Mikko Pynnönen

The new meaning of customer value: a systemic perspective

Purpose – Today, as services and products are becoming increasingly intertwined and the competition increasingly global, delivering customer value is not as simple as it used to be. In this article, we suggest that in contemporary business environment customer value is often systemic by nature. This means that managers need to assess their firms offering through systems‐thinking perspective in order to find out what are the most effective ways to create value for the customer.Design/methodology/approach – Evidence of systemic customer value is provided in the form of illustrative examples from Apples and Googles offerings. Furthermore, we utilize a quality function deployment (QFD) tool to provide an example of modeling of the systemic value attributes.Findings – This paper illustrates how such systemic customer value in the firms offering can be modeled. This enables the tracking down of the functions that produce the most value in terms of meeting various customer needs. A firm that understands the ...

MANAGING CUSTOMER-DRIVEN BUSINESS MODEL INNOVATION

The Information and Communications Technology (ICT) industry is now reaching saturation point in terms of growth, and constantly increasing demand for services can no longer be taken for granted. Customers have lot of options, and firms have to compete for business ever more intensely. In order to provide evidence of best practices in such environments, this paper reports a case study on customer-driven business model innovation. The resulting four-phase process framework is based on findings from a Pan-Nordic ICT service providers recently implemented R&D project. On the theoretical level, the framework builds on the value-network and resource-based approaches, whereas in practice it may be useful to firms intending to innovate and redesign their business model in an attempt to provide superior customer value.

Mapping business: value stream-based analysis of business models and resources in Information and Communications Technology service business

This article applies an approach which originates from the input-output and value network perspectives for mapping the value streams among actors. The analysis is also conducted for modifying and developing a schematic framework for mapping value streams in the Information and Communications Technology sector. Case business models have been analysed by using the value streams among actors as a primary data source. In addition, the enablers of separate streams and assets have been identified in order to address the differences and similarities of the resource base in different business models.

From business concept innovation to a business system: a case study of a virtual city portal

The growing ubiquity of information technology is enabling the development of new services which consumers can access with existing devices such as mobile or smart phones, PDAs, home and public computers. The services are accessed via community portals that host a variety of services in one convenient virtual place, like a virtual city. The function of the portal is to provide services to citizens whose needs can be better met via a virtual interface. The main argument of this paper is that including the customer into the innovation process and creating a business system based on value flows are the key elements of creating new business models in e services. In this paper we introduce the business concept innovation process for applying e-government in cities in the form of a virtual city portal. Furthermore, we introduce a value flow-based business system for implementing the portal.

Analyzing systemic customer value in scalable business services

This paper examines complex service offerings and the creation of systemic customer value in such settings. We explore the extent to which customers value systemic offerings as opposed to more separated offerings. We conducted a questionnaire survey within the customer base of two Finnish service companies. We utilized t-tests to find out how systemic offerings and separated offerings differed in terms of perceived customer value along different dimensions. The findings support the claim that systemic offerings are valued more than offerings that are more separated in nature. The results of the study carry practical implications for firms offering complex and integrated service solutions. In addition, analyses of the service-value elements included in the offering and of the related customer value will enable firms to optimize their service provisioning so as to give higher customer value and subsequently enhance their competitive advantage.

Mapping future services: a case on emerging smart energy metering business

Recent regulatory amendments and other major trends in the electricity distribution business will change the business logics of the sector. The forces that drive restructuring can be put into three general categories. Those are: 1) a requirement for a more functional marketplace for energy; 2) combating climate change; 3) requirements for the security of energy supply. In this paper, we re-develop the business concept innovation process for applying it to smart energy metering services. Furthermore, we introduce how value flow based business system modelling can be linked with a market emergence model. The main argument of this paper is that including the customer needs in the innovation process and creating a business system based on value flows are the key elements of creating new business models in e-services. Indeed, bundling the roadmaps of intelligent home systems to correspond to converging customer needs is a crucial question for opening the service markets.

Strategic management of forest industry transformation

One attractive opportunity for the forest industry is intelligent packaging which is based on the integration of ICT into the capabilities of a manufacturing firm. These new solutions are potential sources of value but unfortunately the industry strategies centering on manufacturing hinder the creation of value for the customer. Generally, the mindset should be changed from a goods-dominant logic to service-dominant logic in value creation. The transformation requires the identification of alternative business model structures and fitting the business models in different contexts. This study was conducted using qualitative research methods. We demonstrate a method for conducting a value offering to a service provision network using a business mapping framework. The main contribution is the construction of business model elements for an intelligent packaging concept in the elderly care. In this, only the intelligent package is a direct contribution of the forest industry. The majority of the resource providers and their resources are based on ICT products and services.

Customer lock-in in ICT services business: Designing and managing customer driven business model

The growing demand for ICT (Information and Communications Technology) services is often taken for granted in the industry. This is partially due to the good years of growth in terms of expanding customer base and industry size. However, the industry is reaching a point of saturation in growth. The customers have lots of options to choose from and firms have to compete for customers harder and harder. Normally the good services generate loyalty among customers. This paper presents a framework for understanding how the changing customer preferences should be taken into account when planning business in organic and rapidly changing network environment. The framework of customer driven business model is illustrated with relevant case examples of ICT services and is based on resent studies of customer value preferences and business models in ICT business. The theoretical foundation of the framework is in value network and resource based approaches. The paper presents both academic and managerial conclusions about aligning and developing firmpsilas business model for providing superior customer value.

Agile Methods for Boosting the Commercialization Process of New Technology

Challenges in innovation processes have influenced the development of agile methods, which are lighter and nimbler tools for development projects. This study elucidates the possibilities of agile methods for enhancing the effectiveness of innovation processes with the aim of quickly and successfully commercializing new technology. The focus is on different process phases of commercialization, from identifying the business potential to finalizing the innovation commercialization plan. As a result of the study, a novel, rapid, and agile process was created to improve the effectiveness of the technology-based innovation process, supporting the creation of more sustainable and valuable business models.

Future medical supply: challenges for business concept formation

Using a pharmaceutical supply network as a case example, this paper describes the challenges for business concept formation. The motivation for the study comes from our earlier studies, which have pointed out the need for change in the pharmaceutical value network. The current structure of the value network is too rigid by legislation and too costly if the share of elder citizens and their needs for medical assistance turn out as projected in the industrialised western countries. Even current resources, the workforce in particular, cannot fulfil the growing needs for elderly care in the future if the system is kept as it is, when it does not even respond well to todays individual customer needs. The business concept formation into individual business models needs more thorough research as also the currently available frameworks lack the dynamism for further planning.