A Value Network Perspective

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A Value NetworkPerspective
What is a Value Network?
A web of relationships that generates economic
or social value through complex dynamic exchanges
of both tangible and intangible benefits. The
network helps build strategic capabilities in
organizations business, government, or civil
society.
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Current business approaches are inadequate.
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Value Networks
How do we leverage our resources, knowledge, and
intangibles to create value ? especially value in
the larger sense of both tangible and intangible
good?
Living system perspective Intangibles
Value networks
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Relative Importance of Intangibles
Potential for greaterparticipation
wideraccountability
Transparency
Financial indicators remain important.
ICT Proliferation
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Example of Value Exchange
Participant
COMPANY
CUSTOMER OR END USER
TangiblesIntangibles
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ValueNet WorksAnalysis
Basic Method
A small number of rules can define a game so
complicated that we can never exhaust its
possibilities.
- Game Theory
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When to use it

• Business web development
• Resource deployment, delivery, and time-to-market
  advantage are dependent on the quality,
  coherence, and vitality of the business web.
• Fast track process redesign
• New technologies are constantly changing - and
  so are the processes to innovate, design,
  manufacture, and deliver them. Multiple,
  interdependent, and concurrent processes are too
  complex for traditional process mapping.
• Reconfiguring the organization
• Change is all there is. Mergers, acquisitions,
  downsizing, expansion to new markets, new product
  groups, new partners, new roles and functions.
• Evolving purposeful networks and communities of
  practice
• Understanding the transactional dynamics are
  vital for purposeful networks of all kinds, from
  global policy networks to internal strategic
  communities.

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ValueNet Works Methodology
The Process
Identify key Participantsand stakeholders
forcreating value.
Identify the Participants
Map the key tangible andintangible value
exchangesbetween the Participants.
Describe the Deliverables
Exchange Analysis
Analyze the patterns andprocesses for creating
value.
Impact Analysis
Conduct a cost / benefitanalysis of every
valueinput for each Participant.
Value Creation Analysis
Analyze cost / benefit ofevery value output for
eachParticipant to increasevalue outputs.
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DiagrammingFirst identify the participants.
Map the tangible exchanges.
Map the intangible exchanges.
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ValueNet Works Methodology
The Process
Identify key Participantsand stakeholders
forcreating value.
Identify the Participants
Map the key tangible andintangible value
exchangesbetween the Participants.
Describe the Deliverables
Exchange Analysis
Analyze the patterns andprocesses for creating
value.
Impact Analysis
Conduct a cost / benefitanalysis of every
valueinput for each Participant.
Value Creation Analysis
Analyze cost / benefit ofevery value output for
eachParticipant to increasevalue outputs.
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PharmCo Value Network
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Case Studies
In life the issue is not control,but dynamic
relationships.
- Eric Jantsch
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eBay business transactions only.
Note role of volunteer user groups.
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Enterprise as Value Network
Solid lines are contractual exchanges. Broken
lines are those little extras that build
relationships and keep things running smoothly.
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Increasing Prosperity

• The value network perspective supports a dynamic
  whole-system view of wealth and value creation.
• With this view we can more deliberately generate
  the type of value and true wealth that marks real
  prosperity and success ? and that makes life
  worth living.
• It offers hope that we can reconcile our business
  and economic models to include the fabric of
  society and the web of life.