service design international workshop, tokyo, japan, december 20th, 2011
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Dr. Stephen K. KwanProfessor, Service Science
Management Information SystemsCollege of Business AdministrationSan José State University, CA, USA
http://www.sjsu.edu/ssme
Contact: stephen.kwan@sjsu.edu
Presented at the Service Design International WorkshopDecember 20th, 2011, Tokyo, Japan
Download these slides at: http://www.slideshare.net/StephenKwan
Service Design Basics –from System to Business Modeling
2
Abstract
This presentation looks at service design from a modeling perspective that incorporates system thinking, design thinking, and business thinking. This approach provides an avenue of integration across different disciplines and roles in the service design process. A desirable outcome of this integration would be more effective information and knowledge management from design to engineering of service systems.
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Some Definitions
Service Science is short for Service Science, Management, Engineering and Design (SSMED1).
Service Science is concerned with the study of Service Systems.cf. Computer Science is concerned with the study of Computer Systems.
Service Systems are man-made complex systems designed to improve the quality of life by co-creating value through value propositions among the stake-holders.
1 Spohrer, J., Kwan, S.K. “Service Science, Management, Engineering, and Design (SSMED): An Emerging Discipline – Outline and References”, International Journal of Information Systems in the Service Sector, 1(3), 2009.
ServiceExperience
ServiceProvider
Customer
A Service System and Its Entities
1Kwan, S. K. & Min, J. H. (2008) “An Evolutionary Framework of Service Systems”. Presented at the International Conference on Service Science, Beijing, China, April 17-18.
Service System Worldview1
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ServiceSystem A
ServiceSystem B
ServiceSystem C
ServiceSystem D
ServiceSystem E
ServiceSystem F
Service Interactions
5
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A Service System Network
ServiceExperience
ServiceProvider
Customer
Society
Community
Competition
Partners
Service System
Employees &Stockholders
Service System Worldview
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ServiceExperience
ServiceProvider
Customer
Society
Community
Competition
Partners
Service System
Employees &Stockholders
Value
Value
Governance
Value
7
Value
Value Co-Creation Through Value Propositions
Kwan 2011
ServiceExperience
ServiceProvider
Customer
Society
Community
Competition
Partners
Employees &Stockholders
Service System Worldview
8
MarketSegmentation
ServiceConceptRealized
CustomerFlow &ServiceDelivery
OperatingStrategy
FacilityLocation& Design
Capacity& Manpower
Planning,Training
CompetitiveStrategy
SocialNetworking
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Service ManagementFitzsimmons & Fitzsimmons
9
InformationTechnology
Platform
Service Provider’s Back Stage Support
BackStage
Processes
FrontStage
ProcessesFront Stage
Service Computing(e.g., SOA)
Service Systems, Computing, and IT Services1
1 Kwan, S. K. & Hefley, B., “Service Systems”, 2008.
ITSM – Management of the Processesand Infrastructure of IT Services
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Service System Design (1)
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CustomerServiceSystemDesign Service
SystemEngineering
From:
To:
Service System Design (2)
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CustomerServiceSystemDesign Service
SystemEngineering
SystemThinking
DesignThinking
BusinessThinking
A Multi-disciplinary Approach
Knowledge Management –maintaining integrity of information and
knowledge throughout the lifecycle
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Design Thinking – some sources
Stickhorn & Schneider
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Business Model
Osterwalder & Pigneur
14
Customer
ServiceExperience
ServiceProvider
Stage 1: Value Chain
FocalRelationship
Value Proposition
Stages in Customer Empowermentin Value Co-Creation
5Kwan, S. K. & Yuan, S. T. ”Customer-Driven Value Co-Creation in Service Networks”, to appear in Demirkan, H., Spohrer, J.C. and Krishna, V. ed., The Science of Service Systems, volume in Service Science: Research and Innovation (SSRI) in the Service Economy series, Springer, 2010.
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Stage 2: Traditional Service Value Network
Customer
ServiceExperience
ServiceProvider
Value Proposition
Provider PartnerNetwork
FocalRelationship
Value Proposition
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Stage 3 – Improved Value Chain
Customer’sSocial
Network
Customer
ServiceExperience
ServiceProvider
Value Proposition
FocalRelationship
Value Proposition
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Stage 4: Customer Driven Service Value Network
Customer’sSocial
Network
Customer
ServiceExperience
ServiceProvider
Value Proposition
FocalRelationship
Value Proposition
Provider PartnerNetwork
Value Proposition
Kwan 2011
Stages of Customer Empowerment
12
34
Sta
keho
lder
s
Service Provider
Society
Community
Employees
Stockholders
Partners
Customers
A point in this 3-D space is a Potential Value
Proposition
Value Dimensions
Variety of Value Propositions
Econom
ic
Environm
ental
Societal
Social
Political
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Intrinsic
Maslow’sHierarchyOf Needs
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HedonicSpiritualCulturalCorporal
EmotionalIntellectualFamilial….
Functional
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Maslow’s Hierarchy of Needs
Disposable Income &Desire forServices
Needsvs.
Wants
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Value Propositions can also be bi-directional
Service Provider
Society
Community
Employees
Stockholders
Partners
Customers
Ser
vice
Pro
vide
r
Soc
iety
Com
mun
ity
Em
ploy
ees
Sto
ckho
lder
s
Par
tner
s
Cus
tom
ers
?
Kwan 2011
Partners
Service Provider
Customers
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ServiceExperience
ServiceProvider
Customer
Value Proposition Model (VPM)Starting with the Service System
Kwan, S.K., Müller-Gorchs, M. (2011). "Constructing Effective Value Propositions for Stakeholders in Service System Networks," Proceedings > Proceedings of SIGSVC Workshop . Sprouts: Working Papers on Information Systems, 11(160). http://sprouts.aisnet.org/11-160
Kwan & Müller-Gorchs 2011
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ServiceExperience
ServiceProvider
Customer
ServiceExperience
Customer
ServiceExperience
Customer
Value Proposition
VPM – a common example
Kwan & Müller-Gorchs 2011
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ServiceExperience
ServiceProviderCustomer
ServiceExperience
Customer
ServiceExperience
Customer
A SharedExperience
Community/Social
Network
Value Proposition
VPM – individuals and community
Kwan & Müller-Gorchs 2011
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ServiceExperience
ServiceProviderCustomer
ServiceExperience
Customer
ServiceExperience
Customer
A SharedExperience
Community/Social
Network
Value Proposition
VPM – individuals and Facebook community
Kwan & Müller-Gorchs 2011
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ServiceExperience
ServiceProviderCustomer
ServiceExperience
Customer
Value Proposition
ServiceExperience
Vendor
ValueProposition
ServiceExperience
VPM – service provider partners
Kwan & Müller-Gorchs 2011
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ServiceExperience
ServiceProviderCustomer
ServiceExperience
Customer
ServiceExperience
Vendor
ServiceExperience
ServiceExperience
VPM – partner’s acquistion of customer
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ServiceExperience
ServiceProviderCustomer
ServiceExperience
Customer
ServiceExperience
Vendor
ServiceExperience
Example 1 of 4
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ServiceExperience
ServiceProviderCustomer
ServiceExperience
Customer
ServiceExperience
Vendor
ServiceExperience
ServiceExperience
VendorService
Experience
Example 2 of 4
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ServiceExperience
ServiceProviderCustomer
ServiceExperience
Customer
ServiceExperience
Vendor
ServiceExperience
ServiceExperience
VendorService
Experience
Example 3 of 4
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ServiceExperience
ServiceProviderCustomer
ServiceExperience
Customer
ServiceExperience
Vendor
ServiceExperience
ServiceExperience
Example 4 of 4
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Foundational Premises of Service Dominant Logic
MicroeconomicConsiderations
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Customer’s Value System
Provider’s Value System
Opportunities forValue Co-Creation
His Customer’s Value System
★
★
★★★★★
★
Value Systems and Value Dimensions
FP8
Kwan & Müller-Gorchs 2011
Stages of Customer Empowerment
12
34
Sta
keho
lder
s
Service Provider
Society
Community
Employees
Stockholders
Partners
Customers
A point in this 3-D space is a Potential Value
Proposition
Value Dimensions
Variety of Value Propositions
Econom
ic
Environm
ental
Societal
Social
Political
Intrinsic
Maslow’sHierarchyOf Needs
33
HedonicSpiritualCulturalCorporal
EmotionalIntellectualFamilial….
FP10
Functional
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Constructing a Value Proposition
Metrics
Rules
Schema
Quality
Probability of Success
Costs
Benefits
Service Experience
The Customer have a lot of VP’s
to choose from
FP7VP Service Level Agreement?
Recursive
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A Customer’s Choice of Service
A Customer’ Choice Function:
A Service Provider’s Promised Value:
Based on the Customer’s own
expectations
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A Customer’s Realization of Value
A Customer’s Realized Value:
Customer’s Contributions
Service Provider andHis Partners’ Contributions
Co-Production Service Process
Co-Creation of Value
FP6
FP9
An Example
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Constructing Value Propositions:Customers and Service Providers
Connecting Components of a Value Proposition to a Service Provider’s KPI’s
through Feedback
Sc,R,Mtoo
Kwan & Müller-Gorchs 2011
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Amazon.comBookcloseout_us
nengland4
theBookGrinder
Customer
Example: E-Commerce
Kwan & Müller-Gorchs 2011
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Customer
Amazon.comSP0
Bookcloseout_usSP1
theBookGrinderSP2
negland4SP3
S0
S4
S1
S5
S2
S6
S3
Se0
Se1
Se2
Se3
SE0
SP4
VP0
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Customer
SE0
SP0
Time
SE0 = Service Experience provided by SP0
SP0 = Service Provider of the Focal Relationship (the basis of the Value Proposition from Kwan & Yuan 2011)VP0 = Value Proposition offered by SP0 to Customer for SE0
FocalRelationship
VP0
Instantiationof the Service
Experience at aparticular point
In time
Service Pattern 1 – Single Service Episode
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Customer
SE0
SP0
Time
VP0
Pattern 2 – Continuous Service over a Period of Time
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Customer
Se0
SP2
Time
VP0
Se1
Se2
SP1SP0Instantiation of the Service
Experience at a particular point In time
Service Pattern 3 – Service in Parallel
Kwan & Müller-Gorchs 2011
SE0
43
Customer
Se0
SP0
Time
Se1 Se2
VP0
Pattern 3 – Continuous Service with Occasional Service Episodes
Kwan & Müller-Gorchs 2011
SE0
Kwan & Müller-Gorchs 2011 44
Customer
SE0
SP0
Time
SE1 SE2
SP1 SP2
SE4
SE5
SP3
SE6
SE3
VP1
VP2
VP3
VP0
Pattern 4 – Service provided by more than one Partner Service Providers
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Future Directions
• More on development of Value Dimensions and Measurement• More on connecting VPM with Service Provider’s KPI• More on Quality Dimensions and Measurement• Integrate VPM with Service System Design and Prototyping
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Integrate withForesight and Innovation Method
© Cockayne and Carleton
Knowledge Managementfor Service System Design
& Engineering
Kwan 2011
Foresight and Innovation Method
Service System Framework& Service System Networks
Business Model, Value Propositions& Service Patterns
© Cockayne and Carleton
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47Kwan & Müller-Gorchs 2011 47Kwan & Müller-Gorchs 2011
Foresight and Innovation Method
BPMN
UML – Use Cases
Story Boards
UI Prototyping
Service Blueprint
MANGA
WorkSystem
© Cockayne and Carleton
ProcessChain
NetworkDiagram
Looking for the right tools to
connect to the next
stage
Dr. Stephen K. KwanProfessor, Service Science
Management Information SystemsCollege of Business AdministrationSan José State University, CA, USA
http://www.sjsu.edu/ssme
Contact: stephen.kwan@sjsu.edu
Download these slides at: http://www.slideshare.net/StephenKwan
Service Design Basics –from System to Business Modeling
FinPresented at the Service Design International Workshop
December 20th, 2011, Tokyo, Japan
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