Munim Raza

USE OF CUSTOMER VALUE PROPOSITION

AS AN INSTRUMENT TO OPTIMIZE AUTO-
MOBILE DEALER NETWORK

Master of Science Thesis

Master’s Thesis
Faculty of Management and Business
Mohammad Moshtari
June 2023
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ABSTRACT
Munim Raza: Use of Customer Value Proposition as an instrument to optimize Automobile
dealer network.
Master’s Thesis
Tampere University
Master’s Degree Programme in Industrial Engineering & Management
June 2023

In the automobile industry, the customer value proposition is a key part of making dealer
networks and original equipment manufacturers (OEMs) work better together. As part of a deal-
er network's customer value proposition, it's important to give both the dealers and the end cus-
tomers unique and compelling benefits. For dealers, the customer value proposition includes
things like competitive prices, the availability of products, marketing support, training pro-
grammes, and an efficient way to handle the supply chain. These value propositions are meant
to give dealers the tools and resources they need to meet customer needs, boost sales, and
improve the general efficiency of their operations. At the same time, the customer value propo-
sition for end consumers includes things like the quality of the product, personalised services,
support after the sale, easy financing choices, and a smooth buying process. By making sure
that their value propositions match the needs and preferences of both dealers and end custom-
ers, automakers can build strong, mutually useful relationships with their dealer networks. This
makes customers happier and more loyal, which is good for business.

The goal of the thesis is to create a systematic framework for dealership networks in the car
industry that is backed up by theoretical studies. The goal of the framework is to use customer
value tools to get dealer networks involved in the process change. In particular, the framework
aims to improve the standard procedures and protocols that car OEM makers use when talking
to dealers. The main goal is to make sure that dealers understand how the created value will
help them, which will make it easier for them to work together. The thesis looks at how consum-
er value models and value frameworks for evaluation can make it easier to convince dealer
networks of something. Unlike most studies, this one not only looks at how customer value
frameworks can be used to negotiate, but also focuses on how the value created for end users
can be used to encourage dealers to work together.

The study suggested a method for communicating value to dealer networks. It included cus-
tomer perceived value models and frameworks for assessing value. By showing how the
planned solution will help, OEMs can improve their ability to persuade dealers and build long-
term relationships with them. This framework emphasised how important it was to understand
dealers' points of view, do good study on the market and dealers, and work with dealers at all
levels of the hierarchy to get their support. The empirical study of the case company gave useful
information about how the proposed framework could be used in the real world. The case com-
pany wanted to give sellers more value through process change by making the system for mak-
ing and managing cases work better. The use of a centralised digital portal cut response times
by a lot, gave accurate data on case volume and status, and made the whole process easier to
see. The case company did a good job of explaining to dealers what they thought were the
benefits of the value offer. This increased trust, confidence, and customer retention.

Keywords: Customer perceived value, Dealer network, Case creation & engagement system,
Dealer Hierarchy, Value Assessment, End consumer value
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PREFACE
This thesis was written and perceived as a major segment of Industrial engineering and
management master’s degree programme. The topic of the thesis was originated
through project implementation at a case company during employment.

First, I would like to thank my colleagues from the case company for supporting me
throughout the project and providing me with valuable insights.

Second, I would like to thank my supervisor Mohammad Moshtari for his splendid su-
pervision and continuous assistance during the writing process. His ideas had
strengthened my though process and helped me structure my thesis.

Last, Thanks to my parent whom blessings have supported me throughout the process.

Tampere, 27 June 2023

Munim Raza
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CONTENTS
1. INTRODUCTION .................................................................................................. 7
1.1 Background.......................................................................................... 7
1.2 Objective .............................................................................................. 8
1.3 Thesis Structure ................................................................................... 9
2. RESEARCH METHODOLOGY ........................................................................... 10
2.1 Research Method ............................................................................... 10
2.2 Research Process .............................................................................. 12
3. LITERATURE REVIEW ....................................................................................... 14
3.1 Customer Perceived Value................................................................. 14
3.1.1 Customer Value Definition .......................................................... 14
3.1.2 Customer Value Assessment ...................................................... 16
3.1.3 End Consumer Value .................................................................. 19
3.2 IN-DIRECT DISTRIBUTION NETWORKS ......................................... 20
3.2.1 Role of Distribution Channels ...................................................... 20
3.2.2 Fundamentals of In-Direct Distribution ........................................ 25
3.2.3 Automobile Distribution Network ................................................. 28
3.3 Customer value proposition for dealer network .................................. 31
3.3.1 Relationship between Manufacturers and Dealers ...................... 31
3.3.2 Customer Perceived Value Creation for Dealer Network ............. 33
3.3.3 Value Communication to the Dealer Network .............................. 35
3.3.4 Dealer Network Value Assessment ............................................. 39
4. CASE COMPANY ............................................................................................... 42
4.1 Case Background .............................................................................. 42
4.2 Underlying Problem............................................................................ 44
5. DATA ANALYSIS & DISCUSSION...................................................................... 50
5.1 Solving the problem ........................................................................... 50
5.1.1 Utilizing Salesforce - CRM System.............................................. 50
5.1.2 Displaying Value Proposition to Dealer Network ......................... 54
5.1.3 Using Value Assessment to Convince Dealer Network ............... 59
5.2 DISCUSSION & LESSON LEARNED ................................................ 62
5.2.1 Problem & Framework Review .................................................... 62
5.2.2 Case Reflection .......................................................................... 64
5.2.3 Analysis of the Results ................................................................ 68
6. CONCLUSION .................................................................................................... 72
6.1 Theoretical Implications ..................................................................... 72
6.2 Managerial Implications ..................................................................... 74
6.3 Scope of Further Research ................................................................ 75
6.4 Thesis Limitations .............................................................................. 76
7. REFERENCES ................................................................................................... 77
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LIST OF FIGURES
Figure 1 Thesis Structure.............................................................................................. 9
Figure 2 Research Process ........................................................................................ 12
Figure 3 Applying data gathering methods to research process. ................................. 13
Figure 4 Customer value framework (modified from Lyly- Yrjänäinen et al., 2010). ..... 14
Figure 5 Customer Value Model ................................................................................. 15
Figure 6 Consumer importance vs satisfaction framework (modified from Yang,
2003). .................................................................................................. 16
Figure 7 Customer value assessment framework (modified from Keränen and
Jalkala, 2013) ...................................................................................... 17
Figure 8 CPV Assessment Framework ....................................................................... 18
Figure 9 Factors Influencing Consumer Income (Zhang & Hu, 2010) .......................... 19
Figure 10 Factors Influencing Consumer Income (Zhang & Hu, 2010) ........................ 20
Figure 11 Supply Chain Network Hierarchy (modified from Wei Wen, 2018)............... 22
Figure 12 Distribution function in Alternative Techniques (modifed from Cavusgil,
2014) ................................................................................................... 23
Figure 13 The distinction between two distributor structures. ...................................... 24
Figure 14 Supplier- Customer Relationship in Distribution Channels .......................... 25
Figure 15 Hybrid Networks (modified from Anderson et al. 1997) ............................... 27
Figure 16 Automobile distribution network .................................................................. 29
Figure 17 Role of Dealer Networks in Automotive Industry ......................................... 30
Figure 18 Relationship bottlenecks between OEM & Car Dealers ............................... 32
Figure 19 Value Creation for global supply & delivery network (modified from Wei
Wen, 2018). ......................................................................................... 34
Figure 20 Automobile Manufacturer Hierarchy (modified from Wei Wen,2018) ........... 34
Figure 21 Dealer Network Customer Value Structure (modified from Wei Wen,
2018). .................................................................................................. 35
Figure 22 Customer Value Communication Objectives ............................................... 36
Figure 23 How to convince a dealer ............................................................................ 37
Figure 24 Role of OEMs to support Dealers enhance their customer base. ................ 38
Figure 25 Communicating value assessment to dealer. .............................................. 40
Figure 26 Value Communication Process. .................................................................. 41
Figure 27 Geographical Jurisdictions of the Case Company. ...................................... 42
Figure 28 Performance Measurement Strategy adapted by Case Company. .............. 43
Figure 29 Stakeholders in Case Company. ................................................................. 45
Figure 30 Current Scenario. ........................................................................................ 47
Figure 31 Example of delayed response time ............................................................. 47
Figure 32 Proposed Scenario. .................................................................................... 50
Figure 33 Impacts of using salesforce dashboards. .................................................... 51
Figure 34 Dealership Hierarchy Level. ........................................................................ 53
Figure 35 Dealer customer value model ..................................................................... 56
Figure 36 How case Company representative uses the customer model to
convince dealers. ................................................................................. 56
Figure 37 Pilot project with a single dealer group. ....................................................... 57
Figure 38 How case company demonstrate CVP ........................................................ 58
Figure 39 Value assessment for dealer network. ........................................................ 59
Figure 40 Using customer value assessment during dealer meetings. ........................ 60
Figure 41 Value for end consumer for dealer network. ................................................ 61
Figure 42 Implementation Phase. ............................................................................... 61
Figure 43 Systematic Framework ............................................................................... 64
Figure 44 Steps to communicate the customer value to dealer network. ..................... 65
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Figure 45 How Case Company representative follow the 4 steps strategy. ................. 66
Figure 46 Case Analysis based theoretical framework ................................................ 67
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LIST OF TABLES

Table 1 Methods for Data Gathering (Modified from Gummesson,1993) .................... 11

Table 2 Types of Intermediaries.................................................................................. 25
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1. INTRODUCTION

1.1 Background

In modern business landscape, the idea of value has assumed a position of domi-
nance. Multiple dimensions are present in this context. According to Doyle (2008), the
essence of value creation is the capacity to innovate and develop an extensive range
of offering for specific market segments. By providing such collections of offerings, a
business can establish a unique value proposition that favourably positions its offering
relative to existing market alternatives (Kothandaraman and Wilson, 2001). This in-
volves delivering distinctive and desirable benefits that address the needs and prefer-
ences of the target consumers, thereby providing the organisation with a competitive
edge. Businesses can enhance their market presence and achieve sustainable suc-
cess in today's dynamic and competitive business environment by comprehending and
implementing value creation strategies effectively.

Existing literature on customer value focuses primarily on direct channel contexts, while
the value network perspective and the function of intermediaries in customer value cre-
ation networks receive scant attention. In the context of indirect distribution channels,
there is a notable lack of scholarly research pertinent to customer value assessment
and communication. This demonstrates the need for additional research and under-
standing of how customer value is evaluated and effectively communicated in the pres-
ence of intermediaries in the distribution channel, emphasising an important area for fu-
ture scholarly investigation.

The role of distribution networks in the automotive industry is the main focus of this
thesis research. In the automobile industry, dealer networks play a crucial and multi-
faceted function. Dealer networks facilitate the distribution and sale of vehicles by act-
ing as intermediaries between automobile manufacturers and final consumers. As
dealerships are strategically located to reach geographically dispersed client bases,
they play a crucial role in ensuring efficient market coverage. Additionally, dealer net-
works serve as brand ambassadors, representing manufacturers and providing valua-
ble pre- and post-sale consumer support. By providing personalised services such as
demonstration drives, vehicle customization, and maintenance, they contribute to the
development of strong customer relationships. Moreover, merchant networks play a
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crucial role in marketing and promotion, implementing a variety of strategies to in-

crease brand awareness and stimulate demand. Through their expertise and
knowledge of the industry, dealerships provide customers with product information,
guidance, and a customised purchasing experience. Consequently, the presence of ef-
ficient and well-managed dealer networks is crucial to the success of automotive manu-
facturers, as they contribute to efficient distribution, customer satisfaction, and the
overall expansion of the automobile industry.

1.2 Objective

This thesis put forwards a systematic framework with support from theoretical studies
for dealer networks in automobile industry. The goal of the framework is to use cus-
tomer value tools to engage dealer network to participate in process change that would
optimize the standard operations protocols used by OEM manufacturers when engag-
ing with dealers. Additionally, the main idea is that, by ensuring that the dealers per-
ceive the benefits they would attain from the created value, they can be easily con-
vinced to cooperate. Customer value models and value assessment frameworks can
be used to increase the convincing power when conducting discussions with the dealer
networks.

The usage of customer value tools in the framework enhances the reliability of this ap-
proach. In comparison to the other conventional studies, this thesis not just studies how
customer value models can be used to negotiate with dealer networks but is also sheds
light on how the value generated for the end consumer can be used to entice the deal-
er to cooperate. Additionally, evaluating and communicating customer value proposi-
tions in automobile dealer networks has been a rarely explored research area. Hence-
forth, the objective of the thesis is to…

…to how to use customer value proposition of automobile dealer network as a means
to convince them to participate in process change to enhance dealer – manufacturer
relationship.

To achieve the stated objective, this thesis begins by presenting the theoretical founda-
tion of customer value, with a focus on the concept of value proposition and an expla-
nation of the roles and responsibilities of dealer network, as well as pertinent key in-
formation regarding process change. Based on the aforementioned theoretical frame-
work, a methodological approach is subsequently formulated and elaborated. Lastly, a
case company implements the proposed strategy with the intent of enhancing its nego-
tiation skills.
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1.3 Thesis Structure

As mentioned in above sub-sections one of the major aspects of this thesis research
was to understand the fundamental dynamics of a business relation between an auto-
mobile OEM and its existing dealership network. In simple words, how that relationship
can be extended by creating value for the dealers which would also motivate them to
enhance their customer group by optimizing sales and aftersales activities.

This dissertation consists of six chapters. The objective and principal content of each
chapter are as follow in below figure:

Figure 1 Thesis Structure

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2. RESEARCH METHODOLOGY

2.1 Research Method

In the context of business and management case study research, the generation of
qualitative data is a crucial step that has a substantial influence on the quality and val-
ue of the research outcomes. According to Sutton and Austin (2015), qualitative data
collection enables researchers to gain access to the thoughts and emotions of relevant
participants, allowing for a more profound understanding of the significance of their ex-
periences. In addition, Simmons et al. (2011) argue that researchers must possess the
necessary skills to employ appropriate data collection methodologies.

Due to technological obstacles, Draper and Swift (2011) assert selecting appropriate
quantifiable information gathering can be difficult, but employing appropriate research
methodologies is crucial for ensuring the quality of research. They describe four quali-
tative data collection techniques: interviews, observation, texts and documents, and ar-
chival data. Additionally, focus groups and qualitative/quantitative interviews are the
most prevalent data acquisition methods in qualitative research (Gill et al. 2008).

Gill et al. (2008) categorise research interviews as structured, semi-structured, and un-
structured. Unstructured interviews lack any preconceived queries or ideas. In semi-
structured interviews, there are some preconceived notions, but interviewers have the
flexibility to pursue more detailed responses. Focus groups, on the other hand, are
group discussions organised around specific topics for the purposes of research, allow-
ing researchers to collect data from multiple participants simultaneously.

In qualitative research interviews, Hayman et al. (2012) propose the use of narration as
a realistic and effective technique for data gathering. Heliker (2009) adds that by redis-
tributing power, story-sharing can strengthen cooperation between researchers and
participants. By fostering a more collaborative environment, story sharing facilitates the
collection of accurate qualitative data by researchers.

The purpose of case study research, according to Gummesson (1993), is to investigate

the implicit truth and value underlying phenomena in order to gain insight into their
origin, justification, evolution, and future implications. These date gathering methods
are summarized in the table as follows.
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Table 1 Methods for Data Gathering (Modified from Gummesson,1993)

Utilising extant resources necessitates the extraction of qualitative information from

several sources, such as unstructured data, analysed website information, books, arti-
cles, documents, and notes. Despite being more commonly associated with quantita-
tive data collection, questionnaires can also be used to collect qualitative data for case
studies by employing statistical techniques. In contrast, interviews using questionnaires
are the most common method for generating qualitative data in case studies, with indi-
vidual or group interviews conducted. Interviews offer the benefit of obtaining the nec-
essary information faster than questionnaire surveys.

Observation, which encompasses both direct observation and participant observation,

utilises human senses to gather information about a phenomenon that can be captured
by sensory perception. Observation encompasses information gathered via the modali-
ties of sight, hearing, touch, smell, and taste, among others. Action science is a quite
valuable and substantial way to gather information in which scholars actively influence
and partake in the process being studied. Gummesson (1993) suggests that action sci-
ence incorporates all other data collection techniques, but requires the active participa-
tion of researchers, thereby enhancing the performance of qualitative data collection.

In Conclusion, Researchers must ensure that all data and information presented are
accurate, complete, objective, timely, comprehensible, and presented in an under-
standable manner. The collected data will be utilised to support the case study's main
ideas and contribute to the subsequent decision-making process.
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2.2 Research Process

The thesis kick started in January 2022, when the author started working at the case
company in Helsinki, Finland. In the initial phase, the research progression was distrib-
uted in three distinctive stages. First, identification and analysis of the problems in the
research area the case company has been already facing and then identifying potential
problems within the case firm. Second, after identification it is of prime importance to
analyse the issues using theoretical framework extracted from the literature studies, ex-
isting research and action science. Last, applying the formulated framework to rectify
the problem is the closing stage. Figure 1 shows the research process applied during
the thesis timeline.

Figure 2 Research Process

As shown in the above figure, the research process can be distributed in six different
stages. In the first stage, the thesis officially starts when the author starts working for
the Dealer network development department of the company. In the second stage, au-
thor starts to conduct market research and digs deep into the dealer dynamics in all 7
countries in the Nordics and Baltics. This process also includes meetings with DND
managers to understand their perspective regarding dealer issues and the operational
procedures currently implemented when dealing with the dealers. Third stage starts
with the finalization of thesis topic and final identification of the project problem.

Fourth stage focuses on the implementation phase. This stage starts with creation of
theoretical framework and it’s subsequent application to solve the case problem. Addi-
tionally, this stage comprises of several internal and external meetings. Internal meet-
ings comprise of project discussions between the author and case company repre-
sentative. External meetings entail discussions between dealer principles and dealer
network development manager of the case company. Fifth stage focuses on the post-
implementation discussions with the dealers to follow progress on the process change
 13

and if any additional changes are required. Last stage, outcome of the implementation
is formulated as a written thesis.

Throughout the course of the study, a variety of data collection techniques were em-
ployed at various stages to assure the collection of pertinent qualitative data. Through
the frequent usage of 5 data gathering techniques proposed by Gummesson (1993)
which have been discussed in detail before. Figure 3 depicts an illustrative diagram
based on the working process to provide a visual representation of the research pro-
cess undertaken.

Figure 3 Applying data gathering methods to research process.

As shown in the above illustration, in first stage, a combination of action science and
action science is used. Followed by second stage, where interviews were conducted
along with questionnaires to understand the dealer dynamics in a structured way. They
remaining stages all involve action science as a most valuable qualitative data gather-
ing method.
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3. LITERATURE REVIEW

3.1 Customer Perceived Value

3.1.1 Customer Value Definition

Customer value is the consumer's perception of worth of a market offering. They are
more likely to accept the one who, in their opinion, offers the best value in contrast to
the competitors. Customer value, according to Paananen and Seppänen (2013), has
multiple meanings and connotations. The approach has recently gained traction in
marketing strategy (Khalifa, 2004). However, different authors describe the concept dif-
ferently. The table provides an overview of the many authors' perspectives on custom-
er value.

While definitions differ, the basic premise is that customer value is made up of two key
components: advantages and expenses. As a result, the concept proposed by Kotler
and Keller (2012) is applied here. Anderson et al. (2009) define the advantages at-
tained by the consumer as "...economic, technical, service, and social benefits." The
sum of benefits is defined as total customer value (TCV) (Lyly-Yrjänäinen et al., 2014).
If these sub-elements are inferior to the current condition or alternatives, they may be
considered costs. A firm, for example, may have to make some financial compromises
in order to purchase things. These costs can thus be divided into three categories: pur-
chase, usage, and disposal, yielding total customer cost (TCC) (Lyly-Yrjänäinen et al.,
2014). This concept is exemplified in Figure 4.

Figure 4 Customer value framework (modified from Lyly- Yrjänäinen et al., 2010).
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This figure represents the network of value offerings supplied to the client while ensur-
ing corporate profitability. Customer perceived value serves as a genuine offering of-
fered to customers in this scenario. Buyers, according to Kotler and Keller (2012), em-
ploy their cognitive and visual perception skills to weigh the benefits vs the costs. Im-
proved perceived value may be associated with increased satisfaction and loyalty
(Minna et al., 2005) and purchase intention (Chang & Tseng, 2013). Long-term client
connections need effort in both customer encounters (Pruchnow et al., 2006) and value
delivery (Anderson et al., 2009).

A team of researchers conducted trials that included multiple benefit/cost models of

customer value. Each model incorporates a number of customer value drivers that are
cost and benefit related. Prioritisation and relevance of customer value drivers are
highly influenced by consumer perception, which is impacted through a range of traits
such as the essence of the product and service, the industry type, and the target mar-
ket. It is straightforward to evaluate and transmit perceived customer value by relating it
to purchase price; however, analysing and communicating perceived customer value in
the case of usage cost is highly complex. To simplify the preceding narrative, a new
categorization of benefits and sacrifice might be presented using the customer value
paradigm proposed by Lyly-Yrjänäinen et al. (2010). Figure 5 depicts the customer val-
ue framework with an emphasis on usage cost.

Figure 5 Customer Value Model.

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In the above figure interconnection between perceived value and total cost is shown.
As previously said, different value drivers affect the client in different ways. To make
things simpler, the cost of usage is highlighted to highlight the impact. Consumers
would normally buy an offering when perceived value attained is substantial i.e. entire
advantages perceived from a product surpass the customer's sacrifices (Lyly-
Yrjänäinen et al., 2010).

Customers' willingness to pay for certain benefits is defined by value models. Anderson
and Narus (1998) refer to the fundamental offering as "naked solutions." These offers
can then be augmented with features that provide value to each customer while avoid-
ing value drains that cost both the company and the customer. Surprisingly, the client
does not appear to place equal value on expenses and benefits. Benefit growth is less
significant than cost saving.

According to one of the value models, consumer value is tied to customer loyalty and
satisfaction. A model was created by Yang (2003) to demonstrate relationship between
corporate service excellence and consumer pleasure. Yang's importance-satisfaction
paradigm is depicted in Figure 6.

Figure 6 Consumer importance vs satisfaction framework (modified from Yang, 2003).

The model has both vertical and horizontal dimensions, as shown in the figure above.
The vertical dimension indicates consumer happiness, Companies, on the other hand,
can change and increase the qualitative aspects of their business offers.

3.1.2 Customer Value Assessment

When a product is brand new, establishing consumer value can be challenging. The
fundamental reason for this is that, like any projection, value evaluation is subject to
some degree of uncertainty. The supplier may be unfamiliar with a customer's proce-
dures, or the solution may be inapplicable to several clients as it is to one. Hence, val-
 17

ue assessment can be used as an integral technique in order for businesses to evalu-

ate consumer value, (Johanssson et al., 2015).

Customer value assessment methodologies, according to Payne and Holt (2001), can
be assessed through perspectives of customer satisfaction and service quality.As a re-
sult, in the consumer market, customer happiness can be viewed as a powerful predic-
tor of customer purchasing behaviour (Mittal & Kamakura, 2001).

With respect to quality of a service, consume rvalue is frequently stated as baragin be-
tween the cost and the quality (Keränen and Jalkala, 2013). Additionally, a paradigm
that comprises the principal evaluating technique for consumer value was proposed by
Keränen and Jalkala (2013). Figure 7 depicts the approach for assessing customer
value.

Figure 7 Customer value assessment framework (modified from Keränen and Jalkala, 2013).

Major actions and processes in value assessment were analyzed by Keränen & Jalka-
la, (2013). They identified five key tasks based on four steps: value potential identifica-
tion, baseline evaluation, performance review, and long-term value realization, all
backed by structured data management throughout the process (Keränen & Jalkala,
2013). The explicit necessity is recognized in the identification of value potential, which
can be difficult because customers may be unwilling to disclose or even understand
their underlying challenges on their own (Keränen & Jalkala, 2013). As a result, the
value proposition is currently dependent on estimates and lacks the documentation re-
quired for validation.

The next step is to undertake a baseline assessment after evaluating the value poten-
tial (Keränen & Jalkala, 2013). This current scenario assessment serves as the founda-
tion for later evaluating the delivered value. As previously said, seeing the entire picture
might be difficult; therefore, defining the value pieces that comprise the value potential
can help managers estimate the complete value (Anderson et al., 2009). Customers
 18

may overestimate their current situation, according to Jalkala and Keränen (2013), and
outcome specification can help customers communicate their expectations to the sup-
plier while also ensuring that the supplier actually delivers the expected outcome. The
baseline evaluation is typically finished before delivery, however part of it can be done
during the negotiation process.

The final evaluation technique is performance evaluation, which focuses on documen-

tation and implementation of pilot projects that would help understand the footprint on
consumer capabilities. The purpose is to quantify the impact on clients’ ventures. Pilot
projects demonstrate that companies understand their services and how they can as-
sist customers in resolving problems. Similarly, identifying the influence on customer
performance pertains to how providers convey improvement suggestions to customers.

The next procedure is value realization for the long term. This technique consists of two
tasks: validating realized customer value and recording realized customer value. The
process's purpose is to make sure that the customers get the benefits that was re-
searched in earlier stages. Suppliers must invest time and money in teaching consum-
ers how to run their businesses successfully and efficiently.

As a result, the process concludes with ongoing and consistent data management
(Keränen & Jalkala, 2013). Except for the prior phases, systematic data management
refers to the complete value appraisal process, which encompasses all of the proce-
dures stated earlier. Systematic data management will now be used to regulate the en-
tire value assessment process, allowing for the development of detailed customer val-
ue assessments (Keränen & Jalkala, 2013). Figure 8 shows how this framework oper-
ates with customer perceived value (CPV) model.

Figure 8 CPV Assessment Framework.

Framework, as illustrated in Figure, can analyse perceived customer value in stages.

Furthermore, the framework sheds light onto the relationship between consumer hap-
piness and product offering. Additionally, firms can implement this strategy to provide
customer value for its target customers.
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3.1.3 End Consumer Value

Aside from the previous paradigm for evaluating customer value, there are other ways
for studying customer value from other perspectives. According to firms that rank high
in perceived customer value, consumers can rate them and tend to pay for their prod-
uct and service offerings. As a result, corporate returns can be viewed as an important
sign of corporate performance. In other words, client monetary worth may be consid-
ered to be a substantial signal. A method for determining client lifetime value based on
revenue was proposed by Zhang and Hu (2010). Four distinctive elements were put
forward by them. Figure 9 depicts four different factors.

Figure 9 Factors Influencing Consumer Income (Modified from Zhang & Hu, 2010).

Customer revenue, as illustrated above, is an important number for determining cus-

tomer value. It comprises both direct and indirect revenue generated by the utilisation
of a supplier's offerings.

To begin, an income clients earn from using the supplier's offerings in terms of direct
income for the client is considered present income. A private railway operator, for ex-
ample, has purchased an engine through a manufacturer. Latest locomotive is in oper-
ation for a single year, and earnings for new product represent current income for the
company. In general, client income during a specific time period can be characterised
as present income.

Second, any value which a firm can attain by providing state of the art products and
services to its clientele continuously comes under the concept of projected income.
Based on the preceding company's example, a new electric locomotive has a life ex-
pectancy of 25 years. It symbolises the fact that there 24 remaining years for the loco-
motive and the revenue generated for those 24 years would serve as the potential in-
come. Public praise effect income is intangible in context of in-direct revenue for the
consumer, referring to the customer's experience with the supplier's offerings. The rail-
way operator, for example, delivers an outstanding travelling experience as well as effi-
cient and swift speed, making it the first choice for business travellers.
 20

Finally, prospective income from new consumers is referred to as halo effect income.
Existing customers will inform their families, friends, or co-workers about their experi-
ences with suppliers' products and services.

This perceived value model is visually attractive, and it is easy to quantify. To under-
stand the deeper dynamics of a collaboration between value assessment framework
and value model, Figure 10 represents the interaction between both elements.

Figure 10 Factors Influencing Consumer Income (Modified from Zhang & Hu,
2010.)

As shown in Figure, value assessment strategy portrays the feasibility of the perceived
value, on the other hand, return value gained from the consumer can be considered as
the value for end consumer. To make it simpler, the first framework talks about the
overall business process, while the other model talks about the value extracted from
the end customer.

Finally, corporations must understand that consumer value is a problem. As a result,

the two customer value evaluation models stated above may be of use to enterprises.
Cross-collaboration among business value and customer quality is underlined by exhib-
iting and analysing customer value evaluation models from two separate perspectives.

3.2 IN-DIRECT DISTRIBUTION NETWORKS

3.2.1 Role of Distribution Channels

Distribution channels are essential to the marketing process because they facilitate the
delivery of providers' goods and services to consumers. This concept has been exten-
 21

sively explored and discussed in scholarly literature, as evidenced by a number of no-

table citations. Corey et al. (1989), Lusch et al. (2010), Anderson et al. (2009), and Ko-
tler & Keller (2016), among others, have studied distribution channels. This thesis pro-
vides a comprehensive comprehension of distribution channels as marketing channels
by employing a broad perspective. As discussed by Achrol & Etzel (2003) and Kotler &
Keller (2016), it is acknowledged that these channels may incorporate both sales
channels and tangible distribution channels.

Anderson et al. (2009) classifies distribution channels according to the extent of direct
provider participation. They divide distribution channels into direct and indirect catego-
ries. In a direct distribution channel, the provider is accountable for all channel activi-
ties, including the distribution and sale of physical products. An indirect distribution
channel, on the other hand, involves intermediaries who perform specific duties on be-
half of the provider. In indirect marketing channels, intermediaries play a vital role by
facilitating exchange and making offerings accessible to subsequent intermediaries or
end consumers. End users consume or incorporate an offering into their own products
or services, whereas intermediaries promote the offering itself. This distinction is em-
phasised by Sheth & Parvatiyar (1995), Weitz & Jap (1995), Lusch et al. (2010), and
Kotler & Keller (2016).

According to Klosek (2007), establishing a mutually beneficial relationship with a dis-

tributor can yield significant advantages for an organisation. The value of a long-
standing distributor to an organisation can be substantial. In some areas with dense
populations and strong cultural ties, direct market penetration may be challenging.
Identifying dependable and trustworthy distributors can be extremely advantageous for
accessing these markets. The presence of dependable distributors can be an indispen-
sable steppingstone for accessing potentially lucrative markets.

It is essential to recognise that profit sharing is a common aspect of working with dis-
tributors. Despite this, it is possible that the benefits of this partnership outweigh the
costs. Businesses can increase their overall return by distributing a small portion of
profits to distributors. This highlights the strategic importance of investing in distributor
relationships and recognising their contribution to the organization's efforts to increase
its market share.

Distribution is widely acknowledged as an essential element of global supply chain

management, as it entails the integration of manufacturers and retail customers. Aitken
(1998) proposed a framework for the supply chain that depicts the position of distribu-
 22

tion within the larger global supply chain network. This framework shown in Figure 11
explains the function that distributors perform in the global supply chain.

Figure 11 Supply Chain Network Hierarchy (Modified from Wei Wen, 2018).

Wei Wen (2018) illustrates the function of distributors within the global supply chain in
Figure 11. This example highlights the role of distributors in the distribution process as
intermediaries between producers and consumers. Distributors facilitate the passage of
goods and services from manufacturers to consumers. They are accountable for the
physical delivery of goods and services to end-users, acting as a node in the supply
chain. In addition to their logistical role, distributors serve as conduits for order infor-
mation flow, collecting and transmitting relevant client data to manufacturers.

In addition, distributors are accountable for providing market information as active

members of the distribution network. By gathering client or end-user insights and feed-
back and relaying this information to the original suppliers, they serve as valuable
sources of market intelligence. This exchange of market information allows manufac-
turers to stay abreast of consumer demands, preferences, and market trends, allowing
them to adjust their offerings and strategies accordingly.

Distributors perform multiple functions as intermediaries, including physical distribution,

order administration, and market information exchange. By effectively fulfilling these
responsibilities, distributors contribute to the efficient operation of the distribution chan-
nel, facilitating the flow of market feedback information and ensuring smooth transac-
tions between producers and buyers.

Cavusgil et al. (2014) suggested a detailed strategy that identifies distributors' roles
and responsibilities in international business. The role and responsibilities of distribu-
 23

tors and other stakeholders can be clearly defined using their approach. Figure 12 de-
picts distributors' roles and responsibilities in alternate distribution techniques.

Figure 12 Distribution function in Alternative Techniques (Modifed from Cavusgil, 2014).

According to Figure, the distributor is one of the international intermediaries present in

the target market. Distributors share some of the same roles and responsibilities as
sales representatives, brokers, and internet intermediaries. They all receive offerings
from domestic enterprises or intermediaries, or they have the opportunity and capability
to directly engage end customers.

In truth, there are various additional ways for domestic enterprises to achieve globalisa-
tion, through field sales or the establishment of sales offices. Though, when compared
to working through distributors in target markets, the expense and risk are high. In oth-
er words, establishing local distributors to market the exporter's products and services
can reduce risks for all partners. The difference between the two frameworks can be
more clearly studied by integrating both structures. Figure 13 depicts the distinction be-
tween two distributor configurations.
 24

Figure 13 The distinction between two distributor structures.

Within the context of a global supply chain network, the illustration discusses the func-
tion of distributors in the distribution process. The domestic company, comprised of
domestic suppliers and the manufacturer, has several distribution procedure manage-
ment options. They have the option of managing the distribution process themselves or
hiring a domestic intermediary. Choosing a domestic intermediary increases the cost of
entering new markets, but the domestic company would then comply with the interme-
diary's directives.

In target markets, intermediaries also have multiple options for engaging with end cus-
tomers. They may collaborate with local wholesalers and retailers or interact directly
with end consumers. However, the selected strategy impacts the prices charged to
end-users. If distributors collaborate with local wholesalers and retailers, the added ex-
penses will be reflected in the final selling price.

As active participants in the distribution process within the global supply chain network,
distributors play a crucial role. They facilitate the exchange of products and information
between manufacturers and consumers, bridging the gap between the two parties. The
ultimate goal is to ensure that customers obtain the goods and services they desire,
while manufacturers and distributors achieve the desired profit margins.
 25

3.2.2 Fundamentals of In-Direct Distribution

The preceding section defined distribution as a process that occurs within the global
supply system. Purpose for the distribution process is mutual product and information
transmission. In truth, there are two basic distribution relationships for international
markets as shown in Figure 14.

Figure 14 Supplier- Customer Relationship in Distribution Channels.

As shown in figure, there are two major distribution systems adapted by exporters and
suppliers to sell their product offering to their customer base. First, direct distribution
channel in which offering are transferred to the customer directly without introducing an
intermediary or an inventory holder. Second, in a classical in-direct system, manufac-
turing companies would provide their offerings to a third-party distributor who would fur-
ther sell the product offerings to its customer base. There could be several intermediar-
ies serving their customer bases in different region. This thesis would use this channel
as a base distribution network in Automotive industries where a network of dealers
serves their customers in different regions.

There are many kinds of intermediates, which are typically characterised in modern
marketing management literature based on the marketing services they provide and
how they do so (e.g., Anderson et al. 2009; Kotler & Keller 2016). Table 4 aggregates
existing literature to define the many types of intermediaries that can occur in suppliers'
routes.

Table 2 Types of Intermediaries

Intermediaries Interpretation Reference

Distributor Purchase goods from ex- Corey et al. 1989;

porters and sells them to
 26

large scale users

Agent Works on Commission Lyly-Yrjänäinen et al.

based model 2018; Ailawadi & Farris
2020

Dealers Works like a distributor but Anderson et al. 1997;

in specific regions Lyly-Yrjänäinen et al. 2018

Wholesalers Purchase products in bulk Ailawadi & Farris 2020

and sells to resellers

Resellers Adds value in the product Anderson et al. 2009; Ai-

offering before selling lawadi & Farris 2020
them

Brokers Operate like agents but Corey et al. 1989

seek business opportunis-
tically.

Various intermediates play unique functions within distribution networks, according to

the data in Table 4. For example, agents differ from distributors in that they do not pro-
vide financing or share risks, whereas repair shops distinguish themselves by offering
after-sales services. However, certain intermediary categories, such as agents and
brokers, provide services that are similar. As a result, the definitions of various types of
intermediates might be confusing and not always apparent. Kotler and Keller (2016)
use the terms "wholesaler" and "distributor" interchangeably, as do Lyly-Yrjanainen et
al. (2018) with the terms "dealer" and "distributor." Similarly, these phrases are used in-
terchangeably in this thesis.

Given the enormous range of linguistic variants and minute differences in the actions of
specific intermediates, categorising them accurately is a tough and complex endeavour
(Corey et al., 1989). However, in many cases, the classification of the intermediate is ir-
relevant. Selling, for example, is a critical job performed by a variety of intermediaries
(Corey et al., 1989), and how selling is conducted and arranged is not significantly con-
fined by intermediary classification.

Customers are increasingly likely to receive services from different channel members
based on occasion and demand as marketing and channel functions have become
 27

more uniformly spread across channel members (Anderson et al., 1997; Achrol & Etzel,
2003). This behaviour is particularly noticeable in hybrid channels, where many chan-
nel members collaborate to perform diverse channel activities (e.g., Anderson et al.,
2009; Anderson et al., 1997). The shifting distribution landscape involves a flexible ap-
proach to channel design and management that allows for a dynamic allocation of
tasks across numerous channel members to suit the changing needs of customers.
Figure 15 shows a hybrid channel in action.

Figure 15 Hybrid Networks (modified from Anderson et al. 1997).

As shown in the figure, Anderson et al. (2009) say that the Internet has changed the
way people look for products in a big way. Customers are less loyal to one channel be-
cause it's easy to find and compare goods from different channels. Many suppliers
have used integrated multi-channel strategies to deal with channel issues. In these
strategies, the main provider and resellers work together to do channel tasks and serve
customers of both parties. This approach gets rid of competition for customers between
the main provider and other channel members, making it easy for customers to choose
and switch between channels as their needs change.

Anderson et al. (2009) says that one thing that makes an integrated multi-channel dis-
tribution system stand out is that channel members work together on different channel
tasks. Unlike traditional channels and hybrid channels, integrated multi-channel sys-
tems require a lot of cooperation between channel users. In these kinds of systems,
networks are very important. The main provider actively gathers leads and sends them
to other channel members. Resellers, on the other hand, work with the focal supplier to
find the best service option for big clients. They are paid fairly for their work as long as
 28

both parties agree that the focal provider is the best person to handle the customer ac-
count.

Even though the exact type of intermediary and channel structure is not the main topic
of this thesis, the conversation focuses on supplier-intermediate-customer channels,
which have a single intermediary between the main supplier and the final customer. In
this case, middlemen are in charge of making sales to the end customer.

As the business of indirect distribution grows, new channel designs have come into be-
ing. (Anderson et al., 1997; Frazier, 1999) Globalisation, more competition around the
world, quick technological advances, and new digital marketing possibilities has all
changed how suppliers and middlemen work together. (Lusch et al., 2010) Suppliers
have been told to give non-critical marketing tasks to other channel members so they
can focus on their core skills and improve the distribution channel's ability to be innova-
tive, flexible, and adapt to local conditions in dynamic markets. Weitz and Jap (1995)
found that a less hierarchical culture and a more even distribution of marketing tasks
led to less control and influence by suppliers and more power for intermediaries. Also,
the consolidation of middlemen has given them a lot more power (see, for example,
Anderson and Narus (1990) and Goodman and Dion (2001)).

In the end, Anderson et al. (2009) show how the Internet has changed the way cus-
tomers look for products, which has led to the use of integrated multi-channel market-
ing systems. Traditional and hybrid channels are different from these kinds of systems
because channel members work together to do more than one thing. Globalisation, im-
provements in technology, and changes in marketing possibilities have all changed the
way that suppliers and intermediaries work together. As a result of these changes,
power has moved from suppliers to intermediaries, making delivery networks more flex-
ible and open to new ideas.

3.2.3 Automobile Distribution Network

The actions and functions involved with automobile pre-sales are referred to as auto-
motive distribution. It includes all vehicle acquisition-related tasks (demand forecasting,
purchasing planning, price/volume negotiation, import procedures), marketing (strate-
gy, campaigns, brand management), transportation management, warehouse man-
agement, and stock returns management. Dealer management (defining agreements,
standards, and techniques) and warranty management are other key tasks. Automobile
distribution networks are the routes that automobiles take from manufacturers to deal-
erships and then to consumers. This technique is divided into many steps, which in-
clude production, transportation, and sales. The distribution network typically begins
 29

with the manufacturer, who makes the autos and transfers them to regional distribution
depots. After that, the vehicles are sent to individual dealerships or merchants, who sell
them to consumers. Many Car Manufacturers directly sell their cars to car dealers
which act as distributors. A typical automobile distribution network is shown in Figure
16.

Figure 16 Automobile distribution network.

As shown in the Figure, the distribution of automobiles is divided into several stages,
including production, transportation, and sales. The first stage of the automobile distri-
bution network is vehicle production by the manufacturer. Manufacturing includes the
assembly of many components and systems to make a finished vehicle. Automobiles
must be delivered from the factory to the dealerships after they are built. This involves
the use of many modes of transportation, such as trucks, trains, ships, and planes. The
final stage of the automobile distribution network is the sale of vehicles to consumers.
The procedure includes marketing and advertising the vehicles to potential buyers, ne-
gotiating with dealerships, and financing the transaction.

Direct distribution, indirect distribution, and hybrid distribution are the three types of au-
tomobile distribution networks. In first type, the manufacturer sells vehicles to consum-
ers directly, either through their own retail stores or through online channels. This type
of distribution is commonly used by luxury car manufacturers as well as companies
who specialise in custom-built or limited-edition vehicles. In direct distribution, the pro-
ducer has greater control over the sales process and can engage directly with the ulti-
mate consumer. Indirect distribution is the use of intermediaries, such as wholesalers
or distributors, to sell vehicles to dealerships. This distribution approach is popular in
 30

the mass market since it enables manufacturers to reach a bigger audience more effi-
ciently. Under indirect distribution, the manufacturer sells the vehicles to middlemen,
who then sell them to dealerships. Consumers are then sold the vehicles through deal-
erships. A "hybrid distribution" is a blend of direct and indirect distribution. Manufactur-
ers may sell some vehicles directly to consumers while simultaneously distributing to
dealerships through middlemen under this system. This allows producers to have more
control over some sales while still reaching a bigger audience through middlemen.

Dealers play the most integral role in the automobile sales and distribution network and
hence are the integral stakeholders in this thesis. A dealership network is a group of
dealerships that are authorised to sell and service vehicles from one or more manufac-
turers. This network frequently includes dealerships in various areas or markets that
specialise in specific types of vehicles or services.

The goal of an automobile dealer network is to provide consumers with access to the
vehicles and services offered by the manufacturer or group of manufacturers. This
network allows manufacturers to reach a wider audience, provide better customer ser-
vice, and ensure that their vehicles are available for purchase and service in a variety
of places. Dealerships in an automobile dealer network may be privately owned and
operated, or they may be owned and operated by the manufacturer or a third-party
dealer group. Regardless of ownership, network dealerships must adhere to the manu-
facturers or group of manufacturers' standards and norms. Facility design, employee
training, customer service, and marketing and promotion are examples of such re-
quirements. Dealerships that meet these standards are often given special titles such
as "authorised dealer" or "certified dealer," indicating their affiliation with the manufac-
turer or group of manufacturers.

Automobile dealer networks are vital to the automobile business because they provide
consumers with a convenient and dependable means to purchase and service vehi-
cles. They also help firms build brand loyalty, increase income, and retain consumer
ties. Figure 17 shows key roles of dealerships in Automotive business.

Figure 17 Role of Dealer Networks in Automotive Industry.

 31

As shown in above illustration. First, Dealerships are responsible for selling vehicles to
end users. They help customers choose the right vehicle, arrange financing, and com-
plete the buying process. Dealerships typically offer test drives, vehicle trade-ins, and
other value-added services to attract and keep customers. Second, dealerships are the
primary means by which vehicles from manufacturers are delivered. They place orders
with manufacturers, then receive and inspect the vehicles before selling them to end
users. Vehicles can also be moved between dealerships to meet customer demand
and optimise inventory levels.

Third, dealerships are responsible for the upkeep and repair of vehicles sold to clients.
They provide routine maintenance such as oil changes and tyre rotations, as well as
more involved repairs. Automobile dealerships typically contain qualified professionals
and specialised equipment to diagnose and fix vehicle faults. Fourth, Dealer networks
are critical in creating and maintaining customer relationships. They provide individual-
ised service, follow up on sales and service encounters, and make every effort to re-
solve any difficulties or complaints. Dealerships also teach and support customers on
automotive operation, maintenance, and features. Last, they are responsible for pro-
moting vehicles and services to potential customers. They may conduct advertising
campaigns, participate in community events, and offer deals and incentives to attract
customers. Dealerships frequently use customer referrals and positive reviews to gen-
erate new business.

Overall, dealer networks play a significant role in the automotive distribution network
since they connect manufacturers with end customers. They provide a number of ser-
vices to assist customers in acquiring, servicing, and maintaining their vehicles, as well
as striving to build long-term relationships with customers in order to promote business
growth.

3.3 Customer value proposition for dealer network

3.3.1 Relationship between Manufacturers and Dealers

The previous chapter thoroughly explored the customer value proposition and distribu-
tor characteristics. This chapter will discuss how to apply what you've learned about
customer value propositions to solve distribution problems. The goal of this chapter is
to look at existing distribution networks and analyse the key relationships between the
car manufacturer and dealer network.
 32

In the automotive sector, the relationship between OEMs and dealers is crucial. Car
manufacturers rely on their dealers to market their products to consumers, and dealers
rely on the manufacturers to supply them with vehicles on a constant basis. Because
the manufacturers are located upstream in the supply chain and the dealers are locat-
ed downstream, this is a vertical connection.

According to the literature, this connection is frequently controlled by a franchise

agreement, which establishes the terms and conditions under which the dealer will sell
the manufacturer's products (Baron & Besanko, 2004). The franchise agreement fre-
quently includes pricing, advertising, warranty, and other aspects of the relationship.

Market power allocation is a crucial issue in the relationship between manufacturers

and dealers. Manufacturers wield enormous market power because they control auto-
mobile production and distribution, but dealers wield less market power because they
are frequently small businesses that rely on the manufacturer for vehicle supply. As a
result, manufacturers may have substantial control over their dealers' activity, such as
setting prices and limiting their ability to provide rival products (Eckert & Westhoff,
2017).

The relationship between manufacturers and dealers has been thoroughly examined.
Baron and Besanko (2004), for example, discovered that the distribution of market
power among producers and dealers had significant implications for pricing and well-
being. According to Eckert and Westhoff (2017), manufacturer restrictions on dealer
activity have a significant impact on competitiveness and consumer welfare.

As a critical perspective, the relationship between OEM and dealers can be quite criti-
cal & full of complexities. Major challenges can be ascertained as per the distinguished
literature on automobile distribution networks. Figure 18 illustrates these 4 challenges
within the automobile supply chain.

Figure 18 Relationship bottlenecks between OEM & Car Dealers.

 33

As per the above figure, one of the most critical issues in the OEM-dealer relationship
is the question of pricing and profit margins. OEMs may impose disadvantageous pric-
ing policies on dealers or limit the prices at which dealers may sell their products. Be-
cause dealers may perceive they are not making a significant profit margin, this might
lead to issues and conflicts (Pereira, 2017). Another issue that may arise in the OEM-
dealer relationship is a disparity in bargaining power. OEMs usually have greater nego-
tiation power than their dealers, making beneficial terms and conditions difficult to ne-
gotiate. As a result, dealers may feel pressured to accept undesirable terms. (Bauer,
2019).

Third, Franchise contract disagreements can also be a source of dispute in the OEM-
dealer relationship. Franchise agreements usually govern the terms and circumstances
of the OEM's relationship with its dealers; however, problems can arise when one party
believes the other is not following the terms of the contract. These disagreements can
be costly and time-consuming to resolve, and they can damage the relationship be-
tween the parties (Henderson, 2015).

Last, A lack of transparency and communication can also be a concern in the OEM-
dealer relationship. OEMs may suppress information about their products or business
processes, making it harder for dealers to make educated decisions. Misunderstand-
ings and disagreements may also occur as a result of poor communication between the
OEM and its dealers.

To summarise, the OEM-dealer relationship can be complicated, and a variety of com-

plications can arise. Pricing and profit margin problems, disparities in negotiating pow-
er, franchise contract issues, a lack of transparency and communication, and competi-
tion from internet sales channels are among them. To preserve a healthy and effective
cooperation, OEMs and their dealer networks must address these concerns.

3.3.2 Customer Perceived Value Creation for Dealer Network

Managers of multinational corporation’s exercise extreme caution when managing dis-
tributors to mitigate the negative repercussions of the dealer - manufacturer issues dis-
cussed in the preceding section. Some huge international firms finally decide to enter
new markets on their own, avoiding the concerns entirely. Manging dealer networks in
primary target industry is a vital stage in the distribution process for other global corpo-
rations lacking the requisite resources.
 34

When compared to other stakeholders, distributors, just like any other participant within
global supply domain have a well-defined and clear-cut value proposition. Figure 19
demonstrates the value of the client throughout the supply chain network.

Figure 19 Value Creation for global supply & delivery network (modified from Wei Wen,
2018).

As shown in the above illustration, each stakeholder has their own customer value
structure in terms of value offer. Additionally, indirect charges are not contemplated
here. It denotes that overall customer expenses are the same as the costs of purchas-
ing goods and services.

Car manufacturers are central firms that buy basic materials from suppliers and then
use those materials to create optimal products. Along the process, manufacturers incur
direct and in direct costs. Figure 20 depicts the manufacturer's consumer value hierar-
chy.

Figure 20 Automobile Manufacturer Hierarchy (modified from Wei Wen,2018).

 35

As shown in the above figure, apart from the procurement cost of the raw materials
there are other secondary costs which comprise a substantial chunk of direct costs
which may include paid salaries to the employees and production workers alike. Indi-
rect expenses can range from storage/inventory cost to administration costs etc. In
B2B markets, manufacturers commonly express a desire to increase production effi-
ciency to minimize total manufacturing costs. Meanwhile, companies have stronger
bargaining power when it comes to purchasing raw materials, which can substantially
cut total pricing.

On the other hand, the customer value structure for the dealer network would differ ex-
tensively. As their will no labor costs for the dealers, the only active direct expense
would be to procure those vehicle units from the OEM and sell it to the end consumer
in their respective geographical region. This concept can be seen in Figure 21 below.

Figure 21 Dealer Network Customer Value Structure (modified from Wei Wen, 2018).

As per the illustration, direct costs can be considered as the buying cost for distributors
or dealers. Additionally, inventory, delivery and other in-direct costs can be added on
top of it. Previous studies have shown that the promotional fees can be proclaimed as
an in-direct cost for the dealer network.

Distributors often have a lot of negotiation power when it comes to sales prices for
manufacturers. One possible explanation is that they must invest more in product ad-
vertising than producers. Furthermore, when end-customer sale prices are the same,
reduced buying costs represent better profit for distributors, according to the competi-
tive dynamic in B2B marketplaces.

3.3.3 Value Communication to the Dealer Network

When customer value for the dealer network has been analyzed and defined in a sys-
tematic way, the next and the most integral step is to figure out how that customer per-
ceived value can be communicated to the dealers. In general, Increased message con-
sistency and sales impact can be achieved through communication. It also entrusts
someone with the task of integrating the many brand images and messaging, increas-
ing the company's ability to reach the right customers at the right time.
 36

To have effective communication, you need to think about a few key things, like setting
communication goals, choosing the right communication platforms, and making deci-
sions about the marketing mix. Professionals in promotional communications list four
possible goals that organizations can try to reach with their communication efforts as
shown in Figure 22.

Figure 22 Customer Value Communication Objectives.

As shown in the figure below, the information shows the main goals and stages of how
a consumer makes a choice. The first goal is to understand the category need, which
means making a product or service category to meet or fill a perceived gap between
the consumer's current state of motivation and the emotional state they want to be in.
The goal is to find ways to close this gap and share them.

The second step is to be able to spot or remember a specific brand within the set cate-
gory and know enough about it to buy it. Outside of business, remembering something
is more important than being recognised, but being recognised is easier to make hap-
pen. Inside the shop, however, people act much more based on how they know each
other. It adds to how people think of and respect the company as a whole and helps
build the brand's value.

The third step is to find out how well the brand is thought to be able to meet the con-
sumer's current needs. These needs can be negative, like dealing with issues or prob-
lems, avoiding possible problems, or giving enough satisfaction, or positive, like getting
physical satisfaction, intellectual excitement, or social approval. The way a brand
meets these wants is how consumers decide if it is good or bad.

The above discussed objectives serve as the baseline to negotiate with customers and
convince them to initiate business cooperations. The desired outcome of a negotiation
is that the wants and interests of both parties are realised. To some extent, negotiating
power is a deciding factor in choosing which side will succeed.
 37

When discussing the communication between dealers and manufacturers convincing a

distributor is difficult without significant temptation. When it comes to communicating
customer value to dealers, automakers confront a number of challenges. Information
asymmetry, mismatched incentives, and cultural differences between manufacturers
and dealers can all be hurdles. Nonetheless, for dealers, perceived consumer value
can be a powerful instrument for enhancing business bargaining power. Figure 23 de-
picts how to use customer value to persuade dealer network.

Figure 23 How to convince a dealer.

As shown in the above the figure, Customer Perceived value (CPV) for the dealer net-
work is not just shown through visualization but is also ritualize through legal contracts
formulated by OEMs Sales team with support through cross-functional departmental
cooperation. Quantification of the costs and benefits is of utmost importance in such
contracts, all direct & indirect expenses along with net and gross profits are mentioned.
Because of such numerical analysis, dealers can perceive the advantages they will at-
tain from their relationship with the OEM.

Car manufacturers can determine a dealer's perceived worth by doing research and
collecting data on dealer attitudes and behaviour. Qualitative and quantitative research
approaches include surveys, focus groups, interviews, and observation. One approach
for determining dealers' perceived value is to conduct a customer satisfaction survey.
This can include surveying dealers about their satisfaction with various aspects of the
manufacturer's products and services, such as product quality, customer service, and
marketing support. This data can be utilised to identify areas where the manufacturer
meets or exceeds dealer expectations, as well as places where improvements can be
made to increase dealers' perceived value.
 38

Another approach is to conduct focus groups or interviews with dealers to gather quali-
tative data on their attitudes and perceptions. This can include open-ended questions
on their interactions with the manufacturer, their perceptions of the brand, and their
opinions on various aspects of the company's products and services. This data can
help identify areas for improvement by offering important insights into dealers' percep-
tions of the manufacturer's perceived value.

Observation can also be used to determine a merchant's perceived worth. This could
include going to dealerships and observing customer interactions, as well as sales and
marketing practises. By researching this behaviour, manufacturers can gain insights in-
to how dealers view and market the manufacturer's products and services, as well as
discover opportunities for development.

Another important perspective for communicating CPV to dealer network is to help

them support their regular dealings with the end consumers. Automobile manufacturers
are crucial in supporting their dealers in obtaining and maintaining end users. The au-
tomobile industry is extremely competitive, and manufacturers and dealers must work
closely together to develop effective marketing and sales strategies that meet the ex-
pectations of customers. Figure 24 illustrates this concept.

Figure 24 Role of OEMs to support Dealers enhance their customer base.

The concept visualized in above figure, shows what action OEMs can take to ensure
Dealers are able to attract and sustain customers in their geographical regions. Manu-
facturers may help dealers attract and keep end customers by providing training and
assistance. This can include training on product highlights and benefits, sales methods,
and customer service. Manufacturers can also provide ongoing support and resources
to assist dealers in staying current on new products and features, as well as providing
exceptional customer service and support.
 39

Manufacturers can also help dealers obtain and keep end users by providing marketing
assistance. This can include creating national marketing campaigns for dealers to use
in their local communities, as well as supplying dealers with customised marketing ma-
terials to offer their products and services. Manufacturers can also assist dealers in de-
signing targeted marketing and sales strategies that meet the needs of their local con-
sumers.

Manufacturers can also help dealers acquire and keep end users by providing them
with access to customer data and insights. Customer preferences and habits, as well
as insights into emerging trends in the automotive business, may be included. By
providing this information, manufacturers can help dealers better understand their cus-
tomers and develop specialised marketing and sales strategies to meet their needs.

Finally, automakers may help dealers acquire and keep end customers by offering
training and support, marketing assistance, access to customer data and insights, and
ongoing support and resources. Working closely with their dealers, manufacturers may
develop efficient marketing and sales strategies that meet the demands of their cus-
tomers while generating sales and profitability for both sides.

Overall, establishing dealers' perceived value demands a multifaceted strategy that in-
cludes data collecting from a variety of sources as well as the application of both quali-
tative and quantitative research methodologies. By acquiring important insights into
how dealers evaluate their goods and services, car manufacturers may use this
knowledge to improve the consumer value proposition and increase sales and profita-
bility.

3.3.4 Dealer Network Value Assessment

According to the theoretical review mentioned in Chapter 3, Value assessment for the
customers is a fascinating way to visualize the relationship between monetary value
and customer quality. OEMs can use this concept of value assessment and analyse
their dealer network when selecting them or when proposing an extended value propo-
sition (During strategy change etc.). The conclusions of the value assessment process
can be used to communicate the proposed value to the dealers in the best way possi-
ble. Below Figure 25 shows how a sales Manager from a reputed OEM would com-
municate the CVP to a dealer in Tampere using consumer value assessment.
 40

Figure 25 Communicating value assessment to dealer.

As shown in the figure, sales manager of an OEM can provide complete value as-
sessment reports to the dealer network. A car manufacturer can conduct a value as-
sessment of its vendor network using a combination of quantitative and qualitative
techniques. This can aid the manufacturer in gaining a better comprehension of its
dealers' perceived value and in identifying areas for improvement.

A manufacturer can conduct a value assessment by accumulating data on the mer-

chant network's key performance indicators (KPIs). This can include metrics such as
sales volume, consumer satisfaction, and profitability. The manufacturer can determine
which dealers are functioning well and which may require additional assistance by ana-
lysing this data.

Alternately, a manufacturer may conduct merchant surveys or focus groups to collect

qualitative feedback regarding merchants' interactions with the manufacturer. This can
include questions about the level of manufacturer support, the effectiveness of market-
ing and sales programmes, and the overall value proposition of the manufacturer's
products and services. By analysing this feedback, the manufacturer can identify areas
in which it can improve to better meet the requirements of its dealers. The third option
available to a manufacturer is to conduct a market-wide competitive analysis of other
manufacturers. This may involve analysing the value propositions of rival brands and
the level of support provided to their distributor networks. By comparing its own perfor-
mance to that of its competitors, the manufacturer can identify areas where it may need
to make improvements in order to remain competitive and maintain merchant loyalty.

Using a combination of quantitative and qualitative techniques to acquire data and

feedback, a car manufacturer can evaluate the value of its vendor network. By analys-
ing this data, the manufacturer can identify areas where improvements can be made to
enhance the value proposition of its products and services as a whole and better meet
the requirements of its dealers.

A systematic procedure has been identified based on the analyses mentioned previ-
ously. The negotiation procedure can be used by companies to attract dealer or to
 41

propagate value propositions to existing dealer networks. The process aims to enable
businesses to convince distributors to work with them and to motivate them for future
sales. Figure 26 depicts the methodical negotiation procedure.

Figure 26 Value Communication Process.

According to the above example, the initial phase of the structured discussion process
illustrates dealers value proposition. Dealers can anticipate the quantity they can ob-
tain. The desired outcome is for distributors to quickly recognise and be intrigued in the
cooperation's advantages.

OEM Manufacturers can then demonstrate their second instrument, a sales strategy,
when distributors express interest in their proposal. It specifies which customers and
consumer segments will be prioritised in new markets. The outcome will save time and
effort for the distributor in terms of strategic sales planning. Manufacturers will incur
some costs, but the return will be worthwhile.

It is important to note that in coming chapters, the value proposition propagated by the
case company is to existing dealer network and t how that value proposition can be
communicated using the above systematic process.
 42

4. CASE COMPANY

4.1 Case Background

The case company is one of the leading automobile OEM manufacturers in the Nordic
region and serves as a subsidiary to a Global OEM operating all around the world. The
company is responsible for the sales, marketing, and distribution of products in the re-
gion and has an excellent reputation for innovation, quality, and customer satisfaction.
Case company serves the dealer networks in the seven countries across the Nordic
and Baltic region. It geographical capabilities are shown in Figure 27 below.

Figure 27 Geographical Jurisdictions of the Case Company.

As shown in the Figure, Clearly, case company's business capabilities can extend to
most Baltic Sea neighbouring countries. The company focuses on Finland and other
Scandinavian countries. The company has been an innovator in the creation of cus-
tomer-friendly new technologies and features. It was one of the first to introduce elec-
tric vehicles to the Nordic market and has continued to invest in R&D to improve the
performance and efficacy of these vehicles. In addition, the company was a pioneer in
the creation of advanced safety features, such as its Intelligent Mobility technology,
which includes automatic emergency braking and lane departure warning. These inno-
vations have helped differentiate products on the fiercely competitive Nordic market
and contributed to the company's solid brand reputation in the region.

The company's dedication to quality and dependability has also contributed significant-
ly to its success in Northern Europe and Baltics. Consistently ranked at the top of cus-
tomer satisfaction surveys and the recipient of numerous awards for product and ser-
vice excellence. The rigorous quality control procedure ensures that each vehicle
 43

meets the highest performance and safety standards. In addition, the company has in-
vested in training and support programmes to guarantee that consumers receive the
highest level of service and assistance. By nurturing consumer loyalty and trust, these
efforts have contributed to the company's excellent brand reputation in the region.

Case Company has also demonstrated excellence in customer service. The company
has made substantial investments in training and support programmes to ensure that
its dealers and service centres offer the highest level of customer service feasible.
Moreover, the company has established a customer support centre that functions as a
central point of contact for vehicle owners with questions or concerns. This focus on
customer service has fostered strong relationships between the company and its cus-
tomers, thereby contributing to the company's strong brand loyalty in the region.

Case Company’s approach to administering its dealer network is designed to provide

dealers with the necessary support, resources, and incentives to succeed in their re-
spective markets. This strategy incorporates a number of essential strategies and tac-
tics intended at fostering mutually beneficial relationships between company and its
dealers. This strategy is illustrated in Figure 28.

Figure 28 Performance Measurement Strategy adapted by Case Company.

Case Company main strategy for managing its dealer network is the creation of a
transparent set of performance metrics and expectations. These metrics, which include
sales volume, customer satisfaction, and service quality, are used to assess the per-
formance of individual car dealerships and to determine the level of support and re-
sources they receive from OEM. It is able to create a level playing field for all of its
dealers and ensure that each dealer has a clear comprehension of what is expected of
 44

them in terms of performance and customer service by establishing clear expectations

and metrics.

The provision of training and support resources is a crucial component of Case Com-
pany's vendor network management strategy. Firm provides its dealers with a vast ar-
ray of training programmes and resources, such as sales training, product knowledge
training, and service and repair training. In addition, It offers its dealers a variety of
marketing and advertising resources, such as access to national and regional market-
ing campaigns and co-op advertising funds that can be used to promote products on a
local level. By providing these resources, Case Company is able to assist its dealers in
acquiring the skills and knowledge necessary to sell and service vehicles effectively
and to establish strong customer relationships.

Case Company utilises a variety of incentives and rewards programmes to motivate

and incentivize its dealers to achieve high levels of performance. These incentives in-
clude financial rewards for achieving sales goals, benefits for achieving high levels of
customer satisfaction, and recognition programmes honouring top-performing dealers
in a variety of categories. By offering these incentives and rewards, It is able to foster a
culture of high performance and excellence among its dealer network and ensure that
its dealers are continually motivated to provide superior customer service and sales
performance.

Case Company is committed to fostering collaborative, strong relationships with its

dealers. The company works closely with its dealers to comprehend their requirements
and challenges and to provide them with the necessary support and resources for suc-
cess. This collaborative approach facilitates the development of trust and loyalty be-
tween company and its dealers and enables the company to respond swiftly and effec-
tively to market or customer preferences changes.

In conclusion, Case Company approach to managing its dealer network is designed to

provide dealers with the necessary support, resources, and incentives to prosper in
their respective markets. By providing clear expectations and metrics, training and
support resources, incentives and rewards, and fostering collaborative relationships
with its dealers, It is able to establish a strong and effective dealer network capable of
consistently delivering exceptional customer service and sales performance.

4.2 Underlying Problem

As mentioned in the previous section, The case company jurisdictions are within Nor-
dic and Baltic region and is Headquartered in Espoo, Finland. The product offerings by
 45

the firm ranges from passenger vehicles, Electric Vehicles (EVs), SUVs, LCVs & per-
formance, and luxury vehicles. Additionally, the case company also provides Aftersales
services through its dealer network. After sales services include regular maintenance,
Warranty assistance & Financing and leasing options. Case Company Invests in re-
search and development to advance autonomous transportation technologies. Their
goal is to develop autonomous vehicles that prioritise safety, reduce accidents, and
enhance travel experiences in general.

In general, firm offers a vast array of products and services to satisfy its customers' di-
verse needs. Before mentioning, the problem case firm is facing it is important to speci-
fy the stakeholders involved in this issue. Figure 29 represents the stakeholders in the
corporate network surrounding the firm.

Figure 29 Stakeholders in Case Company.

As shown in the figure, A number of significant industry stakeholders play critical roles
in shaping the industry's dynamics, policies, and developments. These constituencies
have a significant impact on the operation and profitability of the industry. First, Case
Company which is the prime manufacture, they design, develop, and produce vehicles
for sale on the market. It invests in research and development to create innovative,
 46

technologically advanced vehicles that meet consumer demands. Second, Suppliers

play an important role in the automotive industry by providing the essential compo-
nents, parts, and systems for vehicle production. Through dealerships, automobile
manufacturers and consumers are connected. They are accountable for selling vehi-
cles, offering after-sales services, and maintaining customer relationships. Govern-
ments and regulatory bodies exert considerable influence on the auto industry through
legislation, policies, and regulations. They establish safety standards, emission regula-
tions, and consumer protection laws. Financial institutions such as banks, credit un-
ions, and leasing companies offer financing options for vehicle purchases. The con-
sumer is an important stakeholder in the automobile industry. Their preferences, de-
mands, and buying habits impact market trends and automaker strategies.

Sometimes Car manufacturer uses agents which are indispensable to the sale and ac-
quisition of automobiles. As intermediaries between buyers and purveyors, agents rep-
resent either the automaker or the dealership. Their primary responsibility is to facilitate
the process of purchasing a vehicle and to provide a variety of services. In this case,
case company uses agents in their Baltic operations.

The relationship between case company and the dealer network is the biggest highlight
of this stakeholder representation, because the biggest chunk of business is created
around them, henceforth the case company premium mission is to support the dealers
in Nordics and Baltics in their business dealing with consumers and make the process
as effective and efficient as possible. Previously, the case company had communica-
tion and feedback system between dealer network and itself through email channel. If
dealer groups or outlets (Dealer group is larger entity composing of several outlets
such as Autokeskus is a Dealer group, but Autokeskus Tampere is an outlet) have any
issues related to products, after-sales services, cost calculation or business processes
etc, they can generate a case through email which will be received by the Case com-
pany back office stationed in Paris (Subcontractor). Figure 30 represents the whole
scenario.
 47

Figure 30 Current Scenario.

As shown in the above figure, at the current moment, the case company is using
emails to receive complaints, cases, and information requests from dealers across the
Nordics and Baltics. The figure shows some of these cases could be directly related to
a particular end customer requiring software updates for an EV unit or some issues re-
lated to payment term etc. Henceforth the customer would contact the dealer through
call who can assess if this case requires a response from the case company.

The case company as of now, has hundreds of dealerships across the geographical
regions of Nordics and Baltics. Which means that the back office, which is the team of
sub-contractors hired by the case company had to respond to hundreds of emails on
daily basis and forward them to concerned department. This unfortunate situation not
just creates a huge backlog but enhances the miss communication between the deal-
ers and the Dealer network operations team and country teams of case company.
There is a high probability that does cases which requires immediate attention are at-
tended after a delayed response time. One of such examples are demonstrated in be-
low figure 31.

Figure 31 Example of delayed response time.

 48

The above illustration represents a real/time case encountered by Case Company

Sales Manager. Automobile dealerships frequently experience difficulties with vehicle
allocation by automobile manufacturers. Manufacturers have limited production capaci-
ty and may prioritise certain models or regions based on market demand or strategic
goals. However, this allocation process can be problematic for dealerships, particularly
when demand exceeds supply for particular models. The case company was facing the
same issue for its LCV (light commercial vehicles) business line. The dealer group from
Eastern Finland had requested a particular model which was unavailable. In addition to
limited supply, the constraints in procuring semiconductors were also a big problem.
The situation was quite diabolical because the model was dealer’s flagship offering to
the customer and unavailability would direly affect dealer’s ability to meet customer ex-
pectations and revenue generation.

Additionally, with limited vehicle allocation from case company, the dealership was al-
ready behind the set sales target and customer quality performance measurement. The
dealership had to go through the entire feedback and case system to await response
from the sales and dealer network team, which due to extreme backlog result in de-
layed response time. If the case generation system was modified to ensure agility and
efficiency, dealership could have coordinated with the case company more effectively
and come up with contingency plans to mitigate this issue.

It can be concluded that, these issues can impact the profitability, customer satisfac-
tion, and overall relationship between case company and dealerships. Communication,
collaboration, and flexibility are required to overcome these obstacles. Establishing ex-
plicit allocation strategies, taking regional market dynamics into consideration, and
aligning sales goals with realistic market conditions can aid in mitigating these issues
and fostering a more harmonious relationship between the manufacturer and the deal-
er.

One major drawback in using email, as a mean of communication is the abstract viola-
tion of GDPR regulations. The General Data Protection Regulation (GDPR) became ef-
fective in the European Union (EU) and the European Economic Area (EEA) in May
2018. Its primary purpose is to protect the personal data and privacy of EU/EEA citi-
zens and to regulate their processing.

According to the GDPR, the motorist is the owner of the vehicle's data. This clarification
places a substantial burden on automakers, rental car companies, and fleet operators
to conform with data privacy regulations. A single autonomous vehicle can generate as
much data as approximately 3,000 people. Therefore, one million autonomous vehicles
 49

would generate the same quantity of data as three billion people. This puts manufac-
turers in a challenging position! The sheer volume of data is extremely daunting, ne-
cessitating the adoption of stringent compliance regimes not only to avoid the wrath of
hefty GDPR penalties but also to protect the data of dependable customers. Data intru-
sions can be extremely detrimental to a business, leading to the loss of customers to
competitors.

Under the GDPR, confidential personal information cannot be collected without the ex-
press consent of the user. This includes biometric data such as voice or fingerprint
recognition, behavioural data such as driving patterns, routes, and destinations, diag-
nostics data such as speed, fuel economy, and navigation data, as well as garage door
access codes, log-in information, and any data stored within the vehicle's infotainment
systems. Even a simple notation that a consumer has children, or a dog would be con-
sidered profiling under the GDPR.

To determine whether the use of email by car dealerships to resolve issues with manu-
facturers complies with the GDPR, a comprehensive analysis of the specific circum-
stances, data flows, and compliance measures in place would be required. It is advised
that auto dealerships and manufacturers evaluate their data processing practises, iden-
tify the appropriate legal grounds for processing personal data, and implement the
necessary safeguards to ensure GDPR compliance when using email communications.
 50

5. DATA ANALYSIS & DISCUSSION

5.1 Solving the problem

5.1.1 Utilizing Salesforce - CRM System

In the previous chapter, we discussed in detail which process was being used to create
cases for the dealer network and how response from the case company was generated
and how delayed response time affected the business productivity of both stakeholders
along with the communication between the dealers and the case company. In this the-
sis, it is proposed to use a customer relationship management (CRM) tool Salesforce
as a mean to create cases and receive them in a single portal. Dealer groups and con-
cerned departments from case company would be granted access to the case genera-
tion and engagement portal ensuring transparent communication and visibility across
the hierarchy and ensuring accurate status of all cases from generation, implementa-
tion and completion phase are visible for the users. The proposed scenario is present-
ed the below Figure 32.

Figure 32 Proposed Scenario.

As shown in the above figure, in the proposed process change instead of using Emails
as a mean to create and receive dealer cases, Salesforce – CRM can be used.
Salesforce case creation and engagement module will be linked to Case company in-
 51

house dealer portal, which will allow registered dealer groups to create licenses for it’s
users. To ensure limited complexity, from each dealer outlet two users will be allowed
to access the case portal and create/edit the cases. It is an important aspect since mul-
tiple users could lessen the transparency and authenticity of the generated case. The
dealer group would have the authority to decide which users they would like to create
and manage the cases. Dealer principles, sales managers, aftersales managers & war-
ranty personnel could be preferred since majority of cases would be highly relevant to
their business portfolio.

Another integral feature of this process change would be on the case company’s side
i.e., which department or the employee will be able to access the portal to view the
cases and activate responses. In the initial discussions with case company, it was de-
cided that the dealer network department (DND) would be the main point of contact
with the ability to edit and resolve cases and give response to the dealers. The DND
Personnel will also be able to approve licenses and assign user roles for the dealers as
well as forward the cases to concerned department such as engineering and aftersales
etc. Representative from the case company stated that the reason why single point of
contact is optimum:

“Since the dealer network department (DND) is responsible for managing our
dealer network with strong relationships with dealer personnel, they would know which
response despite the status of the case would help ensure our cooperation with dealers
along the process. They can coordinate the case effectively and ensure the response
time is justified”.

If the dealer case is more complicated or technical and requires direct communication
among dealer and the case company concerned representative, the DND personnel
can grant access to the case for that department personnel who will then be able to
make changes directly. Additionally, the Case creation and engagement portal will
have metrics and dashboard capabilities which are designed to provide real-time in-
sights and visualisations of key performance indicators (KPIs) and data related to sales
and customer quality. The role of Salesforce dashboards can be seen in below figure
33.

Figure 33 Impacts of using salesforce dashboards.

 52

As shown in the figure, using dashboards and metrics would provide instant visibility for
the case company and provides them with sufficient time to handle all the bottleneck
solutions. There are some paramount features of salesforce dashboards which are
used in the case creation and engagement portal after discussions with the case com-
pany representatives.

First, using reports that retrieve data from Salesforce objects and present it in tabular
or summary format, dashboards are constructed. You can construct and modify reports
to satisfy your specific data needs, which serve as the basis for dashboards. Second,
on dashboards, various chart types, such as bar charts, pie charts, line charts, and
gauges, are used to visually represent data. These visual components expedite the
comprehension of data trends, comparisons, and patterns. Third, you can add tables to
your dashboards to present information in a tabular format. Metrics such as total sales
revenue, win/loss rates, and average transaction size can be presented as single val-
ues or key performance indicators (KPIs) to facilitate quick reference. Last, dashboards
include interactive filters that allow users to drill down into particular data subsets.
These filters enable users to zero in on specific regions, time periods, or other relevant
criteria, providing a more focused view of the data.

The dashboards will also have feature and customization option so users can visualize
cases and reports in a format they would deem suitable. These options are as follows:

1. Layout Customization: Modification of Layout Salesforce interfaces offer flexible

layout and design options. You can reorder and resize components according
to your preferences, making it easy to highlight the most important information.

2. Filters: You can add global filters that affect all components and component-
level filters that allow you to filter data for specific charts and tables to your
dashboard. These filters enable dynamic modification of the displayed data on
the interface. For example, case company management can use geographic lo-
cation filter to see the case creation volume and response rate in Norway and
Denmark separately and take sufficient action for rectification.

3. Drill Down Functionality: Dashboards can be designed with drill-down function-

ality, allowing users to investigate underlying details and related reports by tap-
ping on specific data points or charts. This function provides a deeper level of
analysis and insights.

4. Dynamic Refresh: It is possible to configure Salesforce interfaces to automati-

cally refresh at specified intervals to ensure that data is always current.
 53

5. Collaboration and Sharing: Individuals or organisations can share organisation-

al dashboards. Controlling each user's level of access and permissions enables
data-driven decision making and collaboration.

6. Accessibility on Mobile Devices: Salesforce dashboards are accessible via the

Salesforce mobile app on mobile devices. This allows sales teams and adminis-
trators to view and analyse data while on the go, which is advantageous.

Case generation and engagement portal dashboards are valuable tools for monitoring
and analysing data, enabling businesses to make decisions based on data, identify
trends, and improve overall performance. Using the provided customization options
and features, businesses can construct highly effective dashboards that are tailored to
their specific needs.

During the development phase of this tool, it came into the case company knowledge
that, in order to ensure transparency and continued visibility it of utmost importance to
have a certain level of hierarchy when distributing the licenses to the dealers. Not eve-
ryone one can be allowed to have case editing rights, for some only viewing options
are sufficient. Henceforth a hierarchy system was constructed to assign user roles and
subsequent license. The above-mentioned system is shown in below figure 34.

Figure 34 Dealership Hierarchy Level.

As shown in the above figure, Case Company has divided the dealer network in to
three different parts. The above example is from a renowned Swedish car dealer
group, Hedin Bil group. The group level represents the central management or head-
quarter of a dealer network. The group consist of several outlets in regions. The group
is headed by the Dealer principle and overseas management of all outlets and primarily
responsible for all business decisions on a larger level. A dealer principle would be the
 54

main point of contact when negotiating new contracts with e the case company or con-
sulting on a change of strategy. At group level, only viewing access is sufficient, since
cases are on outlet level and each specific customer case is not relevant to the dealer
principle (especially for a huge dealership).

On second tier is the main dealer level. This level corresponds to regional dealer out-
lets. To illustrate, Hedin bil has a main dealer level for outlets in Stockholm metropoli-
tan areas and suburbs which is further divided into multiple outlets across the city ca-
tering hundreds of thousands of customers. It is to be noted that main dealer level
normally exists of is of importance for large dealer groups with multiple outlets across
regions. Third tier corresponds to outlet level, the target dealership where the issue has
originally generated. The personnel on this outlet will be granted creation and editing
rights on their licenses and will be the main point of contact.

As discussed with the case company representatives, it was decided that the dealer
principle will be solely responsible from dealer side to ensure that all the users from all
three hierarchical levels have been assigned the licenses and can easily log into the
system and make changes. On the case company side, Dealer network Development
(DND) Department will assign a point of contact personnel who will monitor the licens-
es and make changes in the system once the user has filed in the request for license.
All the license request or change of user role requests will go through this contact per-
son.

Figuring out the user hierarchy for case generation and engagement tool on Salesforce
is also to ensure GDPR Guidelines. As a CRM platform, Salesforce administers and
maintains customers', prospects', and other individuals' personal information.

It is important to understand GDPR compliance is not solely dependent on the

Salesforce platform. Case Company is responsible for implementing the required
measures, educating employees, and developing processes to ensure GDPR compli-
ance. Legal professionals or data protection experts should be consulted to ensure that
use of Salesforce complies with the specific requirements of GDPR and any other data
protection laws applicable in case company jurisdiction.

5.1.2 Displaying Value Proposition to Dealer Network

After the solution has been identified for the case problem, the benefits attained from
the proposed process change can be attributed as the perceived customer value. Now
the next step is to demonstrate this new value proposition to the case company dealer
network. The goal of this section is to properly visualize the benefits of the process
 55

change in terms of customer value models discussed in chapter 2 to negotiate with the
dealer groups. One substantial result of these negotiation is that dealer groups are
onboard and ready to start cooperation immediately starting with Case generation and
engagement tool system training.

Dooly (2012) shows a wide range of persuasion techniques, including 100 ways that
businesses can use to change the way customers act. These methods come from
many different fields, like marketing psychology and neuromarketing. Certain brainflu-
ence methods are very important when it comes to formalising customer value models.
Some of these methods are price and item brainfluence, picture brainfluence, and
cause-related brainfluence. Price and product brainfluences are the most concrete and
easy to see.

Customer value models are like a blueprint that shows what each party gets out of the
deal. By using elements of brainfluence, businesses can successfully change how cus-
tomers see things and affect how they make decisions. Visual tools, in particular, are
much better than just words when it comes to explaining ideas and value offers to
dealer networks. Using visual aids helps dealers understand the proposed ideas in a
more complete and powerful way, which eventually helps to persuade them.

It's important to note that companies in B2B markets often use both physical activities
and intangible influences to convince clients to work together. This method recognises
that it's important to use both physical, practical things (tangible operations) and not
tangible, psychological things (ethereal influence) to persuade and get people to work
together.

However, before meetings and negotiations with dealer network, case company repre-
sentatives must have a thorough understanding of the dealer network dynamics and
potential threats. In general, the optimal outcome of a dealer meetings is to satisfy the
needs and interests of both parties, but achieving absolute consensus is challenging.
Typically, dealers in automobile industries are more powerful because they have suffi-
cient control offer customer base in a selected geographical region. This does not,
however, imply that case company must accept all distributor requirements passively.
Cooperation, not compromise, should be the basis of the negotiation. The DND per-
sonnel must perceive the distributors' negotiating leverage. In case of these negotia-
tions, these are between the case company and existing dealer network about pro-
posed changes regarding an issue which dealers have been discussing for a long time,
so there should not be substantial demands from the dealers themselves. Therefore,
attracting and persuading distributors will be essential for the case firm. Without suffi-
 56

cient incentive, dealers are difficult to convince. Nevertheless, dealers' envisioned cus-
tomer value models can be enticing. Figure 35 depicts the mode of value of the distrib-
utor.

Figure 35 Dealer customer value model.

As shown in the above illustration, dealer network value proposition can be visualized
in multiple ways through figures, quantifiable values and qualitative benefits. By calcu-
lating direct & indirect costs incurred, profits for each dealer can be determined which
can be qualitatively compared with the benefits, specifically for this case, the profits re-
ciprocate to increase in sales and aftersales services. This happens because swift re-
sponse time helps the dealer outlets to fulfil customer’s request immediately which it-
self is a substantial perceived value.

At this point, the case firm may approach dealer network with the value proposition.
The case manufacturer's Dealer network development representatives will use the
benefits dealer can gain from the proposed value proposition to negotiate with dealers.
Figure 36 depicts how marketers use the value model of a dealers as an enticement to
approach them.

Figure 36 How case Company representative uses the customer model to convince deal-
ers.
 57

According to Figure, the paper not only depicts but also formalizes the dealer's per-
ceived value. From the standpoint of the dealer value proposition, the dealer's t cost,
and profit are quantified. Written communication allows the dealer principle to perceive
the benefits of the cooperation more rapidly than verbal communication alone. The out-
come is that initiating the negotiation will be straightforward.

However, while discussing with the case company representative, it was deduced that
some dealer groups might find the whole licensing process to be quite out of ordinary
and as an obstruction to their daily business operations. In simple words, there was a
possibility that dealers would be interested but no action will be prevailed. To make
sure that the process change works, the case company decided to launch a pilot pro-
ject with one dealer group in Sweden with the goal to investigate the reception of the
process change by the dealer group and its employees. From the results obtained from
the pilot project, effective measures can be taken to optimize the strategy as shown in
Figure 37.

Figure 37 Pilot project with a single dealer group.

As shown in the above figure, the pilot project conducted with one dealer group having
all levels of hierarchy assigned started with dealer preliminary meetings with DND rep-
resentatives. In this meeting dealer principle would give the list of users across the hi-
erarchical to be assigned for licenses. Once the user roles have been assigned, train-
 58

ing was planned for the dealer group where all the information about the process
change, and system portal were shared and questions from the users were answered.
Case company representative visited the dealer outlet to monitor the progress. Simul-
taneously, response time was regulated for a test case to study effectiveness of pro-
cess change. The results were quite constructive and dealer satisfaction was eminent
form their response. The aftersales manager from the group commented.

“The use of salesforce as a means of generating cases is highly efficacious, it reduces

a lot of time going back and forth contacting different departments to get any response.
With single channel communication, we could respond to our customers swiftly after an
issue occurs.”

Henceforth, case company subject to feedback from the pilot project went forward with
discussions with other dealers. From the above figure, it can be gathered that both
documents, customer value model and pilot project findings impact the decision-
making capability for the dealer networks conclusive. Figure 38 shows how case firm
can utilize both documentations as means to enhance its convincing power.

Figure 38 How case company demonstrate CVP.

In Figure, the company in the case study conducts a thorough technical and business
analysis under pilot project to determine if this process changes along with the licens-
ing process are optimal. The company in the case study can anticipate benefits per-
ceived by the dealer through market research and interviews. Additionally, Dealer net-
work can save a substantial quantity of resources in terms of time i.e., period in which
dealer is waiting for response from the case company for an end consumer case.
Meanwhile, dealer representatives can provide modified value propositions to end cus-
tomers.
 59

Using formalized customer value models, the company in the case study can quantify
the perceived value to dealers, thereby attracting their interest. In the interim, dealer
network can leverage the perceived value for end-users in their sales efforts.

5.1.3 Using Value Assessment to Convince Dealer Network

In accordance with the analysis conducted in previous sub chapter, by using formalized
customer value model, case company is able to enhance their convincing power. Indi-
vidual dealer groups would continue the discussion with the case company in further
steps related to scope definitions, division of roles and responsibilities etc. Henceforth,
the discussion with continue for the time being until all the stakeholders across the
dealer hierarchy are on board.

During the meetings with the case company representative which were ongoing parallel
to discussions with some of the dealer groups, the DND manager noted that some
managers (Sales, Warranty & After sales) on the outlet levels are still reluctant to sup-
port the process change attributing it to resource exhaustion. They believed that re-
sources and time spent on this project would negatively impact their sales productivity
and customer quality. They understand the advantages gained by the dealership and
end consumers in long term, but they are apprehensive if the outlet level users would
continue using the case creation and engagement portal with their waning motivation. It
was also noted for smaller dealerships, especially situated in northern regions of Scan-
dinavia which have less than 3 employees, if they would be able to have enough hu-
man resources relative to their customer demand to successfully pilot the process
change.

Looking at the new setbacks, value assessment can be used as mentioned in Chapter-
2 to convince the dealer network. To simplify, case firm can formulate customer value
assessment with respect to the concerns put forward by the dealer network. Hence-
forth, when finalizing the discussion with dealers, the conclusions of the value assess-
ment could be used to convince them. Figure 39 shows a dealer value assessment.

Figure 39 Value assessment for dealer network.

 60

As shown in the above illustration, the customer value assessment framework will ana-
lyze and evaluate the customer perceived value for the dealer network in a structured
order. Stakeholders from all levels of dealer hierarchy will understand the economic
and logistical potential of the process change relative to the value assessment ele-
ments.

Now the next obvious step is to convince the dealer by showing the results of the im-
plementation of the framework. As mentioned before, in this particular case, the goal is
to ensure all stakeholders across the dealer hierarchy are on board, the very reason,
the case company has to resort to value assessment in addition to presenting the re-
sults already conducted customer value model analysis. Figure 40 illustrates how case
company representative would present the findings of the framework to the dealer prin-
ciple.

Figure 40 Using customer value assessment during dealer meetings.

.In the above figure, the case company representative during the meeting shows the
dealer principle the results of the value assessment framework on outlet level. One of
the findings was the impact of reduced response time due to process change on overall
operations of the dealer outlet. The finding shows that reduced response time would
help enhance the customer quality index and high sales retention, which would be
enough for outlet staff to be convinced of the implementation of process change in their
outlet.

Additionally, it was also proposed in one of the meetings with case company repre-
sentative, that the quantitative and qualitative benefits perceived by end customer for
the dealer network can also be calculated and presented to the dealers. Figure 41 por-
trays a specimen of end consumer value for dealer network.
 61

Figure 41 Value for end consumer for dealer network.

The sample depicted in Figure 57 indicates that the paper contains numerous meas-
urements. Dealers’ income is essentially divided into direct and indirect income. When
the annual earnings for a single individual is understood total can be calculated in
terms of direct expense, and it is possible to estimate the total income over the next
five years. In fact, the case company can calculate a substantial five-year cumulative
income. Dealer network can be presented with the result in compelling numerical form.

After conducting the value assessment framework from all aspects, the discussion
phase was conducted with dealer networks from all the geographic regions in all 7
countries. During the discussions with case company representatives, it was decided
that the implementation stage would be the replication of the pilot project conducted in
Sweden with one dealer group mentioned in previous sub-sections.

It was also concluded that, the implementation phase would start with one country first.
Finland was chosen as the ideal option, since it closer vicinity to the case company
headquarters and increased enthusiasm of Finnish dealers during discussion phase.
Figure 42 shows the implementation stages in detail.

Figure 42 Implementation Phase.

 62

As shown in the above figure, the case company starts the process change with dealer
networks in Finland initially with system training. The case company decided to conduct
a joint training session with the users along the salesforce hierarchy from every Finnish
dealer group. It must be noted that the list of users has already been sent by the dealer
principle to the case company DND personnel. The system training focuses on how to
add the user profile from dealer portal to sales force and how users can access the
case creation and engagement portal and create cases. Further how they can check
the hierarchy level and edit/ view cases. They were also shown, how they can use the
dashboards and other relevant metrics for the specific dealer network. Second step
was the dealer visits, where case company representative would visit dealer groups
and outlets and support the employees related to the process change and eventually
monitor the progress of the licensing phase. Third step was to monitor the response
time for first case for each dealer to have an understanding on how the process change
is working out initially. Fourth step was to organize specifics system trainings for deal-
ers who require some specific system changes during the course of the implementation
phase. Final step was mostly from case company side i.e. to document the results for
all dealers and conduct quantitative analysis according to the findings and present it to
upper management.

After successful completion of implementation phase for Finland, case company decid-
ed to continue with other six countries simultaneously. More human resources from the
Dealer Network Development team were associated with the project to ensure stringent
time schedules. Salesforce helpdesk & support team were taken in the loop during im-
plementation for any technical system issues. These issues would serve as the feed-
back to improve the technical interface of the portal. In next chapter, this thesis will dis-
cuss the impact of the process change and the reflection of this case.

5.2 DISCUSSION & LESSON LEARNED

5.2.1 Problem & Framework Review

Although there is ample research on value proposition and its communication, there
has been limited research when an intermediary is involved between the end consumer
and OEM. How value is created and communicated to a distribution network in an indi-
rect medium has been readily discussed in this thesis and is a prime focus of the theo-
 63

retical framework. Customer value in distribution channels refers to the advantages and
benefits that customers perceive when acquiring products and services through a par-
ticular distribution channel. It includes the channel's performance, capabilities, and
overall value proposition from the perspective of the consumer. Academic research ex-
amines consumer value in terms of efficiency, convenience, assortment, information
accessibility, and service quality in distribution channels.

This thesis focuses on distribution networks in automobile industry and what problems
automobile OEMs faces in creating and communicating value to its distribution net-
work. When striving to create value for the dealer network, OEMs face obstacles. A
prevalent challenge is maintaining a balance between standardisation and customiza-
tion. OEMs must establish guidelines, standards, and procedures frequently to ensure
brand consistency and vendor network alignment. However, excessive standardisation
can hinder dealers' ability to adapt to local market conditions and meet specific con-
sumer demands. It is necessary to establish a balance between standardisation and
customization in order to generate value while granting merchants autonomy and flexi-
bility.

Managing dealer disputes and competition is a further difficulty. In a competitive mar-

ket, close proximity between merchants may lead to disputes over consumer territories
and sales volume. OEMs must establish clear guidelines and policies regarding dealer
territories and implement effective communication channels to resolve disputes and
foster cooperation. OEMs must manage dealer competition while ensuring market op-
portunities are equitable, which can be a complex task.

Additionally, one problem that OEMs face regularly, which also forms the central case
problem in this thesis, is managing the existing dealer base by proposing changes in
dealer processes and standard operations procedures. These changes are substantial
for both dealers and OEMs to maintain their cooperation, manage resource utilization
effectively, increase customer retention and satisfaction, and attain sales and af-
tersales targets efficiently. However, due to the complex dealer hierarchy, limited hu-
man resources, and extensive communication barriers OEMs face obstacles in propos-
ing and implementing changes.

The thesis argues that by communicating the perceived benefits attained by the pro-
posed solution can help convincing the dealers to get on board. Customer perceived
value, it’s subsequent models and value assessment frameworks serves as a effective
tool to enhance OEMs convincing capabilities. The use of customer value framework is
to enhance the relationship between dealer network and the OEM and subsequently
 64

motivate them commit to this relationship for a long term. Additionally, OEM encour-
ages dealers improve their sales and customer quality targets by showing them that the
company is dedicated to creating value for them and their customer base through stra-
tegic planning and continuous collaboration.

In the section where existing literature was discussed, value communication framework
was proposed in context of intermediaries in in-direct networks. This framework was
then coupled with the context of dealer networks in automobile industry to create a sys-
tematic framework as shown in Figure 43.

Figure 43 Systematic Framework

As shown in the above illustration, Chapter 2 focused on understanding of how value is

perceived and subsequent models and value assessment structures. Chapter 3 then
entails the brief analysis of distribution channels and role of dealer networks in distribu-
tion hierarchy and subsequently in automobile industry. The results deduced from both
chapters were amalgamated in chapter 4 generating a preliminary framework based on
literature.

This systematic framework is designed to enable OEMs to convince existing dealer

networks to collaborate with them to accelerate process change and to stimulate future
sales. All the aforementioned documents mentioned in the framework can be regarded
as convincing tools that strengthens the collaborative relationship between dealers and
OEM manufacturers.

5.2.2 Case Reflection

The case company gave the approval to study the ramifications of currently imple-
mented operative procedure for creating customer cases and overall management. The
case company management has been observing the case response time as a substan-
tial bottleneck in their dealer operations which had impacted the collaboration between
them. The end goal was to create value for the dealers through change management.
In other words, by optimizing the case creation and management system, the case
 65

company opted to ensure that the relationship between dealer groups and themselves
remains perpetual and long-standing.

The analysis of existing scenario showed a loophole in the case management process.
The amount of time involved from creating the case through email by the dealer, case
documentation by back office and, transfer of the created case to relevant department
was noted to be exceptionally long and hectic for the dealer to follow. Additionally,
there was not accountability and visibility for individual customer cases for the case
company because of multi-channel involvement and unavailability of a centralized sys-
tem. Limited visibility across the process also served as an obstruction during the study
since there were no set metrics and available data which could serve as the basis of
the research.

After studying the downsides of the existing process and having discussions with deal-
ers and case company representatives alike, a need for a centralized case creation
and management system was identified. A centralized digital portal would significantly
result in minimal response time and provide accurate statistics on the volume and sta-
tus of the cases specific to each region. Additionally, case company would also gain
sizeable intelligence on the end consumer complaints and can help the dealership to
rectify those complaints. In the end, case company could maintain long term relation-
ship with the dealer networks, which would in turn allow them to achieve revamped op-
erational effectiveness.

With a developed solution, now the next step was to materialize the value created
through the solution and communicate the perceived benefits extracted from the value
to the dealer network. The analysis of the literature clarified how case company can
use the customer value model coupled with dealer value assessment framework to en-
hance the firm convincing power. Figure 44 illustrates the concept.

Figure 44 Steps to communicate the customer value to dealer network.

 66

Figure shows there are four steps that are needed to be followed in a structured order
when have discussions with the dealer network to get them on board. The prime objec-
tive of using these steps is to make sure that all the stakeholders and users across the
dealer hierarchy can be convinced that the process change is an optimum solution.

One of the advantages of using a 4-step convincing strategy is engage the dealer per-
spective from all side. In other words, taking in account the observations from all levels
of dealer hierarchy. This requires an effective planning from case company perspec-
tive, the DND manager (official case company representative) should possess deeper
understanding of key dealer issues relevant to the process change and focus on how to
solve that. This concept is illustrated in figure 45.

Figure 45 How Case Company representative follow the 4 steps strategy.

As shown in the figure, before officially starting the discussions with the dealer princi-
ples of the dealer groups, case company representatives must prepare documentation
in accordance with the 4-step strategy. In other words, effective market and dealer re-
search is of utmost importance. Through efficient prep work, the representative can
understand the focal point of the value created for the dealer and what perceived bene-
fits are closely relevant to the dealer hierarchy. Additionally, case company representa-
tive who will be the focal point should have significant communication skills to engage
the dealer throughout the discussion.

First, the strategy kickstarts with formulating and demonstrating the customer per-
ceived value model for the dealer network. The main purpose of this step is to show
what quantifiable and qualitative benefits in terms of revenue & customer satisfaction
etc. would the dealer attain. This first step is integral to engage the dealer in the begin-
ning.
 67

Second, now the case company can use the combination of customer value model and
the documentation for the pilot project as discussed in chapter 6. The pilot project is the
visualization of how value has been created for an individual dealer. Through this doc-
ument, dealer representative can see what benefits can be perceived in all levels of hi-
erarchy. Additionally, it shows how response time was minimized for a single dealer.

The next part of the strategy is to apply the customer value assessment framework to
convince dealer network. This framework entails a detailed analysis of the long-term
potential of process change. Additionally, the dealer network would be able to evaluate
the feasibility of process change from dealer perspective.

Last, end consumer value will serve as the final step of above shown strategy. It shows
the advantages of process change in monetary value. At this point, Dealer network can
see clearly, how process change is significant for all levels of hierarchy and make a fi-
nal decision to get on board.

At this point we can see how the implementation of the case is connect to the theoreti-
cal systematic framework mentioned in section 7.1. After understanding the customer
value models & assessment frameworks followed by deeper understanding of dealer
networks in relation to case company, thesis uses value concepts to optimize the deal-
er network. Figure 46 shows the optimal and conclusive systematic framework.

Figure 46 Case Analysis based theoretical framework.

 68

As shown in above illustration, the systematic framework generated through literature

study representing the customer value models, value assessment and end consumer
value can directly connect to the value offered by the case company to it’s dealer net-
work in all seven countries. Initially it all starts with understanding the stakeholder in-
volved. in the whole dynamics. During the initial meetings with the case company rep-
resentative, the basics were laid down by understanding which stakeholder group we
are targeting followed by deeper understanding of their role in cooperation and their
impact on the solution offering and the problem itself.

After all the prep work has been laid out, the company starts following the 4-step
framework methodology discussed before. Starting with defining the perceived value
for dealer network and implementing customer value models to understand how deal-
ers can benefit from the value solution offering generates. When the dealer is interest-
ed to discuss further, case company now uses other convincing tools supported by the
conducted literature analysis such as value assessment framework and customer value
attained for end consumer. This value strategies are coupled with real life, pilot imple-
mentation of the solution using a singular dealer group. Implementing a pilot project
was a turning point for both the case company project and this thesis research, since it
allowed to put forward conclusive, quantitative results on the negotiating table with the
dealers.

In conclusion, case company follows a systematic framework to convince dealers to

participate in the process change in a structured order. The case company will continue
to do so until all the dealers in Nordic and Baltic region are on board. The goal of this
structured framework is to ensure that dealer groups can perceive their benefits
through value creation and maintain their long-term collaboration with the case compa-
ny.

5.2.3 Analysis of the Results

The systematic framework generation in this research thesis investigates the applica-
tion of perceived customer value and value propositions for Automobile dealer net-
works and how the created value can positively impact the relationship between dealer
networks and automobile OEMs. Further, the thesis analyses how customer value
proposition tools can be used to enhance the convincing capabilities of OEMs when
negotiating a relationship contract with new dealers or implementing process change
with existing dealer network. The thesis notes that since the dealer network is the end
point of contact with the end consumer, they possess a substantial edge in decision
 69

making and can impact any change, henceforth a systematic framework is required to
get them on board for further development.

Nonetheless, the thesis shows after a stringent collaboration with the case company a
systematic framework supported by theoretical study was developed to initiate the pro-
cess change. The developed framework turned out to be quite triumphant change
management tool with effective quantitative and qualitative results. According to the
dealer network development manager, who was the central point of contact for the pro-
ject, the process change was a classical representation of how value can be created
for dealers and end consumer simultaneously. He noted that:

“This project has been a beacon of light for any further change applications. By im-
plementing a new case creation and engagement system, we have not just minimized
the response time, but we have strengthened the trust and confidence by end consum-
er on the dealer outlets, which would further increase their customer retention rate”.

This comment by the DND manager itself shows how excited and content the case
company has been after the project. Indeed, the process change is an amazing driver
of increased retention rate. By reducing response time, dealer representatives can
serve their customer needs instantly supporting their countless needs which shows the
dealer commitment to its customer. Hence, this would also serve as an effective com-
petitive advantage in a particular geographical region.

The project also received ecstatic feedbacks and review from the dealer side, highlight-
ing their perspective. During the end phase of the thesis, short interviews were con-
ducted with selected dealers across the dealer hierarchy to understand, how the im-
plementation of the process change has impacted their regular work and their standard
protocols. One of the dealer outlet sales managers talked about how switching from
email case generation has impacted their human resource optimization in a good way.
He stated:

“This implementation has been a splendid success. Through this single channel com-
munication, we don’t have to allocated multiple employees to handle cases which are
in great numbers owing to our high sales index”.

According to the dealer representative response, one of the major issues connected to
previous case creation process was the extensive use of human resources for handling
customer cases, which resulted in incompetent resource optimization. By using case
creation and engagement portal, only two users are required to handle the cases and
its status across the case timeline. Hence, remaining manpower can be utilized to en-
hance sales and aftersales activities of the dealer outlet.
 70

Additionally, after completion of the thesis, the review was presented to the CEO of the
case company who had been following up on the status of the project during it’s time-
line too. He was quite surprised by the differences witnessed before and after the
change management process and how value has been communicated to the dealer
network. He had assumed that the project might receive resistance from big dealers
specially in Sweden. His overall response is stated below.

“Process change implementation has been quite impressive. I have been getting phone
calls from dealer principles across the region who have appreciated our efforts espe-
cially with the decreased response time, they have been able to close many case in
limited time. Their satisfaction has provided us with the beacon of hope for continued
success for our company in this region”.

The positive feedback and replies from the dealer network, as well as the CEO's ap-
proval, show that the implemented process change is working to create value for both
the dealers and the end customers. The shorter reaction times and streamlined case-
handling processes have made customers happier, increased the number of customers
who stay with the dealers, and helped them get the most out of their resources. These
results have not only made the dealer stores more efficient and effective as a whole,
but they have also given them a competitive edge in the area.

The systematic framework made for this study thesis is a big reason why the process
of implementing changes went well. By using the perceived customer value as well as
value proposition instruments, the framework helped automakers explain to the dealer
network how the process change would be good for them. It made it easier to come to
agreements with new dealers and make changes to how things are done with existing
dealers.

The structured framework was made and use with the help of close collaboration with
the case company. The success of the process change was greatly helped by the in-
volvement and ideas of the dealer network development manager, who was the main
point of contact for the whole project. The teamwork made sure that the framework met
the needs and requirements of the case company. This resulted in a custom solution
that helped the dealer network deal with its problems.

The good results of putting the process change into place show how important it is to
create value for both dealers and end consumers. The increased speed and effective-
ness with which dealer locations handled customer issues not only made customers
happier, but also made it easier for them to trust and believe in the dealer network.
 71

This, in turn, could make it easier for customers to stay with the case company and
help it do well in the long run in the area.

Overall, the successful change in the process and the positive feedback from the deal-
er network and the CEO show that the systematic framework suggested in this study
thesis works. The framework is a useful change management tool for original equip-
ment manufacturers (OEMs) of cars. It helps them build value for both dealers and end
customers at the same time. By reducing response time, making the best use of re-
sources, and strengthening relationships within the dealer network, the framework
gives automobile OEMs in competitive markets a strategic edge.

In a nutshell. The experimental study is an amalgamation of the theoretical framework

and the collaboration with the case company across the project timeline. The systemat-
ic framework focuses on rationality and was constructed in a methodical way. Dealer
networks and case company team can follow the framework easily in a structured way.
Using this strategy, case company could easily identify the focal value points that the
dealer network would instantly perceive. Hence, they can effectively pinpoint the busi-
ness prospective of their solution offering through this systematic case framework.
 72

6. CONCLUSION

6.1 Theoretical Implications

This thesis examines the idea of value for customers in the context of distribution
channels in the automotive industry, focusing on the challenges automobile original
equipment manufacturers (OEMs) confront in generating and delivering value to their
dealer networks. Significant obstacles, such as sustaining an equilibrium between
standardization and modification, managing dealership disagreements and competition,
and proposing adjustments to dealer operations and procedures, have been identified
in the thesis. It has suggested a methodical structure based on theoretical principles
and empirical insights to address these challenges and enhance OEM and dealer net-
work coordination.

In addition, the thesis addresses the difficulty of managing the extant dealer base by
recommending modifications to dealer procedures and routines of operation. These
modifications are required to preserve cooperation, resource utilisation, customer re-
tention, and sales and after-sales objectives. However, the complex dealer organisa-
tional structure, limited resources, and barriers to communication hinder the effective
implementation of proposed changes.

To address these obstacles, the thesis recommends the use of customer-

perceived value as a successful tool to improve the OEMs' persuasion abilities and
strengthen the dealer network's relationship with the OEM. It suggests that dealers can
be motivated to commit to a long-term partnership by articulating the perceived benefits
of the solution being suggested.

The thesis presents a framework that systematically integrates value communication

frameworks with the broader setting of dealer networks in the automotive industry. It
describes how the framework incorporates consumer value models, dealer relation-
ships, and the application of value principles to optimise the dealer network. The sys-
tematic framework intends to persuade merchants to take part in the process of change
by demonstrating the created value and fostering a long-term partnership.

This thesis has important theoretical implications for the field of marketing, particularly
in the context of consumer creation of value and communication in distribution net-
works, with a particular emphasis on the automobile industry. By investigating the con-
 73

cept of consumer value and its application in indirect distribution channels, this study
contributes to the existing literature and expands our knowledge of value creation and
interaction in complex business-to-business relationships.

First, the thesis expands the theoretical comprehension of customer value by empha-
sising its importance and implementation in distribution channels. Prior research has
examined customer value extensively in the framework of direct transactions between
customers and firms, but there has been limited investigation of the creation of value
and communication when intermediates are present. This study investigates how value
is interpreted, created, and communicated in distribution networks, specifically the au-
tomotive industry. The thesis offers valuable insights into the role of intermediates in
value delivery and the significance of aligning value propositions across the network by
analysing the distinctive difficulties and dynamics of distribution channels.

In addition, the thesis contributes to existing research on value communication by pro-

posing an organised structure for communicating value to the merchant network. It
highlights the importance of comprehending the specific requirements and preferences
of dealers at various levels of the hierarchy and adapting value messages accordingly.
The structure incorporates customer perception of value models, value evaluation
frameworks, and end-consumer value to improve original equipment manufacturers'
(OEMs) persuasive abilities when negotiating with dealers or instituting process chang-
es. This contribution increases our knowledge of effective value communication meth-
ods in indirect distribution networks with multiple stakeholders.

In addition, the study investigates the equilibrium between standardisation and custom-
ization in dealer network value creation. It identifies the difficulties OEMs face in main-
taining this equilibrium, such as ensuring brand consistency while permitting flexibility
to accommodate specific market circumstances and consumer demands. The thesis
emphasises the need to strike a balance between standardisation and customization in
order to generate value for both OEMs and dealers. This theoretical insight possesses
implications for decision-making in management as it guides original equipment manu-
facturers (OEMs) in formulating instructions, standards, and processes that strike the
optimal balance between standardisation and customization.

The thesis also casts light on the OEMs' complex task of managing dealer disputes
and competition in a competitive market. It emphasises the need for simple rules, poli-
cies, and effective channels of communication in order to resolve conflicts and promote
dealer cooperation. This theoretical contribution addresses the challenges that original
equipment manufacturers face in administering dealer territories, sales volumes, and
 74

potential markets. It offers insights into the nature of dealer competitiveness and strat-
egies for sustaining a cooperative dealer network while ensuring equal market oppor-
tunities.

6.2 Managerial Implications

This thesis' findings have significant managerial implications for OEMs and dealer net-
works. This research developed a systematic framework that provides valuable insights
as well as techniques for managing OEM-dealer relationships, particularly in the con-
text of carrying out process modifications and creating value.

The framework emphasises, first and foremost, the importance of comprehending con-
sumer value and effectively conveying it to the dealer networks. By implementing cus-
tomer value models and evaluation frameworks, OEMs can demonstrate the tangible
as well as intangible advantages that dealers can anticipate from the proposed solu-
tions. This improves the OEMs' ability to persuade and assists dealers in recognising
the value that the business is committed to creating for them and their clients. OEMs
must demonstrate the beneficial effects on revenue, customer contentment, and other
pertinent metrics to engage and motivate distributors to adopt the process changes.

Yet another managerial implication relates to the management of dealer disputes and
competition. In a marketplace that is competitive, dealer proximity can lead to disputes
over customer regions and sales volumes. To address this issue, OEMs should estab-
lish clear rules and procedures regarding merchant territories and implement effective
channels of communication to resolve disputes and promote cooperation. It is essential
to foster equitable market opportunities and dealer collaboration while maintaining a
healthy level of competition.

In addition, the thesis emphasises the significance of successful change management

within the extant dealer base. It can be difficult to propose modifications to dealer pro-
cesses and standard operating procedures due to the complex dealer hierarchy, limited
resources, and communication barriers. Therefore, OEMs must employ a methodical
approach to change management that includes extensive research and an understand-
ing of the dealer network's most pressing issues and concerns. By demonstrating the
worth and benefits of proposed changes, OEMs can garner the backing and devotion
of dealers, resulting in successful implementation and enhanced operational effective-
ness.

In addition, the thesis emphasises the significance of a centralised system for case
creation and administration for dealers. The analysis revealed that the existing case
 75

management process was tedious, lacked accountability, and impeded visibility. By im-
plementing a centralised digital portal, OEMs can substantially reduce response times,
provide precise information on case volumes and status, and increase the general ef-
fectiveness of the dealer network. This optimised case management platform not only
improves OEM-dealer collaboration, but also increases client confidence and fulfilment
by resolving their issues more quickly.

The systematic framework devised in this thesis provides OEMs with a structured
method for convincing and engaging dealers in their procedure changes. It provides a
distinct road map for initiating conversations, demonstrating perceived customer value,
executing pilot projects, and evaluating long-term potential. By adhering to this struc-
ture, OEMs can systematically resolve the issues affecting the interests of the dealer
system, align their goals, and establish a cooperative, long-term relationship.

6.3 Scope of Further Research

This thesis also points out a few areas that need more study to help us learn more
about customer value in distribution channels and how that affects the relationship be-
tween OEMs and dealers. First, future study can look into the role of intermediaries in
indirect distribution networks and how value is created and communicated to dealers
through these intermediaries. The main focus of the current study was on the direct
connection between OEMs and dealers. However, the presence of intermediaries can
add new complexities and dynamics that need to be investigated.

Also, this study mostly looked at OEMs' attempts to create and communicate value to
dealers from their point of view. Future study can take a multi-stakeholder approach
and look at things from the dealers' and end users' points of view to learn more about
how customer value is created in distribution channels. OEMs can make their value
propositions and strategies more effective by tailoring them to the needs and wants of
dealers and end customers.

Also, the focus of this study was on how process change affects customer value and
dealer collaboration. In the future, study can look more closely at other factors that af-
fect customer value in distribution channels, such as service quality, how easy it is to
get information, the variety of products available, and how convenient it is to use. By
looking into these factors and how they affect customer value, OEMs can learn more
about the drivers of value creation and come up with better strategies.

Lastly, this study looks at how cultural factors affect how process change is done and
how it turns out in different countries. In the future, researchers can look into how cul-
 76

ture values and practises affect dealer-OEM relationships and how well strategies for
communicating value work in different cultural settings. OEMs can tailor their ap-
proaches and make sure that their value propositions are relevant and accepted in dif-
ferent markets if they understand these cultural factors.

6.4 Thesis Limitations

This study has contributed significant contributions to the knowledge about customer
value in dealer networks in the automotive sector, but it is important to acknowledge
the constraints and limitations that may affect its generalizability and applicability.
These limitations suggest future research and care when interpreting results.

First, this study focused on the automobile sector and the issues OEMs confront in
creating and conveying value to their dealers. This study may not apply to other indus-
tries or areas. Thus, this study's framework and suggestions should be applied cau-
tiously. Second, the research focused on the Nordic and Baltic regions. Cultural, eco-
nomic, and legal considerations in these regions may have affected dealer network dy-
namics and process change. Thus, this study's conclusions may not apply to other na-
tions with varied socio-economic situations and market systems.

This study's data gathering, and analysis are limited by a single case company and its
dealer network. The case company provided useful insights and allowed for an in-depth
analysis of the research problem, but its unique qualities and dynamics may influence
the conclusions. Replicating the study with other case companies from different areas
would strengthen its generalizability. This study also focused on OEM attempts to build
and communicate value to dealer networks. To understand distribution network value
generation and communication, future study should include dealers and end consum-
ers. Dealers and end users' perspectives on distribution network relationship manage-
ment would provide a more balanced view.

Self-reported data and participant perceptions are another constraint. Response bias
and individual interpretations are possible despite thorough data collection and analy-
sis. Future study could use objective metrics and independent assessments to validate
and strengthen results. Finally, this study focused on the dealer network's case genera-
tion and management process change. These process modifications were not properly
examined for organisational and industry-level reasons. Future research could examine
how organisational culture, leadership styles, and business dynamics affect distribution
network process modifications.
 77

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