Below is a shorter more cleaned up version of the transcript of our discusion:
Tell me about your journey about how you got to where you are today.
I grew up in Maine on a farm, and had very supportive family and teachers that encouraged me in math and science. At MIT, I studied physics, and then went to a Boston-area start-up working on speech recognition in the late 1980’s that Exxon later acquired. At Yale, I got a PhD in Computer Science and Artificial Intelligence, before living in Rome Italy for about a year as a visit scholar in residence at the University of Rome. At Apple, I worked on next generation learning systems with a group of universities and publishers. At IBM, I helped start IBM’s venture capital group, then after the internet bubble burst helped start IBM’s first service research group. A few years back I took on the challenge of leading IBM university programs team worldwide, which is quite exciting in an era of smart, where universities are key to regional economic development and need to re-invent themselves in the era of smarter systems. So I have studied physical systems, technological systems, and now social systems – or what we call service systems, which have people and skills and technology and business models. I study the evolution and transformation of complex service systems, and how best to scale up innovations that can improve quality of life worldwide. Universities and their cities are fascinating types of service systems to study these days.
Tell me about new science of service systems, and what that means for an organization
The science of service systems is intellectually deep and economically significant, because service systems are so complex. Some people say service systems are just sociotechnical systems, but we see them as more because they involve people and skills as well as technology and business models. Universities tend to silo the humanities, social sciences, engineering sciences, and business and economic sciences – but the science of service systems brings them all together to study value co-creation phenomena in an age of rapid technological change that requires changes what people know (skills) and business models. For an organization, the new science of service systems is relevant to how they compete, cooperate, learn, and improve. Most organizations fail, but some do not – that is interesting to study. Equally interesting is the societal context of these organizations, and what defines progress and improving quality of life in regions around the world. The study of service systems provides insights into why organizations fail and succeed, and how regions, in spite of this organizational turnover, can improve innovativeness, equity, sustainability, and resiliency generation over generation. Not surprisingly, universities and cities are key types of service systems, as are businesses and families.
In a single statement, organizations and regions need more T-shaped adaptive innovators – people with both depth (problem-solving) and breadth (communications), and expertise in using technology to improve depth and breadth to compete and collaborate.
How can companies work together with government, educational institutions to accelerate the growth of our service economy?
First of all one needs to appreciate the growth of service economy is a reflection of how well we have learned to use technology to improve labor productivity in agriculture and manufacturing. As a result there is growth of people and organizations augmented by technology that interact to co-create value with others… Technology advances also mean a growth of self-service, where people have advanced technology to do things without interacting directly with other people (ATMs, check-in kiosks, on-line stores, etc.) so organizations can use customer-labor to replace employee-labor improving labor productivity in the traditional service sector of the economy. Education, health, and government will soon be impacted by self-service technologies. So technology innovation and higher skill levels result in an observed growth of the service sector. An important question is to look globally at all the regions of the world and figure out policies that improve innovativeness, equity, sustainability, and resiliency generation after generation – progress that improves quality of life. This is what IBM calls smarter planet, smarter cities, smarter universities, and smarter education/people. In a single statement, government, academia, business, and the social sector need to focus on transforming universities to create more start-ups that improve local quality of life, and that can scale globally.
I noticed there is a Handbook of Service Science. What is Service Science?
Service science is the study of service systems and value co-creation phenomena. About 500 universities worldwide have started service science courses and programs. A value co-creation phenomenon is how entities – people, businesses, and nations – interact in win-win ways, both the right kind of competition and cooperation. For example, when people compete in Chess, the weaker player benefits because he/she can learn from the stronger player. Competition that accelerates learning is good. Service systems are complex systems of people and skills as well as technologies and business models – such as businesses, cities, universities, etc. The world is full of service systems interacting and learning. Service science is the study of service systems and value co-creation phenomena, both competition and collaboration. For example, consider the National Football League Draft. Why does the weakest team in the league get the first draft choice? Each year the weakest team can select the strongest college player who has registered with the NFL draft – so Indianapolis Colts drafted Andrew Luck the start Stanford Quarterback. The reason is obvious, because this way of doing things improves the weakest team year over year, and keeps the games interesting. Understanding value-co-creation mechanisms is an important part of what service science studies. Sometimes these mechanisms or business models are essential for long-term sustainability of complex systems that must compete and collaborate. They often blend competition and collaboration, for example winner-take-all and improve-weakest-link policy logics.
Are there any learnings from manufacturing that we can apply to the service economy?
Yes, the most important is the use of technology to improve productivity. - Where are the opportunities for companies in the service economy? Today Big Data Analytics and Social Media present big opportunities. There are also a lot of opportunities related to making cities smarter, as more than 50% of the world population now lives in cities, and the percentage is increasing. Energy for transportation and buildings, and water and material recycling are just some of the areas of great opportunity. Using technology to improve self-service and customers, as co-creator of value is a huge opportunity.
What do you see as key future trends in technology and product dev. in the coming years?
Manufacturing as a local recycling service is a big opportunity for cities, and improving local physical supply chains and global information supply chains is a huge opportunity. Transportation revolutions include driverless cars and personal urban mobility systems that can be largely build from 3-D printers. Robots in modular-architecture for building construction and recycling is poised to reduce the cost of new buildings, and make them stronger, safer, and more energy efficient. Universities as living labs to improve quality of life in their cities is another big opportunity. Here’s work we’re doing to develop lithium-air battery technology capable of powering a family-sized electric car for approximately 500 miles (800 km) on a single charge. http://www-03.ibm.com/press/us/en/pressrelease/37511.wss Self-service is coming to education, healthcare, and government is also big.
What do you think the future has in store for Marketing, IT, Customer Service, … ?
IBM Watson technology will make systems much smarter, and everyone will have access to the equivalent of “a genius” who can do a lot of cognitive work for them – way beyond the calculator and spreadsheet — these next generation cognitive tools will give everyone access to a lot more brainpower to get things done. For example, WellPoint is using Watson to improve medical diagnoses: http://www-03.ibm.com/press/us/en/pressrelease/35402.wss
What are the three practical things both C level and front line leaders should focus on to prepare for tomorrow.
Geoffrey Moore’s book “Escape Velocity” provides good practical insights and IBM is one of the examples highlighted in the book. As learning accelerates, most of the opportunities are in the future, so we have to learn how to escape the pull of the past to innovate better. Service science provides the theory for service systems learning, and the book “Escape Velocity” nicely captures the practical implications. All organizations will need improved relationships with universities (student competitions, linkages to university based start-up, life long learning and alumni activities, etc.). They will also have to factor in and prepare for the need for constantly using more technology innovation, and upskilling their talent year over year. “Doing more with less” is the right mantra and business discipline to master year over year. This means using technology to both improve productivity and create new work opportunities in balance.
How should companies think about establishing corp cultures
Getting big things done is easier with you have a shared corporate culture that everyone is aligned around, including what the corporation values. IBM has a lot of material that talks about our corporate values and culture – including the process we used to revise it – an online innovation jam – crowdsourcing with IBM employees.
What types of people, companies, etc. are engaging with your business?
IBM is one of the largest companies in the world – 101 years old (last year was the centennial year), >$100B revenue, 433K employees, operating in 170 nations, more than 100 acquisitions in the last 12 years, number one 19 years in a row on patents, including Watson DEEP QA systems for learning natural language interactions from examples, etc. – so the big shift in IBM is from large business customers, to more customers that are cities, states, and nations — and regional universities can play a key role in those customer interactions.
Where do you get your information? What websites do you read/follow? What books do you read?
I follow key people and organizations on twitter, and visit many universities worldwide – I ask university presidents, deans, faculty, and students what they are reading, and I read a lot of books as well.