Cloud enterprises have shifted from linear to networked business models through a value transformation process centered on the development of multisided service platforms. These platforms facilitate service exchange and value cocreation by enabling three essential transitions: 1. from control to orchestration of enterprise resources, 2. from internal optimization to external interactions, and 3. from customer value to ecosystem value. Innovative service transformation is most in evidence with enterprises that are native cloud companies or companies that have more rapidly and effectively adopted ecosystem-based service platforms such as Netflix, Google, Facebook, Uber, and Airbnb. Service ecosystems enable the critical processes for value cocreation that is foundational to the continuous development of innovative user experiences. However, many developers and adopters of cloud service business models fail to innovate. This is usually blamed on inappropriate business strategy and/or insufficient technological solutions. However, the root cause is often more basic; specifically, it is the lack of service thinking that is necessary for the development of cloud-based service innovation models. This paper explores the service science foundations of cloud computing and the dimensions of service thinking that inform the service transformation process for cloud-based companies. A framework for the development of cloud-based service transformation is proposed with evidence from three case examples.

Cognitive computing refers to smart systems that learn at scale, reason with purpose, and interact with humans and other smart systems naturally. This special issue seeks to provide readers with an overview of the current topics and practices related to cognitive computing, and looks at the future for IT professionals as these technologies become indispensable and essential enablers of product and service development and the creation of new markets.

For organizations seeking to transform from product-oriented to service-oriented enterprises, the cloud is the place to start. Simplicity, flexibility, choice, and the ability to access computing resources on demand are the driving forces behind cloud computing. The cloud has become the engine for business growth and enterprise service transformation. The cloud transforms how we interact with retail, transportation, health care, media, banking, investing, entertainment, and people to enable the cocreation of value through dynamic service experiences. This chapter introduces the foundations of cloud computing with an overview of service innovation concepts to set the stage for the chapters that follow.

Cloud operators realized early on that servers originally designed for enterprise data centers were not optimal for their application. These servers are well known branded machines from manufacturers such as Dell, Hewlett Packard Enterprise or SuperMicro, known as original equipment manufacturers, or OEMs. Instead, they deploy in house designs with machines built by contract original design manufacturers, or ODMs. The cloud platform ecosystem represents an evolution of the standard high volume enterprise server ecosytem that started in the early 1990s. We document this evolution and look at some of the business and technology opportunities that this evolution brings.

This paper examines emerging digital frontiers for service innovation that a panel discussed at a workshop on this topic held at the 48th Annual Hawaii International Conference on System Sciences (HICSS). The speakers and participants agreed that that service systems are fundamental for service innovation and value creation. In this context, service systems are related to cognitive systems, smart service systems, and cyber-physical systems and depend on the interconnectedness among system components. The speakers and participants regarded humans as the central entity in all service systems. In addition, data, they saw personal data in particular as key to service systems. They also identified several challenges in the areas of cognitive systems, smart service systems, cyber-physical systems, and human-centered service systems. We hope this workshop report helps in some small way to cultivate the emerging service science discipline and to nurture fruitful discussions on service innovation.

Service science merges technology with an understanding of business management, processes, organizational design, and culture to develop and apply tools to address business problems and create market opportunities. It is an interdisciplinary field that combines organization and human understanding with business and technological understanding to categorize and explain the many types of service systems that exist as well as how service systems interact and evolve to co-create value. Managers seeking to develop innovative service solutions will need to understand how to apply their organization's unique resources and capabilities in an effective, efficient, and value-creating manner. This chapter covers service science, service-dominant logic, product-service systems, the service thinking mindset, T-shaped professionals, the emerging frontiers for service innovation, and insights for the implementation of service innovation strategies

The cloud computing business model is evolving into a compelling platform for service innovation that is transforming the behavior of users and organizations to disrupt existing markets and create new ones. The essential advantage of cloud computing derives from the ability to leverage IT to engage users and other actors in the creation of innovative value propositions and to reengineer existing ones. For IT organizations and enterprises, a transition to cloud-oriented services occurs when an application migrates to the cloud with minimal changes to its design and delivery continues to support current performance and security requirements. For a cloud-based service transformation, much more is required. IT objectives drive larger, comprehensive application changes. Transforming the IT organization to embrace cloud-based service innovation involves rethinking and redesigning the organization’s approach to its customers. This chapter covers service transformation strategies, business models, and a framework for the transformation process.

Smart cities are becoming a megatrend strategy for applying ICT to improve quality of life in urban environments. Recent technological advances have accelerated smart city development, and the pervasiveness of digital sensors and control systems has enabled myriad applications. Effective smart city systems should be instrumented, interconnected, and intelligent. This special issue provides compelling examples of smart city systems that can enable the optimization or redesign of existing services and identify new value-creation opportunities.

A number of events in IT practices paved the way to the adoption of the cloud we see today. One of them took place primarily in large organizations: the service-oriented architecture (SOA) transformation between the turn of the century and 2007, in which application silos were broken up into loosely coupled reusable service components (servicelets) linked by web services or RESTful application programming interfaces (APIs). This is the transformation described in the Uber and Netflix case studies in Chapter 4. IT became modular, with the servicelet as a unit of composition. We look at the notion of application-specific cloud platform (ASCP) as the hardware platform that runs this new environment.

See how the principles of Service Science govern the dynamics driving the adoption of cloud computing in the industry. Cloud as Service shows you how the evolution of enterprise computing platforms to

See how the principles of Service Science govern the dynamics driving the adoption of cloud computing in the industry. Cloud as Serviceshows you how the evolution of enterprise computing platforms to application-specific cloud platforms (ASCPs) have aligned to business needs. You'll also learn processes for developing and building ASCPs. You'll gain insight into how executives, managers, and technologists are utilizing cloud services, cloud service providers, equipment manufacturers, and software and application vendors participating in cloud supply chains. For business, the appeal of cloud computing must go beyond the notion of convenient, on-demand access of networked pooled access to computing resources. Industry leaders have learned to apply cloud computing to become more nimble, cost effective, and customer engaging as they strive for competitive advantage, regardless of size. These companies define and build cloud platforms customized for their needs rather than using someone elses. This book shows you how to use a holistic, end-to-end view of platform planning, platform development, supply chains and operations to collapse platform development times to a fraction of the original time. Youll see that strategies for selling to the cloud market are essentially incomplete; and that in order to be successful, businesses must become cloud service businesses themselves, incorporating cloud technologies in their engineering, IT, sales and marketing, and delivery processes. What You'll Learn: Historical perspective to provide insight into the dynamics driving cloud evolution today State of the art in IT requirements and cloud solutions The value of User Experience (UX) driven design principles The crucial roles of Service Brokers and Service Assurance Managers The landscape of emerging cloud services and what they mean to your enterprise Service Portals and Enterprise Service Buses Who This Book Is For: CIOs, CTOs, data center architects, solution architects and application engineers Educational institutions building a systems integration curriculum Developers who want to understand how their work fits in the cloud ecosystem

The previous chapters covered some fundamental aspects of the service dynamics as applied to IT and how service dynamics define the cloud and cloud processes. We also discussed how the enterprise platforms that characterized the first wave of standard high-volume (SHV) servers evolved into second-wave cloud platforms under a service dynamic with strong customization and built-to-order components. The second wave drivers and adopters were the largest cloud service providers (CSPs) worldwide with the concept of application-specific cloud servers (ASCPs). A competitive advantage for these players and initial barrier to entry to smaller players was the nonrecurring engineering (NRE) cost to design and manufacture the desired customizations. However, as platform providers and consumers went through the learning curve and achieved increasing technology maturity, the benefits of customization became democratized and available to smaller CSPs.

To qualify as truly innovative, new IT applications must successfully achieve customer value cocreation, adoption, and acceptance. Without this, a new technology isn't an innovation; it's just a failed product or service that didn't gain traction. We're now well into an era in which significant competitive advantage is achievable from IT-enabled business innovation. This special issue was conceived as a vehicle for understanding some of today's issues and for looking at opportunities for tomorrow. The authors' contributions in all the articles have implications for IT-enabled innovations that go beyond the immediate application settings on which they report. A video discussing emerging service innovations is available at http://youtu.be/4xBRfWt20-I.

Effective smart systems need to be instrumented, interconnected, and intelligent. The articles in this issue have application to four areas related to systems that can extract, model, and provide useful intelligence from real-time or near-real-time data.