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Towards an integrated business model for business-to-business focused service providers pursuing a customer intimacy strategy: A Case study aimed at optimizing the business of an innovative joint venture by increasing coherence and alignment within the integrated business model

Langenkamp, David (2010) Towards an integrated business model for business-to-business focused service providers pursuing a customer intimacy strategy: A Case study aimed at optimizing the business of an innovative joint venture by increasing coherence and alignment within the integrated business model.

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Abstract:This study is commissioned by COO, a newly created Dutch joint-venture operating within the facility market. It tries to answer the question what could be altered and specified regarding the initial ideas of this joint venture in order to develop into a viable organization. In other words, this study tries to answer, for COO, the two fundamental questions to every service organizations: What are the important elements of the service to be provided for the customer? and What efforts does this suggest in terms of designing, delivering and marketing the service? In guiding the answering process of these questions, the business model of Osterwalder (2004) is used as starting point. However, discussing this model showed some disadvantages. To overcome these, the business model from Osterwalder (2004) is integrated with the strategy map (Kaplan and Norton, 2000). This new integrated business model consists of four perspectives: the customer, the process, the learning and growth, and the financial perspective. These four perspectives together contain eleven elements: value proposition, target customer, relationship, distribution channel, value configuration, partnership, capability, information systems, corporate culture, cost structure, and revenue streams. It is this integrated business model which is eventually used as guiding tool within this study. First it is used to develop a theoretical framework. From conversations with the founders of COO, the website, and the corporate presentation, it showed that COO is as service organization with a Business-to-Business (B2B) focused customer intimacy. Therefore, the theoretical discussion of the four perspectives and eleven elements revolves around these characteristics in order to develop a theoretical framework on business models for service organizations with a B2B-focused customer intimacy strategy. Then, the founders of COO are again interviewed to get a clear picture of the initial situation of COO in terms of the integrated business model. After that, this study zooms in on customizing the theoretical framework to the specific situation of COO. This is done by developing an interview framework, based on the theoretical framework, which is used to interview seven market-experts. The main results of these interviews were first of all that, given the current situation of COO and the market characteristics, the Small- and Medium-sized Enterprise (SME)-market seems most attractive for COO. Also, the experts stated that there are no fundamental content-wise differences between the four sectors COO is aiming for. Furthermore, it was said that all of the four main services of COO (janitor-COO, E-COO, facility purchasing, and facility consultancy) could be of value to customers, but in certain situations and with certain requirements. Finally, it is concluded that although COO is not as innovative as they claim, they can still be operating with a competitive advantage if they become pro-active, flexible, willing to change, and customeroriented in the sense that they are willing and able to personalize and customize the service. The results of these interviews combined are then combined with the literature in order to come to several recommendations on how COO could, given the current internal and external situation, best alter and specify their initial ideas with the intention to become a viable organization. The most important recommendations are that it is preferable for COO to first focus on Small- and Medium-sized Enterprises within the region by exploiting their knowledge and network. This means that large enterprises are not yet to be targeted. Also the value proposition and external communication should not focus on the innovativeness of the janitor-COO concept, but on the personal, tailored, reliable, problem-solving character of offering total relieve for the client-organization regarding facility management issues. This is best done by sub-dividing the main value proposition into three elements: janitor- COO, E-COO, and purchasing and consultancy. It was also concluded that for COO, it is best to offer E-COO only in combination with SITA and Novon, not with other parties. Also, it is concluded that given the current situation, COO will do wise to be selective in their targeting. Furthermore, given their main strategy, it is preferable for COO to focus on customer lifetime value by aiming for long-term relationships with the help of creating loyalty. Loyalty is said to relate to perceived quality which in turn depends on balancing between expected quality (e.g. influenced by references) and experienced quality. Experienced quality is said to be influenced by, among others, the characteristics of the value propositions and the SERVQUAL-model domains, especially reliability, assurance, and the willingness to help aspect of responsiveness. Finally, it would be valuable if COO can provide specific management reports in which they constantly come with recommendations on how to improve the service.
Item Type:Essay (Master)
Faculty:BMS: Behavioural, Management and Social Sciences
Subject:85 business administration, organizational science
Programme:Business Administration MSc (60644)
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