Tactical sourcing, fast lane for medium value purchases

Medium value purchases make up a vast portion of organisations’ purchases. Medium value purchases differ from large purchases that the purchases value is smaller and quantity higher. They are not managed efficiently if they are managed as large purchases. However, they should not be managed as small purchases as they have savings possibilities that are not obtained with a process that is designed for small purchases. This study offers a solution for medium value spend management. The solution is tactical sourcing. The tactical sourcing is designed for Tieto Corporation’s need and it was influenced by Six Sigma methods and tools.

Evaluating land-use related environmental impacts of biomass value chains for decision-support : Comparison and testing of methodologies proposed for environmental life cycle assessment

Life cycle assessment (LCA) is one of the most established quantitative tools for environmental impact assessment of products. To be able to provide support to environmentally-aware decision makers on environmental impacts of biomass value-chains, the scope of LCA methodology needs to be augmented to cover landuse related environmental impacts. This dissertation focuses on analysing and discussing potential impact assessment methods, conceptual models and environmental indicators that have been proposed to be implemented into the LCA framework for impacts of land use. The applicability of proposed indicators and impact assessment frameworks is tested from practitioners' perspective, especially focusing on forest biomass value chains. The impacts of land use on biodiversity, resource depletion, climate change and other ecosystem services is analysed and discussed and the interplay in between value choices in LCA modelling and the decision-making situations to be supported is critically discussed. It was found out that land use impact indicators are necessary in LCA in highlighting differences in impacts from distinct land use classes. However, many open questions remain on certainty of highlighting actual impacts of land use, especially regarding impacts of managed forest land use on biodiversity and ecosystem services such as water regulation and purification. The climate impact of energy use of boreal stemwood was found to be higher in the short term and lower in the long-term in comparison with fossil fuels that emit identical amount of CO2 in combustion, due to changes implied to forest C stocks. The climate impacts of energy use of boreal stemwood were found to be higher than the previous estimates suggest on forest residues and stumps. The product lifetime was found to have much higher influence on the climate impacts of woodbased value chains than the origin of stemwood either from thinnings or final fellings. Climate neutrality seems to be likely only in the case when almost all the carbon of harvested wood is stored in long-lived wooden products. In the current form, the land use impacts cannot be modelled with a high degree of certainty nor communicated with adequate level of clarity to decision makers. The academia needs to keep on improving the modelling framework, and more importantly, clearly communicate to decision-makers the limited certainty on whether land-use intensive activities can help in meeting the strict mitigation targets we are globally facing.

Value based pricing and marketing of marine engines

Objective of the thesis is to create a value based pricing model for marine engines and study the feasibility of implementing such model in the sales organization of a specific segment in the case company’s marine division. Different pricing strategies, concept of “value”, and how perceptions of value can be influenced through value based marketing are presented as theoretical background for the value based pricing model. Forbis and Mehta’s Economic Value to Customer (EVC) was selected as framework to create the value based pricing model for marine engines. The EVC model is based on calculating and comparing life-cycle costs of the reference product and competing products, thus showing the quantifiable value of the company’s own product compared to competition. In the applied part of the thesis, the components of the EVC model are identified for a marine diesel engine, the components are explained, and an example calculation created in Excel is presented. When examining the possibilities to implement in practice a value based pricing strategy based on the EVC model, it was found that the lack of precise information on competing products is the single biggest obstacle to use EVC exactly as presented in the literature. It was also found that sometimes necessary communication channels are missing and that there is simply a lack of interest from some clients and product end-users part to spend time on studying the life-cycle costs of the product. Information on the company’s own products is however sufficient and the sales force is capable to communicate to sufficiently high executive levels in the client organizations. Therefore it is suggested to focus on quantifying and communicating the company’s own value proposition. The dynamic nature of the business environment (variance in applications in which engines are installed, different clients, competition, end-clients etc.) means also that each project should be created its own EVC calculation. This is demanding in terms of resources needed, thus it is suggested to concentrate on selected projects and buyers, and to clients where the necessary communication channels to right levels in the customer organization are available. Finally, it should be highlighted that as literature suggests, implementing a value based pricing strategy is not possible unless the whole business approach is value based.

The importance of customer's value expectations in customer acquisition

Pro gradu –tutkielman tavoitteena on tutkia asiakasarvoa ja sitä, miten asiakasarvoa voidaan käyttää hyväksi uusasiakashankinnassa. Tällä hetkellä kirjallisuudessa on pinnalla muutos tuotekeskeisyydestä asiakaskeskeiseen näkökulmaan, joka tunnistaa asiakasarvon tärkeyden bisnes suhteissa. Tämä tutkimus osallistuu kyseiseen keskusteluun muodostamalla tavan mitata asiakasarvoa, ja peilaamalla saavutettuja tuloksia uusasiakashankinta prosessiin. Empiirinen tutkimus on toteutettu kahdessa osassa: kvalitatiivisessa sekä kvantitatiivisessa. Ensimmäisessä osassa haastateltiin kahdeksaa potentiaalista asiakasta, minkä jälkeen saadut tulokset vietiin suurempaan skaalaan toteuttamalla kysely suurelle joukolle potentiaalisia asiakkaita. Lopulliset tulokset osoittavat, että asiakasarvon käyttäminen hyväksi uusasiakashankinnassa on erittäin tehokas ja käyttökelpoinen metodi. Asiakasarvoon perustuvat asiakassegmentit mahdollistavat oikeiden arvojen kommunikoinnin oikeille segmenteille. Se antaa yritykselle myös mahdollisuuden valita houkuttelevimmat asiakasryhmät ja vahvistaa asiakaskantaansa.

Customer´s perceptions of value during the lifecycle of concentrate filtration

The objective of this study was to examine how customers purchase complex industrial solutions in mining industry, and what kind of value they perceive during different phases of the solution life cycle. In addition, a systematic method for understanding customer value was developed, which can be applied for other company’s offerings as well. The method includes step-by-step instructions for 1) the collection of customer value data and 2) implementation of the findings. The theoretical part of the study focuses on solution and customer value literature in business-to-business markets. In this study qualitative embedded multiple-case study was used as a research method. The primary data was collected through in-depth interviews in two market areas and by participating in customer meetings as an external observer. The results show that there are two ways of buying solutions that needs to be treated individually. Customers prefer to buy solutions from engineering companies as they think that suppliers still need to work on their solution capabilities. Therefore, Outotec should focus more on marketing itself as a solution provider. Customers buy solutions that create the most value with the lowest risk and they need to be supported throughout the solution lifecycle. References that demonstrate previous experience are the most effective way to reduce customers’ risk. However, the customer-perceived values and challenges differ between the market areas, and thus, suppliers should have divergent strategies for specific market areas.

Value at Risk in Foreign Exchange Risk Management

This thesis examines the suitability of VaR in foreign exchange rate risk management from the perspective of a European investor. The suitability of four different VaR models is evaluated in respect to have insight if VaR is a valuable tool in managing foreign exchange rate risk. The models evaluated are historical method, historical bootstrap method, variance-covariance method and Monte Carlo simulation. The data evaluated are divided into emerging and developed market currencies to have more intriguing analysis. The foreign exchange rate data in this thesis is from 31st January 2000 to 30th April 2014. The results show that the previously mentioned VaR models performance in foreign exchange risk management is not to be considered as a single tool in foreign exchange rate risk management. The variance-covariance method and Monte Carlo simulation performs poorest in both currency portfolios. Both historical methods performed better but should also be considered as an additional tool along with other more sophisticated analysis tools. A comparative study of VaR estimates and forward prices is also included in the thesis. The study reveals that regardless of the expensive hedging cost of emerging market currencies the risk captured by VaR is more expensive and thus FX forward hedging is recommended

Study on Customer Perceived Value of Container Loading Equipment

The goal of the thesis was to gain understanding of organizational buying behavior and its effect from the selling perspective and to generate base for verifying customer value propositions for Actiw Oy. The first objective was to discover the current buying decision criteria of current customers to understand the buying motives which had led to the investment initially. Second objective was to understand how the buying decision criteria and customer experiences can be turned into customer value propositions. Research was done with 16 customer interviews, which were focused on obtaining the information on the buying center and the value of the solution. Thesis goes through the main theories of OBB and the theory behind customer value management. Based on customer interviews, the currently used customer value propositions were tested and categorized into points-of-parities and points-ofdifferences. The interviews confirmed customer behavior in new task and modified rebuy situations and also gave confirmation to the internally done customer value propositions. Main finding of the study was, that as the value propositions are possible to present more specifically to each new case instead of using all benefits at the same time.

Value creation through sponsorship in electronic sports

The objective of this thesis was to study value creation through sponsor-ship in a new emerging electronic sports environment. Sub-questions were formulated which helped in finding answers to the main research question. Theory of traditional sports and practice of electronic sports were compared with each other in order to find out how theories of tradi-tional sports fare in the new environment. B2B-relationship model of Actors, resources and activities is used in this thesis to help in clarifying the different variables used in electronic sports sponsorship environment. The empirical research was conducted via interviews with the managers working in electronic sports environment. One of the main conclusions is that relationship management is really important.. Actors in electronic sports need to find and create win-win-win situations. This means that they need to benefit the actors in sponsoring relationship and also the community.

Enhancing business-to-business relationship through value co-creation in traditional business sector: A case of building services engineering

This study discusses the significance of having service as a business logic, and more specifically, how value co-creation can be seen as an enhancing phenomenon to business-to-business relationships in traditional business sector. The purpose of this study is to investigate how value cocreation can enhance a business-to-business relationship in the heating, ventilation and airconditioning (HVAC) industry of building services engineering, through three sub-objectives: to identify what is value in the industry, how value is co-created in the industry, and what is value in a business-to-business relationship in the industry. The theoretical part this study consists of academic knowledge and literature related to the concepts of value, value co-creation and business-to-business relationships. In order to research value co-creation and business-to-business relationships in HVAC industry of building services engineering both, metaphorical and conceptual thinking of service dominant (S-D) logic and more managerial approach of service logic (SL), contributed to the theoretical part of the study. The empirical research conducted for this study is based on seven semi-structured interviews, which constituted the holistic, qualitative single case study method chosen for the research. The data was collected in September 2014 from CEOs, managers and owners representing six building services engineering firms. The interviews were analysed with the help of transcriptions, role-ordered matrices and thematic networks. The findings of this study indicate that value in HVAC industry consists of client expertise and supplier expertise. The result of applying client expertise and supplier expertise to the business-to- business relationship is characterized as value-in-reputation, when continuity, interaction, learning and rapport of the business relationship are ensured. As a result, value co-creation in the industry consists of mutual and separate elements, which the client and the supplier apply in the process, in addition to proactive interaction. The findings of this study, together with the final framework, enhance the understanding of the connection existing between value co-creation and business-to-business relationship. The findings suggest that value in the HVAC industry is characterized by both value-in-use and value-inreputation. Value-in-reputation enhances the formation of value-in-use, and consequently, value cocreation enhances the business-to-business relationship. This study thus contributes to the existing knowledge on the concepts of value and value co-creation in business-to-business relationships.

Determination of potential value drivers by identifying customer expectations and perceived value

The purpose of this exploratory research is to identify the potential value drivers regarding a new service offering. More specifically, the aim is to build understanding of customer expectations and perceived value of energy efficiency solutions in the building’s sector. The knowledge is then used in defining potential value drivers. The research is conducted from the customer’s perspective in a business-to-business context. The theory part of the master’s thesis focuses on discussing the antecedents of customer expectations and customer value. The theory gives implications how to determine value drivers and develop value propositions as well as conduct value assessment. The empirical part is based on the qualitative research method. The research was conducted as a single-case study, and the primary data was collected through semi-structured interviews with potential customers. The results of the research revealed that the customer expectations are connected to being able to define value drivers. In addition, the research revealed generic themes relating to the offering and customer-supplier relationship, which help in the process of identifying potential value drivers. The results were discussed in terms of product-, service-, price- and relationship-related value drivers for the new service. Based on the data analysis the dominant value drivers are elaborated in terms of identified customer benefits and customer sacrifices (costs). Finally, some implications of value proposition and value assessment to support the value delivery were given.

Value perceptions of measurement and monitoring system customers

The value that the customer perceives from a supplier’s offering, impacts customer’s decision making and willingness to pay at the time of the purchase, and the overall satisfaction. Thus, for a business supplier, it is critical to understand their customers’ value perceptions. The objective of this thesis is to understand what measurement and monitoring system customers value, by examining their key purchasing criteria and perceived benefits. Theoretical part of this study consists on reviewing relevant literature on organizational buying behavior and customer perceived value. This study employs a qualitative interview research method. The empirical part of this research consisted of conducting 20 in-depth interviews with life science customers in USA and in Europe. Quality and technical features are the most important purchasing criteria, while product-related benefits seem to be the most important perceived benefits. At the marketing of the system, the emphasis should be at which regulations the system complies with, references of supplier’s prior experience, the reliability and usability of the system, and total costs. The benefits that should be emphasized are the better control of customer’s process, and the proof of customer’s product quality

Value added KPI service delivery with quality function deployment: Multiple case study in asset & real estate management

The aim of this study is to investigate value added service concept for an asset and real estate management case company. The initial purpose was to recognize the most value adding key performance indicators (KPIs) information delivered for its customers, real estate investors with value added service. The multiple case study strategy included two focus group interviews with five case interviews in total. Additionally, quality function deployment (QFD) was used in order to form up the service process. The study starts with introduction and methodology explaining the demand for the thesis study. The subsequent chapter presents the theoretical background on real estate management KPIs in four main points of views and quality function deployment from the service development point of view. The chapter also defines research gap for the case study. According to the case study interviews, the most favored KPIs to deliver for the clients are income maturity of lease agreements and leasing activity. These KPIs and quality characteristics are translated into the QFD. In total, the service QFD explains the service planning, process control, and action plan phases.

E-commerce value chain in Russian markets – The role of market specific factors

International e-commerce is still rather new concept and therefore lacks comprehensive research. Different nature of markets and companies has challenged the traditional theories as well as redefined traditional operations. Prior research has mainly concentrated on studying the specific topics as barriers and the choice of international strategy. For this reason, there is a lack of research that comprehensively analyzes the operations of international e-commerce companies. The aim of this study was to increase knowledge on operations of Finnish e-commerce companies in Russia. In order to receive comprehensive knowledge of the operations, research analyzed the internationalization process, the effects of market specific factors to e-commerce and the implementation of various value chain activities of e-commerce. Research focused on examining how companies have seen the peculiarities of Russian markets and how to respond to them. The empiric part of the study was conducted as a qualitative research by interviewing five company representatives and three specialists of international e-commerce and Russian business.The results of this research revealed that having e-commerce in Russia is challenging and requires long term, strategy-based work. E-commerce is assumed to be inherently global business model, but in the case of Russia, numerous e-commerce activities require localization. The most crucial activity to localize is a content and language of content. Even though e-commerce market in Russia has a lot of peculiarities, operating via marketspace decreases the level of bureaucracy and market risk. Despite the challenges, developing e- commerce market in Russia offers a huge potential for companies, whose international strategy needs Russian operation to achieve company goals.

Purchasing Process of Industrial Solutions – Added Value, Difficulties and Good Practices

Purpose of this study is to clarify the industrial solutions purchasing process from purchaser companies’ point of view. Also customer’s view on value generating aspects and difficulties in purchases will be discussed as well as different purchas-ing entities where customers have ended up in their solution purchases. Current solution literature is mainly concentrated in supplier views and customer perspec-tive has been left without adequate attention. However, knowledge of the customer and the identification of customer need are at the core of a successful solution business. The focus of this thesis is on Finnish companies’ solution purchases that have been realized during last five years. Industrial solutions in this case are facto-ries or other large industrial plants. Industrial solutions’ purchasing process will be opened all the way from discovering the need until the start-up of the plant. Of in-terest is the customer experience of the success of the acquisition and the pur-chaser’s view on good practices allowing a successful procurement project.

Creating Value for Corporate Sustainability: Stakeholder Engagement

The thesis aims to build a coherent view and understanding of stakeholder engagement’s contribution to corporate sustainability value creation. Theory suggests that corporate sustainability relies on sustainable relationships between the firm and its multiple stakeholders. This study is qualitative and evidence is derived from integrative analysis of literature, secondary data and case study analysis. The findings from the interviews analysis supplement the framework developed as the results of the literature review. The results obtained throughout the thesis research imply that stakeholder engagement helps develop more thorough understandings of issues and alternative perspectives, which in turn facilitates the decision-making processes improvement. The improvement is also achieved through ethical analysis, by weighing the impact of firm’s decisions on all relevant groups. Therefore, clear communication and exchange of information also improve the acceptance of sustainability initiatives amongst stakeholders both in terms of building trust and managing expectations. As practical implications, this thesis presents organizational practices that can be employed by companies to support effective engagement with stakeholders. The described practices could enhance processes such as partnership and co-creation resulting in greater sustainable development.