Value-creating networks – a conceptual model and analysis

Abstract

Value and supply chains have been studied widely in the field of strategic management. Value nets and networks are most familiar in the fields of e-commerce and mobile-commerce. None of these, however, have been studied widely in the field of infrastructure and technical networks. Studies have mostly been theoretical in nature and there is a lack of empirical studies concerning value creation. Objective of this research is to understand communities’ technical networks value creation processes and networks providing the value to the end customers. Starting point is to understanding what value creation and value-creating networks are and how they can advance firms operational efficiency and effectiveness. In this theoretical research a conceptual and analysis model for value-creating networks was created. The conceptual model consists of four critical elements, namely customer value, core competencies, relationships and interaction. These four elements where used when the analysis model was created. The analysis model consists of five questions: 1) Who is the customer and what is considered valuable? 2) What activities are needed to create the value? 3) What resources are needed to carry out the activities? 4) Who are able to utilise these resources? and 5) How actors interact and influence each other? When these questions are answered related to a certain product or service the current state of the value-creation can be determined and the future possibilities discovered. Objective of all network actors should be satisfied, internal or external, customers. The network should work together to deliver the product or service to the customer at the right time, to the right place and at the right price. The analysis of value-creating networks gives possibilities to realise customers’ needs and find the main actors in the network. The analysis makes the relationships and interaction of the different actors clearer and gives the opportunity to find the underlying problems and objectives for future development. When the customer, customer’s needs and the value-creating network has been identified it is possible to make improvements and increase the value created to the customer. This research is part of a more extensive research project named C-Business – Communities’ technical networks ownership, governance and operation, which aims to investigate the pros and cons of different ownership and governance models of communities’ technical networks.

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