Value excavation: Towards a process model for multi-value creation in multi-actor contexts

Niels Faber^{1,2, 3,*}, Bartjan Pennink¹, Peter A.J. Bootsma³ and Thomas Broecks<sup>1

1</sup> University of Groningen, The Netherlands; ² Hanze University of Applied Sciences, The Netherlands; ³ Noorden Duurzaam association, The Netherlands

[email protected]

Abstract

Value creation has been the central axis of the business model concept since its inception. However, what value-creation in this context means has not be clarified (Lüdeke-Freund, Rauter, Pedersen, and Nielsen, 2020), nor has clarity been given on the underlying notion of value. What we see is an implicit use of value creation, meaning a sequence of activities generating something, to which some actor (e.g., producer, consumer, stakeholder) ascribes some value. This value commonly materializes in financial terms. Recently, Faber, Bootsma, and Pennink (2022) have attempted to shed some more light on the issue of value creation, with their value-actor matrix. This matrix essentially captures the values and actors / stakeholders that are involved in sustainable local and regional development. The purpose of their matrix is to provide a tool to visualise what values are present within specific social contexts, to determine to what extent values across all aspects of sustainability are addressed within local and regional development efforts.

In order to contribute to the discussions on how to realize a sustainable development in the region two ways of conceptualizing are needed. The first way is to construct a causal model in which the factors that could contribute to sustainable regional development are introduced and related to each other. We started to work on this (see Gerrits and Pennink, 2022) but that is just the beginning. The second way of conceptualizing is a focus on the process of how actors and their values can be combined, what actor groups to involve, which steps to take and how to stimulate that process. Later on, these two ways of conceptualizing must be combined.

In this paper we suggest a method to put Faber, Bootsma, and Pennink’s (2022) value-actor matrix into practice. The value-actor matrix has been presented as a tool to support the acceleration of the transition towards a sustainable development and particularly a circular economy at regional and local scales. For this, the matrix intends to capture the actors that are involved in such transition and the values on which their activities aim to make an impact. The suggestion is made that both the variety of involved actors and the variety of addressed values, in combination with the prioritization of these values, through a facilitated, deliberative process in multi-stakeholder groups, results in the realisation of a specific arrangement of a sustainable development. The latter is conceptualised using environmental, social, and economic dimensions.

At the core of this transitional challenge, societal coordination has been identified as one of the main problems of circularity transitions. In order to resolve such voids in social coordination, Faber et al. (2022) suggest that new coordination models should meet four criteria: ‘[1] integration of top-down and bottom-up efforts, [2] scalability from local to global, [3] diplomacy between ideological and sectoral coordination and [4] intuitiveness for rapid proliferation’ (Faber et al., 2022). Focusing on societal coordination of regional development leads to a novel and more integrative approach, different from economical thoughts like green growth, government centred policies (e.g., citizen participation) and industry centred innovation models like the helix family.

The process model / method we provide here gives shape to the required social coordination in empirical reality. The model is intended for use in multi-sectoral groups of stakeholders for regional or local sustainability transition efforts. At the heart of the process model, we position the value-actor matrix as an analytical instrument. By doing so, it provides a means to identify both the current and desiredsituation of sustainable development and circular economy within the focal context. Furthermore, our process model meets the four criteria specified above.

The process unfolds according to the steps described below. We envisage three prerequisites for entering into this process. First, the notion of multiple values is accepted by all initiators as the principle starting point of the discussion on local and regional sustainable development. Consequently, the unfolding discussion takes shape on various value dimensions. Second, the identified value dimensions are part of the criteria for selection of new participants to the discussion. This is operationalised in a sector model, describing the societal sectors that are needed in a joint development effort. Depending on the (under)representation of values or sectors, additional participants may be required to restore balance between values or sectors, or assure their proper representation. Third, and lastly, all participants should be accepted spokesmen for their particular sections and sectors. Sustainable regional and local development takes shape within a societal context, looking for solutions to overcome current issues that withhold such development. To assure societal implementation and acceptance, we argue that a broad representation may lead to more acceptable (i.e., more sustainable) outcomes of this process.

When all three prerequisites are met, the process of developing in the value-actor matrix continues as follows:

1. Bootstrapping the process: in this phase, a preliminary set-up of the process is prepared.

2. Selecting and inviting actors representing value dimensions. The initiators and the invited actors together form the team for further development.

3. Collectively selecting a regional or local situation or problem of sustainable development

4. Data gathering: economic, social and ecological indicators and trends, history, stakeholder analysis, opinion survey, governance policy, and regulations overview

5. Clarification of the chosen problem / situation at hand and refining the preliminary value set.

6. Decision making whether to start a joint effort and how.

7. Start of discussion of the problem / situation in the campaign team

   1. Actors in the campaign team express how they can contribute to addressing the chosen issue of sustainable development; values that play a role are made explicit

   2. Actors in the campaign team reflect on how activities may reinforce one another; when needed outsiders are invited to expand on the reflection.

   3. Campaign kick-off with sufficient high-level involvement and adequate publicity.

8. Campaign monitoring and evaluating by the campaign team.

   1. Reflecting on the way the values are being combined: Is the value creation process dominated by one of the main field of values (social, ecological and or economic)?

In this paper we will develop this procedure and we will work out several cases which will show how the suggested procedure can work and how this can contribute to a more sustainable development.

References

Faber, N., Bootsma, P., & Pennink, B. (2022). Multi value creation for sustainable regional development: Defusing the complexity trap. In L. Michelini, A. Minà, & P. Alaimo Di Loro (Eds.), Proceedings of the 7th International Conference on New Business Models: Sustainable Business Model Challenges: Economic Recovery and Digital Transformation. LUMSA University.

Gerrits, I. and Bartjan Pennink (2022) Shared value creation and sustainable development: developing a causal model by analyzing energy cooperatives in different institutional contexts. In Central European Review of Economics and Management. Vol. 6, No.2, June 2022, 37-70. http://dx.doi.org/10.29015/cerem.944

Lüdeke-Freund, F., Rauter, R., Pedersen, E. R. G., & Nielsen, C. (2020). Sustainable Value Creation Through Business Models: The What, the Who and the How. Journal of Business Models, 8(3), 29.