Stakeholder value creation system: understanding the process

PurposeUnderstanding how firms manage multiple stakeholders is an academic and business call. This paper aims to describe a firm's processes to implement a stakeholder value creation system, defined as the firm's processes to create appropriate value with multiple stakeholders.Design/methodology/approachThe authors based their investigation on a conceptual framework extracted from a previous literature review. From there, the authors conducted qualitative empirical research designed as a multiple-case study. In-depth interviews with 47 people from 11 different firms are the key source of this study.FindingsThis paper proposes a framework demonstrating how a firm can implement a stakeholder value creation system. Results pointed to three processes: value creation, distribution and capture. Value distribution mechanisms are drivers for both value creation and capture processes. The system is a set of multiple flow relationships between the firm and its stakeholders.Research limitations/implicationsThis research is limited to the Brazilian context.Practical implicationsThe stakeholder value creation system is composed of seven elements: walk-the-talk organizational behavior, stakeholder business model, societal non-attended need, stakeholder preference matrix, stakeholder bargaining power, retention of rents and governance mechanism. Managers may design their firm's unique processes using these elements as drivers.Social implicationsThe present investigation demonstrates that societal issues matter for firms to formulate strategies that positively impact their economic, social and environmental results.Originality/valueThe authors investigated competitive strategy concepts of value creation and appropriation from a combination of resource-based and stakeholder theories and a system perspective. The framework of this study consolidated both theories' ideas from a complementary perspective. The authors suggest managers and academics should adopt the power of the "AND" position instead of the "OR" trade-off position.