A value-creating network analysis from software business (original) (raw)
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Purpose: A common thread in the modern marketing theories, such as service-dominant logic and viable systems approach VSA , is the notion value co-creation: the locus of value creation is no longer perceived to reside within firm boundaries but value is considered to be co-created between various actors within the networked market. The evolution of value creation, from value creation by the manufacturing firm to value cocreation in a network, necessitates a corresponding change in the concepts used to depict value creation. The present research investigates business models as a broader conceptualization of value co-creation that captures this change. Design/methodology/approach: The topic is approached by a combination of literature review and interactive research (Gummesson, 2002a), including interactions with managers from 12 international companies. Findings: Business models are defined as configurations of twelve interrelated elements, covering market, offering, operational, and management viewpoints. The effectiveness of a business model in value co-creation is defined by the internal configurational fit between all business model elements and the external configurational fit between provider's and customers' business models. Practical implications: A firm can radically improve the value co-creation by designing business models that have high degree of internal and external configurational fit. Originality/value: For a scholarly audience the article contributes to the discussion on value cocreation by providing a conceptualization of the business model construct depicting the value cocreation in a network. For a practitioner audience it offers ideas for improving business performance through conscious business model development.
Journal on Chain and Network Science, 2006
Networks are assumed to enhance small firms' performance and competitiveness. Research indicates that there are various sources of value that could derive from networks, such as cost and time efficiency, quality improvement, flexibility and innovation. However, in most cases these values are associated with a general framework of what Information Communication Technologies (ICT) and network models are supposed to offer to small and medium enterprises (SMEs) and their participating actors. Little empirical research has focused on the real value that participating firms can appropriate and create. Based on an empirical study involving SMEs, this paper analyses the value that SMEs can create and/or appropriate by participating in networks and the extent to which value creation depends on factors such as absorptive capability and social capital. This study demonstrates that SMEs can create and appropriate a great deal of value when they become an integral part of network systems. Ho...