Carla Cano
Aug 18

Value and Value Co-Creation in ITIL 4

Understanding Value and Value Co-Creation in ITIL 4

Value in ITIL 4 refers to the benefits, usefulness, and importance that a service provides to its customers. It is the primary outcome that customers seek when they engage with a service provider. Value co-creation expands this concept by emphasizing that value is not created by the service provider alone but through collaboration between the provider and the customer. This partnership allows both parties to contribute to and benefit from the service, leading to greater overall value.

Key Concepts of Value and Value Co-Creation

Concept

Explanation

Example

Value

Value represents the perceived benefits and positive outcomes that a customer derives from a service, weighed against the costs and risks involved. It is subjective and varies depending on the customer’s needs, preferences, and circumstances.

A company subscribes to a cloud storage service. The value for them lies in the ability to store large amounts of data securely, access it from anywhere, and share it easily with team members. This value is compared against the cost of the service and the security risks involved.

Value Co-Creation

Value co-creation is the collaborative process where both the service provider and the customer work together to create value. The provider offers the service, while the customer contributes by defining their needs, providing feedback, and using the service effectively. The outcome is shared value.

A software development company works closely with a client to create a custom application. The client provides continuous feedback and insights about their business needs, while the company uses its technical expertise to build the application. The final product meets the client’s needs precisely, creating value for both parties.

Service Provider Role

The service provider’s role in value co-creation is to deliver services that meet customer needs, maintain high standards, and facilitate a collaborative environment. They must understand the customer’s context and be flexible in adapting the service to maximize value.

An IT service provider offers managed IT services to a business. By regularly consulting with the business on its changing IT needs and adjusting services accordingly, the provider ensures the business continues to derive maximum value from the service.

Customer Role

The customer’s role in value co-creation is to actively engage with the service provider, clearly communicate their needs, provide feedback, and use the service in a way that maximizes the value they receive.

A retail company uses a customer relationship management (CRM) system provided by a vendor. The company regularly communicates its sales strategies and challenges to the vendor, who then tailors the CRM to better support the company’s goals, enhancing the value the company receives from the CRM.

Mutual Benefits

In value co-creation, both the service provider and the customer benefit from the partnership. The customer gains a service that better meets their needs, while the provider gains insights, loyalty, and possibly even improvements to their offerings.

A fitness app provider allows users to customize their workout plans and gives real-time feedback on their performance. Users benefit by getting personalized workouts that help them achieve their fitness goals, while the provider benefits from user data to enhance and refine the app.

Summary

In ITIL 4, value is a key concept that represents the benefits, usefulness, and importance that customers derive from services. However, value is not created by the service provider alone; it is co-created through a collaborative process between the provider and the customer. This concept of value co-creation highlights the importance of both parties working together to achieve the best possible outcomes.

  • Value is subjective and depends on the customer’s perception of how well the service meets their needs relative to the costs and risks involved.
  • Value Co-Creation involves both the service provider and the customer contributing to the creation of value. The provider offers the service, and the customer’s active engagement helps tailor the service to meet their specific needs.
  • Service Provider Role is to deliver services that meet customer expectations, maintain quality, and foster a collaborative relationship.
  • Customer Role is to clearly communicate their needs, provide feedback, and use the service effectively to maximize the value they receive.
  • Mutual Benefits arise from this collaboration, with both parties gaining from the partnership—customers receive more personalized and effective services, while providers gain insights and customer loyalty.


Understanding these concepts is essential for successfully managing and delivering services that truly meet customer needs and create significant
value.