Week 5: Value Net Analysis

Question 1

What does value net analysis do?

Answer 1

Developed by Adam Brandenburger and Barry Nalebuff.
Displays company’s external dependencies to show otherwise hidden sources of its competitive advantage (synergy).

Main aim: establish strategic alliances
allow competing parties to identify cooperation benefits.

Basic idea: corporate value is created in a network in which companies often create dualities that are both- competitive and cooperative in nature. Main goal is to find a balance between two characteristics to maximise value.

Question 2

Competitors and Complementors

Answer 2

*Competitors- someone who has product/service that customers value more than yours. Customers value your product less when they have competitors offering, not like when they only would have yours.

*Complementors- someone whose offerings make customers value your service more. There is synergy between you and your complementor’s product.

Question 3

Name components of Value net analysis, explain

Answer 3

1. Company (central)
2. Competitors
3. Complementors
4. Customers
5. Suppliers

Value is created in an intricate network around companies. Not only relationship with customers and suppliers, but also with competitors who have a second role as complementors.

!!Value can be created even with competitors if companies look intrinsically enough in the value net!!