Inter‑organization modeling of value network
Àâòîð: Levitasova V., Gizatulin A.
Èñòî÷íèê: Ñó÷àñíà ³íôîðìàö³éíà Óêðà¿íà: ³íôîðìàòèêà, åêîíîì³êà, ô³ëîñîô³ÿ: ìàòåð³àëè VI ì³æíàðîäíî¿ íàóêîâî-ïðàêòè÷íî¿ êîíôåðåíö³¿ ìîëîäèõ ó÷åíèõ, àñï³ðàíò³â, ñòóäåíò³â.– Äîíåöüê: ÄîíÍÒÓ, ²Ïز – 2012. – Ñ. 116–120.
Modeling value network of inter-organization interactions is very important for Ukraine. Because solution to this problem may increase the competitiveness of Ukraine in the international market and it is essential for the development of the investment potential of our state.
A dynamic approach to inter-organizational exchange is also important for Ukrainian firms. It is needed to capture the nuances of complex relationships between these firms, which develop in the modern economy. Problem of Inter-organization modeling of value network is poorly developed in Ukraine. We can list the following foreign scientists involved in its development: Allee, Andersson B., Barney J.B., Biem A., Brandenburg A., Bergholtz M., Caswell N., Dyer J., Edirisuriya A., Johannesson P., Llayperuma T., Nalebuff B. Normann R., Ramirez R., Singh J.H., Uzzi B., Weigand H.
As the economy is becoming more connected, more global, and more complex, strategic tools are required to provide insight to researchers and practionners trying to analyze firm’s interactions. Firms can no longer be classified neatly as customers, suppliers or competitors. Often they are two or more of these dimensions simultaneously [3]. Also, advances in technology have contributed to an increase in the number of inter-organizational relationships and the complexity of these relationships. The Internet and high bandwidth connectivity make it possible for firms to engage in intricate transactions with fewer spatial and temporal constraints. In addition, web services have automated many of labor intensive elements of inter-organizational exchanges, thus reducing the costs and complexity of these relationships [5].
Value Network as a model of inter-organizational exchanges is an attempt to address the increasing intricateness of inter-firm relationships, pushed by a more and more connected economy. Value Network has long been an object of interest for both researchers and practitioners [1,3]. However, the term usually denotes conflicting views and proposed studies lack rigorous models that could allow for descriptive and prescriptive analysis.
Various approaches have been proposed to create a modeling language for firm interactions. Interesting attempts to represent inter-organization exchanges were made in following models: the e3-value modeling framework the c3-value modeling framework, and the Allee’s modeling framework. These models were chosen because they are more acceptable to a modern economy.
e3-value modeling approach is a conceptual representation that has its basis in the ARA model view of the industry. The e3-value model is an efficient modeling framework that has been used in wide array of modeling engagements [4]. However, unlike our proposed approach, the lack of a clear strategic focus in the model weakens its ability for prescriptive strategic insights.
The c3-value modeling scheme is an extension of the e3-value model geared toward strategic analysis. Starting from the resource-based view of the firm (RBV), with its claim that sustained competitive advantage is gained by owning strategic resources that are valuable, rare, inimitable, and non-substitutable (VRIN) [2], the c3-value modeling approach proposes analyzing strategy along the following three dimensions: customer, capabilities, and competition, with a particular emphasis on competition as a means to realize the VRIN characteristics.
Indeed the c3-model explicitly takes into account the value proposition that is conveyed by the e3-value‘s value objects and proposes a dichotomy of the transferred value: a primary value object that conveys the intended businesses of an actor and the secondary value object that enhances the value delivered by the primary value object.
The c3-value modeling approach is a powerful strategic technique, it focuses on the direct competitor and the direct customer thus neglecting the inter-dependencies inherent in the current global economy and the potential given by the network perspective [6].
Allee’s considers a value network as an autopoetic or living system, a system that continually changes and reproduces itself [1]. As such the network is unmanageable. Allee’s model is constituted by the following entities: participants, transactions, deliverables, and exchanges.
A participant represents an individual or group of people. Transactions refer to a transfer of a deliverable from one participant to another. In Allee’s model transaction are unidirectional and a bi-directional transaction is called an exchange, which is a transaction that triggers a response from the recipient to the original sender. Exchanges are of primary importance in the model as drivers of value. Deliverables can be tangible such as good, services, and revenue, or intangible such as knowledge and benefit. Analysis within the Allee’s framework is mostly visual and consists of detecting patterns of exchanges between participants, specially the ones involving intangibles, with the assumption that value is created through exchanges. Verna’s model does not assign a purpose to the network and its focus on exchanges added to its assumption on the unmanageability of the network limits its potential for strategic analysis.
Therefore, none of the proposed models is not universal. Each of them has shortcomings: no focus on the network to gain a competitive edge; no direction towards strategic analysis with the assumption of an end-consumer as the main valuator of the whole network. So it is necessary to develop more concrete and rigorous value network model for identifying and analyzing inter-organization exchanges, by synthesizing and extending previous work in the area, in particular the e3-value model , the c3-value , and the Allee’s model of intangibles.
Literature
1. Allee V. The Future of Knowledge: Increasing Prosperity through Value Networks/ Verna Allee – Boston: Butterworth-Heinemann, 2002. – 256ð.
2. Barney J., Firm resources and sustained competitive advantage/ John Barney – Journal of Management, 17, 1991, pp.99-120.
3. Brandenburg A. Competition: A Revolution Mindset That Combines Competition and Cooperation : The Game Theory Strategy That's Changing the Game of Business/ A. Brandenburg, B. Nalebuff – Doubleday Book, NY, 1997.– 283p.
4. Gordijn J. Business Modeling is not Process Modeling/ J. Gordijn, J. Akkermans, J. Vliet – In Conceptual Modeling for E-Business and the Web, LNCS 1921, Springer-Verlag, 2000.
5. Parolini C. The Value Net: A Tool for Competitive Strategy/ Cinzia Parolini – John Wiley & Sons Ltd, England, 1999.– 300p.
6. Porter M. Competitive Strategy/ Michael Porter – Free Press, New York, 1980. – 457p.