Publisher: Harvard Business School Press
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In this visionary book, C. K. Prahalad and Venkat Ramaswamy explore why, despite unbounded opportunities for innovation, companies still can't satisfy customers and sustain profitable growth. The explanation for this apparent paradox lies in recognizing the structural changes brought about by the convergence of industries and technologies; ubiquitous connectivity and globalization; and, as a consequence, the evolving role of the consumer from passive recipient to active co-creator of value. Managers need a new framework for value creation. This book is about the emerging "next practices" in value creation.
Increasingly, individual customers interact with a network of firms and consumer communities to co-create value. No longer can firms autonomously create value. Neither is value embedded in products and services per se. Products are but an artifact around which compelling individual experiences are created. As a result, the focus of innovation will shift from products and services to experience environments that individuals can interact with to co-construct their own experiences. These personalized co-creation experiences are the source of unique value for consumers and companies alike.
In this emerging opportunity space, companies must build new strategic capital-a new theory on how to compete. This book presents a detailed view of the new functional, organizational, infrastructure, and governance capabilities that will be required for competing on experiences and co-creating unique value. This is the future of competition.
A valuable (…) book, which has open innovation written all over it, but just doesn’t say the word(s). The authors describes how the traditional theory of firm has changed into a new reality. A new model for value creation, which happens at the boundaries of the firm. Well informed customers, users and partners cocreate with the firm, to create new value for themselves and the whole value chain. The market is no longer outside the valuesystem, but intertwined with it.
Cocreation requires new capacities of the firm. Management must seek new ways of access and appropriation of value, without ownership. Building blocks in the process e.g. are constant dialogue, transparency, risk assessment, agility. The network of experiences are an integral part of the product experience.
The book makes you think where the real value of a firm lies, and hence what values can easily be freely revealed. I appreciated the “Strategy has become like efficiently navigation in the fog.” I concur. A good (re)read. Prahalad is still in my top three of business gurus.
Jw. said on Feb 17, 2012, 23:03