Value Dominant Logic

Abstract

Value is creating good for, improving the well-being and worth of ourselves and others. Value and value creation are natural to and basic in human behaviour and endeavour, and should be at the centre of our attention. Actors 1 (whether individuals or institutions) in the global ecosystem strive for value for themselves and their constituents. This article proposes a holistic value dominant logic (VDL) that exists universally and encompasses what happens during, before and after (outside) the business and social ecosystem. VDL looks at the needs perspective of the actors and the results of the actors. VDL describes value waiting to happen, how it can be recognized and developed (and its role is creativity and innovation) and how to prevent value destruction. Value, though considered important, has remained a result of the process in service exchange, with no major push on measurements and on conscious value creation. This article aims to put a bigger focus on value and its creation. VDL is based on a global ecosystem; on understanding what value is and how it is embedded in the ecosystem and how it impacts business and society, and beyond. Value addition and value creation are delineated. Eight principles of VDL are enunciated.

Consumer Brand Value Co-creation Typology

“…This notion of marginal and radical enhancement in value is anchored in innovation literature (Garcia & Calantone, 2002; Zhou & Li, 2012). Our second dimension also finds support in VDL (Mahajan, 2017) as many uses of the brand result in a creation of value that goes beyond the internal boundary of the firm. While it could be argued that in the first level ( basic use ) value is co-created within the brand’s business/social boundaries, in later two levels ( marginal and radical uses ) value is co-created beyond the brand’s business/social boundaries.…”

“…So at the very minimum a consumer, in an attempt to satisfy any of these motivating factors, is going to co-create with him/herself as the dominant partner. Although as VDL posits, value creation can happen when an individual performs an action, for example, a student creates value for him/herself when studying for an exam (Mahajan, 2017), once a brand is involved even if the consumer uses the brand/product in private there is a certain degree of co-creation that can be either positive or negative. In other words, a consumer buys a product or service and co-creates or co-destructs value in his/her privacy, and a firm’s role in co-creation is to just make the value platform available.…”

“…Although the notion of co-creation has been around for some time, especially in the services literature under the labels of inseparability and simultaneity of production and consumption of service (Grönroos, 2011, 2017; Lovelock & Gummesson, 2004; Perera, Albinsson, & Shows, 2017; Vargo, Archpru Akaka, & Vaughan, 2017), the term co-creation has come of age with the service-dominant logic (SDL) literature (Leclercq, Hammedi, & Poncin, 2016; Vargo & Lusch, 2004, 2016; Vargo et al, 2017; Wilden, Akaka, Karpen, & Hohberger, 2017). Co-creation also finds strong support in the concept of value-dominant logic (VDL) (Mahajan, 2017), as VDL focuses beyond the process of creating value, and rather focuses on the goal of creating it consciously, unconsciously, implicitly or explicitly for all actors within an ecosystem that interact with each other.…”

Value Migration to the Sustainable Business Models of Digital Economy Companies on the Capital Market

“…The difficulty with value is that it is intangible because value depends on the value ecosystem and their perception of value. Value is fundamental, it is what we are seeking (it exist whether we notice it and not see it); value is what is good (or meritorious), useful, important or worthwhile [58]. It is visible on the capital markets, which is manifested in value migration from less attractive to more attractive models.…”

Firm Motivations for Shareholder Co-creation

“…To better understand the process of co-creation with shareholders, a view of value creation must be adopted. Value creation is the process of executing proactive, conscious, inspired and imaginative or normal actions and increases the benefits of all stakeholders (Mahajan, 2017). To this end, value creation occurs when a firm co-creates with shareholders.…”