Coevolving Innovations

I’m migrating over to a Thinkpad T61, having last moved to a T41 in March 2005. Since research is core to my personal development, I’ve been diligent about preserving my digital files. My laptop stores documents created on a personal computer as early as 1994, with an archive of documents converted from mainframe files back to 1991. Thus, to move over to a new computer, it’s taken three days (and nights) to transfer:

• 12.5 GB of work-related e-mail and databases (i.e. Lotus Notes e-mail plus local document-sharing replicas);
• 8.6 GB as 19,000 work-related flat files (i.e. documents and presentations, mostly created in Microsoft Word, Microsoft Powerpoint and Adobe Acrobat);
• 346 MB as 4900 work-related modeling files (i.e. created in Rational Software Modeler or Websphere Business Modeler, with a lot of XML);
• 1.2 GB of personal productivity files (i.e. browser profiles and plugins for Firefox and Flock, personal e-mail in Thunderbird, personal diary in Sunbird, and blog feeds in FeedDemon);
• 9.6 GB of streaming media (i.e. temporary storage for MP3 audio that I’ve recorded and haven’t published to a web site yet, and lectures/interviews to be downloaded for listening to my MP3 player);
• 756 MB of digital photographs archived on other servers, but yet to be blogged (or not); and
• 2.4 GB of working files to maintain my multiple web sites (to speed up recovery if an irreversible crash ever happens).

There must be thousands of IBM employees annually who upgrade from one computer to a replacement. The company provides excellent utilities for migration that undoubtedly take less than three days. Most people would probably follow the path of least resistance: to move from an existing Windows XP platform to a new hardware with the same XP operating system.

I have a concern on the longer term, though: Microsoft stopped selling XP in June 2008, and support for XP Service Pack 3 ends in April 2010. Microsoft’s flagship product is clearly Vista. I expect to be on this laptop for another three years before becoming entitled to a replacement.

IBM as a company has been running a beta on the Technology Adoption Program for a new “IBM Standard Desktop - Vista” since April 2007. In parallel, however, there’s also been a beta on Open Client for Linux with version 1.0 released in November 2005 and version 2.0 released in June 2006. We’re now at version 2.2. This is an complete software package configured and tested on the standard models of laptops that IBM issues employees. Internal technical support specialists do the work of keeping up with newest software releases (e.g. Lotus Notes 8 and Lotus Symphony 1.1 ). Their work reduces my effort to maintain my PC, after I’ve moved my content over. In the case of a complete breakdown of my computer, I should be able to get an emergency replacement and be back up and running in less than 24 hours.

Around the office, people have been each choosing one of three paths.

As I’ve been doing research into service systems, I’ve reached my own conclusions about two blind spots in the current literature.

• 1. There continues to be a lot of debates about the distinctions (and non-distinctions) between services and products. From a systems perspective, I’m satisfied that the most important features are sufficiently covered by a definition of offerings initially conceived by Richard Normann, and further developed by Rafael Ramirez and Johan Wallin. Features are expressed in three dimensions of physical content, service and infrastructure content, and people (relationship) content.
• 2. Descriptions of service systems often follow mechanistic frames for function, structure and process that are helpful for understanding physical aspects of a system, but are less helpful for understanding the social contexts of collaboration. Conversations for action — also known as the language action perspective initiated by Fernando Flores and Terry Winograd — are an alternative way to model some aspects of human-to-human interaction, coming from the field of computer science. Language action is well known to reserachers in computer-supported cooperative work — actually famous or infamous, depending on your point of view — but less well known in by business researchers. The social perspective is inescapable in this perspective, because only human beings can make commitments. (Try blaming a machine for an error, and see if it cares!)

Since a service system is a social system, combining the above models of offerings and conversations for action is helpful in recognizing the types of obligations made about products, services, and (people) relationships.

As I was doing research on offerings for my dissertation, it occurred to me that there are at least four types of commitments: (a) a commitment to produce a product, (b) a commitment to follow a process, (c) a commitment to provide a capability, or (d) a commitment contribute towards a relationship.

Commitments, and their failure to come to fruition, occur in the context of other commitments, language (without directly associated action) and action (without directly associated language).

I included these ideas in a review of my dissertation work with friends / fellow researchers in Iowa in February. The reception was a bit frosty, because the style of my dissertation is inductive (i.e. facts to theory), and this new model is deductive (i.e. theory to facts). My friends were helpful in suggesting that I remove this new model from my dissertation. I already have more than enough content for the thesis, and working in these ideas would only produce more dissonance. It’s good to have constructive criticism like this!

In the spring, I decided that I needed to write some papers for conferences. For the UK Systems Society meeting in Oxford, I developed the ideas as a paper, and then with an accompanying presentation. To my surprise, at the conference at the beginning of September, the paper was awarded Best Student Paper for UKSS 2008.¹

In summer 2006, I constructed a curriculum on International Service Business Management for a one-year master’s program in Finland. Appropriate to the Finnish style, this content was assembled in rapid development. With a profile of students admitted mostly with technical undergraduate degrees and 5-to-10 years of working experience, the curriculum leaned toward the style normally expected in a practical executive MBA program.

In contrast, at presentations in August 2007, and then again in March 2008, Jim Kijima proposed a more ambitious challenge — for the new program at the Tokyo Institute of Technology — looking at services science based on systems science. For full-time graduate students, he sees systems science as a “liberal art” where their perspectives are broadened beyond their disciplinary technical teaching. In Japan, it’s not enough to have T-shaped professionals, they expect pi-shaped people, i.e. two downward stems with at least a major and a minor, in addition to the crossbar.

I took the idea of services science and systems science as a challenge, and constructed an article and a presentation for the ISSS Madison 2008 meeting as an exercise. With a target of master’s level engineering and management students, developing this content was based on a few premises:

The science, management and engineering of service systems is associated with a call for T-shaped people. The most recent emphasis is on T-shaped professionals, which was preceded by T-shaped skills, with linkages back to a 1990 study on hybrid managers. Some insight can be gained by working backwards through the nuanced terms.

The 2008 Cambridge (IfM and IBM) report issues a challenge to universities for developing skills, and then seeks to enlist support from business and government.

Developing T-shaped professionals
Discipline-based education remains a vital role of modern universities. In order to close the skill gap, however, universities should also offer students the opportunity to gain qualifications in the interdisciplinary requirements of SSME. Such qualifications would equip graduates with the concepts and vocabulary to discuss the design and improvement of service systems with peers from other disciplines. Industry refers to these people as T-shaped professionals, who are deep problem solvers in their home discipline but also capable of interacting with and understanding specialists from a wide range of disciplines and functional areas.

Widely recognised SSME programmes would help ensure the availability of a large population of T-shaped professionals (from many home disciplines) with the ability to collaborate to create service innovations. SSME qualifications would indicate that these graduates could communicate with scientists, engineers, managers, designers, and many others involved in service systems. Graduates with SSME qualifications would be well prepared to ‘hit the ground running’, able to become immediately productive and make significant contributions when joining a service innovation project.

Support needed from business and government
Establishing SSME qualifications is a challenging task. Interdisciplinary course development requires significant effort to develop because different faculty members might find it hard to work together sustainably over time. Educational innovations are vulnerable because they are often reliant on the efforts of one or two people. Interdisciplinary programmes are even harder to organise, and more expensive to initiate and maintain, than conventional ones. Rapid progress in the design and delivery of these programmes would require support and resources from business and government. [p. 11]

This isn’t nearly the first mention of the idea of T-shaped. Leonard-Barton (1995) provides a drawing of T-shaped skills, while describing the resistance of businesses to develop them.

On more than one occasion, I’ve heard IBM executives assert:

The nature of innovation has changed. In the 21st century, innovation is open, collaborative, multidisciplinary and global.

The ideas of open, collaborative, multidisciplinary and global appeared in the Global Innovation Outlook 2.0 report that was published in mid-2006. These words appeared on IBM-internal slides presented by Nick Donofrio at an Consulting Leadership Exchange in September 2005, and at the external-facing conference on Education for the 21st Century in October 2006 … with lots of other occasions in between. But what do these four words mean?

To make some sense for myself, I’ve extended these words into phrases and contrasted their contexts in a table .

I’ve been listening to audio recordings of Donofrio in conversation, as well as following Irving Wladawsky-Berger’s blog. While I believe that my reasoning is consistent with theirs, this is not something they’ve endorsed. When I present the right column to audiences, I generally see nods in agreement. At the same time, the implications of a contrasting left column on current business practices provokes some deeper reflections. Let me unpack each of the four points.

I normally focus on industrial and service businesses, but recently headlines on rising food prices have me looking into agricultural businesses. Here some statistics to ponder: the world’s top 4 crops — wheat, corn, rice and barley — weigh more than the next 26 crops combined.

The world’s top 30 food crops (estimated edible dry matter) [following Cordain (1999) Table 1]

Our diet really is quite limited in scope, according to Cordain (1999):

In the interest of furthering a science of service systems, the language-action perspective may be relevant. Business-oriented researchers have an appreciation of the gap between what people say and what they do, but may not be familiar with the development of this framework coming from computer science. Two decades of the language-action perspective were recently marked since the publication of Understanding Computers and Cognition in 1986 by Terry Winograd and Fernando Flores. It’s been almost three decades since “Doing and Speaking in the Office” by Fernando Flores and Juan Ludlow first appeared in an IIASA conference proceedings in 1980. This approach was foundational to the Commitment Management Protocol, as described in Adaptive Enterprise: Creating and Leading Sense-and-Respond Organizations by Steve Haeckel in 1999. The language-action perspective can provide some clarity in describing coordination within a service system.

Let’s trace the development of ideas, following milestones in three major sections:

• 1. What’s the linkage between language and action at work? Doing and speaking in the office
• 2. How do computers fit into collaborative work? Understanding computers and cognition
• 3. How can empowered workers coordinate outcomes and roles? Commitment management protocol

These works were published in 1980, 1986 and 1999. The viewpoints are all complementary, with each oriented towards slightly different issues.

In the pursuit of gaining a stronger understanding of a science of service systems through systems science, I’ve been working my way through the works of Richard Normann, Rafael Ramirez and Johan Wallin. There’s a long evolution of thought there, with a depth that may not be obvious to readers who aren’t systems scientists. Thus, phrases such as coproduction, interactive value, offering and value constellation have a specific meaning within the systems science community that the layman may not appreciate. Let me try to bring together some of the ideas, across the references.

• 1. A service system includes a supplier with a customer (and possibly subcontractors) as coproducers of outcomes
• 2. Interactive value is actualized not in coproduction of the supplier with customer, but in coproduction of the customer with his/her customer / counterparts
• 3. Offerings are interactions that provide benefits in the form of (a) physical product, (b) service and infrastructure and (c) interpersonal relationship
• 4. An offering can be either an output of coproduction, or input into coproduction
• 5. A value constellation includes the supplier, customer and subcontractors as coproducers

The systems flavour comes out not only in recognizing parts within the service system, but in emphasizing the interactions between parts. It’s worth re-examining these writings in the context of a new science of service systems.

I had previously written that “the (new) service economy is not the same as the service sector“. There’s an deep problem in trying to define and measure something new, when we have to rely on government statistics that have an anchor point of 1980, 1971, or even 1945. Using old definitions doesn’t necessary invalidate the measurements, but is problem if we’re dealing with a paradigm shift in a scientific revolution.

In quantifying economic systems, many of the approaches take an output-oriented (i.e. GDP or value-added) approach. Another alternative is to take an input-oriented approach (i.e. labour). Looking into labour has brought me back to Richard Florida’s research. In The Rise of the Creative Class (2002) appears a breakdown of U.S. statistics that contrast to the three-sector view.

Appendix Table 1 Counting the Classes, 1999 [p. 330]¹

Share		Employees (OES data)	Percent Share	Employees (Emp. & Earnings data)	Percent Share
Creative Class		38,278,110	30.0%	38,453,000	28.8%
	Super-Creative Core	14.932,420	11.7%	14,133,000	10.6%
	Other Creative Class	23.345,690	18.3%	24,320,000	18.2%
Working Class		33,238,810	26.1%	32.760,000	24.5%
Service Class		55,293,720	43.4%	58,837,000	44.1%
Agriculture		463,360	0.4%	3,426,000	2.6%
	Total	127,274,000		133,488,000

Why does the view of occupations as super-creative core and other creative class matter? From The Flight of the Creative Class in 2004, creative class occupations are shown to drive disproportionate amounts of wealth generation in the U.S. (Their creative sector I’ll frame as “new” service economy occupations, to contrast from their service sector as traditional service economy occupations).

As Service Science, Management and Engineering (SSME) has been developing, I’ve noticed a refinement of language. Rather than just abbreviating the long clause to service science, I’m now careful to use the phrase of a science of service systems, following Spohrer, Maglio et. al (2007). There’s a clear definition of service system in the final April 2008 revision of the report by the University of Cambridge Institute for Manufacturing.

What is a service system?
A service system can be defined as a dynamic configuration of resources (people, technology, organisations and shared information) that creates and delivers value between the provider and the customer through service. In many cases, a service system is a complex system in that configurations of resources interact in a non-linear way. Primary interactions take place at the interface between the provider and the customer. However, with the advent of ICT, customer-to-customer and supplier-to-supplier interactions have also become prevalent. These complex interactions create a system whose behaviour is difficult to explain and predict. [p. 6]

I’ve been sorting through the significance of this service system orientation, and have reached the following personal points-of-view.

• 1. The definition of a service system as a system is earnest
• 2. A service system creating and delivering value emphasizes a value constellation perspective over a value chain perspective
• 3. Research into service systems is muddled in the ideas of coproduction and (value) cocreation
• 4. A service system creates value with an offering as a platform for co-production
• 5. The constraints on service systems are changed with advances in technology
• 6. The (new) service economy is not the same as the service sector

Each of these points-of-view require some elaboration. (If the content that follow isn’t detailed enough, there are footnotes, too!)