What is Value Derivation

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.