Derivative Proposition 2
Collaborative competence is a primary determinant of a firm’s acquiring the knowledge for competitive advantage.
Information technology, by facilitating the service-integration function, both within the firm and across the entire value-creation network including the customer, has a dramatic effect on the ability of all entities in the value-creation network to collaborate.
S-D logic recognizes technology as bundled, operant resources. New technologies are created by developing new operant resources, finding novel ways to embed operant resources in operand resources and/or finding ways to “liquefy” operant resources (i.e. unembed them from operant resources so that they can be employed separately). In reality, these processes usually occur in complementary combinations.
As unit computation and communication costs approach zero, more and more entities will be connected and collaboration will become increasingly feasible. Not only are the increased connections and collaborations with employees and suppliers but also with customers. Four factors are driving this trend:
- Open standards. Open standards deal with co-production and collaboration. Information is increasingly symmetric versus asymmetric as more and more information and experiences are shared. Collaboration becomes the norm and innovation is stimulated.
- Specialization. As individuals, organizations, and networks become more specialized they need others for what they themselves cannot do. Thus, more and more specialization leads to larger and larger markets. The consequence of intense specialization is increased interdependency among all entities that stimulates more collaboration that, in turn, stimulates innovation.
- Connectivity. Connectivity makes the market system much more timely and quick in responding to changes in demand and supply. The market then becomes highly flexible.
- Network ubiquity. The final force that has created an inflection point in the movement toward collaboration is network ubiquity. Increasingly, everyone and everything is connected to each other and each thing. Network ubiquity accelerates the consequences of open standards, specialization, and connectivity. The consequences are higher collaboration and more innovation.
Because of the convergence of these trends, it is logical that all entities (individuals, organizations, and households) will continue to look for ways to transform everything they do using information technology. To start, the mapping of processes consisting of all activities and tasks within and between entities should be undertaken. The goal is to discover ways to use information technology to take waste (usually time or effort) out of the value-creation process, redesign the system to eliminate points of system failure, and/or add valuable experiences to the service-provision process.
This mapping of activities that are involved in the co-production of service can be accomplished with a variety of techniques, often referred to as process mapping, service blueprinting, or activity mapping. All are based on industrial flowcharting; in all cases, the focus is on the mapping of processes and service flows, rather than merely a task, activity or function as it relates to a unit of output.
Service blueprinting also focuses on processes in the firm as it interacts with customers. A typical service blueprint breaks out into four components:
- Customer actions
- Onstage contact employee actions
- Backstage contact employee actions
- Support processes
The flowchart might use the horizontal axis to represent time and the vertical axis to model these components and their subcomponents. S-D logic suggests going a step further by mapping the customer’s role in value co-creation. CRM software could evolve to CEM (Customer Experience Management) software in recognition of the central role of customer experiences.
In sum, information technology is a pivotal force in enabling more collaboration and consequently innovation throughout the entire value network.