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How can firms best engage customers to co-create value? A surge in academic and practical interest around this question of value co-creation (VCC) highlights the possibilities people see when Ford enables customers to design their own cars, Facebook enables customers to create content for other users, and Proctor and Gamble sources more than half its innovations from its own customers. At the same time, both academics and managers wrestle with exactly how to handle the enormous task of co-creation.

Seeking insight, we searched the scholarly literature on VCC, and reviewing 149 unique papers, realized VCC is not one enormous task. Instead, it is composed of 6 different faces, 3 that describe the first VCC stage of co-production and 3 more that describe the second VCC stage of value-in-use. We understand why people have an incomplete understanding of VCC, as for example 79% of the studies in our data set considered only one stage or the other. In this paper, we describe each unique aspect of VCC so managers and researchers can see the whole, work with the parts, and generally better utilize the power that is derived when firms and customers collaborate.

Photo: iStock/Jacob Ammentorp Lund

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Kumar Rakesh Ranjan

Kumar Rakesh Ranjan

Indian Institute of Management Calcutta

Kumar Rakesh Ranjan completed his Fellow Program in Management (~Ph.D.) in marketing from Indian Institute of Management Bangalore in 2014. Prior to his doctoral education he worked for four years in Sales and Marketing roles. Currently he is an Assistant Professor in...

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Stuart Read

Stuart Read

Willamette University Atkinson Graduate School of Management

Stuart Read is a Professor at Willamette University's Atkinson Graduate School of Management. Professor Read's research is focused on effectuation. Derived from practices employed by expert entrepreneurs, effectuation is a set of heuristics that describe how people make...

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