Academic journal article Journal of Economics & Management

Systemic Products and Value Creation Process in Healthcare Networks

Academic journal article Journal of Economics & Management

Systemic Products and Value Creation Process in Healthcare Networks

Article excerpt

Introduction

Essential to any business network is the underlying system through which it produces a value. Creating and capturing the value reflects the two fundamental functions of all organisations: 1) creating the value in ways that differentiate them from the competition and 2) develop core competencies that are different from those of competitors [Shafer et al. 2005]. In order to create the value for the end customer, networks need to employ their core competencies in core processes so that something valuable to the customer is created.

This value-system construct is based on the notion that each product/service requires a set of value creating activities performed by a number of actors forming a value-creating system [Möller & Rajala 2007]. Nowadays, it can be observed that the interest in the value net concept in the healthcare system is growing. Progressing integration of the medical sector actors is indicated by the emergence of healthcare value nets and systematic product development. The purpose of the article is to identify and describe the forms of systemic products and network structures in healthcare in the context of value creation, and consequently to develop theoretical-descriptive models of value creation on the medical market. The paper presents a fraction of empirical research which has been aimed at identification and description of the value creating process and systemic product structures in the healthcare system in CCE. This paper has been divided into several sections. The first section focuses on the introduction followed by a value-creation system, healthcare value networks and a systemic product in the healthcare literature review. The further part of the paper presents research objectives and research methodology, as well as a discussion and conclusions.

1. Value-creation system

Marketing is about managing profitable customer relationships. The twofold goal of marketing is to attract new customers by promising superior value and to keep and grow current customers by delivering satisfaction [Armstrong & Kotler 2007]. Creating value for customers has been recognized as a key concept in marketing [e.g. Drucker 1954; Rust & Oliver 1994; Sheth & Uslay 2007; AMA definition of marketing; Chartered Institute of Marketing definition of marketing], making the value and value creation an important research subject [Grönroos 2011]. At the general level, the customer value has been referred to as an overall assessment [Zeithaml 1988], a function of consumption behaviour [Sheth, Newman & Gross 1991], perceived quality adjusted for the relative price [Gale 1994], an emotional bond [Butz & Goodstein 1996], relationship [Payne & Holt 2001], personal perception [Woodall 2003, and subjective personal introspection [Holbrook 2005]. In the article it is assumed that the value for customers appears when, after being assisted by the provision of resources or interactive processes, customers are or feel better off than before [Grönroos 2008]. Features of healthcare services quite considerably contribute to their distinctive character and, at the same time, affect the value offered to the customer/patient. On the basis of their skills and knowledge and with full observance of norms and rules prevailing in a healthcare services area, medical services firms provide services which are designed to solve problems of their customers. Customers' participation is vital and indispensable for this cooperation [Bitner et al. 1997].

By "value-creating system" Parolini [1999] means a set of interlinked activities that create value for final customers. In order to leverage at best their resources and competencies, firms should not limit their perspective to their value chain (set of sequential activities) or, even worse, to their direct suppliers and customers. In conceiving their strategy, they must take into account the whole value-creating system within which they operate, and, if possible, assume the point of view of the final customer [Parolini 1999]. …

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