© 2002 IBM Corporation IBM EMEA University Relations Service Innovation Dr Diem Ho Member of the...

© 2002 IBM CorporationIBM EMEA University Relations

Service Innovation

Dr Diem HoMember of the IBM Academy of TechnologySt Petersburg State University, Graduate School of Management April 15, [email protected]

University Relations April 2009 © 2009 IBM Corporation2

Diversity of Disciplines at IBM Research

ChemistryComputer Science

ElectricalEngineering

Materials Science

Mathematical Sciences Physics

Services Science, Management &

Engineering

Behavioral Sciences


History of Innovations60+ Years of World Class Research


Economic Evolution: moving toward Services and then?

Nation % WWLabor

%A %G %S 25 yr % delta S

China 21.0 50 15 35 191

India 17.0 60 17 23 28

U.S. 4.8 3 27 70 21

Indonesia 3.9 45 16 39 35

Brazil 3.0 23 24 53 20

Russia 2.5 12 23 65 38

Japan 2.4 5 25 70 40

Nigeria 2.2 70 10 20 30

Banglad. 2.2 63 11 26 30

Germany 1.4 3 33 64 44

Top ten nations by labor force size(about 50% of world labor in just 10 nations)

A = Agriculture, G = Goods, S = Services

>50% (S) services, >33% (S) services

2004 2004United States

The largest labor force migrationin human history is underway,

driven by urbanization, global communications,

low-cost labor, business growthand technology innovation

(A) Agriculture:Value from

harvesting nature(G) Goods:

Value from making products

(S) Services:Value from enhancing the

capabilities of things (customizing, distributing, etc.) and interactions between things


Knowledge Cycle and Innovation The Role of Higher Education

New Technologies /

Knowledge

Society/Businesses

Develop values

Assimilate

Acquire CreateDiscover

Understand business challenges

Knowledge Cycle

InnovationsInnovations

Disseminating knowledge

Creatingnew knowledge

Application of knowledge

“Business schools need to have a two-track faculty, with the second track being a clinical faculty, that is, ...those

who would bring into the classroom the world of practice and experience”. JEFFREY E. GARTEN (former YSM dean)


EngineeringScience

Services Science

Cost Utility

Quality Perception

Services Science and Engineering: Value Creation

HOW VALUES ARE CREATEDServices focus on creating Utility Value or Perceived Value for a product/asset. They are in contrast with Engineering which focuses on Cost and Quality

Value from enhancing the

capabilities of things (customizing,

distributing, etc.) and interactions

between thingsProduct-focussed

Client-focussed

Intrinsic Client perceived Product /Asset Values

Science and Humanity Disciplines

Management


Route to Market: Servitization vs Productization

Products

Clients

Clients

Clients

Clients

Reusable assetsResidues of common assets

Productization

Servitization

Business or Societal Challenges

ClientsServices

Service Innovation


New Technologies /

Knowledge

Society/Businesses

Develop values

Assimilate

Acquire Create


Technical Vitality

h

Economic Evolution: Servitization and Productization

Products Services

Client’s needs

Service complexity

Pro

duct

com

ple

xity

Products

Services

Products

soph

istic

atio

n

nomad agriculture goods services integrating

by Integration

?Driver: getting closer to users

URGENCY

OF NOW!


Service Innovation: Value Creation Matrix Where innovation can be targeted? Can innovation value be measured? Where values should show up?

ValueChallenges

MarketShare

Revenue Profit Productivity/Utility

Customers Customer Intimacy

Product/Service Leadership

Market Differentiation/Singularity

Operations Excellence

Regulation Compliance/Social Responsibilities

Products & Services

Market & Competitors

Operations/ Processes/ Resources

Governance &Business Integrity


Service Innovation: Value Creation Matrix How do we do it?

ValueChallenges

MarketShare

Revenue Profit Productivity/Utility

Customers Mass Customization

Facilitation, Simplification, Integration, Standardization, Differentiation

Globalization, Market Singularization

Optimization, Automation, Integration, Securitization

Regulation Compliance Optimization

Products & Services

Market & Competitors

Operations/ Processes/ Resources

Governance &Business Integrity


SHAREHOLDER´S VALUE

MA

RK

ET

SHA

RE

PR

OD

UC

TIY

IT

Y/U

TIL

ITY

RE

VE

NU

E

PR

OF

IT

MARKET SINGULARITY

MARKET SINGULARITY

REGULATION COMPLIANCESOCIAL RESPONSIBILITIES

REGULATION COMPLIANCESOCIAL RESPONSIBILITIES

PRODUCTS & SERVICES

LEADERSHIP

PRODUCTS & SERVICES

LEADERSHIP

OPERATIONS EXCELLENCEOPERATIONS EXCELLENCE

CUSTOMER INTIMACY

CUSTOMER INTIMACY

Ultimate Objective

Fundamental Indicators (KPIs)

Business Expectation

Government/Society

Expectation

Value Creation

UtilityQuality PerceptionCost


MARKET & COMPETITORS

MARKET & COMPETITORS

GOVERNANCEBUSINESS INTEGRITY

GOVERNANCEBUSINESS INTEGRITY

PRODUCTS & SERVICES

PRODUCTS & SERVICES OPERATIONS/PROCESSES/RESOURCESOPERATIONS/PROCESSES/RESOURCES CUSTOMERSCUSTOMERS

Examples of Skills Required

•BI//Data warehousing

•Behaviour Science

•Business Analytics

•Optimization

•CRM, Marketing

•Sales

•Innovation

•BI/Data warehousing

•Product/Service Management

•Product/Service Marketing

•R&D Management

•Microeconomics

•Pricing

•Innovation

•Social Responsibilities

•Ethics and Values

•Business Law/Reg. Compliances

•IT based Risk Management

•Leadership

•Entrepreneurship

•Strategy

•Critical Thinking/Analysis

•Macroeconomics

•Infrastructure

-IT Architecture

-IT for Services

-IT Management

•Project Mgt/Consultancy

•Financial Management

•Processes

- e-Commerce

- SOA/BPM/ERP/ISC

- Quality Management

•Human Capacity Mgt

•Knowledge Mgt

BI: Business Intelligence

SOA: Service Oriented Architecture

ERP: Enterprise Resource Plannng

ISC: Integrated Supply Chain


Impacts on Higher Education

New Technologies

/ Knowledge

Society/Businesses

Develop values

Assimilate

Acquire CreateDiscover


Knowledge Cycle Student Perspectives:• Hitting the ground running

•Employability•Knowledge•Experiences•Insight

•Project based

approach• Preparing for innovation

•Versatility: wider spectrum•Major•Minor

• Expecting the unexpected•Adaptability

•Methodology•Framework

Faculty perspectives:• Quality: Standing out

among the out -standings•Patents•Publications

• Pertinence: Pushing the frontier of innovation and relevancy•Government/industry

Partnership

- practicality

- alignment with government/industry

strategic objectives • Sustainability:

Committing to change•Continual learning

InnovationsInnovations

Multi-disciplined and Collaborative


Conclusion: to meet the 21st century challenges

Service Innovation: creating new value by getting closer to clients (to meet client’s needs and wants) by:

Enhancing capabilities Facilitating ease of use Gaining new customers Creating new markets Gaining competitive edge with regulation

compliance (opportunities vs constraints)


About the speaker: Dr Diem Ho is Manager of University Relations for IBM Europe, Middle East and Africa (EMEA).

His mission is to build and manage relationships of mutual value for IBM and the academic community.

Diem’s past research interests covered many disciplines in Science, Technology and Finance/Economics. He has published widely in physics, mathematics, image processing, remote sensing, engineering, optimization and finance.

He recently co-edited/authored a special issue of the Computational Economics on Stochastic Process and Data Analysis published by Springer.

In recent years, he has lectured intensively on Higher Education Reform and is a member of the peer review teams for the EFMD-EQUIS and EPAS accreditation programs and a member of the EPAS committee.

He is an associate editor of the journal of Computational Economics and is a member of the IBM Academy of Technology.

Before assuming his current position, he was an EMEA practice leader with the IBM Management Technologies Consulting Group, specializing in using Technologies to address Business Challenges in Banking and Finance sector.

Before joining IBM, Diem was a university professor and he continues to supervise PhD thesis to-date.

Diem obtained two Master degrees and a PhD in Magnetospheric Physics at Stanford University, California.

© 2002 IBM Corporation IBM EMEA University Relations Service Innovation Dr Diem Ho Member of the...

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