Value Capture Processes Research Articles

Making virtual celebrity: Platformization and intermediation in digital cultural production

Focusing on intermediation in cultural production in a digital ecology consisting of multiple platforms mediating simultaneously converging and diverging industries, this study critically engages with the thesis that platforms act primarily as a disintermediation vector in a linear value chain within a single industry. With two empirical cases of intermediation in the emerging virtual celebrity sector – one organizing the recursive loop of prosumption, the other articulating authenticity against technological standardization and overproduction, the study shifts the focus away from questions of labor and agency of individual creators and unpacks the conditions of intermediation in the context of new industrial models of value creation, commodification, and division of labor. The empirical cases demonstrate that the implications of platforms for digital cultural production are paradoxical – while their business models lead to a centralized process of value capture, their flexible organizational forms may afford new distributed patterns of value creation.

Explaining Value Capture Implementation in New York, London, and Copenhagen: Negotiating Distributional Effects

Value capture (VC) is widely cited as a method for local authorities to provide urban public goods to their cities in the face of fiscal stress. Its application in practice however remains limited. In this article, we aim to explain the implementation process of VC as a strategy to fund public transportation infrastructure through case studies in London, New York, and Copenhagen. Adopting a theory of gradual institutional change, we argue that the implementation of VC depends on the capacity to change distributional institutions that are inherently contested. Particularly relevant is the role of the beneficiary, whose support of VC is necessary but not likely. Our results show that a strategic urban development project can act as a driver to overcome this barrier, but that this driver can, simultaneously, also hinder the institutionalization potential of a VC strategy. We therefore suggest that, for VC strategies to become more commonplace, sharing value uplifts among beneficiaries must become more commonplace too.

How small companies capture value from their intellectual property: a qualitative study

Innovative small companies often struggle to profit from their intellectual property (IP) due to various constraints, a challenge that remains under-researched. In our analysis of seven Canadian firms, we illuminate the ways these businesses maximize IP value. In doing so, we proposed a nuanced, resource-based view (RBV) framework. This framework reveals that small business managers first evaluate resource deficiencies for specific IPs. Following this, they pinpoint and implement compensating strategies linked to organizational resources, distinct IP forms, and networks. Consequently, small firms can harness the full potential of IP by adeptly evaluating resource gaps and applying appropriate compensatory measures. Moreover, this study underscores that the value that small firms derive from IP depends on their capability to resolve deficiencies with effective strategies. These insights not only advance our understanding of IP value capture processes in small firms but also offer actionable guidance for businesses and policymakers aiming to bolster innovative ecosystems.

Simultaneous management of business model innovation and replication processes:

This article aims to understand how organizations can simultaneously manage their business model innovation and replication processes. Using an exploratory qualitative approach, we analyze Airbnb’s business model innovation and replication processes when the company launched its new value proposition. Our findings show that innovation and replication processes are designed, tested and implemented simultaneously. We underline the role of the platform in standardizing the key elements of the different stages of the processes. Through its digital platform, Airbnb can standardize its value creation and value capture processes to drive replication at scale. We discuss the contributions of our study to the replication strategy literature and to research on the Airbnb business model.

Analysing the Factors Influencing the Internationalisation of Social Entrepreneurship: A Study of Internationalised Social Businesses from Bangladesh

Social businesses (SB) have significant relevance as they create social impact through revenue-generating business models. The current study is intended to contribute to social entrepreneurship literature by identifying the factors that can influence social business in the internationalisation process from a developing country context, Bangladesh. The research utilised the qualitative approach to extract the required information from the selected ten (10) business cases. MAXQDA software was used to generate the required codes and categories. From the findings, three broad categories of factors have been identified that influence internationalisation: firm-centric, entrepreneur-specific, and context-specific factors related to home and host country environments. The study determined that the firm’s capabilities, such as designing technological apps and platforms to provide essential health, education, and medical services, contribute to internationalisation. In addition, the research identified the adaptation of the business model as one of the determinants of SB internationalisation. Some adaptation practices include maintaining hybrid logic, adopting social franchising model, value delivery, and value capture processes through partnership with for-profit organisations in host countries. The findings of this study are expected to be useful for academicians and also for the social entrepreneurs willing to take their enterprises to the international market level.

The Role of Dependence Relationships in the Value Capture Process

We view the firm as a complex system and deploy Emerson’s power dependence theory to explain who captures value in deals between the firm and its suppliers and customers. The value realised in a deal is the difference between the buyer and seller reservation prices and dependence is a function of need strength and the availability of alternative deals. We argue that prices are the outcome of perceived dependence relationships between buyer and seller. Dependence on the focal deal is based on the buyer or seller’s subjective judgements concerning the use value being traded, the other party’s dependence and the availability of alternative deals. We develop eight value levers which firms can deploy to improve their dependence relationships. We then use this value capture perspective to address three questions: 1) should firms pursue generic strategies? 2) what is a valuable resource? 3) how should firms approach strategic change? We conclude that any change or resource which enhances the firm’s dependence relationships improves firm performance.

A micro level investigation of stakeholder motives on university technology transfer business models

ABSTRACT Within this paper, we take a micro level perspective to explore how ecosystem stakeholder motives have impacted value creation and value capture processes within the University Technology Transfer (UTT) business model over time. To achieve this, we adopt a longitudinal qualitative methodology comprising of case study evidence of two differing bounded contexts of universities and their respective UTT stakeholder-based business models over an eight-year period. Our findings reveal, that in seeking to balance and align the value creation and capture processes needed to satisfy diverse stakeholders and achieve university mission, the importance of portfolio models within UTT business model design to ensure ongoing strategic alignment and sustainability.

From private label to co-branded credit card: an assessment of the impact of a change in value proposition over customer value perception and company value capture

Purpose: The aim of this paper is to evaluate the success of a value proposition over time, considering two aspects: customer’s perceived value and value capture. Research Design: The survey was conducted in a Brazilian retail credit card issuer, originally of the “private label” type, that changed to a co-branded operation. Aside from the research on customer’s perceived value, a survey was performed on the actual transactions made by cardholders in order to measure value captures, before and after the credit card offering change. Findings: The results confirmed that changes in value proposition, from private label to co-branded credit card, have a positive impact in customers’ perceived value and in company’s value capture. One year after the credit card service changed, there was an increase on both perceived value, considering all the variables involved, such as quality, price and benefit; and value capture, measured by the amounts spent by customers, number of transactions completed and credit limit usage. Research limitations/implications: There might be a selection bias since we sent the questionnaire via email, reaching only those respondents who had access to and opened the email. These respondents may be (and probably are) different from other users (e.g., older, less educated, etc. credit card holders). Therefore, for future research we suggest a new study with a more democratic instrument. It is also noteworthy that this study was not concerned with an understanding of all the process of value capture, other factors than the considered here can influence the company’s value capture. Practical implications: No matter how good the company’s understanding of its customer basis is, it can never be sure beforehand of the impact of such actions on customer perceptions, i.e. whether the new value proposition will be perceived as attractive enough to allow for actual value capture. Originality: The originality of this study lies in how it evaluates a change in value proposition through the impact on customers’ perceived value and value capture. Previous works have measured usage patterns and perceptions, but all of them are focused on actual patterns and perceptions among existing credit cardholders

Value capture mechanisms in publicly funded research

There is increasing pressure on academic scientists to acquire research funding and to produce impactful research that stakeholders external to the research can capture value from. However, our understanding of the mechanisms by which funded scientists do this remain unclear. We conceptualize a two stage process of value capture in publicly funded research, the first being resource exchange and knowledge exploration and the second, exploiting the funded research to expand its use. Based on this framing we ask, what are the mechanisms through which value in use is captured in publicly funded research? We draw on interviews with 41 health science principal investigators (PIs) in New Zealand along with related secondary material. Our findings identify two value capture in use mechanisms – boundary spanning and brokering – that PIs employ to extend the use of their funded research to a diverse range of ecosystem actors. While boundary spanning facilitates efficient and deep value capture with select ecosystem actors, brokering allows for wider value capture by identifying, combining and balancing multiple ecosystem interests simultaneously. Our research shows that PIs are not only at the nexus of science to business interactions, their influence surpasses industry to incorporate much broader ecosystem engagement.

The Business Model of ""Enough

As green consumption and eco-modernism so far have failed to significantly reduce the ecological impact of consumption, new approaches are needed to meet sustainability criteria. Next to technology-focused efficiency (relative reduction of energy and material use) and consistency (cradle-to-cradle design) approaches, sufficiency is a specific kind of behavior-based sustainability strategy that addresses how to make do with less. In this contribution, we explore a novel business model framework in order to address sufficiency-based consumer practices. Applying social practice theory reveals levers in terms of materials, competences, and meanings to support sufficiency-based lifestyles. Key challenges are including consumers in the value creation process and adapting value capture processes accordingly. By reconstructing the classical business model – value proposition, creation, and capture – from such a social practice theory perspective, this contribution shows that a sufficiency orientation critically changes our understanding of business models. In developing sufficiency-based alternatives to consumer practices, businesses become extensions of their customers’ practices. Value co-creation means not only that consumers increasingly act as prosumers but that businesses participate in consumer practices. Such an extended value creation implies an increasing inclusion of environmental and societal aspects beyond the boundaries of a business and may hint at a new understanding of a firm’s boundaries as a fluid network of collaborative practices.

Value Creation and Value Capture Alignment in Business Model Innovation: A Process View on Outcome‐Based Business Models

Industrial manufacturers are innovating their business models by shifting from selling products to selling outcome‐based services, where the provider (manufacturer) guarantees to deliver the performance outcomes of the products and services. This form of business model innovation requires a profound yet little understood shift in how value is created, delivered, and captured. To address this research gap, our study examines two successful and four unsuccessful cases of this shift. We find that effectiveness in business model innovation hinges on the three process phases that unfold in collaboration with the customers: value proposition definition, value provision design, and value‐in‐use delivery. We also find that that success is determined by the alignment of specific value creation and value capture activities in each phase: identifying value creation opportunities—agreeing on value distribution in value proposition definition, designing the value offering—deciding on the profit formula in the value provision design, and finally refining value creation processes—regulating incentive structures in the value‐in‐use delivery. Our process model contributes to the literature and practice on business model innovation by providing a thorough understanding of how alignment of value creation and value capture processes is ensured, whilst paying special attention to their interdependence and the interactions between provider and customer.

Free-driven web-based business models

Internet has increased the companies’ propensity to offer products/services free of charge through web-based platforms. This choice challenges the logic of traditional business models aimed at increasing the value captured by the firm. In order to analyse the impact of the free of charge offering on the enterprises’ web-based business models, we developed a systematic theoretical framework able to identify the key actors and flows of value involved in these business models. We tested this framework on 125 web-based platforms, clustering them through a combination of Multiple Correspondence Analysis and Hierarchical Clustering on Principle Components. The analysis allowed us to identify five different configurations of free-driven business models. Differently from the previous literature, we identify three specific configurations based on user-innovators, who are customers interested in participating in value creation processes, if adequately incentivized. These configurations are characterized by different sources of revenues and by the provision of specific free flows of value to user innovators, who can contribute to the business model with their working knowledge and reputation. Our analysis not only contributes to the academic debate on online business models, but it can support web-based companies in the definition of business model characterized by an effective and sustainable equilibrium between value creation and value capture processes.

Trade-offs in the value capture of architectural firms: the significance of professional value

Architectural firms often have difficulty generating profit from their services as they pursue not only commercial but also professional goals. These goals frequently conflict and have to be balanced during the process of value creation and value capture. So far, literature has focused on the interaction between the perceived use value for the customer and the fee that is paid to the firm. To better understand how professional service firms realize their organizational targets, professional value needs to be included. In this study, in-depth interviews with the architects and clients of nine housing projects provide insight into the content and process of value capture by architectural firms. The data reveal strategies by which architects tried to maximize the capture of professional value at the expense of profit or sometimes even their clients’ perceived use value. These trade-offs in value capture confirm the importance of professional value when studying value creation and capture in a professional service context. This paper provides an understanding of how architectural firms struggle to balance competing goals and highlights the importance of well-managed value capture.

A Discovery of Multiple Levels of Open Innovation in Understanding the Economic Sustainability. A Case Study in the Manufacturing Industry

The aim of this paper is twofold: firstly, investigate the theory of governance and open innovation by adding the process of value creation and value capture; secondly, to discuss the potential link between open innovation and economic sustainability. With the current emphasis of the literature being on either the value creation or value capture processes, the phenomenon of open innovation is only partially understood. To help broaden this understanding, we conducted an in-depth case study of the processes behind the transformation of governance structures at Iran Khodro Company (IKCO), which led to the emergence of both value creation and capture processes. A multi project analysis (from 1994 to 2012) has point out that IKCO have created and developed a formal value creation and capture processes from the part level through to the architectural level, allowing a gradual openness at those levels and at the same time ensuring a greater economic sustainability of the IKCO business. These findings reveal the existence of four unique levels of open innovation in product development architecture. Practical implications are also provided relating the impact that each of these levels can have on the economic sustainable model of the firms in the manufacturing sector.

Competitive Sensemaking in Value Creation and Capture

We suggest that a systematic socio-cognitive approach to “competitive sensemaking” has been absent from theory and research on competitive strategy. We define competitive sensemaking as the social and cognitive processes that underlie how firms detect, define, and conceptualize their competitive relationships with other firms. Competitive sensemaking is a subset of the more general process of strategic sensemaking, which is the “making plausible sense” of the broad array of stimuli and circumstances that characterize complex market situations. Using the value-based view of value creation and capture as a conceptual base for our arguments, we unpack four cognitive underpinnings of competitive sensemaking: mental time travel, comparability, counterfactual reasoning, and stories. We then show how these four components were differentially involved in shaping competitive sensemaking in four actual market situations. In doing so, we illustrate how competitive sensemaking provides fundamental inputs into the value creation and value capture process. We conclude the paper by drawing out the implications of competitive sensemaking for strategy theory and research.

Sharing the Pie in Open Innovation: Value capture in crowdsourcing from the solver perspective

A blind spot in the open innovation literature is the value capture process. This study examines value capture in an open innovation ecosystem dedicated to crowdsourcing technical needs from the perspective of solution providers (so called solvers). Through the lens of two-sided market theory and uncertainty reduction theory, we analyze how solvers are able to capture value from crowdsourcing and their barriers to equitable appropriation. Using a multimethod approach including a large scale study of more than 500 domain experts involved in crowdsourcing for technology needs, we highlight the solvers’ dissatisfaction and the need to develop relationship value. Our study shows that the predominant economic view of value should be complemented by social aspects and relational aspects of value such as trust and communication.

The impact of collaboration diversity and joint experience on the reiteration of university co-patents

Numerous studies have demonstrated the central role of universities in the development of innovation ecosystems, however the literature on the manner in which universities might construct and maintain their R&D collaborations is highly limited. The present study addresses this gap, analyzing the propensity of Italian universities to reiterate co-patenting with other organizations which have been co-applicants of their previous patents. Utilizing multi-level modeling, the study confirms the importance of collaboration diversity in the development of further co-patents, even if its effect changes in accordance with the specific dimension under analysis. Besides, the study demonstrates that joint experience in co-patenting has an inverted U-shaped effect on the development of further co-patents by the same co-applicant organizations. These results suggest the usefulness of a dynamic approach in the analysis of R&D collaborations, which could shed light also to the non-linear and varying impact of cognitive distance on innovation, as highlighted by the previous literature. In general, this study favors a better understanding of value creation and value capture processes in university co-patenting, thus allowing the development of useful policy indications.

Trade-offs in the value capture of architectural firms

Architectural firms often have difficulty generating profit from their services as they pursue not only commercial but also professional goals. These goals frequently conflict and have to be balanced during the process of value creation and value capture. So far, literature has focused on the interaction between the perceived use value for the customer and the fee that is paid to the firm. To better understand how professional service firms realize their organizational targets, professional value needs to be included. In this study, in-depth interviews with the architects and clients of nine housing projects provide insight into the content and process of value capture by architectural firms. The data reveal strategies by which architects tried to maximize the capture of professional value at the expense of profit or sometimes even their clients’ perceived use value. These trade-offs in value capture confirm the importance of professional value when studying value creation and capture in a professional service context. This paper provides an understanding of how architectural firms struggle to balance competing goals and highlights the importance of well-managed value capture.

Open for business

Open for business

Introduction

Driven by their desire to contribute to the quality of the built environment and wider society, architectural firms collaborate with other actors in heterogeneous interorganizational projects to provide products and services that solve complex spatial challenges. Due to ongoing developments in society and the construction industry, the professional roles that firms perform within these projects have become increasingly diverse, blurred and contested (Ahuja et al., 2017). While the role of architectural firms historically was clearly defined (Burr and Jones, 2010; Jones and Lichtenstein, 2008), they now cover a broad spectrum of activities and responsibilities, ranging from ‘full-service’ providers to specialist advisors for a certain discipline or phase (Duffy and Rabeneck, 2013; Van Doorn, 2014). The diversity in, and ongoing pressure on, roles often leads to firms experiencing difficulties when co-creating or capturing value in projects. For example, firms are not always able to realize the level of quality that they pursue, or fail to make a decent living out of their service delivery. While attempting to reconcile the demands of the many stakeholders that are involved in projects, architectural firms struggle to realize their professional and commercial goals. Research in the field of management has shown that the simultaneous use of multiple business models helps firms to deal with different demands and opportunities when operating in diverse contexts (Aversa et al., 2015; Kujala et al., 2010; Sabatier et al., 2010). Constant innovation of these business models further contributes to the resilience of organizations (Chesbrough, 2010). Although business model theory has significantly contributed to the understanding of organizations and their collaboration in the value chain, existing theories have been largely developed on the basis of insights from traditional, entrepreneurial firms (Zott et al., 2011). As a result, business model theory primarily addresses how organizations generate financial revenues from the value that they co-create. Considering that organizations’ single-minded pursuit of profits is increasingly constrained by other important goals, such as social responsibility (Thompson and MacMillan, 2010), more insight is needed into how organizations might capture multiple dimensions of value through their business models. Businesses that by nature pursue multiple strategic goals, such as architectural firms or other creative and/or professional service firms, represent an interesting empirical context for such investigations. This research aims to generate insight into the value capture process of architectural firms: 1) to contribute to the understanding of how firms capture multiple dimensions of value in project contexts in order to realize their strategic goals; and 2) to support architectural firms in dealing with the value capture challenges they face in practice. The following two main research questions are used to address the aims of the research: 1 How do architectural firms capture value in construction projects? 2 How can architectural firms be supported in developing strategies for value capture? I chose to focus specifically on firms’ value capture in projects to gain detailed, context-specific insights into the challenges and opportunities that firms encounter when attempting to balance multiple strategic goals. Multiple construction projects were studied to reveal overarching patterns in the value capture strategies of different architectural firms, across different project settings. The research draws on 25 interviews with architects and 15 interviews with clients from 24 recently completed construction projects, as well as observational data from 17 project-oriented strategy meetings to examine architectural firms’ value capture strategies both in retrospect and as they unfold in practice. Based on an engaged scholarship approach (Van de Ven, 2007), I used my own background and continued involvement in architectural practice to conduct my research. The empirical insights gained were further developed into a value capture toolkit that can be used by architectural firms to engage in projects and manage their value capture activities in these projects with greater awareness. The empirical research findings and toolkit were validated on a regular basis in conferences, discussion groups and co-organized workshops with different academic and professional communities. In the remainder of this introduction, I will first present and discuss the theoretical background, which combines a project-oriented perspective on business and a multidimensional perspective on value. The research’s scientific, practical and societal relevance will then be discussed. Subsequently, I will present the research context, paying specific attention to the roles of architectural firms in construction projects, which served as an empirical setting, and the overarching research project, futurA, in which the research is embedded. Following this, the methodological approach is discussed, with a particular focus on why a combination of empirical and design-oriented research is useful to increase our understanding of value capture by architectural firms and other creative and/or professional service firms. The introduction concludes with an overview of the remaining chapters and how they are related.