Summary IBSCM by Tobias Schiphorst
Week 1: B2B companies and value .......................................................................................................... 4
Week 2 VOC-VFC segmentation ............................................................................................................. 11
Value for customers and shareholders (CVM guiding principle 1) .................................................... 11
Customer Centricity and Experience (CVM Guiding Principle 2) ....................................................... 12
Value of the Customer (VOC) ............................................................................................................. 12
Antecedents of VOC ....................................................................................................................... 12
Value for the Customer (VFC) ............................................................................................................ 19
Customer segmentation ..................................................................................................................... 20
Week 3 Value propostions & managing customer value ....................................................................... 25
Value proposition ............................................................................................................................... 25
Products ............................................................................................................................................. 29
Customer service & customer relationship management ................................................................. 31
Price & total cost ................................................................................................................................ 34
Customer value model ................................................................................................................... 37
Risk ..................................................................................................................................................... 38
Managing value propositions ............................................................................................................. 40
Week 4 Return on value within CVM ..................................................................................................... 41
Cost effects ......................................................................................................................................... 46
Revenue effects .................................................................................................................................. 46
Customer perceived value, satisfaction, delight and trust ................................................................ 47
Customer commitment and loyalty ................................................................................................... 51
Retention and churn .......................................................................................................................... 54
Cross-buying ....................................................................................................................................... 56
Share-of-Wallet .................................................................................................................................. 57
Value Co-creation ............................................................................................................................... 57
Word-of-Mouth .................................................................................................................................. 58
Price premium .................................................................................................................................... 59
Paper overview week 5 - 7 ..................................................................................................................... 62
Week 5 introduction into supply chain management ........................................................................... 64
Papers used in this lecture ................................................................................................................. 64
Fishers paper (1997) ........................................................................................................................... 64
Paper of Lambert and Cooper (2009) ................................................................................................ 65
Supply chain network structure ..................................................................................................... 66
Supply chain business structure ..................................................................................................... 67
1
, Supply chain management components........................................................................................ 68
Paper of Guercini and Runfola (2009) ................................................................................................ 69
Paper of Pagh and Cooper (1998) ...................................................................................................... 70
Week 6 Shaping buyer-supplier relationships ....................................................................................... 73
Papers used in lecture 6 ..................................................................................................................... 73
Paper of Jonsson (2013, IKEA) ............................................................................................................ 73
Paper of Prajogo, D. and Olhager, J. (2012) ....................................................................................... 75
Key points of the lecture .................................................................................................................... 76
Week 7 Coordination and Managing risk in the supply chain ............................................................... 77
Papers used in lecture 7 ..................................................................................................................... 77
Paper of Lee, H.L., Padmanabhan, V. and Whang, S. (1997) ............................................................. 77
Paper of Jansson, A.N.U. (2004) ......................................................................................................... 79
Paper of Fiskel, J., Polyviou, M., Croxton, K.L. and Pettit (2015) ....................................................... 82
Key point of this lecture ..................................................................................................................... 84
Tutorial 2 ................................................................................................................................................ 85
Customer value ratio (CVR) ................................................................................................................ 85
Case CVR Jansonius B.V. (calculating CVR)......................................................................................... 85
Customer Value Model ...................................................................................................................... 86
CyclusSimus (calculating value-in-use & net present value).............................................................. 87
SAS Electric bikes ................................................................................................................................ 89
Customer Lifetime Value (CLV) .............................................................................................................. 91
Example of CLV ................................................................................................................................... 91
CarX case ................................................................................................................................................ 92
2
,Creating demand
Lecture 1 until 4
3
, Week 1: B2B companies and value
This week is about B2B markets/companies, what they are, and how they function. We talk about
value in creating demand and delivering demand to the customer.
B2B company -> is a company that delivers its products directly to a private company, governmental
organizations or public organizations
B2B sectors:
- Primary sector: involves extracting, mining, and harvesting natural resources
- Secondary sector: involves processing, manufacturing from what the primary sector delivers
- Tertiary sector: involves the service sector, such as accountancies and advertising/marketing
B2B products -> B2B companies can deliver tangible (salt), intangible (teaching) products or a
combination of both, which can be separated in five groups of products:
1. Resell as is: products are bought for trade, remain unmodified as they are. (for example
Albert Heijn orders beer from Heineken and resells it to its customers)
2. Integrate as components: the product becomes part of the final product, but need no
further processing before being sold the B2B customer. (intel delivers micro chips to Dell
computers for production of computers)
3. Modify and resell: products become part of the B2B-customer’s final product (Heineken buys
hops products from other companies in order to produce beers, that in turn is sold to its
customers)
4. Capital items: products that are used by the B2B-customers’ organization, so the B2B-
customer is the end user. (furniture, electricity, external services) That help de company
service the customer!
5. Internal items: these products don’t become part of the final product and are no capital
item. They are used for operating the company, maintenance, or repair (wine and beer for
the Friday borrel, toilet paper)
Products that B2B customers buy can be divided into Derived demand and Installed base
- Derived demand is the 1, 2, 3 B2B products
- Installed base are the 4 and 5 B2B products
Value chain -> combinations of companies that produce, distribute, and deliver products to the end
user. Each company adds value to the end product
- Raw material supplier -> distributor -> manufacturer -> wholesaler -> retail -> customer
Consequences of value chains in B2B:
- B2B-companies have different customer segments
- Strategic network competition, by forming alliances in order to develop the best set of
capabilities to the market.
Views on competition:
- Traditional: competition is horizontal and firm-to-firm at each level, where suppliers in the
same business compete with each other.
4
Week 1: B2B companies and value .......................................................................................................... 4
Week 2 VOC-VFC segmentation ............................................................................................................. 11
Value for customers and shareholders (CVM guiding principle 1) .................................................... 11
Customer Centricity and Experience (CVM Guiding Principle 2) ....................................................... 12
Value of the Customer (VOC) ............................................................................................................. 12
Antecedents of VOC ....................................................................................................................... 12
Value for the Customer (VFC) ............................................................................................................ 19
Customer segmentation ..................................................................................................................... 20
Week 3 Value propostions & managing customer value ....................................................................... 25
Value proposition ............................................................................................................................... 25
Products ............................................................................................................................................. 29
Customer service & customer relationship management ................................................................. 31
Price & total cost ................................................................................................................................ 34
Customer value model ................................................................................................................... 37
Risk ..................................................................................................................................................... 38
Managing value propositions ............................................................................................................. 40
Week 4 Return on value within CVM ..................................................................................................... 41
Cost effects ......................................................................................................................................... 46
Revenue effects .................................................................................................................................. 46
Customer perceived value, satisfaction, delight and trust ................................................................ 47
Customer commitment and loyalty ................................................................................................... 51
Retention and churn .......................................................................................................................... 54
Cross-buying ....................................................................................................................................... 56
Share-of-Wallet .................................................................................................................................. 57
Value Co-creation ............................................................................................................................... 57
Word-of-Mouth .................................................................................................................................. 58
Price premium .................................................................................................................................... 59
Paper overview week 5 - 7 ..................................................................................................................... 62
Week 5 introduction into supply chain management ........................................................................... 64
Papers used in this lecture ................................................................................................................. 64
Fishers paper (1997) ........................................................................................................................... 64
Paper of Lambert and Cooper (2009) ................................................................................................ 65
Supply chain network structure ..................................................................................................... 66
Supply chain business structure ..................................................................................................... 67
1
, Supply chain management components........................................................................................ 68
Paper of Guercini and Runfola (2009) ................................................................................................ 69
Paper of Pagh and Cooper (1998) ...................................................................................................... 70
Week 6 Shaping buyer-supplier relationships ....................................................................................... 73
Papers used in lecture 6 ..................................................................................................................... 73
Paper of Jonsson (2013, IKEA) ............................................................................................................ 73
Paper of Prajogo, D. and Olhager, J. (2012) ....................................................................................... 75
Key points of the lecture .................................................................................................................... 76
Week 7 Coordination and Managing risk in the supply chain ............................................................... 77
Papers used in lecture 7 ..................................................................................................................... 77
Paper of Lee, H.L., Padmanabhan, V. and Whang, S. (1997) ............................................................. 77
Paper of Jansson, A.N.U. (2004) ......................................................................................................... 79
Paper of Fiskel, J., Polyviou, M., Croxton, K.L. and Pettit (2015) ....................................................... 82
Key point of this lecture ..................................................................................................................... 84
Tutorial 2 ................................................................................................................................................ 85
Customer value ratio (CVR) ................................................................................................................ 85
Case CVR Jansonius B.V. (calculating CVR)......................................................................................... 85
Customer Value Model ...................................................................................................................... 86
CyclusSimus (calculating value-in-use & net present value).............................................................. 87
SAS Electric bikes ................................................................................................................................ 89
Customer Lifetime Value (CLV) .............................................................................................................. 91
Example of CLV ................................................................................................................................... 91
CarX case ................................................................................................................................................ 92
2
,Creating demand
Lecture 1 until 4
3
, Week 1: B2B companies and value
This week is about B2B markets/companies, what they are, and how they function. We talk about
value in creating demand and delivering demand to the customer.
B2B company -> is a company that delivers its products directly to a private company, governmental
organizations or public organizations
B2B sectors:
- Primary sector: involves extracting, mining, and harvesting natural resources
- Secondary sector: involves processing, manufacturing from what the primary sector delivers
- Tertiary sector: involves the service sector, such as accountancies and advertising/marketing
B2B products -> B2B companies can deliver tangible (salt), intangible (teaching) products or a
combination of both, which can be separated in five groups of products:
1. Resell as is: products are bought for trade, remain unmodified as they are. (for example
Albert Heijn orders beer from Heineken and resells it to its customers)
2. Integrate as components: the product becomes part of the final product, but need no
further processing before being sold the B2B customer. (intel delivers micro chips to Dell
computers for production of computers)
3. Modify and resell: products become part of the B2B-customer’s final product (Heineken buys
hops products from other companies in order to produce beers, that in turn is sold to its
customers)
4. Capital items: products that are used by the B2B-customers’ organization, so the B2B-
customer is the end user. (furniture, electricity, external services) That help de company
service the customer!
5. Internal items: these products don’t become part of the final product and are no capital
item. They are used for operating the company, maintenance, or repair (wine and beer for
the Friday borrel, toilet paper)
Products that B2B customers buy can be divided into Derived demand and Installed base
- Derived demand is the 1, 2, 3 B2B products
- Installed base are the 4 and 5 B2B products
Value chain -> combinations of companies that produce, distribute, and deliver products to the end
user. Each company adds value to the end product
- Raw material supplier -> distributor -> manufacturer -> wholesaler -> retail -> customer
Consequences of value chains in B2B:
- B2B-companies have different customer segments
- Strategic network competition, by forming alliances in order to develop the best set of
capabilities to the market.
Views on competition:
- Traditional: competition is horizontal and firm-to-firm at each level, where suppliers in the
same business compete with each other.
4
