Despite the intense efforts to substantiate the value co-creation capability of IT service, current approaches only partially address the complex and dynamic nature of the IT value-creation process. Popular IT service frameworks such as ITIL and COBIT mainly focus on discrete customer-centric practices and processes and overlook the importance of a holistic and systematic approach to understanding value co-creation. The research follows an interpretive approach to building a framework based on a case study and grounded theory technique in a higher educational institution. The initial findings reveal the micro, meso and macro levels of value co-creation in the IT service ecosystem. This research contributes to research on value creation in the context of IT service by providing the holistic approach of the service ecosystem to value creation, which has been barely investigated. This research is in progress and presents the initial analysis of this qualitative study.