Stakeholder value creation system: understanding the process

Purpose - Understanding how firms manage multiple stakeholders is an academic and business call. This paper aims to describe a firm’s processes to implement a stakeholder value creation system, defined as the firm’s processes to create appropriate value with multiple stakeholders. Design/methodology/approach - The authors based their investigation on a conceptual framework extracted from a previous literature review. From there, the authors conducted qualitative empirical research designed as a multiple-case study. In-depth interviews with 47 people from 11 different firms are the key source of this study. Findings - This paper proposes a framework demonstrating how a firm can implement a stakeholder value creation system. Results pointed to three processes: value creation, distribution and capture. Value distribution mechanisms are drivers for both value creation and capture processes. The system is a set of multiple flow relationships between the firm and its stakeholders. Research limitations/implications - This research is limited to the Brazilian context. Practical implications - The stakeholder value creation system is composed of seven elements: walk-the-talk organizational behavior, stakeholder business model, societal non-attended need, stakeholder preference matrix, stakeholder bargaining power, retention of rents and governance mechanism. Managers may design their firm’s unique processes using these elements as drivers. Social implications - The present investigation demonstrates that societal issues matter for firms to formulate strategies that positively impact their economic, social and environmental results. Originality/value - The authors investigated competitive strategy concepts of value creation and appropriation from a combination of resource-based and stakeholder theories and a system perspective. The framework of this study consolidated both theories’ ideas from a complementary perspective. The authors suggest managers and academics should adopt the power of the “AND” position instead of the “OR” trade-off position.