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One of the defining characteristics of today’s industries is that they collaborate in a business network to co-produce or exchange goods and services, thereby co-creating value (Amit & Zott, 2001; Brandenburger & Nalebuff, 1997; Christensen, 2003; Vargo & Lusch, 2004; Lusch & Vargo, 2006; Vargo et al., 2008). Such a network has been called a “value network” (Allee, 2000; Bovet & Martha, 2000; Lusch et al., 2010; Stabell & Fjeldstad, 1998). In the context of service industries, such a network is also called “service value network” (SVN) (Basole & Rouse, 2008; Blau et al., 2009; Chan & Hsu 2012).
In contrast to traditional value chains (Porter, 1985; Porter, 2013) and supply chains where resources flow in dyadic relationships from raw material providers to manufacturers to suppliers to customers, SVNs encompass multi-way collaborations between different service actors, comprising service providers, enablers, consumers, and other stakeholders, such as government agencies and regulators. These relationships are characterized as business-to-business (B2B), business-to-consumer (B2C) and consumer-to-consumer (C2C) (Basole & Rouse, 2008).
Comparing with other forms of business network, such as Virtual Corporation (Davidow & Malone, 1992), Smart Business Network (Heck & Vervest, 2007) and Business Web (Steiner, 2004) SVNs view everything as a service (Levitt, 1972) and goods and products as service delivery vehicles (Araujo & Spring, 2006; Lusch & Vargo, 2006). In addition, value in SVNs is created at the network level (Basole & Rouse, 2008; Bovet & Martha, 2000), in which each service actor contributes incremental value to the overall service offering. Thus in SVNs, value creation is a shared activity among service actors, who contribute to this activity by focusing on their core competence and leveraging knowledge and capital assets of their partners (Basole & Rouse, 2008; Blau et al., 2009; Conte et al., 2011). Consequently, value in SVNs is co-created by service actors (Basole & Rouse, 2008; Vargo et al., 2008) and the risk involved in value creation is also shared among them (Basole & Rouse, 2008; Michalk et al., 2010).
SVNs can be observed in almost all business sectors. For example, in software industries, service computing and cloud computing has changed the way we develop, deliver and use software. Everything as a service (XaaS) has been manifested as SaaS (Software as a Service), PaaS (Platform as a Service) and IaaS (Infrastructure as a Service) (Zhang et al., 2010). Software companies collaborate to offer these services to their users over the Internet in a SVN fashion. In the telecom sector (Holzer & Ondrus, 2011; Peppard & Rylander, 2006; Zhang & Wu, 2006), network and infrastructure providers, handset providers, content providers, and customers have converged around the value network to co-create value. Similar phenomena can be observed in the e-commerce sector (Amit & Zott, 2001), the automobile industry (Basole & Rouse, 2008), and the healthcare sector (Basole & Rouse, 2008).