5/6 - Analyzing collaborative value creation Flashcards
Two perspectives on value
Value-in-exchange
Value-in-use
-> How is value received? Directly through the innovating actors’s use of the innovation (value-in-use) or through the exchange of knowledge with one or more other parties in return for compensation (value in exchange)
Two perspectives on value
Value-in-exchange
= value creation as a process of exchanging resources between actors
- value in exchange regards value as encapsulated in the (exchanged) resources and, as such, a resource has a sacrifice (e.g. it’s purchasing costs) and an estimated benefit (related to the later utilization of the resource
- therefore receivers define value based on their perceptions of the potential usefulness of the exchanged resource for addressing their needs
Two perspectives on value
Value in use
= value that an actor creates through a use process for itself
- views value as an outcome (e.g. new product or service) of a process (e.g. contributing to an open-innovation project) that consumes resources (e.g. Human Resources)
- > used resources are the sacrifices and the outcome is the benefit
- > value is created through processes of developing, producing and delivering new market offerings that create turnover
- > value is bound to an actor applying resources in a process aimed at moving toward a valued goal
Four value processes
Which processes are there?
Value realization
Value partake
Value provision
Value negotiation
Four value processes
Value realization
- The actual deployment of resources to achieve a goal
- the receiver of the value is the actor performing the process
Value in use: Tv -> value created, when TV is used
Four value processes
Value partake
Process of securing a share of the value created by another actor at the time of resource utilization
-> partaking in another actor’s value creation
How can I participate in the value creation process?
Four value processes
Value provision
- the provision of resources to an exchange partner who values the resource based on later potential use
- > while there is an intent to commercialize the exchanged resource at a later stage, the current exchange only offers a potential for later value realization
- > resources exchanged may not yet have an identified use
- > valuation can be uncertain or difficult
Tools, so that you can do something in the future
-> e.g. patients who don’t take their pills
Four value processes
Value negotiation
Process of negotiating access to and/or ownership over resources in return for the provision of value to an exchange partner
-> based on the provision of resources, actors attempt to ensure suitable return in exchange - and these exchanges need to be negotiated
A relationship-oriented value model - value for customers
Which functions are there?
Purchasing functions:
- Payment
- Volume
- Quality
- Safeguard
Network functions:
- Innovation
- Information
- Access
- Motivation
A relationship-oriented value model - value for customers
Relationship Value Estimation
Payment
- purchase price, total cost of ownership or net present value
- different payment functions, e.g. industrial products no longer sold upfront but paid for on the basis of their usage
A relationship-oriented value model - value for customers
Relationship Value Estimation
Volume
- the allocation of larger purchase volume to selected suppliers allows customers to influence suppliers, to consistency of their supplies and to reduce communication costs
- the volume function has three aspects: the volume of a given product (share of wallet), the volume of different products (share of product portfolio), and volume over time (share of long term contracts)
A relationship-oriented value model - value for customers
Relationship Value Estimation
Quality
- the quality of a product is determined by the extent to which that product fits into the customer’s operations - the better the fit, the higher the perceived value
- quality can be related to the product itself in that the product encompasses valuable features that increase the value of the customer’s product for its customers
A relationship-oriented value model - value for customers
Relationship Value Estimation
Safeguard
- customers may also create value by developing a network of flexible suppliers that can change order volumes at short notice
- > network reduces distribution costs and inventory levels
- > customers may wish to have a “reserve source” to lessen their dependency on other suppliers
A relationship-oriented value model - value for customers
Relationship Value Estimation
Motivation
- by working with a supplier that is known for its innovativeness, social responsibility, or corporate success, an employee can gain respect and recognition among colleagues, which then increases that employee’s motivation
A relationship-oriented value model - value for customers
Relationship Value Estimation
Access
- suppliers may actively help customers to establish contacts with potential exchange partners or influential people
- > other suppliers, possible customers
- > customers can use their relationships with prestigious suppliers as a reference
