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Knowledge Management Systems: Value Shop Creation

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was the value chain developed by Porter (1985). Insights emerged, however, that many organizations have no inbound or outbound logistics of importance, they don’t produce goods in a sequential way and they don’t make money only at the end of their value creation. Therefore, two alternative value configurations have been identified: labeled value shop and value network, respectively (Afuah & Tucci, 2003; Gottschalk, 2005; Stabell & Fjeldstad; 1998).

As we move into the knowledge society, more and more organizations make their living from knowledge creation and knowledge application. The typical value configuration where we find such knowledge work is the value shop. The value shop is a value configuration creating value by applying knowledge to customer problems. A hospital applies medical knowledge to patients’ problems, a law firm applies legal knowledge to clients’ problems and police detectives apply law enforcement knowledge to criminal investigations.

Even where the main value configuration of an organization is the value chain, we find more and more examples of value shop activities within the organization. For example, successful electronic business is dependent on knowledge management organized as problem solving in the value shop. In IT outsourcing relationships, the vendor is a value shop when solving client problems. In IT insourcing, similar knowledge management challenges emerge. In IT governance, knowledge management has to support decision-making through knowledge-based value shop activities to be successful.
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