Investing Answers Building and Protecting Your Wealth through Education Publisher of The Next Banks That Could Fail
Investing Answers Building and Protecting Your Wealth through Education Publisher of The Next Banks That Could Fail

Value Network

What it is:

A value network is a system that organizations, departments, operating units or people use to do work, buy or sell products, or create plans that benefit the entire organization.

How it works (Example):

Research and development units, for example, are key components of many companies' value networks. By working with government agencies for grant funding or approvals, third-party vendors for supplies and talent, and internal marketing or development teams, the R&D department creates new goods and services that make more money for the company, help cure diseases or other social problems, and foster the growth of the third-party vendors. This is a value network.

Why it Matters:

A value network is like an ecosystem, and many analysts even map them out for presentation. Value networks contain many symbiotic relationships in which the participants all benefit in some way from their participation in the network. Similarly, if one part of the value network is weak, the rest of the network may suffer.

Related Terms View All
  • Auction Market
    Though most of the trading is done via computer, auction markets can also be operated via...
  • Best Execution
    Let's assume you place an order to buy 100 shares of Company XYZ stock. The current quote...
  • Book-Entry Savings Bond
    Savings bonds are bonds issued by the U.S. government at face values ranging from $50 to...
  • Break-Even Point
    The basic idea behind break-even point is to calculate the point at which revenues begin...
  • Calendar Year
    If Company XYZ starts its fiscal year on January 1 and ends its fiscal year on December...