Value-in-Exchange
The value model that built industries and economies – embed, exchange, use-up. But is increasingly holding us back with its blind spots increasingly stalling your innovation and limiting your growth.
Value-in-use
The value model underlying service-dominant logic, which sees value created as products are used and having only potential when not used. We see usage as improving well-being.
Comparing Models
[DRAFT] Attributes comparison of value-in-exchange, -in-use, and improving well-being through progress.
Value-in-exchange: Powering Growth for Centuries
The recent centuries explosive growth comes from following the value-in-exchange model.
Value-in-exchange: stalling growth
Over recent decades, growth has been stalling; a worrying sign!
Value-in-exchange: Crack #1
Value is difficult to define, meaning many things to many people
Value-in-exchange: Crack #2
Value-in-exchange is an incomplete view of a customer/consumer’s value lifecycle
Value-in-exchange: Crack #3
We’re no longer in the industrial-era; is value-in-exchange the optimum model for growth?
Value-in-use: Limitations
Whilst value-in-use addresses the cracks in value-in-exchange, it has its own limitations.
Innovation: through value-in-exchange lens
Innovation though the value-in-exchange lens may “limit” us to incremental innovation to minimise disrupting flow of exchanges
Innovation: through value-in-use lens
Innovation though the value-in-use lens encourages us to focus on trying to to further improve actor’s wellbeing
The Progress Economy
your new operational model for innovation and growth
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Value
Value as a unit of strategy helped create extraordinary growth during the past few centuries. But growth has slowed and economies have become increasingly service-based, digital, and interconnected, it is worth asking whether value remains the most useful unit for understanding innovation and creating growth
What is value?
Boardrooms, financial institutions, and business schools are filled with discussions about creating, and co-creatiing, value, adding value, and exchanging value.
Few concepts have become more central to management thinking. By almost any measure, value has become our predominant unit of strategy. Yet despite its ubiquity, value remains surprisingly difficult to define, measure, and operationalise.
At first glance, defining value appears straightforward. It is the most a customer will pay. A view that has driven substantial growth over the centuries. Dig deeper though, and that definition becomes shallow. Researchers tell us value is elusive, difficult to define, and even “value creation probably is among the most ill-defined and elusively used concepts in service marketing, and in management in general”
This creates a practical problem. When managers say they are creating value, are they discussing financial outcomes, emotional outcomes, social outcomes, functional outcomes, or some combination of them all? The answer is often unclear.
THE PROGRESS ECONOMY’S VIEW
The Progress Economy promotes progress, rather than value, as the unit of strategy.
This builds on logics that are service-based, such as Grönroos’ service-logic and Vargo & Lusch’s service-dominant logic. In these, value is see as something that is (co-)created during use of a product rather than being embedded and exchanged.
The Progress Economy sees:
- Progress as the movement to a more desirable state (comprising functional, emotional, and contextual components) – an improvement in well-being.
- The various flavours of value are actor’s individual and phenomenological judgements of that movement, before, during, and after.
