With the rise of the services economy, Service Science Management and Engineering (SSME) is the new academic discipline for the 21st century, writes OU SHIAN WAEI, managing director of IBM Malaysia. SSME is especially pertinent to Malaysia, with more companies evolving in the wave of globalisation and embracing the globally integrated enterprise model

THE reality of a globally integrated world has arrived with serious implications for all institutions — including higher education. Leaders can either absorb and act upon globalisation, or have it act upon them.

For the first time in history, everything is connected — businesses, workflows, transactions and billions of individuals.

There are 1.2 billion people, millions of businesses and perhaps a trillion devices connected to the World Wide Web. By 2011, it is estimated that the Internet will reach two billion people — nearly one-third of the world’s population.

And when everything and everyone is connected, we know what happens — work moves. It flows to the places where it will be done best — that is, most efficiently and with the highest quality. It’s like water finding its own level.
What are the ramifications for academia of this new water level? Are the future employees that will drive the differentiation and innovation that keeps us ahead of the pack getting the educational experience they will need to lead?

A recent study from two DePaul University professors suggests not. The study examined United States. Labour Department data on thousands of managers across 52 industries who identified the skills they found most valuable in managers.

The study also looked at the core curricula at over 350 business schools and compared the manager’s views with the required MBA coursework.

While managing decision-making and human capital were at the top of managers’ lists when it came to ranking skills in order of importance — it was five out of six in terms of how well-represented it was at the B-schools. Based on their offerings, business schools place the greatest emphasis on managing administration and control, an area that came in next to last in terms of importance to managers surveyed.

This disconnect points to an obvious need for a more collaborative relationship between higher education and industry in order to create the 21st century skills that will drive competitiveness and economic growth.

One example: When IBM first started building computers, there were no formal education programs in computer science. In fact, the term “computer science” didn’t even exist. So where were the designers, engineers and the scientists going to come from?

The answer was to work closely with universities. IBM’s first research lab was at Columbia University, a co-project of the school and IBM. Columbia’s first computer science course was co-taught by an IBMer. Today there’s no shortage of computer science education.

Now the services industry is facing the same daunting challenge. There is a dearth of formal programmes to provide the educated employees needed to support the services marketplace (which accounts for 80 per cent of the total US gross domestic product and growing). And while IBM is again at the forefront of the movement to collaborate with academia, this time, we are not alone.

Earlier this year, IBM joined with a consortium of over a dozen companies and universities, including Cisco, HP, Microsoft and UCLA, Wharton School of Business, the European Commission and the Fraunhoffer Institute in Germany, to create the Services Research and Innovation Initiative (SRII). The mission of the group is to increase the amount of funding for service research, development and innovation in the technology industry.

We all see this focus on service innovation as bringing together a number of different academic areas — from the business school, the engineering school and also the arts school — as services requires a deep understanding of people, cultures, and the ability to interact remotely in this global environment — exactly what the DePaul study bore out.

Academia needs to make service innovation a priority because it’s their role to prepare students for the high value jobs of the future, jobs that are out there and available and will be for decades to come. Industry can shine headlights to what’s coming, but ultimately it is up to our university partners whether they will participate or not.

But one piece of advice from a company who has been to the brink and back: If you are not selling what the customer is buying in this global economy, you can become uncompetitive over time.

We are not arguing that any of the specialised disciplines that service science draws on will go away, they are important and necessary — but we do challenge the claim that normal approaches to integrating the efforts of the specialists are the best approach for innovation in this globally integrated world.

So lead, follow or get out of the way, but getting out of the way won’t guarantee that you don’t get run over.