Value Shop Configuration

Value Shop Configuration

Petter Gottschalk (Norwegian School of Management, Norway)
Copyright: © 2007 |Pages: 9
DOI: 10.4018/978-1-59904-060-8.ch001
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Abstract

To comprehend the value that information technology provides to organizations, we must first understand the way a particular organization conducts business and how information systems affect the performance of various component activities within the organization. Understanding how firms differ is a central challenge for both theory and practice of management. For a long time, Porter’s (1985) value chain was the only value configuration known to managers. Stabell and Fjeldstad (1998) have identified two alternative value configurations. A value shop schedules activities and applies resources in a fashion that is dimensioned and appropriate to the need’s of the client’s problem, while a value chain performs a fixed set of activities that enables it to produce a standard product in large numbers. Examples of value shops are professional service firms, as found in medicine, law, architecture and engineering. A value network links clients or customers who are or wish to be interdependent. Examples of value networks are telephone companies, retail banks and insurance companies. A value configuration describes how value is created in a company for its customers. A value configuration shows how the most important business processes function to create value for customers. A value configuration represents the way a particular organization conducts business.

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