Value and competitive advantage: searching for definitions, relationships, and repercussions

Value represents a central issue in Strategy theory and yet remains a vague and unclear concept. To shed light on this question, this paper explores the main definitions of value and their implications for the theoretical development of the field of Strategic Management, particularly concerning sustainable competitive advantages. By using different concepts related to value, such as use value, value creation, exchange value, perception of use value and use of the value, it is argued that for an enhanced understanding of the process of creating and sustaining competitive advantages it is necessary to go beyond the traditional economic paradigm and explicitly include the consumer behavior perspective. Competitive advantage, in this enlarged context, may be seen as the result of a coordinated system of firms that align for value creation and delivery and mutually interact for the sharing of the captured value. In a recursive movement, information and values flow both upstream and downstream in the supply chain formed by interacting firms, generating a complex strategy creation phenomenon determined by the specific heuristics of each strategist.