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Are you creating or capturing value? A dynamic framework for sustainable strategy

Author

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  • Paul Verdin
  • Koen Tackx

Abstract

Is value the holy grail for every company? Definitely it is something executives, investors and researchers are interested in since decades. If we only look at 4 major strategy journals over the last 20 years (Strategic Management Journal, California Management Review, Harvard Business Review and Sloan Management Review), together they published 189 articles with the word value in the title, meaning that on average about every month a new article was published focusing on the concept. Yet, value is perhaps one of the most used and misused terms in the history of management literature. To say the least, a lot of confusion persists not only about the meaning of the term, even more about ways to achieve it in a sustainable way. In this article, we start from a clear distinction between value creation and valuecapturing and propose a simple and intuitive framework showing the critical role of managing the interaction and the dynamics between these two strategic imperatives for achieving sustainable success for any company. We illustrate the framework with recent data from companies across a variety of industries providing further support for the relevance of the model.

Suggested Citation

  • Paul Verdin & Koen Tackx, 2015. "Are you creating or capturing value? A dynamic framework for sustainable strategy," Working Papers CEB 15-002, ULB -- Universite Libre de Bruxelles.
  • Handle: RePEc:sol:wpaper:2013/186393
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    References listed on IDEAS

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    1. Steve Nysten & Paul Verdin, "undated". "Successfully creating and capturing value, the e-business model of PayPal Inc," ULB Institutional Repository 2013/14533, ULB -- Universite Libre de Bruxelles.
    2. Hawawini, Gabriel & Subramanian, Venkat & Verdin, Paul, 2004. "The home country in the age of globalization: how much does it matter for firm performance?," Journal of World Business, Elsevier, vol. 39(2), pages 121-135, May.
    3. Paul Verdin, 2013. "The Strategic Imperative of Creating and Capturing Value," Palgrave Macmillan Books, in: Michael Pinedo & Ingo Walter (ed.), Global Asset Management, chapter 27, pages 527-547, Palgrave Macmillan.
    4. Gabriel Hawawini & Venkat Subramanian & Paul Verdin, 2003. "Is performance driven by industry‐or firm‐specific factors? A new look at the evidence," Strategic Management Journal, Wiley Blackwell, vol. 24(1), pages 1-16, January.
    5. Steve Nysten & Paul Verdin, 2004. "Successfully creating and capturing value, the e-business model of PayPal Inc," ULB Institutional Repository 2013/14535, ULB -- Universite Libre de Bruxelles.
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    Cited by:

    1. Derrick Herbst & Brian Barnard, 2016. "Innovation Management in South Africa: An Inquiry," Journal of Management and Sustainability, Canadian Center of Science and Education, vol. 6(3), pages 34-43, September.
    2. Adriana DIMA, 2021. "The Importance of Innovation in Entrepreneurship for Economic Growth and Development. A Bibliometric Analysis," REVISTA DE MANAGEMENT COMPARAT INTERNATIONAL/REVIEW OF INTERNATIONAL COMPARATIVE MANAGEMENT, Faculty of Management, Academy of Economic Studies, Bucharest, Romania, vol. 22(1), pages 120-131, January.
    3. Tackx, Koen & Rothenberger, Sandra & Verdin, Paul, 2017. "Is advertising for losers? An empirical study from a value creation and value capturing perspective," European Management Journal, Elsevier, vol. 35(3), pages 327-335.

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