The Value Co-creation Process in Service Networks: A Business-To-Business Professional Service Perspective

Abstract

The notion that value creation occurs within the boundaries of an organisation is increasingly being challenged (Normann and Ramírez, 1993; Prahalad and Ramaswamy, 2004b; Vargo and Lusch, 2008a) and it is now widely acknowledged that value is co-created through interactions with actors in an organisation's business network (Cova and Salle, 2008; Ford, 2011; Vargo and Lusch, 2011; Jaakkola and Hakanen, 2013). Despite this, existing frameworks for value co-creation have failed to incorporate the role of business network actors (e.g. Payne et al., 2008; Grönroos and Voima, 2013). Moreover, most empirical studies on value co-creation focus on business-to-consumer settings (Perks and Roberts, 2014). Researchers have also pointed out that the view of actors engaged in seamless co-creation of value is rather idealistic (Lindgreen et al., 2012) and extant research has mostly examined positive and negative outcomes of the value co-creation process (e.g. Heidenreich et al., 2014) rather than investigating whether there are negative aspects of the value co-creation process itself.Against this background, this thesis explores the value-co-creation process in a Third Order service network (Henneberg et al., 2012) that is based on a business-to-business professional service, advertising. The objectives of this research are fourfold: 1) To examine the activities and resources involved in the value co-creation process when actors interact directly in a service network, 2) To identify the enablers and barriers that facilitate and hinder the value co-creation process respectively 3) To examine the value outcomes perceived by actors as a result of the value co-creation process and 4) To explore whether any negative aspects are associated with the value co-creation process.Using a case study approach, multiple triads and dyads were investigated in the advertising service industry in Bangladesh, which is one of the Next-11 emerging markets (Goldman-Sachs, 2011). Within the eight triadic case studies and ten dyadic case studies, 63 semi-structured in-depth interviews were held with managers from client firms, their advertising agencies and third actors (media planning and buying/ activation agencies). Documents (emails, campaign briefs and meeting minutes), numerous site visits and the observation of a client-agency meeting and two client-agency telephone calls added supporting information to the case study investigation. To the researcher's best knowledge, this study is the first to present a framework for the value co-creation process in B2B professional service networks. The results of this study provide a much-needed empirical view of the value co-creation process at the micro level (Grönroos and Voima, 2013; Leroy et al., 2013), showing that the value co-creation process occurs in three overlapping stages: planning, execution and evaluation. The findings further reveal that cognitive abrasion, consisting of idea generation, disclosure/advocacy and convergence activities, plays a crucial role in the value co-creation process. Unlike previous research, this study identifies twelve enablers and ten barriers to the inter-firm value co-creation process. This research brings to attention that the client plays a critical role in managing supplier-supplier value co-creation in service networks. Additionally, three approaches to the inter-firm value co-creation process are presented, consisting of client-driven, supplier-driven and multi-partner-driven value co-creation. This research also provides deeper insights into how atmospheric elements such as role conflicts, role ambiguity, weak-form opportunistic behaviours and power exertion can influence the value co-creation process in service networks.

Date of Award	1 Aug 2015
Original language	English
Awarding Institution	The University of Manchester
Supervisor	Judith Zolkiewski (Supervisor)