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"A value co-production framework does not consider this outline to be entirely inapplicable, but it takes it to be applicable only in specific value creating conditions, inscribed in a wider topology of possible forms of value creation. A co-produced value creation framework is thus of a ‘higher logical type’ than the industrial one, and entails at least the following organizing characteristics:
- Scope economics are as important as scale economics, allowing smaller units to compete against big ones — e.g., in steel making.
- Short product life cycles and production runs becoming economically viable, enabling ‘micro-marketing’ and ‘tailor-made mass co- production’ to emerge.
- Enhanced asset liquidity and reconfigurability are making fixed or sunk costs increasingly risky: activity-based costing, customer- centered analytic accounting, and other battles to eliminate ‘average’ and ‘fixed’ costing per- spectives are signs of this.
- Co-production is inviting ‘hollow,’ holo- graphic, ‘virtual,’ ‘keiretsu’-like organizing. In many industries, these designs compete well with integrated industrial firms."