Ahmad Mujtaba Malik Summaries F2017051006

In this Article “Fundamental of Service Science” it was stated that one should have
knowledge of service sciences before having understanding of service innovation. Services
science is the combination of people, businesses, organization and technology which make a
pool in giving knowledge of:
 Origins and growth rate of service system
 Solution of fundamental problems like ways to improve service quality and productivity
 It helps in producing unique and innovative scientists and professionals who help in dealing
with these problems.
Service sciences build value and comparative advantages among participating labor.
Firstly, services were dependent upon the instructions given by clients but now after
development of global trading and technology advancement, it is dependent upon customized
information and input provided by clients. In reality, service science is collection of people,
internal and external service system of organization, technology and information systems which
depends upon the development of resources.
As people, technology, sharing of information and organization are the resources of any
firm but in firm it occurs in the form of rights, property, physical entities and socially constructed
entities. Many different aspects of organization help in accumulating the knowledge of service
sciences.
Service system is theoretical construct of service sciences while service dominated logic
is the philosophical foundation. For example, IBM improved its services system by moving from
manufacturing dominant logic to service dominated logic. It integrates participants, consultants
and technologies in order to help clients so that they can transform their businesses. Provider in
organizations helps in innovating and making improvement in internal system of organization in
order to automate service delivery.
Specialists, business designs, technological designs and implementations help in providing
interdisciplinary effort to market in order to improve the complex business service. For example,
IT outsourcing provider uses innovative skills, capabilities and experiences in order to help IT
investors. The structure of this department integrates providers and clients. As outsourcing is
done by different departments of organization and these department help in providing services by
verifying and monitoring the information they are providing.
Service sciences help in showing following details that:
 How clients and providers interact each other in order to establish unique service system by
sharing the details of information and risks they are going to face.
 How individuals, technology and organization creates values in order to gain competitive
advantage.
 How effective efficiency and ability is used in order to make reliable improvements and
innovations in doing outsourcing.
Service system is a knowledge based interaction which helps in giving benefits to the firms so
that they can use their capabilities in order to gain competitive advantage over other firms and
help in fulfilling the needs for their clients and themselves too. The ultimate goal of this article is
to provide fundamental knowledge of service dominant logic and service systems which helps in
improving abilities of organizations so that they can improve and design service systems for
community and businesses purposes.
Ahmad Mujtaba Malik Summaries F2017051006

The article “The Service System is the Basic Abstraction of Service Science” published
in springer (2009) by P. P. MAglio, S.L. Vargo and Nathan Caswell focus SD Logic. Industrial
revolution is basis of many new concepts and abstractions. Different paradigm has emerged in
last three centuries. Nineteenth Century is the emergence of work abstraction. Twentieth century
focuses on information technology. Twenty first century is regarding thinking evolution that
leads to developing service system. Service is used as an application of resources for other
benefits. Industries and multinational companies are changing their attitude and developing
service as major department as it creates values. This article articulates about service system
understanding, innovation in it and service dominant logic (S-D Logic).
Author has challenged traditional view of service system. Adam Smith in “Wealth of
Nation” has classified workers as either productive or non-productive people. He is against non-
productive people and often called them a burden on economy. These non-productive people
provide service and contribute from 70 to 80% in GDP of developed countries. We can say that
traditional view focuses on Goods dominant logic. G-D logic focuses on products however
divides these products as tangible and intangible resources. S-D logic focuses on static resources
known as operand resources. They also focus on intangible resources that create value and are
also known as operant resources.
Value is co-created in S-D logic. Good are sometimes used to create values in S-D Logic.
It is utmost important to differentiate between producer and consumer. S-D Logic can be used to
create service system. Service system can be in in form of people, business and technology.
Service system along with skills and competencies can help us to use resources efficiently and
effectively. Resources are either physical or conceptual in nature. Value co-creation is observed
when system interact each other. These interactions are very valued and named as service
interactions. These interactions proceed in three steps that are proposal, agreement and
realization respectively. Service system has beginning, ending and history. If all above three
steps are verified, these are called as values. Proposal if accepted failed in realization stage.
Service system can be formed legally and informal way. It is important to know values of parties
in service system. Values of parties may be different from each other resulting in failure of
service system realization step. Sometimes interactions fail due to interaction of third parties like
government. Even-if proposal is agreed by both parties, there might be strong case of clash
between parties on realization of co-created values. Service provider can terminate service
system if problems are raised by clients.
Service system creates co-relation and co-created values for both parties. ISPAR
(Interact-Serve-Propose-Realize) model enables us to see world as population of interacting
service system for their own mutual co-creation values. One can see how many service systems
can be unified to realize new abstraction. It is also important to find suitable system that co-
creates values and how dispute and are handled and resolved. We have to understand basic
foundations of service system to find benefits.
Service system is open so we can call service system as dynamic configuration of both
operand and operant resources. Service system is also called as resource itself. Individual can
also be called as service system and is called as atomic service system when combined work as
composite service system. Integration of these systems is the most important decision. But it is
really strange that how such a small abstraction unified a variety of things in service system.
Service system abstraction is yet to be explored as not much work has been done.
Ahmad Mujtaba Malik Summaries F2017051006

In this article “Resources for Value Co-Creation in E-commerce: a Review”, it was stated
that today marketers are more focused towards production of goods and according to them these
goods provide them embedded values. In reality, companies are creators of values while the
customers are destroyer of these values. Service Dominant Logic is challenging this perspective
by guiding companies that product is not very important to the customers; the most important to
customers are the services which are rendering according to their characteristics and context.For
example; A camera depends upon the needs and requirements of customers that how they use
and interact themselves with camera. An expert prefers to buy camera over the internet according
to his requirement. This creates higher perception of value in the e-buying process.
S-D logic defines that the values are created by mutual sharing of resources between
customers and firms. As value creation is an interactional process and customers and firms are
the co-creators of that value. Prominent customers use their operant resources like knowledge
and skills in order to find their desired resources from website (as e-services quality, usability)
which help them in creating value for the firms.
Resource Based View is important for firm to link its performance with its internal
characteristics, this resource helps firm in gaining competitive advantage by using intangible
resources like knowledge and information. Resource Advantage Theory is the base of RBV; in
this, tangible and intangible entities are used by firms in order to gain competitive advantage by
targeting different segment of market. Two resources are there:
 Basic Resources
 Higher Order Resources: known as competences or capabilities, which made by combination
of basic resources.
S-D depends upon both RBV and R-A theory, and it classified the resources into two categories:
 Operand Resources: Resources on which operation or act can be performed easily. These are
tangible resources.
 Operant Resources: Resources used to perform activity on operand resources. These are
intangible resources.
A hierarchy of operant resources was developed on the bases of R-A theory:
 Basic Operant Resources (BOR): which contain building blocks of higher order operant
resource like financials, human, legal, organization and relational.
 Composite Operant Resources (COR): which combine basic resources with low levels of
interactivity in order to form final valuable product. For example: Resources A+ Resources
B+ Resources C = Composite Operant Resources D
 Interconnected Operant Resources (IOR): it combines basic resources where lower order
resources are interacted in order to make final valuable market offering product.
As firms go up the hierarchy the following
Interconnected operant
elements increases:
resources (IOR)
Composite operant - Sustainability of competitive
resources (CORs) advantage,
- Cost of acquisition and/or development,
Basic operant resources - Time needed for acquisition and/or
(BOR) development , and
- Firm commitment to resources
Ahmad Mujtaba Malik Summaries F2017051006

These provide acquisitiveness, measurability and sustainability of comparative

advantages. Mostly firms are not focused on higher order resources due to which they get
competitive advantage. They should focus on this.
Customers possess different resources which should be integrated with firms’ resources. These
resources are categorized as:
 Physical Resources: these are those resources which consumer process naturally; in this they
use their mental and physical characteristics like emotions and strengths which can affect their
lives.
 Social Resources: these resources are used by traditional groups like families and ethnic
groups. These resources are fundamental of S-D logics.
 Cultural Resources: Refers to the specialized knowledge and skills, life expectancies,
imagination and history of customers.
It is necessary that consumer resources should be integrated with firm resources. For example,
consumers buy product online relies on the knowledge of their relatives and friends and most of
expertise help them too, which enhanced experienced value. The legal law on online shopping
shows safety, variety, convenience and attractiveness on online shopping.
The methodology used by authors in this article is quantitative research in which they use past
records, conduct surveys and analyze the results accordingly. Authors concluded this article by
proposing some proposition that are:
 Provide deep down E-commerce quantitative empirical studies in service logics which shows
that e-commerce is an interactional process.
 Provide clear definition of resources, comprehensive classification of firm resources and
customer resources and have integrated set of valid and reliable measure of customers and
firms’ resources.
 Provide positive and negative resources. In which they suggest higher order resources are more
important for a company to get competitive advantage.
 Propose the customer resources are equally important with firm resources for making good
dominant logic and this will helps researchers to use these integrated set of resources for their
research purposes.
 Provide findings of good dominant study which were not discussed in any article and these
resources conceptualization help markets to develop masterful operant resources.