Hi, Ryszard:

Perhaps you may want to consider co-creation of value as part of your topic development process! Because there are countless illustrations where companies are involving their customers in the creation of products and delivery of services, commonly viewed as co-creation of value (CCV).

A recent research study [ Kaur Sahi, Sehgal, & Sharma, 2017) explored the value co-creation concept in the house construction business that requires maximum customer engagement with the service provider as compared to other subsectors in the real estate.With this background, the study examined the comprehensive framework of antecedents and consequences of CCV leading to customers’ recommendation in the housing sector. Moreover, the effect of CCV on customers’ recommendation of a service provider is also studied by analyzing the role played by relational value and customized offerings.

One of the main findings of the study is that the three pre-conditions, namely customer participation, customer expertise, and resource integration, significantly affect CCV. It was also found that when customers are allowed to participate and are provided with more choices, it leads to a higher level of trust. Thus, CCV has a significant impact on trust. Customers usually promote a service provider through positive word-of-mouth and make actual recommendations to others when he is able to ensure satisfactory services. Hence, the direct relationship of customer satisfaction with recommendation turns out to be significant.

Another highlight of the study is that value co-creation is a platform where customers should proactively participate and architects must give shape to this pro-activeness by acknowledging their ideas and suggestions. Any ignorance in this process may bring in negative effect of relational value on customer recommendation. Moreover, the effect of trust on customer recommendation is completely mediated by relational value.Thus, the results of the study have some important implications for an architect. 

Customers ought to be provided with innovative and unique architectural designs such as inspiration taken from different western countries and fusion for bringing variety. Relational value can be created by motivating customers as well as involving customers’ family members in key discussions. Also, being empathetic and understanding about any special need of the customer has a profound impact on the relational value. The customer should be periodically assured about the timely execution of the plans drafted since the completion of a house not only depends on the services of an architect, but also involves a whole network of resource partners, that is, appropriate material, labour, and other suppliers!

• Kaur Sahi, G., Sehgal, S., & Sharma, R. (2017). Predicting Customers Recommendation from Co-creation of Value, Customization and Relational Value. Vikalpa: The Journal For Decision Makers, 42(1), 19-35.

Hope this helps!

Kind Regards, Nadeem

Hi, Mohammed Nadeem

Here are my remarks about the article (from the point of view of the questions from my previous post): 

1. The authors suggest that the customer (here: the new-built-house owner) value is perceptual, but they  don't define what the CV is. In  a real investment process the CV = NPV. NPV is not mentioned in the article. The authors admit that: 'benefits derived from CCV both by customers and service provider have not been investigated'. 

2. The authors measure the customer short term perceptions of the part (the construction of the house) of long term investment (in own house) process. Perception of the same (construction) process is different in the longer time (especially during the selling of the house/cashing of investment). 

3. The economic value variables in the model (Economic value: Successful completion of house More control on quality of service, High quality of customized services) are far from real economic value (NPV) variables/drivers.

I have identified some hidden assumptions in the article:

1. The authors threat the house construction process as the consumption process (the house investors as house consumers). In reality the short term house construction process is a part of long-term house-investment process - this is the relevant process to investigate.

2. The authors treat the co-creation process as the time-less, cost-less and asset-less process at the provider side - that is not the truth. In reality co-creation requires additional provider's outlays - the return on the co-creation outlays is not guaranteed.  I know the case when the developer allowed the clients to make their own project-changes during the whole time of their construction projects implementation. Such co-creation process destroyed the developer's profitability and the process was cancelled.  

3. The authors suggest that 'customers participate in the form of giving suggestions, new innovative ideas" which is not in line with R. Verganti's articles (customers are not so creative to suggest radical innovations).

In the model (Figure 1), the economic value precedes the trust and customer behavior - that is OK but the economic value is not defined/mentioned in the article.

My summary:

Long-term perceptions/experiences and NPV-related dependent variables  would help in such research.

Thank you for sharing your remarks.

Dear Colleagues

One particular problem.

Do you think that the category of value appropriation is useful in empirical research on value creation processes?

Bapuji et al (2017) suggest that value appropriation depends on the price a consumer has paid for the product or service of the firm, and amount it cost the firm to product the product or service. (...) The overarching question guiding value appropriation is “how to maximize retained earnings for the firm?”

Bapuji H, Husted BW, Lu J, Mir R (2017) Value Creation, Appropriation, and Distribution: How Firms Contribute to Societal Economic Inequality August 2017 Business & Society 57(6)

Do you think, that the accounting categories (sales, cost of goods sold, retained profit) need to define the additional category of "appropriation"?. For what? How to use it in empirical research?

It seems to me that this is an interesting question and it is very good that this question appeared on the research portal Research Gate. Best wishes

I am not an expert in your specializationl; however, my program of research is closely related to your specialization (economics) and your research question. I am a nursing decision scientist, who is studying to pinpoint Optimal Safe Staffing Levels Maximizing Quality-Cost (i.e., value) in the Continuum of Changes, which serves as Evidence-based Informed Shared Decision-Making Rationales among parties (i.e., patients, nurses, and stakeholders), leading to achieve the Patient-centered Value-driven Healthcare Delivery System.

Article Park's Optimized Nurse Staffing (Sweet Spot) Estimation Theo...

Article Optimizing Staffing, Quality, and Cost in Home Healthcare Nu...

Park's Optimized Nurse Staffing (Sweet Spot) Estimation Theory works as the non-perceptual concepts & frameworks of consumer value in both short-term and long term period. The reason why the theory is based on the non-perceptual concepts is that the three main constructs are objective concepts such as patient outcomes (e.g. mortality), direct cost (e.g. personnel expenditure), and nurse staffing (e.g. a number of nurses, nurses' workloads, or a composition of the nursing professionals). Please email me if there is anything you would like to discuss with me regarding this article: [email protected]

Dear Claire Su-Yeon Park

1.How is the Quality/Value measured in the model? It seems that as a value of money, so the value in exchange rather than value in use is analysed here.

2. It seems to be a short-term decision making model, is it?

3. Could you suggest more texts about the problem?

Regards

Richard Kleczek

Dear Richard Kleczek,

1.How is the Quality/Value measured in the model? It seems that as a value of money, so the value in exchange rather than value in use is analysed here.

Yes, you are right. I plan to conduct cost-benefit analysis to transform quality indicator(s) into a value of money. The reason is that (1) there are so many quality indicators in healthcare (quality of care outcomes encompassing patient outcomes) and (2) a composite variable can also be applied as the representative indicator of quality and (3) the majority of quality indicators are subjective (not objective) indicators and virtually impossible to be measured as a value in use and (4) it should be transformed into a value of money to be linked to a function of cost.

2. It seems to be a short-term decision making model, is it?

Yes, the theory has been developed based on a short-term production function theory (derived from microeconomical model). By the way, I am also curious about how the theory would be changed for a long-term!

3. Could you suggest more texts about the problem?

Sure, I attached the full paper, which explains the theory development process.

Article Optimizing Staffing, Quality, and Cost in Home Healthcare Nu...

It took 5 years for me to develop the theory because nurse scientists are unfamiliar with micro/mathematical economics and operations research (mathematical programming, i.e., optimization). The paper won a Nursing Policy Scholarly Award from the Korean Nurses Association in Feb 2018 and also it is featured on the recent front cover of the Journal of Advanced Nursing (Top 5% SCI-indexed nursing journal): Cover Page Featured on the Front Cover of the Journal of Advanced Nursi...

I am very happy to know you who scored a bull's eye!

Dear Claire

ad "...how the theory would be changed for a long-term".

So far I know, the optimizing attitudes are short term in nature = they don't say anything about long term. The long-term researchers (2a) investigate "transformations" instead "optimizations", (2b) add the meaning-variables to utilities-variables and (2c) investigate value in use instead value in exchange. The "transformation" question in your field would be: how could the staff help to transform the patients' practices (functions+meanings), to improve their values (utilities +meanings)?

An example of such research:

Nascimento LR, Ada L, Rocha GM, Teixeira-Salmela LF (2018) Perceptions of individuals with stroke regarding the use of a cane for walking: A qualitative study. Journal of Bodywork & Movement Therapies xxx, 1-5

Richard