Véronique Ambrosini

Value Creation Versus Value Capture: Towards a Coherent Definition of Value in Strategy

Resource-based theory has tended to focus on the development and protection of valuable resources. What determines a valuable resource has received less attention. This paper addresses three related issues concerning value and valuable resources: what is value? how is it created? and who captures it? We have tried here to integrate different strands of the literature to address these questions. First, we argue that a distinction needs to be made between use value, which is subjectively assessed by customers, and exchange value, which is only realized at the point of sale. Second, we argue that the source of new use values is the labour performed by organizational members, and that firm profits can be attributed to this labour. Profit differences between competing firms derive from labour performing heterogeneously across firms. Finally, we argue that value capture is determined by the perceived power relationships between buyers and sellers.

What are Dynamic Capabilities and are They a Useful Construct in Strategic Management

The dynamic capability perspective extends the resource-based view argument by addressing how valuable, rare, difficult to imitate and imperfectly substitutable resources can be created and how the current stock of valuable resources can be refreshed in changing environments. The concept of dynamic capabilities emerged in the 1990s, and the field has advanced considerably since. This paper presents a review as well as a synthesis of the extant literature. This synthesis first highlights, that dynamic capabilities are shaped by enabling and inhibiting variables within and outside the firm, including the perceptions and motivations of managers; secondly, it identifies processes that create dynamic capabilities; and thirdly, it explains that dynamic capabilities do not automatically lead to performance improvements. Finally, the paper addresses some areas of confusion and contradiction that hamper the development of the literature.

Tacit Knowledge: Some Suggestions for Operationalization

With the emergence of the resource-based view of the firm and of the concept of core competencies, intangible resources, and tacit knowledge in particular have been argued to occupy a central place in the development of sustainable competitive advantage. This is because tacit knowledge is argued to be difficult to imitate, to substitute, to transfer and it is rare. However, there is little empirical research to support this theoretical proposition. Tacit knowledge has so far resisted operationalization. This paper sets out to define the term tacit knowledge and proposes to redefine it, within the context of the resource-based view of the firm, as tacit skills. A methodology (based on causal mapping, self-Q and storytelling) for empirically researching the subject is outlined.

Using Single Respondents in Strategy Research

A survey of empirical papers has revealed a number of studies that have used single respondents, usually the CEO or a top management team member, to make inferences about certain strategic dimensions of their business. In this note, we highlight some of the problems in using this approach. We base our comments on a study of 76 businesses where multiple respondents were accessed. We conclude that, because of often wide variations in responses between members of the same top team (measured by Cronbach alpha), the use of single respondents in this type of strategy research is probably unreliable.

How value is created, captured and destroyed

Purpose – The purpose of this paper is to address value and the value‐creation process. It argues that the firm operating in line with investor interests, acts as both a customer and a supplier of value and considers the internal activities that reflect these motivations.Design/methodology/approach – A series of propositions are developed regarding the creation, capture and destruction of value.Findings – It is argued that two types of value‐creating activities can be identified. In addition there are activities directed at the maintenance of the firm, and the maintenance of its capital stock, and there are activities that destroy value. Value capture is determined by bargaining relationships between stakeholders and their representatives. The paper concludes with some comments regarding value appropriation.Originality/value – The paper addresses the critical issue of “value” in the resource‐based view (RBV) and specifically begins to develop the RBV away from its neo‐classical roots.

Inter-team coordination activities as a source of customer satisfaction

This article reports the results of a micro-level study into firm resources. It involved a comparative qualitative study of the activities contributing to service delivery in two similar but differentially performing divisions, one perceived by customers to be a high quality provider, the other a lower quality provider. The results indicate that there were differences in the incidence of inter-team coordination activities and that effective inter-team coordination was a critical factor in delivering increased customer satisfaction. This suggests that these activities, by causing staff to interact across internal boundaries, may constitute a resource advantage. We propose that these activities are critical for both the coordination of service delivery activities and knowledge exchange, and that contextual factors may have an impact on these activities. The study makes a contribution to the resource-based view and strategy as practice literatures and illustrates how a practice-orientated approach can inform the resource-based view.

Firm value creation and levels of strategy

Purpose – The paper aims to address the following questions: “How is value created within a firm?” and “Is the distinction between competitive and corporate strategy helpful in considering the processes of value creation?”Design/methodology/approach – The paper distinguishes five value‐creating activities within the firm. Three are involved in the process of current value creation, one is directed at the maintenance of the firm and the other activity is concerned with the creation of future value. These processes of value creation are then explored from the perspective of corporate and business levels of strategy by considering whether these activities can be tightly or loosely coupled.Findings – The paper argues that decisions regarding loosely or tightly coupled value‐creating activities should belong to the realm of corporate strategy and that this “corporatising” choice involves trade‐offs in terms of responsiveness and cost.Practical implications – The arguments in this paper can be used by managers ...

The Impact of Causal Ambiguity on Competitive Advantage and Rent Appropriation

We seek to develop the conceptual and practical understanding of causal ambiguity. Specifically we extend current thinking by setting out three types of causal ambiguity, based on whether firm resources are perceived to display linkage and/or characteristic ambiguity, and by examining for each type the impact of causal ambiguity on the sustainability of competitive advantage and on rent appropriation. We highlight the difficulties decision-makers face when they perceive ambiguity and finally we explore some implications of ambiguity with respect to resource-creation processes.

Using teaching case studies for management research

Teaching case studies are widely deployed in business schools. They are contextually rich in detail, and students learn by applying and adapting theoretical concepts to specific business situations described in the case. This article proposes a new way to use teaching case studies, as research materials for academics. The article addresses three questions: (1) Can teaching cases be used as an alternative to field research? (2) When can teaching case studies be used as secondary data? and (3) How can teaching case studies be used as secondary data? The article concludes that teaching case studies are an unexploited and readily available source of research data, a source which should be considered when going into the field and gathering primary data is not possible.

Reducing Causal Ambiguity to Facilitate Strategic Learning

This article reports on a qualitative study conducted within a software company. The study focuses on the strategic learning process within the top management team that was facilitated by the use of causal mapping, which aimed at uncovering the organizations causally ambiguous success factors. The case study we describe is an illustration of how this process allowed the top management team to develop new sets of assumptions about their firms sources of advantage and gave them new bases for strategy making. Our agenda was both theory and practice led. Our academic agenda was to further knowledge about the processes of strategic learning and causal ambiguity in particular, and our managerial agenda was to help the top management team better understand what underpins their organizations success.