Service Science E-Book

Robin G. Qiu

• Herausgeber: John Wiley & Sons
• Kategorie: Fachliteratur
• Sprache: Englisch

Seitenzahl: 562

Veröffentlichungsjahr: 2014

Beschreibung

Features coverage of the service systems lifecycle, including service marketing, engineering, delivery, quality control, management, and sustainment Featuring an innovative and holistic approach, Service Science: The Foundations of Service Engineering and Management provides a new perspective of service research and practice. The book presents a practical approach to the service systems lifecycle framework, which aids in understanding and capturing market trends; analyzing the design and engineering of service products and delivery networks; executing service operations; and controlling and managing the service lifecycles for competitive advantage. Utilizing a combined theoretical and practical approach to discuss service science, Service Science: The Foundations of Service Engineering and Management features: * Case studies to illustrate how the presented theories and design principles are applied in practice to the definitions of fundamental service laws, including service interaction and socio-technical natures * Computational thinking and system modeling such as abstraction, digitalization, holistic perspectives, and analytics * Plentiful examples of service organizations such as education services, global project management networks, and express delivery services * An interdisciplinary emphasis that includes integrated approaches from the fields of mathematics, engineering, industrial engineering, business, operations research, and management science * A detailed analysis of the key concepts and body of knowledge for readers to master the foundations of service management Service Science: The Foundations of Service Engineering and Management is an ideal reference for practitioners in the contemporary service engineering and management field as well as researchers in applied mathematics, statistics, business/management science, operations research, industrial engineering, and economics. The book is also appropriate as a text for upper-undergraduate and graduate-level courses in industrial engineering, operations research, and management science as well as MBA students studying service management.

Leseprobe

Table of Contents

Cover

Title Page

Copyright

Dedication

Foreword

Foreword

Preface

Acknowledgments

Chapter 1: Evolving and Holistic View of Service

1.1 What is Service?

1.2 Different Perspectives on Service

1.3 The Lifecycle of Service

1.4 Service Encounters Throughout the Lifecycle of Service

1.5 The Economic Globalization

1.6 The Evolving and Holistic View of Service

1.7 Summary

References

Chapter 2: Definition of Service

2.1 From Manufacturing to Service: The Economic Shift

2.2 Total Service Lifecycle: The Service Provider's Perspective

2.3 A Service Definition for this Book

2.4 Final Remarks

References

Chapter 3: The Need for the Science of Service

3.1 A Brief Review of the Evolution of Service Research

3.2 Service as a Process of Transformation

3.3 Formation of Service Encounters Networks

3.4 Inherent Nature of Sociotechnical Service Systems

3.5 Digitalization of Service Systems

3.6 An Innovative Approach to Developing Service Science

References

Chapter 4: Service Science Fundamentals

4.1 The Fundamental Laws of Service: A Systemic Viewpoint

4.2 The Service Encounter Sociophysics

4.3 Service Science: A Promising Interdisciplinary Field

4.4 Final Remarks

References

Chapter 5: Organizational and IT Perspectives of Service Systems and Networks

5.1 Service as an Offering of A Service System

5.2 Putting People First

5.3 Controllable and Tractable Service Systems in Pursuit of Smarter Operations

5.4 Competitiveness, Sustainability, and Innovation: Systems Approaches to Explore The Sociotechnical Natures of Service Systems and Networks

5.5 Final Remarks

Acknowledgment

References

Chapter 6: Computational Thinking of Service Systems and Networks

6.1 Monitoring and Capturing People-Centric Service Network Dynamics in Real Time

6.2 Computational Thinking of Service Systems and Networks

6.3 Modeling of a Configurable and Competitive Service System

6.4 Service Systems' Performance: Metrics and Measurements

6.5 PDGroup as an Exploratory Example of Service Systems Modeling

6.6 Conclusions

Acknowledgment

References

Chapter 7: Education as a Service and Educational Service Systems

7.1 Systems of Schooling: Service Science's Perspective

7.2 A Quality Control and Management Case Study for Resident Education: The Systems Perspective

7.3 Off-Campus Learning: An Example of High School STEM Education Enhancement

7.4 A Lifecycle and Real-Time-Based Approach to Service Engineering and Management

7.5 Summary

Acknowledgment

References

Chapter 8: Online Education Service and MOOCs

8.1 Introduction

8.2 A Systemic Approach to Analyze Collaborative Learning

8.3 Collaborative Learning Analytics: Part I

8.4 Collaborative Learning Analytics: Part II

8.5 The Significance of This Illustrated Case Study

8.6 Conclusions

References

Chapter 9: The Science of Service Systems and Networks

9.1 The Science of Service Systems and Networks

9.2 The Science of Service in the Twenty-First Century

References

Index

End User License Agreement

Pages

xiii

xiv

xv

xvi

xvii

xviii

xix

xx

xxi

xxii

xxiii

xxv

xxvi

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

29

30

31

32

33

34

35

36

37

38

39

40

41

42

43

44

45

46

47

48

49

50

51

52

53

54

55

56

57

58

59

60

61

62

63

64

65

66

67

68

69

70

71

72

73

74

75

76

77

78

79

80

81

82

83

84

85

86

87

88

89

90

91

92

93

94

95

96

97

98

99

100

101

102

103

104

105

106

107

108

109

110

111

112

113

114

115

116

117

118

119

120

121

122

123

124

125

126

127

128

129

130

131

132

133

134

135

136

137

138

139

140

141

142

143

144

145

146

147

148

149

150

151

152

153

154

155

156

157

158

159

160

161

162

163

164

165

166

167

168

169

170

171

172

173

174

175

176

177

178

179

180

181

182

183

184

185

186

187

188

189

190

191

192

193

194

195

196

197

198

199

200

201

202

203

204

205

206

207

208

209

210

211

212

213

214

215

216

217

218

219

220

221

222

223

224

225

226

227

228

229

230

231

232

233

234

235

236

237

238

239

240

241

242

243

244

245

246

247

248

249

250

251

252

253

254

255

256

257

258

259

260

261

262

263

264

265

266

267

268

269

270

271

272

273

274

275

276

277

278

279

280

281

282

283

284

285

286

287

288

289

290

291

292

293

294

295

296

297

298

299

300

301

302

303

304

Guide

Cover

Table of Contents

Preface

Chapter 1: Evolving and Holistic View of Service

List of Illustrations

Figure 1.1

Figure 1.2

Figure 1.3

Figure 1.4

Figure 1.5

Figure 1.6

Figure 1.7

Figure 1.8

Figure 1.9

Figure 1.10

Figure 1.11

Figure 1.12

Figure 1.13

Figure 1.14

Figure 1.15

Figure 1.16

Figure 1.17

Figure 1.18

Figure 1.19

Figure 1.20

Figure 1.21

Figure 1.22

Figure 2.1

Figure 2.2

Figure 2.3

Figure 2.4

Figure 2.6

Figure 2.7

Figure 2.8

Figure 2.9

Figure 2.10

Figure 2.11

Figure 2.12

Figure 2.13

Figure 2.14

Figure 2.15

Figure 2.16

Figure 3.1

Figure 3.2

Figure 3.3

Figure 3.4

Figure 3.5

Figure 3.6

Figure 3.7

Figure 3.8

Figure 3.9

Figure 3.10

Figure 4.1

Figure 4.2

Figure 4.3

Figure 4.4

Figure 4.5

Figure 4.6

Figure 4.7

Figure 4.8

Figure 4.9

Figure 4.10

Figure 4.11

Figure 4.12

Figure 5.1

Figure 5.2

Figure 5.3

Figure 5.4

Figure 5.5

Figure 5.6

Figure 5.7

Figure 5.8

Figure 5.9

Figure 5.10

Figure 5.11

Figure 5.12

Figure 6.1

Figure 6.2

Figure 6.3

Figure 6.4

Figure 6.5

Figure 6.6

Figure 6.7

Figure 6.8

Figure 6.9

Figure 6.10

Figure 6.11

Figure 6.12

Figure 6.13

Figure 6.14

Figure 6.15

Figure 6.16

Figure 6.17

Figure 6.18

Figure 6.19

Figure 6.20

Figure 6.21

Figure 6.22

Figure 7.1

Figure 7.2

Figure 7.3

Figure 7.4

Figure 7.5

Figure 7.6

Figure 7.7

Figure 7.8

Figure 7.9

Figure 7.10

Figure 7.11

Figure 7.12

Figure 7.13

Figure 7.14

Figure 7.15

Figure 7.16

Figure 7.17

Figure 7.18

Figure 7.19

Figure 7.20

Figure 7.21

Figure 7.22

Figure 7.23

Figure 7.24

Figure 7.25

Figure 8.1

Figure 8.2

Figure 8.3

Figure 8.4

Figure 8.5

Figure 8.6

Figure 8.7

Figure 8.8

Figure 8.9

Figure 8.10

Figure 8.11

Figure 8.12

Figure 8.13

Figure 8.14

Figure 8.15

Figure 8.16

Figure 8.17

Figure 8.18

Figure 9.1

Figure 9.2

Figure 9.3

Figure 9.4

Figure 9.5

Figure 9.6

List of Tables

Table 1.1

Table 1.2

Table 2.1

Table 3.1

Table 4.1

Table 4.2

Table 7.1

Table 7.2

Table 7.3

Table 7.4

Table 7.5

Table 7.6

Table 7.7

Table 7.8

Table 7.9

Table 7.10

Table 7.11

Table 7.12

Table 7.13

Table 8.1

Table 8.2

Table 8.3

Table 8.4

Table 8.5

Table 8.6

Table 8.7

Table 8.8

Table 8.9

Service Science

The Foundations of Service Engineering and Management

Robin G. Qiu

The Pennsylvania State University USA

Copyright © 2014 by John Wiley & Sons, Inc. All rights reserved.

Published by John Wiley & Sons, Inc., Hoboken, New Jersey.

Published simultaneously in Canada.

No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form or by any means, electronic, mechanical, photocopying, recording, scanning, or otherwise, except as permitted under Section 107 or 108 of the 1976 United States Copyright Act, without either the prior written permission of the Publisher, or authorization through payment of the appropriate per-copy fee to the Copyright Clearance Center, Inc., 222 Rosewood Drive, Danvers, MA 01923, [phone], fax [phone], or on the web at www.copyright.com. Requests to the Publisher for permission should be addressed to the Permissions Department, John Wiley & Sons, Inc., 111 River Street, Hoboken, NJ 07030, [phone], fax [phone], or online at http://www.wiley.com/go/permission.

Limit of Liability/Disclaimer of Warranty: While the publisher and author have used their best efforts in preparing this book, they make no representations or warranties with respect to the accuracy or completeness of the contents of this book and specifically disclaim any implied warranties of merchantability or fitness for a particular purpose. No warranty may be created or extended by sales representatives or written sales materials. The advice and strategies contained herein may not be suitable for your situation. You should consult with a professional where appropriate. Neither the publisher nor author shall be liable for any loss of profit or any other commercial damages, including but not limited to special, incidental, consequential, or other damages.

For general information on our other products and services or for technical support, please contact our Customer Care Department within the United States at [phone], outside the United States at [phone] or fax [phone].

Wiley also publishes its books in a variety of electronic formats. Some content that appears in print may not be available in electronic formats. For more information about Wiley products, visit our web site at www.wiley.com.

Library of Congress Cataloging-in-Publication Data:

Qiu, Robin G.

Service science : the foundations of service engineering and management / Robin G. Qiu.

pages cm

Includes bibliographical references and index.

ISBN 978-1-118-10823-9 (hardback)

1. Service industries. 2. Service life (Engineering) 3. Industrial engineering. I. Title.

HD9980.5.Q28 2014

658–dc23

2014007302

To my family.

Foreword

James C. Spohrer

The science of service is emerging. Undoubtedly, a journey of this complexity, striving to scientifically understand a phenomenon as fundamental and richly diverse as service phenomenon, must be explored along multiple pathways over multiple decades. Therefore, it is always a great pleasure for me to recognize and encourage those embarked on this journey. Truly, we are all students of service, learning from each other as we go.

In this volume, entitled Service Science: The Foundations of Service Engineering and Management authored by Robin Qiu, I would like to draw the careful reader's attention to three main aspects of this work.

The Pioneers: In Chapter 3, a brief overview of the evolution of service research is presented. The complexity and diversity of service phenomenon is reflected in part by the number of academic disciplines whose scholars have written on this topic. Scholars from schools of management, engineering, natural sciences, social sciences, as well as arts and humanities (service design), not to mention practitioners and policy makers in government, have all played a role in the exploration. Figure 3.5 entitled “A sustainable socio-technical process-driven service system” provides an excellent visualization of five types of capital (natural, human, social, financial, and infrastructural) and the processes that transform these resources over time. It is worth noting that each of the major scholarly schools has a primary focus on one of the five major forms of capital.

Putting People First: In Chapter 5, I especially enjoyed the section on putting people first. The book presents novel approaches to the mathematical formalization of service, without losing sight of this important fact—service is about putting people and their experiences first. Pay special attention to Figure 5.8 entitled “Service value diagram corresponding to GE's change effectiveness model”—for though it is one of the simpler diagrams in the book, it highlights that increasing value derives from increasing quality and increasing acceptance, when mutually agreed to and cocreated by providers and customers. Furthermore, with the global rise of smart phones and social media tools, there has never been such an exciting time in human history to gather and analyze big data aspects of service encounters. We are in the age of increasingly powerful tools for value cocreation. This work also makes the important point that value cocreation is also about cotransformation of providers and customers.

Education as a Service: Chapters 7 and 8 provide an excellent example of applying the theoretical developments in this book to the challenge of improving education as a service. Both chapters highlight the value of structural equation modeling techniques as well. Chapter 9 further distills the theoretical developments into a practical and iterative method for daily improvements to service business offerings. Figure 9.3 entitled “Engineering and managing competitive services: scientific perspective” conveys a tremendous amount of methodology quite concisely. Readers familiar with statistical control theory will find this chapter an especially nice summary of the developments in the book.

While much work remains to broadly establish a holistic and lifecycle approach to service systems, this book boldly suggests pathways and approaches to help researchers mathematically formalize service systems and networks in the age of big data, without losing sight of the importance of putting people first. In the coming years, I look forward to reading more along this pathway as the ideas presented are further tested and refined.

James C. Spohrer

Director, IBM University Programs World-Wide (IBM UP)

IBM Almaden Research Center

Foreword

Richard C. Larson

Services. What do we think of? Taking cash from an ATM machine? Talking on our cell phones? Surfing the web? Watching TV? Picking up our mail? Yes, all these daily activities and much more. In fact, we would be hard-pressed to identify significant parts of our lives that are not service-related. About 150 years ago, over 50% of the US workforce toiled in agriculture. Today, it is about 2%, and we grow a lot more food. Agriculture is not a service, but its workforce has plummeted while the sector has become more productive. In the US post-WWII boom, in the late 1940s, the fraction of the US workforce in manufacturing peaked at about 35%. Today, it is a mere 9%. The percentage of gross domestic product (GDP) associated with manufacturing parallels these numbers, from being about 30% post-WWII to being about 12% today. What has filled the void? Answer: The US service sector. It has swelled to about 80% of the GDP!

What precisely is the service sector? Economists define it by subtraction. The service sector is everything in the economy that is NOT agriculture (including forestry and fishing) OR industry (manufacturing and also mining and construction). That subtraction leaves us with the majority of the world in which we live! In addition to the mundane day-to-day services chores, we have the health care system (about 18% of the economy), education (8–10% of the economy) and much more—government, transportation, entertainment, utilities, etc. The excellence or nonexcellence of services can literally mean the difference between life and death!

We are fortunate that Robin Qiu has written this book at this time. He reports that we in the United States have had a national obsession with manufacturing and our international competitiveness in that domain. Yet, it is services that comprise the largest part of the economy, by far. The service sector creates a net international trade surplus for the United States. Scores of books have been written about manufacturing, which is now 12% of the GDP. Far fewer books have been written about services, which constitutes 80% of the GDP. Robin has been a leader in pushing us, not to ignore manufacturing, but to move it upward to its rightful place focusing on the services sector. He is the principle founder of the new INFORMS journal, Service Science. This book represents another major contribution to service sector analysis.

At my home institution, the Massachusetts Institute of Technology, the graduate Masters program “Leaders for Manufacturing,” founded in 1988, has recently been renamed “Leaders for Global Operations,” reflecting the fact that many of today's industrial leaders are in services such as retailing and supply chain management and not manufacturing.

Robin says that a service is provided as part of a complex sociotechnical system. This broad nontechnocratic view is perfect from my point of view. Services cannot be meaningfully studied solely through sharply focused discipline-based glasses. To be effective, service sector analyses cannot be Tayloristic “time and motion” studies. We require an interdisciplinary approach, where aspects of the social sciences often dominate traditional narrow engineering-measurable quantities.

My favorite early example of this is the story of queueing at elevators in the 1950s in New York City. With the post-WWII economic growth, more high rise buildings were constructed in Manhattan—as office buildings, hotels, and apartments. People started to complain about delays for elevators in these buildings, especially at morning and late afternoon rush hours. A narrow engineering-focused queueing analysis might have concluded that some of these buildings should be destroyed and designed over, with more elevator shafts, as the current designs could not support peak load traffic. (I say this only slightly tongue in cheek!) But a colleague of Professor Russell Ackoff of the University of Pennsylvania was dispatched to study the situation. He indeed verified the numerous customer complaints about elevator delays. Then, in a moment of true creative thinking, he redefined the problem. He thought to himself, “What if the problem is not the magnitude of the delays waiting for the next elevator? What if the problem is the complaints about those delays?” He postulated that the elevator customers needed a distraction while they were waiting. So, in a spurt of lateral thinking, he purchased and had installed floor-to-ceiling mirrors adjacent to all the elevators in a test building. Guess what? The complaints about elevator delays plummeted to near zero, while the statistics of delay remained unchanged! Problem solved, but not with traditional queueing theory. Here a touch of psychology was needed. And so was born the psychology of queueing, the same year (1955) that Walt Disney opened his first amusement park—in Anaheim, CA. Over the years, the Disney Company has shown itself to be a true master of designing and managing complex sociotechnical service systems—including its queues. The arts and entertainment services industry comprises about 4% of the US GDP.

Reading Robin's book chapters, with its many useful framings of services provision, I started reflecting on my own personal services experiences and preferences. He says that trust and reliability are important aspects of services. Here is trust: I have used the same travel agent for 34 years! And, yes, I am happy to pay more than what is charged by an anonymous discount Internet-based travel service because I know it will be done right, changes will be easy, and that she ‘has my back’ if anything goes wrong during travel. Car repair: I have an 8-year-old Subaru WRX STI, a rally racing champion. No one touches it except my dealer (and me)! Eight years, one place for maintenance and on rare occasions—repair. They have my back on that car. And I would not trust a random person employed by some discount national auto repair chain to look after this car—which is an extension of me! Medical services: You guessed it, over 35 years with the same organization. Maybe I am too fixed in my ways. But trust in-services are of paramount importance.

Trust goes in the reverse direction as well: One bad service encounter can lead to a lifetime pledge never to patronize that organization again. The median age of students in a typical graduate class that I teach at MIT is 25. I ask them, “How many of you have had such a bad service encounter in your lives that you have pledged to yourself never ever to go back there again?” These are 25-year-olds, less than 10 years from living with their parents. And, invariably, over half the class raises their hands! How many providers of services are aware of this fact? That continual excellent quality service is required for customer retention. Customer loyalty may go only as far as the next service encounter. Robin Qiu drills the lesson home in this important book.

Services are nuanced, not readily quantified into various measurement bins. Robin describes this in many ways. From my life in Lexington, MA, a historical suburb of Boston with a population of 28,000: We have two Starbucks, one Peet's Coffee, and seven Dunkin Doughnuts! Plus various convenience stores and quick-stop shops located at gasoline stations—all serving coffee to go. I guess Lexingtonians are highly caffeinated! From my home I prefer to drive to the third closest Dunkin Doughnuts. Why? The coffee and food products and prices are identical to each other. Answer: Only in this shop do I get greeted each time with sincere friendly smiles, as if they really want to see me and are happy to have me as a customer. Plus, the place is a neighborhood hangout with many retired folks just sitting around, enjoying each other's company, and passing the time of day—a type of nice ‘bar scene’ in a coffee shop. The ambience is just right. My minute or two of extra driving is worth it! Again, how many “time-and-motion” type studies would ferret out these concerns? I do not think I'm unique in valuing such nuanced aspects of services as important. Robin Qiu hits the nail on the head. Many others miss it completely.

After reading Robin's book, we would know that there is only one topic he discusses for which I have a minor disagreement: Internet-based services. To allude to an ‘alien’ terminology, he equates these to a type of “Service Encounter of the First Kind,” that is, rather distant and impersonal. (In the 1977 movie, Close Encounters of the Third Kind, an encounter of the first kind was an alien encounter beyond 500 ft—implying little closeness, complexity, or subtlety.) I agree with him for many Internet services, such as those associated with airlines, hotels, and rental cars. But, there are Internet-based services such as Etsy (https://www.etsy.com) that resemble personal face-to-face interaction. You might call these “Close Service Encounters of the Third Kind,” that is, up close and personal, nuanced, and complex. In fact, I have found web sites such as Etsy better than shopping mall face-to-face interactions because I am dealing with the proprietor of a small artisanal business and his/her future success depends 100% on customer satisfaction. The email ‘back-and-forth’ between proprietor and customer often resembles a conversation of an old country general store of the 1800s! Writing reviews online for all to see can show each customer's satisfaction or dissatisfaction. It is difficult for the average customer to have that type of impact with impersonal national chain stores, with either face-to-face or Internet-based service encounters. My hunch is that Robin will agree with me and say that I may have misread the book with relation to all Internet-based services! And I am sure he would be right!

It is an honor that Robin has asked me to write this foreword. Enjoy the book. See all the many faceted aspects of services that Robin describes and structures. Also, reflect back on your own personal experiences with services, and you will see that Robin hits the mark virtually every time. In addition, if you are in a planning or managerial role in a service firm, you and your company can gain significant competitive advantage listening to what is said in this book. A service is a complex sociotechnical system, and those who recognize it as such are bound to prosper.

Richard C. Larson

Engineering Systems Division

Massachusetts Institute of Technology

Preface

This book essentially introduces a new perspective of service study. By taking a holistic view of the service lifecycle, we discuss approaches to explore the real-time dynamics of service systems and networks. We advocate that a service must be defined as a value cocreation and transformation process. As such, we can holistically analyze the performance of service systems that enable and execute complex and heterogeneous services. By leveraging the advances in computing and network technologies, social science, management science, and other relevant fields, we present the concept and principles of putting people first in service and demonstrate that service networks in light of service encounters can be comprehensively explored in a closed-loop and real-time manner. The presented framework can be potentially applied in facilitating service organizations to understand and capture market trends, design and engineer service products and delivery networks, execute service operations, and control and manage the service lifecycles for competitive advantage.

Service research is not new. In fact, service research in the field of marketing has an over 30-year-history. In addition to research and development in service marketing, academics and practitioners have actively developed a variety of theories, methods, and tools and then applied them to address service delivery efficiency and effectiveness issues in service operations and management across the service industry for decades. Recently, significant attention in the service research is related to a variety of exploratory studies of service systems, focusing on how to leverage the advances of management science, systems and network theory, and computing and network technologies to help service organizations improve the overall performance of their service systems from both engineering and operational perspectives.

Note that the worldwide economy was dominated by manufacturing during the last couple of centuries. As a result, both academics and practitioners paid much attention to the design, development, production, and innovation of physical products. The economic shift from manufacturing to service made us rethink people's social, physiological, and psychological roles in the economic activities. However, inertial thinking is part of sociopsychological norms to the majority of human beings, resulting in many service organizations offering and delivering their services using manufacturing mindsets. Consequently, the advances in social science, management science, computing technologies, and others are not well integrated and thus leveraged in support of effective service engineering and management as needed in the service industry.

Change is the only constant in today's business world. The effectiveness () of a service as a solution to meet the changing needs of customers is equal to the product of the quality () of the technical attributes of the solution and the acceptance () of that solution by the customers, that is, . However, the customers' acceptance changes rapidly, varying with people, time, places, cultures, and service contexts. Because people's acceptance is largely subjective, manufacturing mindsets with a focus on physical attributes indeed become ineffective when applied in the field of service engineering and management. Hence, to address the discussed change acceleration phenomena with scientific rigor, we must rely on people-centric and service mindsets. In fact, the introduction of putting employee and customers first in the 1990s radically made a turn in the way how service organizations should develop, operate, and manage businesses and measure their successes. Indeed, people-centered service mindsets have afterwards been emerging and receiving more and more attention in the service industry.

Bearing this discussion in mind, we consider a service as a transformation process rather than an offered product. Truly, both provider-side and customer-side people are always involved in an interactive manner in service. Hence, we view a service as a value cocreation process. For a service, goods are frequently the conduits of service provision; the physical attributes and technical characteristics that specify the goods are indispensable to the service. The quality () of the technical attributes in the service, indeed, mainly defines the quality of the goods. To a service customer, is frequently perceived in service provision as the quality of designated service functionalities that are defined in a service specification. As indicated in the equation of , the value of also depends on the value of , which is largely related to sociopsychological perceptions of the customer throughout the service lifecycle. Although this is well understood conceptually, however, the service industry lacks methods and tools to explore and measure and in service in a holistic, real-time, and quantitative manner.

Services are highly heterogeneous. For a given service, a specific customer and a service provider essentially cocreate the service values that meet the respective needs of the customer and the service provider. Thus, each service is unique. The variability of service and the need for measuring sociopsychological perceptions had made extremely challenging the full exploration of the service lifecycle, spanning market discovery, engineering, delivery, and sustaining, in an integrated and quantitative manner.

Indeed, the prior lack of means to monitor and capture people's dynamics throughout the service lifecycle has prohibited us from gaining insights into the service engineering and management in a service organization. Promisingly, we believe that the combination of the following advances in technologies has made possible the design and development of the needed means and methods that can help service organizations overcome the challenges:

Digitalization

Networks and telecommunications

Collaborative methods and tools

The fast advances in social network media

Big data technologies and analytics methods and tools

In other words, real-time data on the dynamics of service cocreation processes from both service providers and customers could be comprehensively captured and analyzed if needed. (Surely, people's privacies must never be compromised, which are beyond the coverage of this book.) When the enabling technologies are appropriately implemented, we can create and execute smarter working and consuming practices so that we can make service cocreation processes not only beneficial but also enjoyable.

Simply put, enormous opportunities truly lie ahead of us. We quite often ask ourselves: “Do we have right methods and tools that ensure service systems to perform in such a way that the respective values for both service providers and customers can be optimally cocreated, at present and in the long run?” However, the question remains unanswered, partially or totally. By leveraging both systems methods and networks analytics, in this book we present one solution to address this unanswered question.

Holistically, a service organization is a service system, essentially consisting of service providers, customers, products, and processes. Different from a goods-producing system, a service system must be people-centered. Therefore, a service system surely is socio-technical. On the basis of the earlier discussion, we understand that it is the transformation process that ties all other system constituents together and cocreates the respective values for both service providers and customers. Whether the values can be fully met relies on the efficient, effective, and smart business operations that are engineered, executed, and managed across the service system.

Service is people-centric, truly cultural and bilateral. The type and nature of a service dictate how a service is performed, which accordingly determines how a series of service encounters could occur throughout its service lifecycle. The type, order, frequency, timing, time, efficiency, and effectiveness of the series of service encounters throughout the service lifecycles determine the quality of services perceived by customers who purchase and consume the services. Note that the people-centered, interactive, and behavioral activities in a service system essentially engender a service cocreation network. Indeed, as the velocity of globalization accelerates, the changes and influences are more ambient, quick, and substantial, impacting us as providers or customers in dynamic and complex ways that have not seen before. The understanding of service networks is essential for service providers to be able to design, offer, and manage services for competitive advantage in the long run.

Because of the sociotechnical nature of a service system, we use a systems approach to evaluate the performance of the service system, aimed at capturing both utilitarian functions and sociopsychological needs that characterize service systems. However, the true people's behavioral and attitudinal dynamics of a sociotechnical system requires conducting real-time, corresponding social network analytics. As a result, the insights of the service interactions in the formed service networks can be truly explored and understood, which assist stakeholders to make respective while cooperative informed decisions at the point of need to improve their service cocreation processes across the service lifecycles in an optimal manner.

To get a comprehensive understanding of this new perspective of service research, readers should read chapters sequentially. Brief introductions to all chapters in this book are provided in the following:

Chapter 1

. Introducing service by briefly reviewing the evolution of service, we emphasize that the holistic view of service is a must in today and the future's world economy.

Chapter 2

. Discussing the concept of cocreation in the service industry. A definition of service for this book is provided, which radically lays the foundation for the remaining chapters in this book.

Chapter 3

. Exploring cocreation transformation processes. We articulate that the increasing complexity of service research and development requires the science of service in a new perspective.

Chapter 4

. Looking into service science fundamentals. By analyzing the dynamics of service, we define laws of service in general. A holistic and sociotechnical view of service becomes essential for us to develop service science.

Chapter 5

. Revealing the digitalization of service systems and networks. We argue that putting people first should be a mindset. The mindset is what service organizations must bear when they design and develop their service systems. Through leveraging process-aware computing systems and sensor-based networks, people's behavioral and sociopsychological data and information can be well monitored and captured.

Chapter 6

. Showing computational thinking of service systems and networks. By taking advantage of the digitalization of service systems and networks, we demonstrate that the system dynamics of service cocreation processes can be fully modeled, analyzed, and controlled in a closed-loop, real-time, and quantitative manner.

Chapter 7

. Using education examples to show how service and service systems can be explored from a systems perspective. Specifically, we apply structural equation modeling to investigate mechanisms of improving educational service systems. By integrating cross-section and longitudinal analyses, we demonstrate the tremendous potential of the applications of the proposed approach in the general field of service engineering and management.

Chapter 8

. Using an online education example to demonstrate the dynamics of service networks. The concept and principles of putting people first are illustrated in great detail in this chapter. When people-sensing mechanisms are well implemented in a service system, service networks that are essentially formed from service interactions within the service system can be fully investigated. We present effective data, network, and business analytics with a focus on looking into the insights of the service system in real time. Ultimately, once system performance modeling and service network analysis are well integrated in a closed-loop, real-time, and quantitative manner, we can truly help service organizations perform optimal service engineering and management throughout the service lifecycle.

Chapter 9

. Concluding the book with some final remarks. We articulate that innovative approaches to the development of Service Science are truly needed. However, we advocate that the service research and practice community must appreciate and continue to develop a variety of methodologies and tools that can be well derived and evolved from the known theories and principles in systems theory, operations research, marketing science, organizational behavior and theory, network theory, social computing, and analytics.

This book does not intend to cover the state of the art in the service research field. Instead, this book simply provides readers a new perspective of service research and practice. It could serve as a good reference book for scholars and practitioners in the contemporary service engineering and management field.

Disclaimer

No product or service mentioned in this book is endorsed by its maker or provider, nor are any claims of the capabilities of the product or service discussed or mentioned. Products and company names mentioned may be the trademarks or registered trademarks of their respective owners.

Robin G. Qiu, PhD

Professor of Information Science

Pennsylvania State University

Acknowledgments

Since 2004, I have been involved in a variety of research projects related to the emerging field of service science. The presented concept and principles of service science in this book are surely derived from those funded studies. The funded projects include US NSF Grants (DMI-0620340 and DMI-0734149), Department of Education Grant (08JA630040, China), Nanjing University of Aeronautics and Astronautics Endowed Professor Scholarships (1009-905346 and 1009-908332), Chinese NSF Grants (70541007, 70772073, and 70902026), and IBM Faculty Award (2008–2009, China), and IBM Grants (SYRTHU5, D07009SUR, JLP201111006-1, NUAA-SUR-2012), Jiangsu Science and Technology Innovation Award (JSTIA269008, Jiangsu, China), and Penn State COIL RIG Grant (2012-14). Without their financial supports, I might never have had an opportunity of working in this emerging and promising field.

Portions of the content of Chapter 5 were previously published as a chapter entitled “Information Technology as a Service” in Enterprise Service Computing: From Concept to Deployment, which was published by Idea Group Publishing (Hershey, PA) in 2007, Copyright 2007, IGI Global, www.igi-global.com. Portions of the content of this book were previously published as chapters entitled “BPM” and “BPM/SOA, Business Analytics and Intelligence” in Business-Oriented Enterprise Integration for Organizational Agility, which was published by IGI Global (Hershey, PA) in 2013, Copyright 2013, IGI Global, www.igi-global.com. Reprinted by permission of the publisher.

Portions of the content of Chapter 6 were previously published in Service Science, 1(1), 42–55, entitled “Computational thinking of service systems: dynamics and adaptiveness modeling” and are used with permission from the Institute for Operations Research and the Management Sciences (INFORMS, https://www.informs.org). INFORMS is not responsible for the errors introduced in the translation of the original work. During the period of developing this project, the author wrote several editorial columns for Service Science. The author made cross-references between those editorial columns and this book.

The author would like to acknowledge the help of all involved in the collation and review process of this book, without their supports the project could not have been satisfactorily completed. Special thanks also go to all the staff at John Wiley & Sons, Inc., whose contributions throughout the whole process from inception of the initial idea to final publication have been invaluable. In particular, I am very grateful to Susanne Steitz-Filler, Senior Editor, who continuously prodded via e-mail for keeping the project on schedule. I want to thank anonymous reviewers whose insights and criticisms helped substantially improve the quality of this book.

Robin G. Qiu, PhD

Chapter 1

Evolving and Holistic View of Service

1.1 What is Service?

The word “service” has many connotations, varying with domains and settings. We must understand and deal with its extant variability in order to decipher and capture its inherent nature in business (Morris and Johnston, (1987). This is particularly important for this book because we have to stay in focus to discuss one solution, namely our unique and innovative approach to address the challenges that we have faced in the service sector over the years or new challenges that we will confront for the years to come. Put in a straightforward manner, presenting the “BEST” solution to address all the challenges confronted by academics and practitioners in the service sector is surely not our intention as there will never be such a one-size-fits-all solution. Given that the business world becomes more integrated, complex, and interdependent than ever before, a systemic view of service is the mindset that we will hold throughout this book. In other words, by relying on systems thinking and holistic viewpoints (Flood and Carson, (1993), we will explore and accordingly decipher the inherent nature of service in the unceasingly changing business world.

Service is frequently defined as an act of beneficial activity. A service that is considered as an act of beneficial activity actually has a long history. If we retrospect to the simplest material exchange that occurred in ancient times, such as a bushel of wheat exchanged for a barrel of oil, we know that a very basic trading service was performed. No matter what units and containers were used and how the trade was done in ancient times, the exchange or trade, a performed service, was essentially an act of helpful and beneficial activity that met the respective needs of the involved exchangers.

A food service in a restaurant is another good example of an act of beneficial activity. Similar to the above-mentioned simple trading service, we can also easily retrospect to ancient times in the early social and economic development stage thousands of years ago. A food service in ancient times certainly had no conceptual difference from a modern food service. Although the catering setting and foods in a restaurant at that time were limited and simple, a performed service was substantively involved with a list of necessary service elements, provider, consumer, resource, process, and value. The service provider was the owner who owned the restaurant and offered dishes as service products. A service consumer was a client who ordered and ate his or her selected foods. A typical service process started from the time the client entered the restaurant and ended when the client paid for the service and left the restaurant. The process was involved with a transformation with the support of operation resources. The client's order is the process's input. The value for the client and the owner is the process's output. The value could simply be the profit the owner made and the satisfaction the client had. The client's hunger stopped; he/she was happy to some degree. Surely, the service was mutually beneficial. Resources, largely natural and labor-based, were leveraged in an extremely simple manner throughout the simple catering process (Figure 1.1). Without question, the corresponding business operations at that time were radically experience-based.

Figure 1.1 A conventional resource model view of a food service.

Figure 1.2 A service involving certain fundamental elements.

Figure 1.1 illustrates the conventional classification of resources. By focusing on resource supply and demand in the social and economic activities, we understand how resources are leveraged in the transformation of goods and services to meet human needs and desires. As a result, we traditionally recognize three categories of resources: natural, human, and manufactured or infrastructural resources. Natural resources essentially are the source of raw materials. Human resources consist of human efforts provided in the transformation of products or services. Manufactured or infrastructural resources consists of man-made goods or means of production (machinery, buildings, and other infrastructure) used in the transformation of other goods and services (Samuelson and Nordhaus, (2009); Sullivan et al., (2011).

Regardless of what type of service is provided and consumed, five essential and core elements characterize a service in a conventional act of helpful and beneficial activity (Figure 1.2). More specifically, the five elements involved in services are resource, provider, consumer, benefit, and time, which can be described in an intuitive way as follows:

Resource

. Resources can be in a physical, soft, or hybrid form. For example, foods as a physical, transformable, and consumable resource or service product in a restaurant play a fundamental role in a given food service. Knowledge or experience in a focused subject area transferred in a training service seems to be a soft resource or service product. When a haircut service is performed, both barber's skills and haircut kits as a hybrid resource must be simultaneously applied or operated to make the service performed in a satisfactory manner. Essentially, with the help of resources, the act of performing a transformation task for a customer who asks for it in exchange for acceptable compensation is termed as service provision. Apparently, resources are the radical conduits of service provision to customers (Vargo and Lusch, (2004).

Provider

. A service is purposely performed by a service provider. A service provider as an entity can be an individual, group, organization, institution, system, or governmental agency.

Consumer.

A service consumer is usually a human being who consumes, acquires, or utilizes a service offered and performed by a service provider.

Benefits

. A performed service surely generates certain benefits. Typically, different benefits are pursued by the service provider and the service consumer as they have different value propositions in executing the service. The benefit for the service provider could be value-based, such as a profit. The benefit for the service consumer might be need-based, such as desire and satisfaction.

Time

. Small or big, simple or complex, a service certainly takes time to get performed to realize the desired benefits. Interactive activities between the provider and the consumer could occur in an

ad hoc

or predefined, unattended, and/or well-controlled process.

Note that service provider-side employees and customer-side consumers should also be part of recourses if we strictly follow the resource model as is illustrated in Figure 1.1. To make the discussion vivid and people-centric, we have to emphasize the identity of active participants in the service model that will be developed and discussed throughout this book. Therefore, we will always make an exception from the general resource model by distinguishing the elements of providers and consumers or customers from the general human resource concept. The concept of human resource in Figure 1.1 will be needed only when the whole resource model is the focus in a related and focused discussion.

Indeed, no matter how small or big, simple or complex a service is, it surely takes time for its provider to perform and its customer to consume the service. Evidently, the consumer and the provider of the service shall interact with each other, directly or indirectly, consecutively or intermittently, physically or virtually, and briefly or intensively, during the process of performing the service. The interaction time accordingly can be short or long. All of these changing factors that largely characterize provider–consumer interactions vary with the types of services that are actually performed. Hence, there are a variety of perspectives on service in academia and practice.

1.2 Different Perspectives on Service

Because of the existence of the above-mentioned variations in perception, a consumer's perception of one kind of service could differ considerably from another. Different forms of resources applied and operated in executing services and varieties of provider–consumer interactions create many different combinations of consumers' perceptions of services, which consequently complicate our service studies in academia and practice. Different consumers' perceptions of services then give rise to the existence of numerous definitions of service. As a result, different service industries have historically adopted different definitions of services to accommodate their respective needs. For example, service is also quite often defined as the supplying of utilities or commodities in the modern economic society. From an end user's point of view, consuming electricity as a service fits in this definition very well. If we consider the daily consumption of electricity as an example, we will see that there is very little interaction between its provider and customer. Typically, we as home owners or apartment tenants in the United States simply call a local office of an electricity service provider we choose, and then we inform the electricity service provider of the date we move in. When we move out, we simply do the same. The needed simple interaction serves only one purpose, which is basically to ensure that the monthly bill statement will accurately and correctly reflect the usages of electricity when we legitimately stay in the houses or apartments. Unless there could be a problem with power lines or a discrepancy in a monthly bill statement, we might not interact with the electricity service provider at all during our entire stay in the house or apartment. We as consumers feel that there is a very little interaction with a service provider; such a service is undoubtedly defined as the supplying of utilities from an end user's perspective.

The unceasingly increased online shopping in the twenty-first century presents another perfect example for a service that is defined as the supplying of commodities. It is well understood in the retailing industry that this supplying of commodities as a service includes commodities, related distributions, and retailing. However, to an end user, such an online shopping service is nothing but the supplying of the needed commodities. We as online shopping customers place orders from a website powered by an online retailer (i.e., a service provider). The orders will be delivered to us regardless of how the orders are fulfilled and how far away the orders have to be transported. Just like utilizing electricity at home, unless there would be a problem with the ordered commodities, we might not interact with the online retailer after the initial online order placement. Obviously, there is surely little physical interaction between a service provider and a service customer throughout the lifecycle of such a typical online shopping service.

Other forms of definitions of service include the providing of accommodation and activities required by the public or the supplying of public communication and transportation. A variety of services in the modern economic society fit in this category of service definition. A list of good examples will be trading, communication, transportation, tourism, hospitality, and health care services. Nevertheless, services provided by educational institutions, security and military, and governmental agencies can also be well classified in this category of definition.

As mentioned earlier, different consumers' perceptions of services have historically resulted in the existence of numerous definitions of service. At first glance, different forms of definitions of service seem to define different things. When we further examine these definitions, it is not difficult for us to find that regardless of how a service is defined in a given discipline in academia or in a specific service sector in practice, a service must include the five core elements shown in Figure 1.2. The differences felt or perceived by customers based on their perceptions of services come from user's experiences (Qiu, (2013) acquired from service encounters by the customers throughout the lifecycle of service executions.

Figure 1.3 The lifecycle of service: a classic service diamond.

1.3 The Lifecycle of Service

In both academia and practice, we can find many versions of defined phases that compose the lifecycle of service. Depending on what we expect for a service or largely perceive during the process of consuming a given service, we might use different constituting stages to compose a service lifecycle. Quite often, we are subjectively or objectively impressed by certain phases or stages of the lifecycle of service. Then, we tend to ignore other phases that we prejudicially think they are less important. The information technology infrastructure library (ITIL®) version 3 (ITIL, (2011) is a nonproprietary and publicly available set of best practices for information technology (IT) service management. ITIL v3 defines five phases of service lifecycle, service strategy, design, transition, operation, and continual service improvement, and accordingly provides comprehensive guidelines throughout all the phases for aligning IT services with the needs of business. We also frequently derive the definitions from the ones widely applied in the manufacturing sector. As a result, just like service, a variety of terms or definitions of the lifecycle of service exist.

Regardless of how many versions we can find in the extant literature, all the described lifecycles of services should always be composed of four essential and classic phases, “learn,” “develop,” “perform,” and “improve,” from a service provider point of view. We use these four essential and sequential phases in a service lifecycle to define the fundamental service diamond relationship in a service organization, which are illustrated in Figure 1.3. These four phases are briefly discussed as follows:

Learn

. We have to know what the market need is before the concept of a new service product gets conceived. Regardless of the type of service, we have to learn the market to identify the needs of prospective customers through a variety of approaches. We understand that customer needs keep changing as time goes. Therefore, we have to learn and capture the changes and accordingly incorporate the changes into service provision throughout the lifecycle of services.

Develop

. We develop, transform, or leverage resources to serve customers and meet their needs. Frequently, the resources in service are mainly and paradoxically perceived as service products. Indeed, as we discussed earlier, the resources in the service industry can be in a physical, soft, or hybrid form. Leveraging all natural, human, and infrastructure resources are essential in service provision. The operand or operant roles of resources in rendering services are significantly more sophisticated than the ones in the manufacturing industry. As a matter of fact, operant resources in service provision produce the effects that are largely perceived and truly appreciated by customers (Vargo and Lusch, (2004).

Perform

. This phase is largely highlighted by a process of service provision. Typically, the performing phase in a service lifecycle is known as the delivery of the service. For a service designated to a given customer, this is also the phase that the majority of service encounters occur from the customer's perspective.

Improve

. As we know that customer needs keep changing as time goes, we must continuously improve our services to stay cutting-edge in the business. Indeed, the improvements in all aspects of services are crucial to keep our services competitive (Qiu, (2013).

This classic service diamond relationship in a service organization clearly marks the four key milestones across the lifecycle of service. When the first version of services is conceived, developed, and offered by a service organization, clear and well-specified milestones that are explicitly based on the above-defined sequence might be created and followed from the operations and management perspectives. During each phase, the service organization usually has different business objectives set as the highest priority in management and operations. The diagram in Figure 1.4 shows a normal and classic view of managerial and operational priorities pursued in the service operations and management of a service firm, in which a milestone priority shifts along with the emergence of a new phase during service business operations. These typical four priorities that are logically identified throughout the lifecycle of service are briefly discussed as follows:

Innovation

. A service is not competitive unless it is creative and innovative. Service products are just part of a service. First of all, we should focus on the transformation of resources to innovate services that are aimed at positioning our services in the market for competitive advantage. Innovations must be thoroughly embodied in not only the service products, but the processes of delivering and improving the services.

Value Proposition

. The execution of a service by a service provider must create a value for the service provider. As a service takes time from beginning to end, we must have the value of a service clearly defined in order to have the value appropriately measured, monitored, and realized in the process of service provision.

Value Creation

. The targeted value is usually created in the process of service delivery. However, it is not uncommon in the service industry that we argue that the delivery of a service actually starts from its development phase.

Performance

. We know how a service meets the needs of its end user once the service is delivered. Quite often, we would like to have the deliveries to be monitored, so the real-time performance of our service businesses can be captured and then weakness can be identified for further improvements.

Figure 1.4 Priority shifts in service business operations and management.

Similar to the lifecycle of manufactured goods, the relationships defined in Figure 1.4 are most likely neither strictly linear nor purely sequential. In other words, the four priorities should not be separately considered during business operations in a competitive service organization. Frequently, a service organization will operate all the four phases in parallel as soon as the first batch of services gets completed. Please keep in mind, the first batch of services could simply be prototype or trial-based services. Competitive services are the results of both the coordinated and collaborated business actions taken by all the employees in the service provider, resulting in that satisfactory consumptions are realized and thus quality services are perceived by the customers.

1.4 Service Encounters Throughout the Lifecycle of Service

Before the emergence of the Internet, a physical context type of interactions between a service provider and a service customer was radically necessary in the process of performing a service. We define a service encounter as an act where a customer interacts with the service the customer wants. Therefore, a service encounter essentially is a social and transactional interaction in which a service provider performs a service activity beneficial to its corresponding service customer (Czepiel et al., (1985); Czepiel, (1990); Bitner, (1992). Undoubtedly, each service encounter becomes a moment of truth. For a given service, we are the service provider and might perform “good” or “bad” services by rendering “good” or “bad” user/service experience. In other words, we have the ability to either satisfy or dissatisfy a customer when we are engaged in a service encounter. With a previously dissatisfied customer, surely we can rely on another service encounter to offer a service recovery that will be satisfying such a previously dissatisfied customer and potentially making him/her a future loyal customer (Surprenant and Solomon, (1987); Bitner, (1990); Tax and Brown, (1998).

Product, price, and place consist of the rudimentary marketing mix (Figure 1.5a) that is crucial when a product is set for sale. Marketers have reconstituted and/or expanded the mix by including different components to accommodate the differences derived from different goods and the changing customers' needs in the market, aimed at improving sales from time to time. Since the 1960s, product, price, place, and promotion (or simply called 4 Ps) have been widely and steadily used as the pillar components (Figure 1.5b) in the supply-side marketing management to define or describe the marketing mix that can be applied for identifying the niche of a physical product for sale (McCarthy, (1960).

Figure 1.5 The rudimentary and popular marketing mix. (a) Rudimentary 3 Ps and (b) Popular 4 Ps.

In the business world, the effectiveness of marketing a product or service has traditionally and largely depended on how 4 Ps would be coordinated in the product or service marketing and sales process. The fundamental concepts of these components in marketing goods can be briefly summarized as follows:

A quality physical product has long been the core in the goods marketing. The value of a piece of goods lies in its ability to satisfy the needs of a customer, which is mainly seen in the physical attributes and technical functions of the provided product.