Operant resources
Operant resources are those resources that act on other resources.
operant resource: a resource that acts on other resources in order for progress to be made
based on definition in Vargo, S.L.and Lusch, R.F.(2004) ‘Evolving to a New Dominant Logic for Marketing’, Journal of Marketing 68(1): 1–17.
The act is an attempt to make one or more progress-making steps. Where those other resources may be operant (such as a seeker or another employee) or operand (such as goods).
Resource-advantage theory sees operant resources as typically:
Madhavaram, S., Hunt, S. (2007) “The service-dominant logic and hierarchy of operant resources”, Academy of Marketing, 36, pp 67-82
- human (e.g. skills and knowledge of individuals)
- organisational (e.g. controls, routines, cultures, and competencies)
- informational (e.g. knowledge about markets, competitors, and technology)
- relational (e.g. relationships with competitors, suppliers, and customers)
We also consider certain systems as operant resources – when they meet the condition of acting on other resources to make progress. A web browser, for example, is an operant resource whereas a typewriter is not. The browser integrates built in skills to translate HTML code (itself an operand resource) received from a web server into a fully-rendered web page. Compare that to a basic word processor that needs to be acted upon to make progress (a system as an operand resource). For an in-depth exploration, refer to Akaka and Vargo’s discussion in “Technology as an operant resource in service (Eco)systems“.
This discussion about systems takes on even greater relevance in light of the recent surge in Artificial Intelligence. These serve as operant resources designed to “augment or automate” human activities, as Spohrer discusses in “Service in the AI era”.
They are fundamental source of strategic benefit
Our service-dominant logic foundation informs us that operant resources are the fundamental source of strategic benefit [ie making progress].
Operant resource are the fundamental source of strategic benefits
#4
Why do we use the term “strategic benefit” rather than “strategic advantage”? The choice stems from Vargo and Lush’s perspective in 2016. Their intention was twofold: i) to underscore the inherent service-service nature of our world, and ii) to prioritize the primary notion of co-creating value over competitiveness, relegating the latter to a secondary motivator.
So what operant resources do seekers and helpers typically have access to? Lets dig in.
Seeker’s operant resources
The seeker is seen as the primary operant resource in the progress economy. They are seeking to make progress, and capable of acting on other resources to reach that.
That said, the progress proposition continuum informs us that a seeker becomes more operand the nearer we get to the relieving end.
We naturally think of seekers as possessing resources (capabilities) such as skills, knowledge, and time. Alves, Ferriera and Fernandes (2016) point to a broader range, including:
Alves, Ferriera and Fernandes (2016) “Customer’s operant resources effects on co-creation activities” referencing Arnould, Price and Mashe () “Towards a cultural resource-based theory of the customer”
- physical – include sensory-motor endowment, energy, emotions and strength.
- social – made up of both personal and cultural relationships
- cultural – include specialised knowledge and skills, life expectancy and historic imagination
How do seekers acquire operant resources
Some capabilities seekers are born with but the majority they acquire in several ways:
- observation/imitation: by observing others making progress attempts
- experience: hands-on involvement in their own progress attempts
- experimentation/innovation: using resources available to them, or combining them, in new ways.
- education and training: taking formal education and training programs to acquire specific capabilities (eg skills and knowledge from a teacher, or strength from weight training)
Let’s not forget that seekers will certainly acquire operant resources via these ways from outside your industry/market. The implication being you should look to see what seekers have when building your propositions. I often point to use of QR codes as an example of this. Originally from the auto industry, they are now used, and expected to be used by seekers, in many different industry/market use cases.
Research by Alves, Ferreira, and Fernandes (2016) underscores the importance of educating seekers in relevant skills and knowledge related to your propositions.
Such education empowers seekers to better leverage your offerings as:
- expertise and self-efficacy can be increased by the helper educating the seeker (H4 in the diagram below).
- value co-creation (jointly making progress in our view) is increased with customer expertise, customer education, and self efficacy (H1, H3 and H5 in the diagram).
What operant resources do helpers have?
Helper’s operant resources
A progress helper is the entity that offers supplementary resources to a seeker, in the form of a progress proposition, to help the seeker progress. It can be a one-person band, an organisation/firm, or an ecosystem/network. Therefore, some of its operant resources may be seeker facing and others internal.
Hunt (2004), sees a helpers’ operant resources falling into the following categories:
Hunt, S. (2004) “On the service-centered dominant logic of marketing”
- Human resources
- Organizational resources
- Informational resources
- Relational resources
Where human resources refers to the skills and knowledge that individual employees posses (rather than a HR function). From this we see the roots of these famous business leader quotes:
Clients do not come first, employees come first. If you take care of employees, they will take care of the clients
Richard Branson
We built Starbucks brand first with our people, not with consumers. Because we believed the best way to meet and exceed the expectations of our customers was to hire and train great people, we invested in our employees
Howard Schultz
It doesn’t make sense to hire smart people and tell them what to do; we hire smart people so they can tell us what to do
Steve Jobs
Backing up human resources are often organisational resources. And here we refer to the controls, routines, culture and competences of the helper. The proposed series of progress making activities in a progress proposition is an organisational resource that seekers are given access to. But there are many routines etc that are not externally available and which helpers’ consider their magical sauce.
Information resources often come about through relational resources. The relationships that the helper has with competitors, suppliers, and customers. Helping progress helpers gain critically needed knowledge about market segments, competitors, and technology.
Hierarchy of helper operant resources
Madhavaram and Hunt (2008) “The service-dominant logic and hierarchy of operant resources” introduce firm’s operant resources as a hierarchical structure consisting of three levels: Basic, Composite, and Interconnected.
At the Basic level, abbreviated as BOR (Basic Operant Resources), we find resources that enable the helper to operate efficiently and effectively. Such resources are “easily” accessible and measurable, and are referred to as the building blocks of the organisation. For instance, a consulting company’s BORs may include the expertise of their consultants; a manufacturing company, the skills of machine operators.
Moving up the hierarchy, we encounter 13 Composite Operant Resources (COR). These resources represent combinations of two or more distinct basic resources or other composite resources. They are characterised by low levels of interactivity but collectively enable the firm to produce market offerings efficiently and effectively.Some examples are market orientation, technology competence and absorptive capacity.
Lastly, there are Interconnected Operant Resources (IOR), which are more complex and interdependent than composite resources. In this category, each component resource significantly interacts with and reinforces the others, enabling the firm to produce market offerings efficiently and effectively. Among the seven interconnected operant resources identified by Madhavaram and Hunt, two examples are organisational learning capability and entrepreneurial proclivity. Which we’ll see again when looking at how to increase innovativeness.
How helpers acquire operant resources
Let’s first recall the origin story of helpers. Helpers are seekers who have overcome a lack of resource progress hurdle, either through experience or purposefully. They now look to leverage their newly gained resources to help others progress (in exchange, often indirectly, for service they need).
An established helpers acquires new operant resources through a variety of ways:
- experience: involvement in progress attempts
- purposefully developing: such as training/education
- innovation: taking the next step towards resources that help progress
- acquiring/collaborating with: other helpers
Gallouj & Weinstein (1997) identify that individuals within firms (helper organisations) acquire competencies through:
Gallouj, F., Weinstein, O. (1997) “Innovation in services”
- education
- training
- experience
- and often from the repeated interaction with customers
They also noted that helpers often endeavour to codify valuable employee behaviours into standardised processes. That allows their institutionalisation and dissemination for future benefits.
Relating to their hierarchy, Madhavaram and Hunt offer two strategic approaches. That firms should consciously and continually aim to:
- acquire and develop lower-order resources that can elevate them within the hierarchy
- cultivate organisational policies, learning systems, and cultures that facilitate this ascent.
Innovation plays a pivotal role in enhancing operant resources and maintaining competitiveness in the market. Helpers should constantly seek to identify resources that help seekers make better progress. As well as resources that manage the ever changing progress sought and progress origins of seekers.
Operant resources can also be secured by the helper through ecosystem partnerships with other helpers or by acquiring another helper, following Williamson’s transaction cost economics theory to minimize transactional inefficiencies in these relationships. Leading to the standard make, buy, or ally choices.
non seeker/helper resources
Some resources are not owned by seeker or helper.
Consider the example of wind propelling kites on cargo ships, as demonstrated in the video below. Wind itself is neither a seeker nor a helper resource (or a capability). Yet it clearly acts upon the kite to facilitate progress, functioning as an operand resource. (If we’re not pedantic with the short-cut of wind as a resource, remember).
…resources such as time, weather, laws, which are often considered exogenous, and uncontrollable by individuals and organisations, are often integrated
Vargo, S.L., Lusch R.F., and Akaka, M.A (2010) “Advancing Service Science with Service-Dominant Logic Clarifications and Conceptual Development”
Time is another resource that is not seeker or helper owned. But seekers attempt to manage the fixed amount they have. When seekers don’t have the time to make progress they either defer that progress attempt or look for relieving propositions.
That’s our overview of operand resources done. They are the primary resources in a service-dominant logic way of thinking, and therefore, in the progress economy.
What, then, of their counterparts: operand resources? Let’s now explore them!
Let’s progress together through discussion…