Co-Creating Value Derivations in a Service System Journey

Co-Creating Value Derivations in a Service System Journey

Ralph D. Badinelli (Virginia Tech, USA)
DOI: 10.4018/978-1-5225-2084-9.ch008
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Abstract

Recent literature on the topic of defining and measuring value has revealed many perspectives and limitations of conventional views of value and value creation. From these perspectives, service innovators have adopted the practice of specifying value propositions as a precondition to providing service. In this chapter we posit a new model of value propositions which, among other disruptive changes, precludes the definition of the value proposition prior to a service execution. Instead, we assert that the value derivation is co-created and emerges through the service journey. Furthermore, although a precise definition of value remains elusive, there are some generic dimensions to value that can be incorporated in the design of a service system so that a value derivation can be co-created through the service journey as value itself is co-created or anticipated.
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Background

A value proposition is considered an essential foundation to the design of a service. Service level agreements (SLA), for example, are endemic to many service industries, especially the IT support services. These contracts are designed as a blueprints of sorts for the deliverables of the service. In spite of the time and effort that are devoted to drafting SLAs, the actual realization and perception of value by different participants in the service can vary significantly from the pre-defined agreements (Rajala et al 2015).

Key Terms in this Chapter

Stigmergy: The phenomenon of intelligent behavior emerging from serendipitous collaborations that occur from shared information that is deposited by many sources in a repository that is accessible to service actors and agents. Stigmergy can enable swarm intelligence.

Engagement Decision: The decision by an agent to execute an engagement based on the agent’s assessment of the value of the outcomes of the engagement and the cost of resource requirements.

Hypernetwork: A network of networks that make up a service ecosystem.

Engagement: The commitment of resources by agents to a service activity.

Value Derivation: The process of discovering the dimensions of value and the means to measure value that occurs during a service journey.

Context: A service activity and its associated resources inputs, outputs and agents.

Service Journey: A sequence of service activities, possibly from different service systems, that constitute a complete service.

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