Value Co-creation for Smart Villages : The Institutionalization of Regional Service Ecosystems

Building a versatile portfolio of public and private digital-enabled services is vital in rural and sparsely populated regions, where traditional market mechanisms alone cannot guarantee the availability of essential services. However, contemporary services tend to build on prevalent institutions, often governed by decisions based on market mechanisms, such as economies of scale – service-by-service and village-by-village. A shift is suggested towards networks of smart villages co-creating value as regional service ecosystems. We draw from institutional theory and employ the Service-dominant logic (SDL) framework in investigating value co-creation in rural villages in Sweden. Analyzing 53 laddering interviews, we derive scripts encoding institutional principles for innovating bundles of digital-enabled services. The study brings forth novel insight for e-government research and practice, and the SDL discourse therein, on outlining required institutional practices and institutional work to counteract plain market mechanisms for governing value co-creation on smart rural service portfolios.