.
“61 Service Design 2010 (Japan) / 75 Service Marketing 2010 (Portugal)/78 Service-Oriented Computing 2010 (US)”

Growth
33

34
Nesting
Matryoska dolls:
Origin Japanese

35
I am nested in at least 10 systems
Level AKA ~No. People ~No. Entities Example
0. Individual Person 1 10,000,000,000 Jim
1. Family Household 10 1,000,000,000 Spohrer’s
2.Neighborhood Street 100 100,000,000 Kensington
3. Community Block 1000 10,000,000 Bird Land
4. Urban-Zone District 10,000 1,000,000 SC Unified
5. Urban-Center City 100,0000 100,000 Santa Clara
6.Metro-Region County 1,000,000 10,000 SC County
7. State Province 10,000,000 1,000 CA
8. Nation Country 100,000,000 100 USA
9. Continent Union 1,000,000,000 10 NAFTA
10. Planet World 10,000,000,000 1 UN

36
Time
ECOLOGY
~14B
Big Bang
(Natural
World)
~10K
Cities
(Human-Made
World)
sun (energy)
writing
(symbols and scribes,
stored memory
and knowledge)
earth
(molecules &
stored energy)
written laws
(governance and
stored control)
bacteria
(single-cell life)
sponges
(multi-cell life)
money
(governed
transportable value
stored value,
“economic energy”)
universities
(knowledge workers)
clams (neurons)
trilobites (brains)
printing press (books)
steam engine (work)200M
bees (social
division-of-labor)
60
transistor
(routine
cognitive work)
Evolution of Natural Systems & Service Systems
Unraveling the mystery of evolving hierarchical-complexity in new populations…
To discover the world’s architectures and mechanisms for computing non-zero-sum

37
Automobile
Technological Acceleration
0 25 50 100 125 15075
Years
25
50
100
TelephoneElectricity
Radio
Television
VCR
PC
Cellular
%Penetration
YEARS

38
•iPhone/iPad app developer
•wireless marketing director
•microfinance infrastructure designer
•3D content developer for movies, TV
•social network manager
•deploying technology into the cloud
•organic solar cell development
•digital image management
Many top in-demand jobs in 2011 did not exist in 2005!
38

39 39
U.S Department of Labor
estimates that today’s learner
will have 10-14 jobs…
by the age of 38!

40
 Estimates are 85% of the jobs today’s learners will be doing
haven’t been invented yet
 they'll be using technologies that don't exist
 to solve problems we don't yet know are problems
40

41
Five historical cycles …

42
~100 years of US job transformations
Source: US Bureau of Economic Analysis; McKinsey Global Institute Analysis

43
Most people say, “IBM makes
computers”

44
Those in-the-know say, “IBM is helping to build a Smarter Planet…”

45
A Smarter Planet is built from smarter
service systems…
INSTRUMENTED
We now have the ability to
measure, sense and see
the exact condition of
practically everything.
INTERCONNECTED
People, systems and objects
can communicate and
interact with each other in
entirely new ways.
INTELLIGENT
We can respond to changes
quickly and accurately,
and get better results
by predicting and optimizing
for future events.
WORKFORCE
PRODUCTS
SUPPLY CHAIN
COMMUNICATIONS
TRANSPORTATION BUILDINGS
IT NETWORKS

46
City challenge: buildings and
transportation
Ryan Chin:
Smart Cities

47
Streetline: Instrumented-
Interconnected-Intelligent

48
Neonatal ICU: Instrumented-
Interconnected-Intelligent

49
Cities: land-population-energy-
carbon
Carlo Ratti:
Senseable Cities

52
Four commandments for cities of the future: Eduardo Paes at TED2012

53
SC IOC as a Platform for Innovation

54
54
 Identifies entrepreneurs developing
businesses aligning with our Smarter Planet
vision.
 SmartCamp finalists raised more than
$50m and received significant press in
Wall Street Journal, Forbes and
Bloomberg
in
Healthcare SmartCamp kickstart - Miami - May 15, 2012
Apply by April 27th
SmarterCities SmartCamp kickstart - New York - May 24, 2012
Apply by May 3rd
North America Regional SmartCamp - Boston - June 20 & 21, 2012
Apply by May 25th
apply now at www.ibm.com/isv/startup/smartcamp
Exclusive Networking and
Mentoring event
North America SmartCamp lead: Eric Apse, eapse@us.ibm.com
University Programs lead: Dawn Tew, dawn2@us.ibm.com

Service innovation 20130611 v1

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