scispace - formally typeset
Search or ask a question
Journal ArticleDOI

On value and value co-creation: A service systems and service logic perspective

01 Jun 2008-European Management Journal (Pergamon)-Vol. 26, Iss: 3, pp 145-152
TL;DR: The authors argue that value is fundamentally derived and determined in use -the integration and application of resources in a specific context, rather than in exchange, embedded in firm output and captured by price.
About: This article is published in European Management Journal.The article was published on 2008-06-01. It has received 2861 citations till now. The article focuses on the topics: Service system & Service design.
Citations
More filters
Journal ArticleDOI
TL;DR: In this paper, an eleventh foundational premise (fifth axiom) is introduced, focusing on the role of institutions and institutional arrangements in systems of value cocreation: service ecosystems.
Abstract: Service-dominant logic continues its evolution, facilitated by an active community of scholars throughout the world. Along its evolutionary path, there has been increased recognition of the need for a crisper and more precise delineation of the foundational premises and specification of the axioms of S-D logic. It also has become apparent that a limitation of the current foundational premises/axioms is the absence of a clearly articulated specification of the mechanisms of (often massive-scale) coordination and cooperation involved in the cocreation of value through markets and, more broadly, in society. This is especially important because markets are even more about cooperation than about the competition that is more frequently discussed. To alleviate this limitation and facilitate a better understanding of cooperation (and coordination), an eleventh foundational premise (fifth axiom) is introduced, focusing on the role of institutions and institutional arrangements in systems of value cocreation: service ecosystems. Literature on institutions across multiple social disciplines, including marketing, is briefly reviewed and offered as further support for this fifth axiom.

2,225 citations


Cites background from "On value and value co-creation: A s..."

  • ...In short, understanding context is essential for understanding the perception and determination of value, since value is a contextually contingent concept (Vargo et al. 2008)....

    [...]

Journal ArticleDOI
TL;DR: The authors analyzes value creation and co-creation in service by analytically defining the roles of the customer and the firm, as well as the scope, locus, and nature of value and value creation.
Abstract: Because extant literature on the service logic of marketing is dominated by a metaphorical view of value co-creation, the roles of both service providers and customers remain analytically unspecified, without a theoretically sound foundation for value creation or co-creation. This article analyzes value creation and co-creation in service by analytically defining the roles of the customer and the firm, as well as the scope, locus, and nature of value and value creation. Value creation refers to customers’ creation of value-in-use; co-creation is a function of interaction. Both the firm’s and the customer’s actions can be categorized by spheres (provider, joint, customer), and their interactions are either direct or indirect, leading to different forms of value creation and co-creation. This conceptualization of value creation spheres extends knowledge about how value-in-use emerges and how value creation can be managed; it also emphasizes the pivotal role of direct interactions for value co-creation opportunities.

2,036 citations


Cites background from "On value and value co-creation: A s..."

  • ...Even as the discussion of value has evolved from a goods-grounded to a service-grounded perspective (Vargo and Lusch 2008; Vargo et al. 2008), as Ballantyne et al....

    [...]

  • ...Even as the discussion of value has evolved from a goods-grounded to a service-grounded perspective (Vargo and Lusch 2008; Vargo et al. 2008), as Ballantyne et al. (2011) observe, “at this stage … fuzzy definitional problems associated with many of the terms used remains” (p. 203)....

    [...]

  • ...On a more general level, value creation entails a process that increases the customer’s well-being, such that the user becomes better off in some respect (Grönroos 2008; cf. Nordin and Kowalkowski 2011; Vargo et al. 2008)....

    [...]

Proceedings ArticleDOI
07 May 2011
TL;DR: This workshop brings together practitioners and researchers to develop a shared understanding of existing approaches and findings around the gamification of information systems, and identify key synergies, opportunities, and questions for future research.
Abstract: "Gamification" is an informal umbrella term for the use of video game elements in non-gaming systems to improve user experience (UX) and user engagement. The recent introduction of 'gamified' applications to large audiences promises new additions to the existing rich and diverse research on the heuristics, design patterns and dynamics of games and the positive UX they provide. However, what is lacking for a next step forward is the integration of this precise diversity of research endeavors. Therefore, this workshop brings together practitioners and researchers to develop a shared understanding of existing approaches and findings around the gamification of information systems, and identify key synergies, opportunities, and questions for future research.

1,767 citations

Journal ArticleDOI
TL;DR: A broadened view of service innovation is offered--one grounded in service-dominant logic--that transcends the tangible--intangible and producer--consumer divides that have plagued extant research in this area.
Abstract: In this article, we offer a broadened view of service innovation--one grounded in service-dominant logic--that transcends the tangible--intangible and producer--consumer divides that have plagued extant research in this area. Such a broadened conceptualization of service innovation emphasizes (1) innovation as a collaborative process occurring in an actor-to-actor (A2A) network, (2) service as the application of specialized competences for the benefit of another actor or the self and as the basis of all exchange, (3) the generativity unleashed by increasing resource liquefaction and resource density, and (4) resource integration as the fundamental way to innovate. Building on these core themes, we offer a tripartite framework of service innovation: (1) service ecosystems, as emergent A2A structures actors create and recreate through their effectual actions and which offer an organizing logic for the actors to exchange service and cocreate value; (2) service platforms, which enhance the efficiency and effectiveness of service exchange by liquefying resources and increasing resource density (facilitating easy access to appropriate resource bundles) and thereby serve as the venue for innovation; and (3) value cocreation, which views value as cocreated by the service offer(er) and the service beneficiary (e.g., customer) through resource integration and indicate the need for mechanisms to support the underlying roles and processes. In discussing these components, we consider the role of information technology--both as an operand resource and as an operant resource--and then examine the implications for research and practice in digitally enabled service innovation.

1,447 citations


Cites background from "On value and value co-creation: A s..."

  • ...value (Chandler and Vargo 2011; Vargo et al. 2008)....

    [...]

  • ...All actors are connected with other actors and other resources, and these connections provide the context for the actors to experience value (Chandler and Vargo 2011; Vargo et al. 2008)....

    [...]

Journal ArticleDOI
TL;DR: In this article, the authors analyse the underpinning logic of value co-creation in service logic and reformulate seven statements included in six of the foundational premises of the service-dominant logic.
Abstract: The underpinning logic of value co-creation in service logic is analysed. It is observed that some of the 10 foundational premises of the so-called service-dominant logic do not fully support an understanding of value creation and co-creation in a way that is meaningful for theoretical development and decision making in business and marketing practice. Without a thorough understanding of the interaction concept, the locus as well as nature and content of value co-creation cannot be identified. Value co-creation easily becomes a concept without substance. Based on the analysis in the present article, it is observed that the unique contribution of a service perspective on business (service logic) is not that customers always are co-creators of value, but rather that under certain circumstances the service provider gets opportunities to co-create value together with its customers. Finally, seven statements included in six of the foundational premises are reformulated accordingly.

1,342 citations


Cites background from "On value and value co-creation: A s..."

  • ...Vargo et al. (2008) conclude that ‘(the) exploration of value co-creation raises as many questions as it answers....

    [...]

  • ...…of a value co-creator (Lusch Corresponding author: Christian Grönroos, CERS Centre for Relationship Marketing and Service Management, Hanken School of Economics, P.O. Box 479, 00101 Helsinki, Finland E-mail: christian.gronroos@hanken.fi et al., 2008: 10; Vargo and Lusch, 2008; Vargo et al., 2008)....

    [...]

  • ...Value creation is a process through which the user becomes better off in some respect (Grönroos, 2008) or which increases the customer’s well-being (Vargo et al., 2008)....

    [...]

  • ...Regardless of whether the firm is termed a co-creator or creator of value (cf. Lusch et al., 2008; Vargo et al., 2008), the implicit conclusion in the literature has been that the firm is in charge of a value-creating process and the customer is invited to join it as a co-creator....

    [...]

References
More filters
Journal ArticleDOI
TL;DR: The authors argue that service provision rather than goods is fundamental to economic exchange and argue that the new perspectives are converging to form a new dominant logic for marketing, one in which service provision is fundamental for economic exchange.
Abstract: Marketing inherited a model of exchange from economics, which had a dominant logic based on the exchange of “goods,” which usually are manufactured output The dominant logic focused on tangible resources, embedded value, and transactions Over the past several decades, new perspectives have emerged that have a revised logic focused on intangible resources, the cocreation of value, and relationships The authors believe that the new perspectives are converging to form a new dominant logic for marketing, one in which service provision rather than goods is fundamental to economic exchange The authors explore this evolving logic and the corresponding shift in perspective for marketing scholars, marketing practitioners, and marketing educators

12,760 citations


"On value and value co-creation: A s..." refers background in this paper

  • ...…logic focuses on the action of operant resources (those that act upon other resources), such as knowledge and skills, whereas G-D logic focuses on the exchange of operand resources (those that an act or operation is performed on, such as goods) (Constantin and Lusch, 1994; Vargo and Lusch, 2004)....

    [...]

  • ...Service is the application of competences (knowledge and skills) by one entity for the benefit of another (Vargo and Lusch, 2004, 2006)....

    [...]

  • ...The traditional view is referred to as goods-dominant (G-D) logic and is based on the value-in-exchange meaning of value (see Vargo and Lusch, 2004; Vargo and Morgan, 2005)....

    [...]

  • ...Rethinking value and value creation: service-dominant logic The S-D logic view of exchange fundamentally challenges the foundation of economics (see Vargo and Lusch, 2004), though in a real sense, it recaptures Smith’s (1776) original notions of applied, specialized knowledge and skills (service)…...

    [...]

  • ...and service logic perspective...

    [...]

Book
01 Jan 1890
TL;DR: In this article, the authors present a survey of the general relations of demand, supply, and value in terms of land, labour, capital, and industrial organization, with an emphasis on the fertility of land.
Abstract: BOOK I: PRELIMINARY SURVEY 1. Introduction 2. The Substance of Economics 3. Economic Generalizations or Laws 4. The Order and Aims of Economic Studies BOOK II: SOME FUNDAMENTAL NOTIONS 1. Introductory 2. Wealth 3. Production, Consumption, Labour, Necessaries 4. Income. Capital. BOOK III: ON WANTS AND THEIR SATISFACTION 1. Introductory 2. Wants in Relation to Activities 3. Gradations of consumers' demand 4. The elasticity of wants 5. Choice between different uses of the same thing. Immediate and deferred uses. 6. Value and utility BOOK IV: THE AGENTS OF PRODUCTION. LAND, LABOUR, CAPITAL AND ORGANIZATION T 1. Introductory 2. The Fertility of Land 3. The Fertility of Land, continued. The Tendency to Diminishing Return. 4. The Growth of Population 5. The Health and Strength of the Population 6. Industrial Training. 7. The Growth of Wealth 8. Industrial Organization 9. Industrial Organization, continued. Division of Labour. The Influence of Machinery 10. Industrial Organization, continued. The Concentration of the Specialized Industries in Particular Localities. 11. Industrial Organization, continued. Production on a Large Scale 12. Industrial Organization, continued. Business Management. 13. Conclusion. Correlation of the Tendencies to Increasing and to Diminishing Return BOOK V: GENERAL RELATIONS OF DEMAND, SUPPLY, AND VALUE 1. Introductory. On Markets. 2. Temporary Equilibrium of Demand and Supply 3. Equilibrium of Normal Demand and Supply 4. The Investment and Distribution of Resources 5. Equilibrium of Normal Demand and Supply, continued, with reference to long and short periods 6. Joint and Composite Demand. Joint and Composite Supply 7. Prime and total cost in relation to joint products. Cost of marketing. Insurance against risk. Cost of Reproduction. 8. Marginal costs in relation to values. General Principles. 9. Marginal costs in relation to values. General Principles, continued 10. Marginal costs in relation to agricultural values 11. Marginal costs in relation to urban values 12. Equilibrium of normal demand and supply, continued, with reference to the law of increasing return 13. Theory of changes of normal demand and supply, in relation to the doctrine of maximum satisfaction 14. The theory of monopolies 15. Summary of the general theory of equilibrium of demand and supply BOOK VI: THE DISTRIBUTION OF THE NATIONAL INCOME 1. Preliminary survey of distribution 2. Preliminary survey of distribution, continued 3. Earnings of labour 4. Earnings of labour, continued 5. Earnings of labour, continued 6. Interest of capital 7. Profits of capital and business power 8. Profits of capital and business power, continued 9. Rent of land 10. Land tenure 11. General view of distribution 12. General influences of progress on value 13. Progress in relation to standards of life

11,519 citations

Journal ArticleDOI
TL;DR: This article highlights and clarifies the salient issues associated with S-D logic and updates the original foundational premises (FPs) and adds an FP.
Abstract: Since the introductory article for what has become known as the “service-dominant (S-D) logic of marketing,” “Evolving to a New Dominant Logic for Marketing,” was published in the Journal of Marketing (Vargo, S. L., & Lusch, R. F. (2004a)), there has been considerable discussion and elaboration of its specifics. This article highlights and clarifies the salient issues associated with S-D logic and updates the original foundational premises (FPs) and adds an FP. Directions for future work are also discussed.

6,323 citations


"On value and value co-creation: A s..." refers background in this paper

  • ...The alternative view, service-dominant (S-D) logic, is tied to the value-in-use meaning of value (Vargo and Lusch, 2008a)....

    [...]

  • ...In each case, the resource- and use-contexts result in uniquely determined value – valuein-use or value-in-context (see Vargo and Lusch, 2008a)....

    [...]

  • ...and service logic perspective...

    [...]

  • ...S-D logic captures this equivalence of participants and their roles in FP9: all economic and social actors are resource integrators (Vargo and Lusch, 2008a)....

    [...]

  • ...That is, we need to establish the fundamentals of service science and a framework for understanding how service systems operate and interact before we can develop a normative service science for what decision makers of service systems should do (see also Vargo and Lusch, 2008b)....

    [...]

Journal ArticleDOI

3,174 citations

Journal ArticleDOI
TL;DR: In this paper, the authors compare problems and strategies cited in the services marketing literature with those reported by actual service suppliers in a study conducted by the authors, and discuss the problems of service marketing.
Abstract: This article compares problems and strategies cited in the services marketing literature with those reported by actual service suppliers in a study conducted by the authors. Discussion centers on s...

2,500 citations


"On value and value co-creation: A s..." refers background in this paper

  • ...…economic activity was driven by what is conventionally known as ‘‘services’’ (i.e., intangible, heterogeneous, inseparable, and perishable offerings; Zeithaml et al., 1985) – both within individual firms and across economies – but that service innovation did not have the same scientific and…...

    [...]