Universidad
Torcuato di Tella
Mid Sweden
University
The Service Ecosystem
S-D
Logic
Reflections upon Systems Theories and Service Research
Robert F. Lusch
Muzzy Chair in Entrepreneurship & Innovation
University of Arizona
Stephen L. Vargo
Shidler Distinguished Professor of Marketing
University of Hawaii
June 9, 2010
Naples, Italy
Università
di Cassino
Exchange Systems …
G-D Logic: A Logic of Separation
S-D
Logic
Producer
Knowledgeable
Innovative and Creative
Produces /Creates Value
Separation
Experienced
Consumer
Inexperienced
Unknowledgeable
Passive/Dull
Consumes/Destroys Value
S-D Logic: A Logic of Togetherness
S-D
Logic
Firm
Cocreating
Customer
Sensing & Experiencing
Sensing & Experiencing
Creating
Creating
Integrating Resources
Integrating Resources
Learning
Learning
Cocreating
Evolving Marketing Thought
S-D
Logic
To
Market
Web
Plumbing
Marketing To
Web 1.0
Retrieve &
Read
Marketing With
Web 2.0
Co-Create
Alexa Global Traffic Rankings
S-D
Logic
Rank
2005
2008
2010
1
Yahoo.com
Yahoo.com
Google.com
2
Msn.com
Google.com
Facebook.com
3
Google.com
Youtube.com
Youtube.com
4
Ebay.com
Live.com
Yahoo.com
5
Amazon.com
Facebook.com
Live.com
6
Microsoft.com
Msn.com
Wikipedia.com
7
Myspace.com
Myspace.com
Baidu.com
8
Google.co.uk
Wikipedia.org
Blogger.com
9
Aol.com
Blogger.com
Msn.com
10
Go.com
hi5.com
qq.Com
Ranking as of: (1) 12/31/05; (2) 11/24/08; (3) 5/16/10
Source: Alexa Global Traffic Rankings
Emergent, Co-created, Resource
Integrating, Dynamic
S-D
Logic
WEB 1.0
WEB 2.0
Speak to Customer
Conversation with
Customer
Customer is Passive
Customer is Experiencing
Customers Locate Content
Customers Offered Service
Push Messages Out
Pull Customers In
Standardized Mass
Produced Messages
Customized and Relevant
Exchange of Messages
Seller Control
Ecosystem Control
Service Ecosystems
S-D
Logic
A service ecosystem is a spontaneously
sensing and responding spatial and temporal
structure of largely loosely coupled value
proposing resource integrating social and
economic actors interacting through
institutions, technology and language to:



Co-produce service offerings
Exchange service offerings
Co-create value
EMERGENCE OF
INTERNET
S-D
Logic
Phase Transition
S-D
Logic
A phase transition is a process
where the characteristics of a
given medium with given
properties is transformed into a
medium with new properties.
PHASE
TRANSITION
LONG AND SMALL VIEW
Universe expanding from an extremely
dense and hot state.
CAMBRIAN EXPLOSION
HUMAN ARTIFACTS
INTERNET
Driving
the Phase
Transition
Specialization
Modula
rization
Communication
Interactivity
Transport
Exchange
Phase Transition to Ecosystems
S-D
Logic









States
Hierarchical Control
Rigid Structures
Centralized Management
Defined Boundaries
Secretive
Closed Systems
Produce & Store
Optimizing
Planning
Flows









Grounded Control
Flexible Structure
Distributed Management
Fuzzy Boundaries
Transparent
Open System
On-Demand
Adaptive & Learning
Improvising
Phase Transition
S-D
Logic
Market
Conversation
Place
Dialogue
STATES
FLOWS
Organization
Ecosystem
Phase Transition
PUSH
PULL
Market
Conversation
Place
Dialogue
STATES
FLOWS
Organization
GOODS
Ecosystem
SERVICE
Phase Transition to Ecosystems:
What it Means for Organizations
Old
Bureaucracy
New
Learning
Factory Production
Co-creation
Platforms
Innovation
Platforms
Integration
Platforms
R&D Labs
Marketing
Channels
Pull and S-D logic
Push and G-D logic
S-D
Logic
No B2B, B2C, C2B, etc…..
S-D
Logic
Resource
Integrating
Actor
Resource
Integrating
Actor
Resource Integrating Actors (RIA)
S-D
Logic
Coordinate
RIA
Communicate
Calculate
Resource
Integration & 3 C’s
Calculation
Language
Behavior
Coordination
Meaning
Thoughts
Source: Loebler & Lusch
Communication
Signs
Signifiers
Resource Integrating Platforms
Unified
Communication
Platforms
Coordination
Platforms
RI
Platforms
Mobility
Platforms
Cloud
Computing
Platforms
Universidad
Torcuato di Tella
S-D
Logic
Mid Sweden
University
Thank You!
For More Information on S-D Logic visit:
sdlogic.net
We encourage your comments and input. Will also post:
• Working papers
• Teaching material
• Related Links
Steve Vargo: svargo@sdlogic.net Bob Lusch: rlusch@sdlogic.net
Some Definitions
S-D
Logic
System = set of interacting or interdependent entities
forming an integrated whole.
Service = application of resources for the benefit of
another actor (Vargo and Lusch 2004)
Service System = A dynamic value co-creation
configuration of resources, including people,
organizations, shared information (language, laws,
measures, methods) and technology, all connected
internally and externally to other service systems by
value propositions. (Spohrer et al.2007)
Ecosystem = a system formed by the interaction of a
community of actors in an environment that these actors
through interaction create.