Cognition Drives Value in New Service Economy
For some time over 70% of the GDP in the US (and 57% of global GDP) comes from services not products. About half of IBM’s revenue comes from services not computers or software. It turns out that creating, delivering and managing services is very different from doing the same for products. Yet our economic, management and innovation models are nearly all geared towards technology and products not services. Little wonder IBM is championing the development of a new field they call Service Science, Management and Engineering or SSME.
IBM was instrumental in creating the field of computer science in the 1950s and that turn out to be a genius business move. They hope to repeat that move in the early 21st century but with SSME or service science not computer science.
Services are intangible, require the co-creation of value between the provider and the consumer and are driven by the application of knowledge and skills. This means cognition is a key factor in the “production of services” and cognitive design could play a key role in service system innovation. More specifically, we should optimize the design of our service systems for how minds naturally work.
Unfortunately, the more traditional fields of management science, industrial engineering, computer science, operations research and the like are lining up to dominate the new discipline. There is some attention being paid to the role of social sciences (see for example MIT’s Center For Engineering Fundamentals) but that might miss the mark. One exception I found was the chapter, The Psychology of Experience: The Missing Link in Service Science in the book (complete version online), SSME: Education for the 21st Century (see page 35). Hopefully there are others.
I am interested to hear from readers working in or considering the field of SSME and how cognitive design can play a role.
