Value co-creation in group enterprises: an evolutionary game theory-based analysis

Abstract

Information barriers exist between subsidiaries in a group enterprise, where each subsidiary acts independently, and hinder rational allocation and utilisation of resources. This study proposed a value co-creation model consisting of heterogeneous subsidiaries in a group enterprise and consumers. By constructing a three-party evolutionary game model, we discussed the impact of information leakage risk, punishment intensity, consumer experience, and reputation on the strategy evolution process, which means the proportion of strategy choices for the three entities over time. We analysed and verified the evolutionary process of the value co-creation system in different scenarios. This study revealed the ‘butterfly effect’ of value co-creation within the group enterprise, highlighting how different combinations of decision-making probabilities among the three entities in the initial stage can result in diverse outcomes, even when starting from identical conditions. The study also found that under certain conditions, group subsidiaries may sacrifice their own interests for the overall interests of cooperation. This study yielded the counterintuitive conclusion that in a stable state, the choice of cooperation strategies between subsidiaries is not directly related to their willingness to share knowledge.