Value Creation Versus Value Capture: Towards a Coherent Definition of Value in Strategy

TLDR

Resource‑based theory has focused on developing and protecting valuable resources, yet the determinants of what makes a resource valuable remain underexplored. The study seeks to clarify the nature of value, its creation, and its capture by integrating diverse theoretical strands. The authors argue that value comprises distinct use and exchange components, that new use value originates from organizational labor driving profits, and that capture depends on perceived buyer‑seller power dynamics.

Abstract

Resource‐based theory has tended to focus on the development and protection of valuable resources. What determines a valuable resource has received less attention. This paper addresses three related issues concerning value and valuable resources: what is value? how is it created? and who captures it? We have tried here to integrate different strands of the literature to address these questions. First, we argue that a distinction needs to be made between use value, which is subjectively assessed by customers, and exchange value, which is only realized at the point of sale. Second, we argue that the source of new use values is the labour performed by organizational members, and that firm profits can be attributed to this labour. Profit differences between competing firms derive from labour performing heterogeneously across firms. Finally, we argue that value capture is determined by the perceived power relationships between buyers and sellers.