Conceptualizing smart service systems

Electronic Markets, Nov 2017

Recent years have seen the emergence of physical products that are digitally networked with other products and with information systems to enable complex business scenarios in manufacturing, mobility, or healthcare. These “smart products”, which enable the co-creation of “smart service” that is based on monitoring, optimization, remote control, and autonomous adaptation of products, profoundly transform service systems into what we call “smart service systems”. In a multi-method study that includes conceptual research and qualitative data from in-depth interviews, we conceptualize “smart service” and “smart service systems” based on using smart products as boundary objects that integrate service consumers’ and service providers’ resources and activities. Smart products allow both actors to retrieve and to analyze aggregated field evidence and to adapt service systems based on contextual data. We discuss the implications that the introduction of smart service systems have for foundational concepts of service science and conclude that smart service systems are characterized by technology-mediated, continuous, and routinized interactions.

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Conceptualizing smart service systems

Conceptualizing smart service systems Daniel Beverungen 0 1 2 3 4 5 6 Oliver Müller 0 1 2 3 4 5 6 Martin Matzner 0 1 2 3 4 5 6 Jan vom Brocke 0 1 2 3 4 5 6 Jan Mendling 0 1 2 3 4 5 6 Martin Matzner 0 1 2 3 4 5 6 0 Department of Information Systems, Paderborn University , Warburger Strasse 100, 33098 Paderborn , Germany 1 Jan vom Brocke 2 Oliver Müller 3 Hilti Chair of Business Process Management, University of Liechtenstein , Fürst-Franz-Josef-Strasse, 9490 Vaduz , Liechtenstein 4 Department of Information Systems and Operations, Vienna University of Economics and Business , Welthandelsplatz 1, 1020 Vienna , Austria 5 Instiute of Information Systems, University of Erlangen-Nürnberg , Lange Gasse 20, 90491 Nuremberg , Germany 6 Department of Information Management, IT University of Copenhagen , Rued Langgaards Vej 7, DK-2300 Copenhagen S , Denmark Recent years have seen the emergence of physical products that are digitally networked with other products and with information systems to enable complex business scenarios in manufacturing, mobility, or healthcare. These “smart products”, which enable the co-creation of “smart service” that is based on monitoring, optimization, remote control, and autonomous adaptation of products, profoundly transform service systems into what we call “smart service systems”. In a multi-method study that includes conceptual research and qualitative data from in-depth interviews, we conceptualize “smart service” and “smart service systems” based on using smart products as boundary objects that integrate service consumers' and service providers' resources and activities. Smart products allow both actors to retrieve and to analyze aggregated field evidence and to adapt service systems based on contextual data. We discuss the implications that the introduction of smart service systems have for foundational concepts of service science and conclude that smart service systems are characterized by technology-mediated, continuous, and routinized interactions. Smart service; Smart products; Internet of things; Service science; Boundary object Introduction Imagine that (in a couple of years) you own a smart washing machine. Of course, your machine’s primary purpose is to do the laundry, but it is also equipped with various sensors that determine the weight of your laundry, judge the quality of the water, and identify the properties (e.g., material, color, dirtiness) of your laundry. Based on these data, the machine autonomously applies just the right amounts of washing powder, water, and electricity; therefore, reducing its environmental footprint and saving money. The company that built your machine can access your data remotely and compare them with data of thousands of other washing machines in the installed base so it can compare your washing machine’s efficiency and effectiveness with the performance of other machines used in comparable settings. Based on the results, the company can adjust the inference engine inside your machine remotely, fine-tuning and optimizing its autonomous functions. This machine also offers a dry-cleaning service that is tailored to your own idiosyncratic needs, perhaps increasing your willingness-to-pay for the machine. In this way, smart service systems bring a customer’s and provider’s perspective on value creation with a smart product together. Also going by names like smart devices, smart objects, and cyber-physical systems, embedding hardware and software systems into physical goods that can connect digitally to other products and information systems is a powerful trend in many industries. Smart products use sensors to obtain contextual data, exchange data with other actors, store and process data locally, make autonomous decisions, and act physically by means of actuators (Acatech 2011) . In this way, previously isolated and passive products join the digitally networked world as actors in their own right. Application scenarios that benefit from the proliferation of smart products are present in many industries, including transport and logistics, manufacturing, energy supply, healthcare, and industries related to living and working in smart buildings (Acatech 2011; Atzori et al. 2010) —even though what “smart” exactly means often remains unspecified (Gretzel et al. 2015). For example, in the area of smart mobility, cars are evolving from pure driving machines to intelligent dataprocessing units that obtain data on their physical surroundings (e.g., road conditions, the position and trajectory of other vehicles), connect to other intelligent devices and smart infrastructure (e.g., toll-collection systems, traffic information systems), and adapt their actions in near real-time based on the analysis of various data streams (e.g., braking after detecting a dangerous situation). Both, consumers and service providers can benefit from the new capabilities of smart products, as Virgin Atlantic IT director David Bulman explains: “The latest plane (...truncated)


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Daniel Beverungen, Oliver Müller, Martin Matzner, Jan Mendling, Jan vom Brocke. Conceptualizing smart service systems, Electronic Markets, 2017, pp. 1-12, DOI: 10.1007/s12525-017-0270-5