AKADEMIN FÖR TEKNIK OCH MILJÖ

Avdelningen för industriell ekonomi, industridesign och maskinteknik

Digital Transformation
Prerequisites for a digital business model

Erik Andersson Nissar

2022

Examensarbete, Grundnivå (högskoleexamen), 15 hp

Industriell ekonomi
Ekonomiingenjörsprogrammet

Handledare: Rose-Marie, Löf

Examinator: Sarah Philipson

Table of Contents
1. INTRODUCTION................................................................................................................ 1
1.1 BACKGROUND ...............................................................................................................................................1
1.2. PURPOSE .......................................................................................................................................................2
1.3 LIMITATIONS IN RESEARCH ..........................................................................................................................3
2. LITERATURE REVIEW ................................................................................................... 4
2.1 DIGITAL TRANSFORMATION ........................................................................................................................4
2.1.1 Digital Transformation Strategy ...........................................................................................................5
2.1.2 Digital transformation frameworks .......................................................................................................7
2.1.3 Summary digital transformation............................................................................................................9
2.2 BUSINESS MODELS ......................................................................................................................................10
2.2.1 Value propositions ...............................................................................................................................12
2.2.2 Business model innovation ..................................................................................................................14
2.2.3 Summary of business models ...............................................................................................................16
2.3 BUSINESS PROCESS MANAGEMENT ...........................................................................................................16
2.3.1 Summary of business process management .........................................................................................18
2.4 STAKEHOLDER MANAGEMENT ..................................................................................................................18
2.4.1 Stakeholder theory ...............................................................................................................................19
2.4.2 Business ecosystems and partnership ..................................................................................................19
2.4.3 Customer Relationship Management ..................................................................................................21
2.4.4 Transportation Management ...............................................................................................................23
2.4.5 Summary of stakeholder management .................................................................................................25
3. CONCRETE RESEARCH QUESTION.......................................................................... 26
4. METHOD ........................................................................................................................... 27
4.1 APPROACH ..................................................................................................................................................27
4.2 OPERATIONALIZATION ...............................................................................................................................28
4.3 CASE STUDY ................................................................................................................................................29
4.3.1 Choice of company ..............................................................................................................................29
4.3.2 Choice of supplier................................................................................................................................29
4.3.3 Recognition of customers ....................................................................................................................30
4.4 DATA COLLECTION .....................................................................................................................................30
4.4.1 Interviews ............................................................................................................................................30
4.4.2 Secondary data collection ...................................................................................................................31
4.5 ANALYSIS ....................................................................................................................................................31
4.6 VALIDITY AND RELIABILITY .......................................................................................................................32
4.7 ETHICS IN RESEARCH ..................................................................................................................................32
5 RESULTS ............................................................................................................................ 33
5.1 THE CUSTOMERS .........................................................................................................................................33
5.1.1 Company customers.............................................................................................................................33
5.1.2 Essve Sverige AB .................................................................................................................................35
5.1.3 Private customers ................................................................................................................................36
5.2 INTERVIEWS WITH ALABANZA ...................................................................................................................37
5.2.1 Alabanzas digital transformation ........................................................................................................37
5.2.2 The redesigned business model ...........................................................................................................38
5.2.3 Business Process Management............................................................................................................41
5.2.4 Requirements on the stakeholders .......................................................................................................42
5.3 INTERVIEW WITH KJELLAND TRANPORT ..................................................................................................43
5.3.1 Kjelland Transport’s Digital Transformation .....................................................................................43
5.3.2 Cooperation and partnership ..............................................................................................................43
5.3.3 Business model ....................................................................................................................................44
6 ANALYSIS .......................................................................................................................... 46
6.1 CUSTOMER SEGMENTS AND CUSTOMER RELATIONS .................................................................................46
 6.2 ALABANZA’S DIGITAL TRANSFORMATION, BUSINESS MODEL AND BUSINESS PROCESSES .......................47
6.2.1 Digital transformation .........................................................................................................................48
6.2.2 Strategic goal.......................................................................................................................................48
6.2.3 Use of new technologies ......................................................................................................................48
6.2.4 Changes in value creation ...................................................................................................................49
6.2.5 Structural changes ...............................................................................................................................49
6.2.6 Financial aspects .................................................................................................................................50
6.3 THE REDESIGNED BUSINESS MODEL ...........................................................................................................50
6.3.1 Value proposition ................................................................................................................................50
6.3.2 Revenue model and cost structure .......................................................................................................51
6.3.3 Key Resources, Key Activities and Channels ......................................................................................52
6.4 BUSINESS PROCESSES .................................................................................................................................53
6.5 KJELLAND TRANSPORT ..............................................................................................................................53
6.5.1 Digital transformation .........................................................................................................................53
6.5.2 Business model ....................................................................................................................................54
6.6 STAKEHOLDER MANAGEMENT ...................................................................................................................54
6.6.1 Alabanza’s view on partnership and cooperation ...............................................................................55
6.6.2 Kjelland Transport’s view on partnership and cooperation ...............................................................56
6.6.3 Requirements and response to cooperation ........................................................................................56
7 DISCUSSION ...................................................................................................................... 58
7.1 DIGITAL BUSINESS MODEL..........................................................................................................................58
7.2 GUIDELINE FOR THE REDESIGN OF BUSINESS MODEL ...............................................................................58
7.2.1 Mobile storage .....................................................................................................................................59
7.2.2 Nissar Alabanza Transportation Technologies (NATT) ......................................................................60
7.3 TRANSFORMATIONAL STRATEGY ...............................................................................................................61
8 CONCLUSIONS ................................................................................................................. 63
8.1 LIMITATIONS AND PURPOSE .......................................................................................................................63
8.1.1 What are the prerequisites for a digital business model? ...................................................................63
8.1.2 Why should stakeholders cooperate to innovate a business model? ...................................................63
8.1.3 How can Alabanza adapt its business model and business processes aligned with a digital
transformation strategy? ..............................................................................................................................63
9 FUTURE DIRECTIONS FOR RESEARCH ................................................................... 64
10 REFERENCES.................................................................................................................. 65
11 APPENDICES ................................................................................................................... 69
11.1 LIST OF TABLES .........................................................................................................................................69
11.2 LIST OF FIGURES .......................................................................................................................................69
11.3 PATTERN FINDING .....................................................................................................................................70
11.4 KJELLAND TRANSPORT INTERVIEW ........................................................................................................78
11.5 ALABANZA AS IS AND TO BE PROCESSES ..................................................................................................83
Abstract

This research paper investigates the need from two different stakeholders, in the purpose to
formulate prerequisites for a digital business model that are in line with a digital
transformation strategy. The paper contains qualitative and quantitative research methods to
gather data. The scope of the research was to create a digital business model with business
model innovation with input from two stakeholder and data from customers. To create a basis
for the research a literature review was executed on the keywords business models, business
model innovation, digital transformation, digital transformation strategy, business process
management, stakeholder management, customer relations and transport management.
Findings showed one digitized business model and one digitalized business model that fits a
digital transformation with cooperation between stakeholders.

Sammanfattning

I denna uppsats undersöks behovet från två olika intressenter i syfte att formulera
förutsättningar för en digital affärsmodell som är i linje med en strategi för digital
transformation. Uppsatsen innehåller kvalitativa och kvantitativa forskningsmetoder för att
samla in data. Forskningens omfattning var att skapa en digital affärsmodell med
affärsmodellinnovation med input från två intressenter och data från kunder. För att skapa en
grund för forskningen utfördes en litteraturgenomgång på nyckelorden affärsmodeller,
affärsmodellinnovation, digital transformation, digital transformationsstrategi,
affärsprocesshantering, intressenthantering, kundrelationer och transporthantering.
Diskussionen och slutsats visar en digitaliserad affärsmodell och en digitaliserad affärsmodell
som passar en digital omvandling med hjälp av samarbete mellan intressenter.

Acknowledgements
With my greatest respect I want to address grateful greetings to Dr. Sarah Philipson, the
examiner for her guidance in research, Rose-Marie Lööf, for her supervision and support,
Kjelland Transport for valuable insight in their operations and business environment,
Alabanza for the opportunity of writing my bachelor thesis and researching their company,
and lastly, Dr. Paul Sudnik, who introduced me to academic research at Hochschule
München.
1. Introduction

1.1 Background

Digital transformation has become relevant for firms to adapt after the transformation to
Industry 4.0. Integrating and exploiting digital technologies is one of the biggest challenges
companies currently face. No sector will not be affected by digital technologies, as
competitors are adapting to the rapid industrial change. Digital transformation is driven by
growth, customer satisfaction, increased efficiency in operations, competitive advantage, and
increased business agility (Morakanyane, Grace & O'Reilly 2017). Digital transformation is a
priority on leadership agendas, approximately 90% of US and U.K business leaders are
expecting that digital technologies will make an increasing strategic contribution to their
overall business. Regardless of the digital technology the company chooses to accomplish in
a digital transformation, there are different frameworks used to choose a strategy. Business
leaders must formulate and execute digital strategies to perform operationally better. The
question is no longer if a company needs to make a digital transformation, but how to use it
as a competitive advantage and how to embrace it (Hess, Benlian, Matt & Wiesböck 2016).

When the supply chain, business processes, products, and sales channels are impacted by
digital technologies with a market-changing potential, it results in entire business models
being reshaped. (Morakanyane et al., 2017).

Problem is that most of the time when strategy frameworks are studied, they rarely consider
the stakeholders in the business model. When redesigning a business model for digital
transformation firms are increasingly relying on the stakeholders of their business ecosystem
to create and capture the value. (Yi et al., 2022).

In this study, the stakeholders for Alabanza’s business model “mobile storage” and the
prerequisites for a digital transformation of it will be studied. The business model service is
to rent out containers as storage and is driven by factors such as increased turnover,
profitability, and competitiveness. The current business model is manual and should be
transformed with digital technologies. The research concerning frameworks for considering
stakeholders in digital transformation is vague, and the definition of digital transformation in
this context varies. The complexity involved in the business model is the logistics of

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delivering containers, the stakeholders that should be prioritized in the business ecosystem,
and the creation of an optimal offer to the customer. At present, it takes too long to deliver a
container and the price is too high. The higher price than expected does not contribute to the
growth Alabanza is looking for. Alabanza has no established method for evaluating customer
value or for prioritizing customers, which complicates the objective of digital business
transformation for targeted customer groups.

Figure 1. Key concepts, own.

1.2. Purpose

This paper aims to investigate the needs and requirements of the stakeholders for a digital
business model, on which transporters, customers and Alabanza can interact. It also aims for
integrating a digital transformation strategy, highlighting the needs and requirements of
important stakeholders in the business ecosystem for business model alignment, and
formulating prerequisites for the digital business model “mobile storage”. The problem is
characterized by four stakeholders:

- Customers that want a good product with a quality of service at an inexpensive price.
- Transportation companies that want a logistics flow with no downtime for their crane trucks
when picking up and delivering containers.

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- The shareholders of Alabanza wants a profitable business, growth, and good cooperation
with transportation companies.
- The employees of Alabanza that wants good workflow.

Digital transformation will require interaction with the stakeholders to create a value
proposition and business model. The research questions to investigate the literature area are:

What are the prerequisites for a digital business model?

Why should stakeholders cooperate to innovate a business model?

How can Alabanza adapt its business model and business processes aligned with a digital
transformation strategy?

1.3 Limitations in research

This research paper has limitations. All research that contributes to the key concepts digital
transformation, business model, and stakeholders which influences the phenomenon digital
business model, will be classified as valuable information and contributions to research. The
research paper does not investigate the customer’s need for a new business model, interface
of a platform; nor allocations in digital process management are investigated, and integrations
of data methods.

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2. Literature review

2.1 Digital Transformation

Even though modern tech companies were the first in creating the digital transformation,
industrial-age industries such as health, electronics, machinery, energy and automotive are
following the path of digital transformation. The transformation can create new opportunities,
such as data collection and exploitation with connectivity of products, customers, companies,
and systems that can make decisions autonomously. (Remane, Hanelt, Nickerson, Neville &
Kolbe, 2017)

The definition of digital transformation is fragmented in research (Morakanyane et al., 2017).

See table 1.

Authors Definition
Hess et al. (2016) “concerned with the changes digital technologies can bring about in a
company’s business model, which result in changed products or
organizational structures or in the automation of processes”

Liu, Chen & Chou (2011) “The integration of digital technologies into business processes”
cited after Morakanyane et al.
(2017)
Chanias & Hess (2016) cited “reflect the pervasiveness of changes induced by digital technologies
after Morakanyane et al. throughout an organization”
(2017)

Schuchmann & Seufert (2015) “realignment of technology and new business models to more
cited after Morakanyane et al. effectively engage digital customers at every touchpoint in the
(2017) customer experience life cycle”

Piccinini, Gregory & Kolbe “characterized by the use of new digital technologies to enable
(2015) cited after significant business improvements”
Morakanyane et al. (2017)

Henriette, Feki & Boughzala “a business model driven by the changes associated with the
(2015) cited after application of digital technology in all aspects of human society”
Morakanyane et al. (2017)

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 Westerman & Bonnet (2014) “the use of technology to radically improve performance or reach of
cited after Morakanayane et enterprises”
al. (2017)

Mithas, Tafti & Mitchell “the extent to which an organization engages in any activity of IT”
(2013) cited after
Morakanyane et al. (2017)

Lucas, Agarwal, Clemons, El “fundamentally altering traditional ways of doing business by

Sawy & Weber (2013) cited redefining business capabilities, processes and relationships”
after Morakanyane et al.
(2017)

Fitzgerald, Kruschwitz, “the use of digital technologies to enable major business

Bonnet & Welch (2013) cited improvements ”
after Morakanyane et al.
(2017)

Bharadwaj, El Sawy, Pavlou “an organizational strategy formulated and executed by leveraging
& Venkatraman (2013) cited digital resources to create differential value”
after Morakanyane et al.
(2017)

Table 1, definitions of digital transformation (Morakanyane et al., 2017)

Digital transformation is the act of turning digital. Depending on the measures and dimensions
the transformation will involve, the definition of the transformation differs. A basis for the
definitions in Table 1, is that they all are highlighting technologies that are digital. The
definition needs to be evaluated against the drive factors of the transformation.

2.1.1 Digital Transformation Strategy

To transform into a digital business, two tools need to be used: digitization and digitalization:
• Digitization is converting information from analogue to digital, or automation of
business processes through information and communication technologies.

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 • Digitalization is the use of digital technologies to change a business model and
provide new revenues and value-producing opportunities; the process of moving to a
digital business (Nwaiwu, 2018).

A digital transformation strategy is a blueprint for how to reach future states of digital business
strategies. It supports companies in governing the transformation that arises from integrated
new digital technologies. The concepts of IT-strategies and digital transformation strategies are
not the same. Compared to digital transformation strategies, the IT-strategies usually focus on
the management of IT-infrastructure within the firm. IT-strategies are parts of digital
transformation. Hence, they enable digitalization and automation of business operations. The
process of defining a strategy and deciding on the resources that are experienced in the new
field the company needs for their development is referred to as strategic planning. (Matt, Hess
& Benlian, 2015)

Digital transformation takes on a different perspective and pursues different goals, depending
on the company’s scope of the digital transformation. From a business-centric perspective, the
strategies focus on transforming organizational aspects, products, and processes driven by new
technologies and explicitly include digital activities at the interface with or fully on the side of
the customers. The result could be a fully digitalized end-user product, and that constitutes a
clear difference in process automation and optimization which could be made internally in the
company’s business processes. Strategies in digital transformation go beyond the process
paradigm, which includes changes to and implications for products, services, and business
models (Matt et al., 2015). Companies converge multiple new digital technologies depending
on their technological maturity and enhance it with ubiquitous connectivity with the intention
of reaching sustained competitive advantage and superior performance in their operations. The
superiority and competitiveness are reached by transforming multiple business dimensions,
including the business model, operations, the customer experience and impacting the people as
well as networks. By operations, the comprising of processes and decision making is meant,
by people the skills talent and culture of the company, and networks include the entire value
system (Ismail, Khater & Zaki, 2017).

Digital transformation is a continuous complex undertaking that can substantially shape a

company and its operations. It is therefore important to assign adequate and clear
responsibilities for the definition and implementation of a digital transformation strategy. If a

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digital transformation strategy is approached half-heartedly, firms may lose their scope and
may encounter operational difficulties. Companies should ensure that the person who is
operationally responsible for the digital transformation strategy has sufficient experience in
transformational projects and directly align his or her incentives with the strategy’s targets
and progress. (Matt et al., 2015).

Depending on the scope of the transformation the strategy can pursue different goals. IT-
strategies refer to digitizing processes and are a part of digital transformation. Digitalization
is transforming the whole business model. Either way, you can integrate digital technologies
in your business processes for automation and optimization, or a fully digitalized end-user
product. It is crucial that the determined strategy considers the whole company and is
approached to the max, otherwise risks can occur for not succeeding with the transformation.

2.1.2 Digital transformation frameworks

Aligned with digital transformation strategy, digital transformation frameworks occur in
research. These frameworks are developed based on academic research or investigation in
companies that already made their digital transformation, and answers to questions on which
procedures and approaches a company should take for a successful digital transformation
strategy.

Matt et al. (2015) demonstrates a framework based on four elements that most digital
transformation strategies have in common. These elements can be ascribed as four
dimensions: use of technology, changes in value creation, structural changes and financial
aspects.

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Figure 2. A framework for digital transformation (Matt et al., 2015)

The use of technologies considers a company’s ability to exploit new technologies and its
attitude towards them. A company needs to decide, whether it should be a market leader in new
technology to create its own technological standards, or if it prefers to use already established
technological standards to operate and execute its business processes. Being a market leader
can lead to substantial competitive advantage, but requires technological competence, and risk
willing initiatives because of the uncertainties of developing new technology. From a business
perspective, the use of new technologies often requires changes in value creation. The company
needs to decide on how much the new technology (digital activities) can interfere and deviate
from their current – often still analogue – core business. Further deviations in value creation
can offer new opportunities to enrich and expand the current product and service portfolio but
can often require more risk-taking and technological changes. The digitization of products and
services can require or enable different forms of monetization, as well as adjustments to the
company’s business scope if new customer segments are addressed. The new different forms
of technology usage and value creation create new operations with the need for structural
changes. Structural changes refer to variations in companies’ organizational setup, and more
importantly, the placement of the new digital activities within the corporate structure. It can be
reasonable to integrate new changes in the corporate structure if the extent of changes is fairly
limited, but for more substantial changes it might be more relevant to create a separate
subsidiary within the firm. The former three dimensions can only be transformed after

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considering financial aspects. Questions the business leaders need to evaluate are what areas
in the company they afford to transform and the ability to finance. Financial aspects are both
drivers and bounding forces for the transformation. Whether the financial pressure on the core
business is high or low, companies should openly confront the need for a digital transformation,
so they don’t lack ways to finance it. (Matt et al., 2015)

Another framework by Gimpel, Hosseini, Huber, Probst, Röglinger & Faisst (2018)
demonstrates six action fields to master for the digitalization of the organization.
• Operations
• Value proposition
• Transformation management
• Data
• Customer
• Organization

Operations put importance on integrated IT, flexible operations, digital supply networks and
digital manufacturing. Value proposition puts importance on smart products, smart services,
individualization, and digital ecosystems. Customer highlights the need for customer
experience management, customer insights, multi/omnichannel management, and hybrid
customer interaction. Data considers the data integration, analytics, security, and ownership
& privacy that develops in digital transformation. The organization has needs of
organizational agility, a workplace of the future, a digital skillset, and a digital mindset. Last,
transformation management highlights the need for digital strategy, transformation
leadership, change management and digital value assurance.

2.1.3 Summary digital transformation

I state that the act of going digital is the digital transformation, and it can either be with the
digitization of business processes or the digitalization of a business model. The definition is
individual for each company or institution depending on the driving factors and dimensions
that are transformed in the company. The transformation process will be more resource-
demanding depending on what stage a company is in its digital development.

The strategy can be determined as an IT-strategy, or digital transformation strategy to turn into
a digital business. IT-strategies refer to digitizing processes and are a part of digital

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transformation. Digitalization is transforming the whole business model, creating new revenue
streams with digital technologies. Either way, you can integrate digital technologies into the
business processes for automation and optimization, or a fully digitalized end-user product.
The strategy needs to be formulated for the whole organization and not only the processes, and
distinct responsibilities, resources and competencies shall be committed to the goals strategic
planning has determined. A framework serves as a basis to understand driving factors and the
status of the company’s current transformation and can contribute to decisions in strategic
planning. (Matt et al., 2015)

2.2 Business Models

The heart of a company is how they create value and receive cashflows in the purpose of
growth. Depending on the company’s sector, the business model can be adapted for its specific
problem solving capabilities that customers are ready to pay for.

The business model concept describes how value is created, captured, and delivered, and as
a blueprint of how a company does business (Osterwalder & Pigneur, 2010; Chesbrough,
2007). The “…business model can be categorized as digital if digital technologies trigger
fundamental changes in these value dimensions…” (Remane et al., 2017:41). A digital business
model is a distinct type of business model that exploits digital technologies (Bock & Wiener,
2017).

The digital business model can usually be reproduced for a very low cost. The digital platform
of logistics that they aim to create will be more valuable as more users join. The digital business
model relies on digital platforms to balance benefits among an ecosystem with multiple
organizations and individuals involved. For example, Apple's app store must be able to provide
both users and application developers with incentives. A framework for digital business models
empathizes with the importance of customer contact points, a digital platform with a central
role as a hub, and the need to orchestrate a complex ecosystem with multiple stakeholders. Five
components in such a framework for a digital business model are (Remane et al., 2017):
1. Value proposition: The reason why a particular customer is willing to pay for a
product or service.
2. Interface: The interaction between the customer and the service platform.
3. Service platforms: Engines to enable the delivery of products or services.

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 4. Organizing model: Structure and processes of the ecosystem to create the products
and services.
5. Revenue model: Distribution of revenues and costs among the ecosystem participants.

Another framework is currently the state of the art of business models, and puts importance
on value proposition and revenue model, but adds additional factors for a well-functioning
business model in the business model canvas (Osterwalder & Pigneur, 2010). See figure 3.

Figure 3. The business model canvas (Osterwalder & Pigneur, 2010).

The different elements of the canvas can be explained as:

1. Key partners: The network of suppliers and partners that makes the business model
work
2. Key resources: The most important assets required to make the business model work
3. Key activities: The activities to make a business model function
4. Cost structure: All costs incurred to operate a business model
5. Customer relationship: The relationship a company develops with a specific customer
segment
6. Customer segment: Defines the different organizations or groups of people the
enterprise reaches to serve
7. Channels – How a company communicates with their customers and reaches them
with the value proposition

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 8. Revenue streams: The cashflows a company receives from each customer segment
9. Value proposition – The combination of products and services that creates value for a
specific customer segment

An important factor in optimizing the business model is the customer experience, which a
well-functioning platform can increase. Customers are increasingly putting higher demands
on a customer experience where they can interact with the company, anytime anywhere.
Companies must strengthen their digital experience to not lose customers to competitors with
a far more developed one. A digital business model therefore can result in an “ownership” of
the best customer experience and be rewarded with growth. With the right insight from the
customers, a business model created from the customer's perspective can lead to completely
new opportunities. (Osterwalder & Pigneur, 2010)

2.2.1 Value propositions

Value proposition is the cornerstone of business models. Without support from the other
elements of the business model canvas, the value proposition cannot be delivered. The value
proposition can be delivered by channels, partners, and with customer relations to the
customer segments, which responses with revenue flows. Key activities, key resources and
the cost structure is connected because it creates the value to be delivered. See figure 4.
(Osterwalder, 2004)

Figure 4. An interlacing of the value proposition, own.

While formulating a value proposition, it is important to consider what problem you solve for
the customer, and how you will deliver the solution. Key activities are the activities that a
company does to solve the customer problem (Osterwalder & Pigneur, 2010).

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The customer value proposition is a strategic tool that is used for communicating to the
customer how they aim to provide value for the customers. It is one of the most widely used
terms in business, it should be the company’s single most important organizing principle,
considering it is crucial to the value creation process. A value proposition should be
granulated down to customer segments. Evidence from case companies proves that the value
proposition makes a significant contribution to a company’s business performance. Uber
Technologies, offer a value proposition to both customer riders and drivers. The customer
seeks low-cost transportation from point a to b, and the customer driver is attracted to the
flexible earning potential. Uber does provide the customer and driver with the service
platform, where the customer can find the driver, and book with a single tap, and the driver
will receive reliable payments. The value proposition Uber presents is solving two specific
problems: for the rider, how to hail a cab with a range of options; for the driver, how to earn
money at any time with substantial flexibility. While deciding on the value proposition, the
manager should consider the strategic level, focus on customer segments, and explicitness of
the value proposition, considering the industry, market, and competitive environment.
Implications of the value proposition for the firm and customers should be evaluated as well
as evaluating what perspective of value proposition they should use for their industry: The
supplier-determined, transitional, or mutually determined. Uber is an example of a supplier
determining value proposition, providing a platform for its customer segments. (Payne, Frow
& Eggert, 2017)

The value proposition can be divided into digital offering or digital experience and concerns
the “digitized” solutions a company is offering its customer, intending to create customer
value. Successful products involve customers thoughts, acts, values, and relations in different
ways depending on the product itself (Gentile, Spiller & Noci, 2007).

Physical products and complementary digital services are offered with established products
that enhance the service level with complimentary digital service. The physical products are at
the core of the offering, with single or multiple digital services that optimize the value
proposition. It can be offerings or recommendations presented in the purchase process of the
physical product, that enable a more effective business process. The value proposition can then
be even more optimized or differentiated with a digital experience, which is personalization,
engagement, and community building. Personalization refers to the use of digital technologies

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to create tailored offerings for the user, engagement as the IT-enabled integration of customers
into the value creation process, as to say involving customers in new products and services,
and community building concerns the use of digital technologies to connect customers with
similar interests. (Bock & Wiener, 2017)

A value proposition is how the company communicates to its customer what they provide and
are the main idea of the business model, therefore it should be the company’s main principle.
Depending on what a company want to offer their customers, the value needs to be created and
delivered and can be categorized. A company can both create value for customers direct, or
indirect by creating a platform for other actors to create value for their customers. A value
proposition solves a customer problem, but how it shall be solved is up to the company to
determine with its key resources, key activities, cost structure and revenue model for financial
resources.

2.2.2 Business model innovation

Business model innovation is the search for new logic for the company and new ways to
create and capture value for its stakeholders (Casadesus-Masanell & Zhu, 2013). It focuses
primarily on finding new ways to generate revenues and define value propositions for its
customers, suppliers and partners. BMI in a business ecosystem is regarded as the foundation
of a company’s competitive advantages and requires an exchange of resources among various
stakeholders to create and capture new value (Yi, Chen & Li, 2022).

To innovate a business model is an ongoing process of exploiting new technologies and

business opportunities. Companies commercialize new ideas and technologies through their
business model. It takes a lot of effort to explore new ideas and technologies and the process
of innovating the business model can be passed on. This is a failure for companies if they
want to capture the potential success of a new business model, as the same idea or technology
will pass through two different business models and will have two different economic
outcomes. The search for a new business model may as well put the importance on being able
to balance between current and new business models. (Chesbrough, 2010)

If the senior leadership teams are motivated and eager to support the digital transformation of
business models, structures, and processes, they still face significant challenges. The need to
balance the exploitation of existing capabilities, at the same time as building up new digital

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capabilities that meet new needs and innovate their current business model. The importance
of strategic renewal is a major game-changer for incumbent firms to renew established
product-based business models with digitalization logic. Strategic renewal in the digital
transformation enables companies to provide multisided value propositions. In adjacent
industries, the creation and delivery of new value propositions are triggered by the entrance
of new competitors and are enabled by business model innovation (Warner & Wäger, 2019).

Different foundations for companies that want to innovate their current business model, by
targeting their current one, have been identified (Chesbrough, 2007). For every category the
company reaches, they have a degree of business model innovation to develop the business
model further. The categories are:
• Type 1 – The company has an undifferentiated business model
• Type 2 – The company has some differentiation in their business model
The company in type 1 do not articulate a distinct model, lacks processes for managing it and
has a problem with strategic renewal to become competitive. The business usually competes
on price and availability and serves customers who buy in that criterion. The type 2 company
has developed a small degree of differentiation in its products and services and can allow
them to target a specific customer that reacts towards their performance.

Business model innovation is hard to achieve. Barriers can occur, such as a lack of a positive
attitude towards change and business model experimentation. Even though the experiments
might fail, the information from the experiment is valuable lessons with approaches that were
not effective for the business. Losses can be constrained and afforded if the right financial
resources and planning are applied. The experiments create new data and set dynamic
capabilities for strategic renewal. The creation of new data can later point out hidden
opportunities. The company needs to identify internal or external leaders for business model
change, to deliver a new better business model by managing the result from earlier experiment
processes. Only by a cultural change of embracing the change of new business models, business
model innovation can help companies to renew growth and profits. Conflict can occur in
traditional configurations of company assets, whose managers are more likely to resist
experiments that might threaten the ongoing value of the company (Chesbrough, 2010). Three
key aspects of BMI has been identified, such as identifying novelty, lock-in complementarities,
and efficiency (Amit & Zott, 2012).

15
Finding new logics in the business model is important to stay competitive and create new
value for stakeholders. Experimenting with the business model can lead to business model
innovation. It is important for companies if they want to create viable growth. A type 2
business model is not that innovative and does not really differentiate their business model
compared to competitors. Increasing the innovativeness increases competitiveness. Even
though the innovation in the business model is not effective, it creates a foundation for further
development.

2.2.3 Summary of business models

A business model is circulating its value proposition. The level of innovation and digital
technologies can determine if the value proposition will be a digital solution. A new offer
requires business model innovation, but if it is possible to deliver a value proposition, is
dependent on all other factors in the business model canvas (Osterwalder & Pigneur, 2010).
The value proposition can thereby be optimized with personalization that is only possible with
an evaluation of the customer relations and customer segments. A value proposition can create
an offer which makes the customer willing to return for the product and contribute with more
financial resources. Strengthening the digital experience is competitive if the customers’ needs
a digital developed solution. Owning the best digital experience requires investments for
interface but will increase the communication and reward the company with growth. Finding
new logics in the business model is crucial to create new value and revenue streams, but barriers
can occur while experimenting with wealth creating capacities in the company.

2.3 Business Process Management

Improving business process management can be used for achieving corporate objectives. This
can be made with investments in technology, fact-based decision making, simplification and
innovation to optimize the processes. The characteristics of a business process are “they have
customers (internal or external), they have defined outcomes and there are users for those
outcomes, and they can cross organizational boundaries”. (Lee & Dale, 1998)

Business process modelling can be used for an analysis of the process flow. The current trend
of modelling is to use diagrammatic modelling, that only visualises the business processes.
Process analysis has little value unless it helps the company to improve its processes. Three
steps need to be undertaken to improve the business processes:

16
 1. Specify the system
2. Identify the performance bottlenecks
3. Choose among the possible modifications to resolve the performance bottlenecks
This does not provide the business process improvement either, without the necessary insight
and level of detail for the actions that lead to process improvement, supported by tools and
techniques. Goals of improving the company’s processes should aim at reducing lead time
and cost (Vergidis, Tiwari & Majeed, 2008)

To integrate business processes with other companies in the business ecosystem for the
automation of a process, each part must communicate different aspects of the company’s
architecture:
• Business architecture – describes the business strategy, organization, and key business
processes.
• Data architecture – describes the structure of an organization’s physical and logical
data assets and its management capabilities.
• Technology architecture – the logical software and hardware needed to support the
deployment of business services, applications, and data, including IT infrastructure,
networks, communications, standards, processing, and middleware.
Process architecture represents the fundamental organization of service development and
should be maintained by using modeling tools. Integration of data between companies for
efficiency, service speed and agility can be described with an integration architecture. For
detailed interface descriptions of data exchange, tools like Enterprise Application Integration
can be used (Pinheiro, Guerreiro & Mamede, 2021).

An application programming interface (API) enables companies to integrate their business

processes between departments and external organizations (Mathijssen, Overeem & Jansen,
2020). Process effectiveness applications provide better optimization, reduce operating cost,
increase throughput, and improve product quality (Samad, McLaughlin & Lu, 2007). Self-
service, something that can be made with self-service technologies (SST) which can as well
contribute to faster delivery and co-value with the customer in the automation of processes
(Hilton, Hughes, Little & Marandi, 2013). Adoption of intelligent automation and more
automated processes reduces workload in business process management, cost, human
resources, and operational time (Ng, Chen, Lee, Jiao & Yang 2021).

17
Companies need to identify processes that will be improved from a digital change. Different
changes, put different demands on tools and techniques. An integration between two
company’s API’s requires monitoring and communication between the two. Internal
processes are not dependent on external parts, perhaps external consultants that can model
and analyze the process flow to improve it with new techniques and tools.

2.3.1 Summary of business process management

A business model contains business processes, and the change of digitizing shall be
communicated to the stakeholders so the business models can be aligned, as well as defining
and identifying the processes that shall be eliminated or improved. Business process
management creates effective operations and processes. The business processes can be
optimized and automated with SST and integration of API:s, and reduces workload, cost
human resources and operational time. To model the processes is a first step for
improvement, but the improvement also needs support from the right techniques and tools.
An improvement of the business processes leads to more efficiency, but needs evaluation of
bottlenecks towards KPI:s, such as time and cost.

2.4 Stakeholder Management

To understand the perspective from customers and carrier companies, additional theories of
transport management and customer relations management is included in this chapter. The
literature also covers business ecosystems and partnerships, since it occurs stakeholders in such
context.

Effective stakeholder management is beneficial for the company’s strategic management and
economic return. It can result in “increased trust that leads to fewer transaction costs, by
reducing resources needed to create and enforce contracts and by eliminating the need for
elaborate safeguards and cogency that require detailed monitoring. A detrimental relationship
can risk the wealth-creating capacity of a company, while a successful beneficial relationship
can enhance it. Conflicts between stakeholders can be solved if the managers re-think the
problem so that the needs of the stakeholders are addressed, and when this is done value
creation can increase significantly. Sometimes trade-offs must be made to solve the conflicts,
which need to be evaluated on how to be made, and then work on improving the trade-offs for
all sides involved. (Parmar, Freeman, Harrison, Wicks, Purnell, de Colle, 2010)

18
2.4.1 Stakeholder theory
Three different philosophies of human behavior in the market setting are self-interest,
reciprocity, and opportunism. Self-interest explains that humans are self-interested utility
maximizers, and the self-interest of a human being will always be greater than paying attention
to another human being’s interest. Opportunism is the theory of humans using opportunism
that describes that some actors are ready to subtlety deceive their exchange partners to
maximize their utility. A philosophy has emerged called reciprocity decisions making, which
gives a more exact model of human behavior in strategic management. Reciprocity suggests
that people maximize their utility while conforming to the norm of reciprocity. That means,
that parties in business constellations are ready to sacrifice self-interest for the sake of their
principles. Either way, you can be deemed fair with positive reciprocity, or deemed unfair with
negative reciprocity, which also determines the degree to which people exhibit reciprocity
tradeoff their self-interest and their principles. Fair behaviour results in a reward, and unfair
reward results in punishment. Overall, reciprocity is the foundation for mutual agreements and
relations with stakeholders and can create so-called “rent”. Rent is referred to the profit made
after costs for beneficial relationships. The more positive the reciprocity is, the more value is
created and captured by the company. (Bosse, Phillipps & Harrisson, 2008)

Self-interest needs to be considered to form a reciprocity relationship between stakeholders.

Tradeoffs can be made when two stakeholders are ready to give up a requirement for the
greater good and form value together. The opportunism should be avoided to not create
detrimental relations, which leads to decreased trust. Increased trust leads to decreased
monitoring in stakeholder management and lowers transaction costs. The interesting part of
reciprocity is that it takes an “if you make money, we make money” approach. Positive
reciprocity is something that leads to more financial resources earned, but a stakeholder needs
to maximize their utility while satisfying the other parts' interest to create “rent”.

2.4.2 Business ecosystems and partnership

The locus of value capture and value creation has shifted to a business ecosystem. This business
ecosystem is composed of interdependent stakeholders, for example, customers and suppliers.
From a stakeholder perspective, business is understood as a set of relationships among groups
that creates the business. The stakeholders interact to jointly create and trade a value. To
understand a business is to know how relationships work and change over time between
stakeholders, and it is the manager’s job to create and distribute value (Parmar et al., 2010).

19
A business ecosystem is a network where each member contributes to the ecosystem’s
wellbeing and is dependent on other members for its survival. In the context of business, this
sums up the evolution of companies that cooperate. Stakeholders are a part of the business
ecosystem. The change of emerging technologies and business opportunities can open up
innovation and beneficial business relationships when firms co-evolve capabilities in the
creation of products and services. The business ecosystem describes the network of firms,
which collectively produce a holistic, integrated technological system that creates value for
customers. The benefit of working in a network of companies that cooperate in the delivery of
greater value for the company than the value it might have created alone. There are three
strategic implications of being part of a business ecosystem. First is the number of resources
that must be invested, both in the company’s innovation and the development of component or
complementary technologies. Secondly, the firm must take the lead in developing innovations
in their business model that can keep evolving with complements. Third, is the assessment of
risk that accompanies cooperation in an ecosystem, evaluating risks in different innovative
projects, their success potential and evaluating the technologies that should be enhanced to
create a scalable business model. (Mäkinen & Dedehayir, 2012)

When redesigning a business model, firms are increasingly relying on stakeholders in the
business ecosystem to create and capture value. The stakeholders can exert a major influence
on a company's business model innovation. A system that connects all stakeholders in a
business ecosystem, and combines their resources results in a business model that aims at
value creation for multiple stakeholders. While evaluating stakeholders, two different groups
can be divided into external and internal stakeholders. The internal stakeholders are owners,
employees, and representatives of the company and shareholders, while the external
stakeholders are customers, suppliers, organizations, creditors, and the government. Benefits
of external industries stakeholder ties can offer companies more heterogeneous resources and
can as well contribute to organizational learning for the company (Yi et al., 2022).

External technology partnerships allow open business models to accomplish even more. Co-
development partnerships are an important mechanism for innovating the company’s business
model. Depending on the context of the relationship, the character of the relationship varies.
To sustain the co-development partnership, one must carefully define the business objectives

20
and align the business models of each company. There are four steps to implement a co-
development partnership (Chesbrough & Schwarz, 2007):
1. Define your business objectives
2. Assess the capabilities you require
3. Determine the degree of business model alignment with partner
4. In managing the partnership, think of future collaboration – not just the current need

Key partnerships describe the network of suppliers and partners that makes the business model
work. A partnership is becoming a cornerstone of business models, and companies can create
alliances to optimize their business model, risk reduction and acquire resources. Osterwalder
& Pigneur (2010) separates the partnerships into four different types:
1. Strategic alliances with not competitors
2. Strategic partnerships between competitors
3. Joint ventures to develop new companies
4. Relations between buyers and suppliers as an assurance of continuous supply

To innovate and create new value, it is important to consider the different stakeholders in the
ecosystem. Understanding the business ecosystem can lead to new value creation and value
capture. Creating value for different actors in the value chain can be beneficial for the business
model while redesigning it. The manager shall understand relations between stakeholders in
the ecosystem to execute a strategic renewal. With a partnership, a company can create
alliances to be even more competitive in the market. Targeting all actors in the business
ecosystem and combining their resources, makes a significant change in how value is created.
Research on digital business models that considers stakeholders in the ecosystem have not been
found during the author's theoretical research, therefore it is an interesting contribution to this
paper.

2.4.3 Customer Relationship Management

Customers are a stakeholder (Parmar et al., 2010). Customer relations are established and
maintained for each customer segment. Profitable customers are a critical part of a successful
digital business model, and to satisfy customers companies may divide them into segments.
These segments can be divided into common needs, common behaviors, or other recognition
factors. The owners of the company must take a strategic decision on which segments to ignore,
and which segments to embrace. Hence, the business model can serve one or several customer

21
segments. Customers represent a separate segment if their needs require and justify a distinct
offer, they require different types of relationships, they have substantially different
profitability, they are willing to pay for different aspects of the offer, or they are reached
through different distribution channels. Depending on the strategy with the business model, the
company can aim to reach different markets which address the customers in different ways. A
segmented market separates its customers by various needs and concerns, a multisided platform
(or market) is solving different needs and concerns by connecting customer segments to each
other, and a company that focuses on a mass market does not differ their customer from each
other. (Osterwalder & Pigneur, 2010)

Customer relationship management emerged in the 1970s as a tool to manage and optimize
sales-force automation within companies. Today, it is a commonly used tool of enterprise
information management for effective customer interaction and customer knowledge
management. Customer relationship management is defined as the “integration of processes,
human capital, and technology, seeking for the best possible understanding of a company’s
customers. CRM allows companies to integrate and centralize their customer data and
transaction records. This contributes to the identification of loyal customers and more
effective marketing activities. One of the key elements to increasing customer loyalty is to
develop personalization software tools – “…the ability to personalize customers user
experience in software…” (Gil-Gomez, Guerola-Navarro, Oltra-Badenes & Lozano-Quilis,
2020:2734). Customer relations describes the type of relationship that a company establishes
with a certain customer segment. The company must be addressing and specifying what
relation they want to keep with each customer segment. The choice of customer relations can
have different underlying motives such as:
• Acquire customers
• Retain customers
• Increase sales with complemented offers or services.
Customer relation can also be explained as the degree of value proposition a company can
fulfil for the specified customer segment. The type of relation chosen for a customer segment
can be specified with questions as such which customers already are established, how much
the customer segment cost, what kind of relation the customers are expecting and how the
customers are integrated with the rest of the business model. (Osterwalder & Pigneur, 2010).

22
A positive customer experience can promote an emotional tie between a company’s brand
and its customer, which enhances the customer loyalty (Gentile et al., 2007).

While developing a customer experience, is to integrate a typically diverse array of stimuli to

assess the tradeoffs that are entailed in creating value for customers. The stimuli are typically
interactive but are crucial to point out in a customer experience while defining it for the
customer segment (Palmer, 2010).

Developing customer relations are important to increase sales and customer loyalty. The
brand itself can create an emotional tie with the use of CRM personalization, which is also a
way to optimize the value proposition (Osterwalder & Pigneur, 2010). The owners must
decide on which customer segments to ignore and which to embrace, by evaluating their
profitability or overall benefit for the business model. When that decision is made, a customer
experience can be created.

2.4.4 Transportation Management

Effective operations require a well-functioning transport. Transport is a set of activities
related to the movement of people and material goods by appropriate means. It plays a very
important role in logistics, because of the goods movement and the creation of ancillary
services. Transport in the national economy enables the exchange of goods and services.
Transportation should not be too late or too early and using a transport information system
provides transport with significant effectiveness with its reliability (Grabara, Kolcun & Kot
2014).

Costs associated with transport are one of the biggest factors that increase cost in logistics.
An organization of transport with transport management can often lead to increased sales, and
an essential benefit is if the transport manager's ability to control and monitor the transport.
(Rydzkowski, 2005, cited after Grabara et al., 2014).

Information systems in transport can provide the transport company with better financial
results, increased transport efficiency, more efficient coordination in the exchange of
coordination, the possibility of remote monitoring conditions along the route, less use of
drivers and optimize the timetable and plans of drivers. In addition, it can also contribute to
an adaption of the trips to the requirements of customers without incurring additional costs.

23
To develop a transport information system, identifying the transportation process is a very
important first step (Grabara et al., 2014):
• Information on a selection of modes of transport
• Information about loads (size, type, quantity)
• Information about senders and recipients
• Start and end time

Another important factor to bear in mind is that the quality of the transport of the service
provided is just as vital as the processing time of the transport. To execute the transport
process more smoothly, companies are increasingly using modern tools of information
systems to run the operation more effective. Telematics is devices and systems that collect
data for the transmission of their distance, which transforms into information to the end-user.

The primary alternative when choosing a telematics system is the return on investment.
Companies do have different alternatives and need to choose one or several that fits their
enterprise in the most optimized way. (Budzik & Zacharski, 2012 cited after Grabara et al.,
2014).

- The ability to scale the system: Simple devices and the software does not have
limitations to expand the scope of retrieved data
- Interactivity: Has advantages from the point of view and better contact with the driver
- Other features: Tools that can make the driver more inventive and secure quality of
the transport process in interaction (photo viewer, video)
- Open or closed system: A closed system offer only the information from its sensors
such as GPS position, open systems allow communication and information between
trucks or companies
- Hardware or software: Operating systems that only work on the provider's platform or
those that can be installed on different hardware
- The scope of processing the collected data: The ability to represent data as statistics or
the ability to represent data with folded parameters
- Central server: Installation of a central server of the transport company that can be
reached through the internet, for example, cloud solutions

24
 - The possibility and scope of the data export for further information systems in the
enterprise

A rising phenomenon discussed in the research is the appliance of smart transportation. Using
mobile devices and devices installed in the city, or sensors embedded in the vehicles, it is
possible to offer optimized route suggestions and autonomous driving. Route optimization is
the method of proposing the best route for a specified destination to decrease traffic
constellation and can be developed by various machine learning and data collection methods.
An interesting machine-learning approach is using decision trees. Every single decision
choice is broken down into subtasks with the help of collected data and can thereafter present
different outcomes of the decisions. (Zantalis, Koulouras, Karabetsos & Kandris, 2019).

A transportation company that uses telematics and transport systems can increase their
efficiency and digitize business processes. To create an information system for transport the
business processes of the carrier need to be identified. A carrier company that uses the
benefits of an information system can decrease cost and increase efficiency in operations with
the ability of surveillance for their customers.

2.4.5 Summary of stakeholder management

Cooperation with the stakeholders in the business ecosystem can create new value for the
business model. It also sets dynamic capabilities if the company understand its market that
changes rapidly with digital technologies. The complexity of stakeholder management is that
no actor in the ecosystem shall feel they are treated with negative reciprocity, then detrimental
relations can arise. All stakeholders have the self-interest to utilize their capacities, but
considerations shall be made for other companies for mutually beneficial relationships. When
a business model is redesigned, either digitalized or digitized the needs of other stakeholders
shall be involved since it will affect the value creation of all actors involved. One stakeholder
of Alabanza is the transportation company with carriers for container delivery. If they have an
active use of telematics and information systems their operations shall be seen as effective.
Even if the price for carriers is high, the use of information systems and telematics can capture
value for Alabanza as well.

25
3. Concrete research question

Research revealed that a business model can either be digitalized or be digitized. Digitization
sets basis for a digital business model and is an IT-strategy that includes automation of
manual processes for process optimization, or the conversion of analog activities to digital.
Digitalization is the development of a digital business model, which is a fully digitalized end-
user product. Transformational strategy needs to be followed strictly with distinct
responsibilities, resources, and competencies. The value proposition that a company decides
is the primary principle they shall follow in their organization. A changed value proposition
results in a redesigned business model. It can be adapted to different stakeholders depending
on the customer relations in different customer segments with different needs. A business
model can be aligned with stakeholders if the redesign is communicated with the change in
business processes, and an effective carrier company uses telematics that can be integrated in
Alabanza’s digital processes. Business model innovation can create digital business models
and be optimized with input from stakeholders, hence the cooperation with the stakeholders
can create new value for the business model. It does also set dynamic capabilities for the
strategy as the company can understand their stakeholders in market change. Positive
reciprocal relations lead to more value creation, negative reciprocity leads to a detrimental
relationship and less “rent”.

These finding creates concrete research questions referring to there are in the literature
review, to find an answer to the stated research questions in the purpose (see chapter 1.2).
Digital Business Model
- How digital is Alabanza’s redesigned business model?
- What does the value proposition require of Alabanza?
Stakeholders
- How can the different requirements of stakeholders be considered for a mutual
beneficial relationsship?
- How are stakeholders affected by the new business processes?
- How digitally mature and efficient is Kjelland Transport?
Digital transformation
- How developed is Alabanza’s organizational digital transformation?
- What are the drivers of digital transformation?

26
4. Method
To answer the research question, the study has contained observations of Alabanza’s
operations, literature studies and interviews with the main stakeholders. First, data from
literature were gathered while observing the case company’s operations. Secondly,
quantitative data from the customer database. Thirdly, qualitative data from Alabanza and
Kjelland Transport. Lastly, the results were analyzed and discussed, and more data from
literature were gathered to find additional reasoning for the results. See figure 5.

Figure 5. Overview on research method, own.

4.1 Approach

First, articles related to the subject related fields were studied to get an overview of the term
digital transformation and digital business models. Thereafter, a brief meeting took part with
the examinator and case company, to figure out what problem with an academic foundation fit
for scientific research and as well provide Alabanza with beneficial knowledge for a redesigned
business model. To answer the research question and conclude, I will be open to findings in
the research but will proceed with a conscious awareness of my knowledge of digital process
management, digital business models, digital transformation, stakeholder management and
carrier logistics. During and before the research I have certain knowledge and view of
Alabanza’s current business and the factors that have an impact on it. However, I don´t have
the knowledge of how they specifically shall comprehend their stakeholders, strategy, and
business model to adapt to a digital transformation. With the help of empirical research in the
form of qualitative interviews and observations in real-time situations, as well as theoretical
data I will identify what needs to be explained, and therefore, this research is abductive. (Kuhn
1970, cited after Philipson, 2013)

27
4.2 Operationalization

First, the research question served as a foundation for the theoretical chapters, for finding
proper articles that were in line with the paper’s topic. The theoretical part is a major pillar
for breaking down concrete research questions that can be transformed into interview
questions. The key terms, stakeholder management, digital business models, and digital
transformation strategy were used to create an understanding of the phenomena of digital
transformation.

Figure 6. Operationalization of research, own.

Specifically, the different dimensions of the framework of Matt et al. (2015) were
decomposed to find out Alabanza’s current situation to adapt to a digital transformation.
Then, the strategy and goal of the transformation were asked to understand the drivers of the
digital transformation. (Morakanyane et al., 2017)

28
The business model canvas (see figure 3) was used to identify Alabanza’s degree of digital
transformation for the business model, and if the outcome would be a digitized or digitalized
business model (Osterwalder & Pigneur, 2010). Questions to find out Alabanza’s As Is and
To Be processes, as to say how their current processes look like and how they want it to be
like because it put specific requirements on the stakeholders that are involved in their
business ecosystem.

Kjelland Transport AB was just as Alabanza questioned on their development of digital

transformation, but as well how they would react to a change in Alabanza’s digital
transformation.

The customers were not interviewed but quantitative data was gathered to understand
different needs of container type.

4.3 Case study

This research paper is limited to three cases which are stakeholders and will be affected when
mobile storage goes digital.
1. Alabanza and its employees
2. Carrier suppliers
3. Customers

4.3.1 Choice of company

While choosing the company for this subject the author was networking with social contacts
for a company that undergoes a change in digital transformation for expansion. Alabanza AB
was in a critical decision situation, where the choice of a digital business model and its
processes need to be balanced with their stakeholders for a scalable business model. In the
company, two managers (also the two owners) and one employee were interviewed.

4.3.2 Choice of supplier

A supplier with delivery solutions for containers was chosen with trustful relationships with
Alabanza AB and is considered as a potential partner to make the new business model effective.
The relation was important, so the author could perform his research properly. The carrier
supplier chosen was Kjellands Transport AB, due to that they run the majority of Alabanza’s
delivery of mobile storage. At Kjelland Transport, the CEO of the company was interviewed

29
because it´s a top-down organization that answers to his command. If the CEO of Kjelland
Transport AB chooses to cooperate with Alabanza, the partnership has a high probability to be
completed.

4.3.3 Recognition of customers

Alabanza’s customer database of customers was investigated to find different demands on
container type, customer segments, customer volumes, average fees of the container and lease
time.

4.4 Data collection

A qualitative approach is used to identify key issues and for stakeholders. When a qualitative
method is used correctly, it provides deeper insight into problems than quantitative methods
(Jepsen & Rodwell, 2008). When the interviews were completed, Philipson’s (2013) well-
grounded theory for pattern-finding was used to gather the data for analysis and conclusion.
During the research, data from literature were gathered, quantitative data from customers, and
qualitative data from Alabanza and Kjelland Transport.

4.4.1 Interviews
For Alabanza and Kjelland Transport, information is collected by interviews. The
approachable interviewing technique consists of two minimum requirements (Jepsen &
Rodwell, 2008)
• interview questions should be specific in their clarity and focus
• they should be appropriately patterned to suit the experiences of the interviewees.
The wording - but not the of the questions - should be adaptable to the experience of the
person being interviewed. Interviews will ensure that the questions are open, and broad, and
invite respondents to answer freely concerning their business environment or customer
experience.
Before every interview, the interviewee was informed about the topics and areas the
interviews will concern. The contact was made by email and phone messages. Alabanza’s
needs and requirements were investigated to implement the redesigned business model, in
line with their digital transformation strategy.
Areas interviewed for Alabanza were:
1. Digital transformation
2. Digital transformation strategy
3. Redesign of business model

30
 4. Business processes
5. Cooperation and partnership

The three respondents of Alabanza were asked the same questions and were remarkably close
in time. Interview times related to the respondent are demonstrated below in table 2.

Respondent 1 Respondent 2 Respondent 3

Time 73 minutes 72 minutes 71 minutes
Table 2. Length of interviews, own.

Areas interviewed for Kjelland transport were:

1. Digital transformation
2. Cooperation and partnership
3. Business model
The interview length of time was 91 minutes.

4.4.2 Secondary data collection

The customers are considered a stakeholder and will be affected by a digital transformation.
Customers from the database and the specific demand on container types were observed to be
able to contribute to the theoretical chapter on customer relations. Observations on customers
in industries, customers with the highest volume, profitability, and a comparison between
private customers and company customers to show which customer segment rents most
containers and fits the redesigned business model.

4.5 Analysis

After all the data was gathered from the different stakeholders, an analysis of the data material
was carried out and compared with the theoretical chapter. During this time more theoretical
data was collected, for being able to discuss all the material that occurred in the observations.
Analysis of the results from Kjelland Transport was made by identifying statements in the
transcribed interviews. The analysis of the result from Alabanza was made with Philipson’s
(2013) method for pattern finding in qualitative data but was adapted and simplified due to the
lack of respondents that could make it possible to find global patterns. Therefore, patterns in
every area investigated were identified by Alabanza’s respondents, as well as statements that
are valuable because it matches the information in the theoretical research. Kjelland Transport

31
could only provide the research with one respondent, therefore only statements were used for
the result and analysis.

4.6 Validity and reliability

Validity is “it determines whether the research truly measures that which it was intended to
measure or how truthful the research results are. In other words, does the research instrument
allow you to hit "the bull’s eye" of your research object?” (Golafshani, 2003;599, cited after
Joppe, 2000).

Reliability is to the extent to which results are repeatable. If another researcher repeated the
study, would they obtain the same result? Another aspect of reliability is to demonstrate
research decisions during the research project, a researcher should be able to understand what
was done, by reading for example a research diary. (Grossoehme, 2014)

The validity of this research was made by contacting the interviewees with the results to get a
confirmation that the author had interpreted their answers correct. The reliability was made
by choosing an academically accepted pattern-finding method, and close communication with
the examiner and supervisor for guidance in the research process.

4.7 Ethics in research

All interviewees were informed beforehand that the interviews would be anonymous if they
so wanted.

32
5 Results
Results were gathered from firstly the customers, secondly Alabanza, and thirdly Kjelland
Transport.

5.1 The customers

152 out of 219 containers are rented by companies, and 64 out of 219 containers are rented by
private persons. A remarkable share of the customers is active in the automotive and
construction industry, and the others are more point a mass market.

5.1.1 Company customers

In one of Alabanza’s digital tools for administration, the top twelve company customers
could be identified. Essve, are providing Alabanza with the largest revenue stream, and
thereafter Astra Zeneca and Intertek Semko, which are highly technological companies in
need of extra storage see table 3.

Company Industry Volume of revenue streams

Essve Sverige AB Construction 5,60%
Astra Zeneca AB Medical 1,90%
Intertek Semko AB Certifications of electrical 1,10%
applications
Essve Produkter AB Construction 1,00%
H&H Tuonti OY Wholesaler 1,00%
GH däck och motor AB Car industry 1,00%
3on Reklambyrå och Webbyrå AB Advertising 1,00%
HNH Bygg AB Construction 0,90%
Myten AB Restaurant and catering 0,80%
ALX Industry 2.0 AB Real estate and business 0,80%
consultancy
Samhall AB Cleaning and maintenance 0,80%
Keolis Sverige AB Public transportation 0,70%
Table 3. Top customers of Alabanza, collected from the database.

The companies renting a container now, are mostly at a period of 1-3 years. Prices can differ
because of the type of container. A ten feet container is less expensive than 20 feet. The
generated monthly cash flows come from the customer with a rental period of 1-3 years. See
table 4.

33
Years of leasing Number of containers Generated monthly cashflows Average fee (monthly)
<10 8 6642 SEK 830 SEK
7-10 10 5642SEK 564 SEK
5-7 16 9172 SEK 573 SEK
3-5 38 30231 SEK 796 SEK
1-3 46 32628 SEK 709 SEK
>1 34 24296 SEK 656 SEK

Table 4. Overview of company customers, own.

Companies that use mobile storage need extra storage. Table 5 highlights different industries
and their share of the containers that Alabanza have in service. One company customer is not
included in the result – Essve Sverige AB. Results indicate that construction and building
industry has the biggest share of containers, as well as the automotive industry that uses the
containers as storage for their tires. See table 5 below.

Industry Share of rented containers

Construction and building 27/152
Automotive industry 23/152
Transportation 10/152
Real estate development 8/152
Sport / outdoor associations 8/152
Medical science 6/152
Fuel stations 6/152
Engineering and technical services 6/152
Wholesalers and retail 6/152
School industry 6/152
Restaurant / food 5/152
Counties 5/152
Industrial design industry 4/152
Music and entertainment industry 4/152
Technological certifications 4/152
Convenience stores 4/152
Hotel 4/152
Cleaning and maintenance 3/152
Museum / local history association 3/152

34
 Logistics 2/152
Beverage and snacks 2/152
Print services 2/152
Law enforcement 2/152
Electricity generation 1/152
Veterinary 1/152
Table 5. Industries that use mobile storage, own.

There are 9 different containers in the product portfolio of Alabanza. The 20 feet container is
by far the most popular one, with a total share of 88 out of 152 containers (approximately
58%). Second, in popularity, is the 10 feet container with a total share of 26/152 containers.
See the demand on different containers below in table 6.

Type of container
Number of 20” 10” 20” 8” 20” 40” 10” MBox 20”
containers ISO Tyre ISO ISO Longside
88 X
26 X
11 X
9 X
7 X
6 X
3 X
1 X
1 X
Table 6. Demands on container type, own.

5.1.2 Essve Sverige AB

Essve has a similar business model as Alabanza. Essve rents out containers with construction
supplies in them (screws, nails, etc.) to construction sites or builder’s merchants, and when
the leasing period is completed, they charge the renter for the inventory that is used. Essve
uses the cooperation with Alabanza for two reasons:
1. Container supply
2. Transportation services
The transportation services are usually when the container needs to go back to the depot,
which Essve lets Alabanza take responsibility for. Essve have now 90 containers in service

35
and 22 at Alabanza’s depot, ready for deployment. All Essve’s containers are 10 feet
containers.

5.1.3 Private customers

The private customers are not the biggest part of Alabanza’s business, since they are the
smallest segment. Compared to the company customers, the private customers are not
providing with the same revenue streams each month. In recent years, the share of private
customers are increasing. The average fee is lower than the company fees, which indicates
either more usage of 10 feet containers or a lower overall price for the customers, see table 7.

Years of Generated monthly cashflows Average fee (monthly) Number of containers

leasing
<10 392 392 sek 1
7-10 624 624 SEK 2
5-7 4006 445 sek 9
3-5 5999 666 9
1-3 11398 600 19
>1 21568 898 24

Table 7. Overview of private customers, own. Private customers are more likely to hire a 20
feet container with a share of 35 out of 64 (approximately 55%). The 10 feet container is
more popular for private customers than for company customers, with a share of 14 out of 64
containers (approximately 22%). See table 8.

Type of container

Number of 20” 10” 20” ISO 8” 10” ISO 20”

containers Longside
35 X
14 X
7 X
4 X
3 X

1 X
Table 8. Private customers container demand, own

36
5.2 Interviews with Alabanza

Alabanza’s interview points out different similarities and differences in their view on the new
business model, digital transformation and what incitements they would need from a carrier
company to develop a digital business model. It also shows, how the different interviewees at
Alabanza want to transform their business processes to digital. Four different areas were
investigated in the interviews with Alabanza:
1. Digital transformation and strategy
2. Digital business models
3. Business process management
4. Cooperation with stakeholders

In the result tables, the R stands for respondents that made statements, Q is for the question,
and the topic is the questions sector within the chosen area.

5.2.1 Alabanzas digital transformation

Patterns were found in all topics discussed. The topic demonstrates the question of the area
of digital transformation and framework. Nine questions in 5 topics were asked within the
area of digital transformation and strategy to find out the driving factors and applicability of
Matt et al. (2015) framework for digital transformation strategy. See table 9.

TOPIC Q PATTERN 1 PATTERN 2 PATTERN 3

DIGITAL 1 Fairly digitalized but in
TRANSFORMATION need of digitalizing
mobile storage
STRATEGIC GOAL 2 Gain growth and market
leader in price
USE OF NEW 3 New technologies are New technologies are
TECHNOLOGIES positive for improvement positive for
improvement but
challenging
4 Creation of technologies
to exploit new
technologies
CHANGES IN 5 Creating new value will Creating new value will An idea of digital
VALUE CREATION involve the delivery involve the delivery ecosystem is
process neglected by two

37
 process and customer
experience
STRUCTURAL 7 It can create a new brand
CHANGES or develop operative
business units
FINANCIAL 8 There is a lack of
ASPECT resources because of
lack of external investors
9 It is worth it to invest but
private risk needs to be
considered
Table 9. Patterns found around digital transformation, own.

Important statements that respondents that were found in the interviews that are additional
information about the research. Q stand for question. See table 10.

TOPIC Q STATEMENT RESPONDENTS

STRATEGIC 2 To improve work methods and routines 2
GOAL
CHANGES IN 5 Different values can be created with a digital business 1
VALUE ecosystem; Capture value in the digital business
CREATION ecosystem
6 Manual checks for security need to be done 1
6 It is purely a burden in terms of resources and focus 1
Table 10. Statements found in digital transformation, own.

5.2.2 The redesigned business model

The business model canvas was used to understand if Alabanza want to create a digital
business model or a digitized business model (Osterwalder & Pigneur, 2010). Twentynine
questions were asked, 9 topics (the elements of business model canvas, see figure 3) within
the area business model. Patterns were not found in all areas and a lot of individual opinions
point at differences in the answers, see table 11.

TOPIC Q PATTERN 1 PATTERN 2

VALUE 1 Improved prices in carriers with digital

PROPOSITION services
2 Temporary and permanent needs of storage Individual opinions about value
delivery

38
 3 Individual opinions about customer problem
CUSTOMER 5 Value is created for private storage needs,
SEGMENTS permanent and temporary
6 Long term customers are companies and
associations
CUSTOMER 7 Customers want to be contacted by email and Facebook and google should be
CHANNELS partners used (individual opinion)
9 The offer needs evaluation methods for the
customer
11 Email and chat services at the webpage Two additional communication
approaches
CUSTOMER 14 Homogenic relations and liquidation of essve
RELATIONS is an individual opinion
REVENUE 15 Low price products and carrier costs is not
MODEL something the customers are willing to pay
for
16 The company prefers e-bill or direct debit as
payment method
17 Simplicity of automatic payments is positive
but some customers are in need of control
18 Insurance of goods and carrier transportation
are individual ideas
KEY 19 Container supply and competences in
RESOURCES business development and IT-development
KEY 21 Business supporting partners and IT-system Price mechanism and digital
ACTIVITIES is key business processes
22 Partner relations and web-based
communication is underrepresented
KEY 26 Digital development and logistic activities
PARTNERS acquired
COST 27 The perception of cost is shared
STRUCTURE
Table 11. Patterns found around the redesigned business model, own.

Important statements that were found in the interviews that is additional information about
the research. Column 1 is topic, R is number of respondents that stated the statement. see
table 12 on following page.

39
TOPIC Q STATEMENT R
VALUE 1 no decision taken yet 1
PROPOSITION
2 Temporary needs for storage; permanent needs of 2
storage
2 Financial easement for temporary and permanent needs 1
3 Construction material and tires are a main storage 1
problem to solve
4 Customer expectations needs to be addressed 1
4 Delivery of product is slow 1
CUSTOMER 5 Companies that wants a cheaper solution for permanent 1
SEGMENTS needs
6 Essve is mentioned as an important customer 2
7 Rather become attractive for more customer segments 1
7 The entertainment industry 1
7 No more segments but more construction companies 1
CUSTOMER 10 On the webpage 3
CHANNELS
10 Over the phone for persuasion 1
CUSTOMER 12 Low expectations for a non-technological product 2
RELATIONS
12 Access to support in delivery or return of container 2
13 Mostly individual customers 1
13 Essve, because of their lack of performance and capacity 1
consumption
13 Non digital aware customers 1
REVENUE MODEL 15 Square meters and the type of container 2
18 No decision made yet 3
18 Transport customers goods to the magazines with digital 1
service; carrier transportation; insurance of goods
18 To create franchises with a reciprocally agreement 1
19 A homogenic pricing is the best solution 2
19 Homogenic pricing, except for good customers 1
KEY RESOURCES 20 Effective carriers 2
KEY ACTIVITES 21 Supply of containers and procurement processes 2
21 Expanding business activities 2
22 Trust building activities 1
KEY PARTNERS 23 Important suppliers and subcontractors 2
23 We are not that dependent on partners at the moment 1
23 In need of partnership building 1

40
 24 Effective carrier companies 2
24 As long it is a balanced relationship; Construction and 1
renovation companies; real estate brokers; Builders
merchants; Cleaning, moving
25 The sister company responsible for marketing and IT 2
25 Container suppliers 1
25 Kjelland Carriers 1
26 Surveillance on carriers in a digital platform 1
COST STRUCTURE 28 The resources of consultants and development 2
29 Carrier cost 2
29 The most expensive cost is to build new systems, an 1
extraneous cost
Table 12. Statements found around the redesign of business model, own.

5.2.3 Business Process Management

Alabanza where asked within the area of business process management which processes, they
would like to digitalize and automize, since automation is defined as digitization (Mwaiwu,
2018). Two topics were discussed within the area. Patterns were found in the two questions
asked, see table 13.

TOPIC Q Pattern 1 Pattern 2

PROCESSES 1 Allocation between customer and container in the
TO contracting process should be digitalized
DIGITALIZE
PROCESSES 2 The customer booking of container should be The booking, delivery, and
TO automized credit checking should be
AUTOMIZE automized
Table 13. Patterns found around improvement of business processes, own.

Important statements that respondents that were found in the interviews that is additional
information about the research. See table 14.

TOPIC Q STATEMENT R
PROCESSES TO 1 The customer requirement and booking process 2
DIGITALIZE
1 Calculation of carrier cost and booking a carrier 2
PROCESSES TO 2 Allocation between customer and container 2
AUTOMIZE

41
 2 Checking of container 1
Table 14. Statements found in around improvement of business processes, own.

5.2.4 Requirements on the stakeholders

Patterns were found in the interview question but not in all answers. Three topics within the
area of cooperation and partnership with stakeholders were investigated with three questions,
regarding the topics of customers, Alabanza, and Kjelland transport which are considered as
main stakeholders of the redesigned business model. See table 15.

TOPIC Q PATTERN 1
REQUIRMENTS 1 Accuracy in the booking process and honest explaining of the conditions
ON THE
CUSTOMER
REQUIRMENTS 3 Potential profit sharing and price reductions in not required from Alabanza
ON ALABANZA
Table 15. Patterns found in requirements on stakeholders, own.

Important statements that respondents that were found in the interviews that is additional
information about the research. R stand for respondents that stated the statement. Q for
question. See table 16.

TOPIC Q STATEMENT R
REQUIRMENTS ON 1 Not that much, it´s like an e-store check-out process 1
THE CUSTOMER
REQUIRMENTS ON 2 Integration of API 2
KJELLAND
TRANSPORT
2 Working in our IT-system 2
2 Ability to take orders 2
2 Accepting commercial terms based on calculation 2
2 Accepting demands on carrier 1
2 Ready to apply hands on activities 1
REQUIRMENTS ON 3 To develop a well-functioning system 2
ALABANZA
3 Integration of data and API 2
3 Find carrier partners 1
Table 16. Statements found in requirements on stakeholders, own.

42
5.3 Interview with Kjelland Tranport

The interview with the CEO of Kjelland Transport gave insights on different implications and
consequences on Alabanzas need in the redesigned business model. The following areas were
involved in the interview:
1. Digital Transformation
2. Partnership and cooperation
3. Business model
In the result tables, Q is for the question, the topic is the sector within the area.

5.3.1 Kjelland Transport’s Digital Transformation

Kjelland’s maturity in digital transformation is to exploit existing technologies for efficiency
in operations. Three questions were asked around digital transformation. See table 17.

TOPIC Q STATEMENT
DIGITAL 1 Follows everything new in their industry; use of transportation programs; self-
TRANSFORMATION booking system; clock in system for the truckdrivers
2 Improval of efficiency and money saving is good
3 No, we recently invested in our servers
Table 17. Kjelland Transport’s digital transformation, own.

5.3.2 Cooperation and partnership

Results indicate the CEO of Kjelland Transport’s view on three different topics within the
area of cooperation and partnership with stakeholders. Six questions were asked on three
topics. See table 18.

TOPIC Q STATEMENT
COOPERAION 1 Operates all over Sweden; hires carrier companies in business network depending
AND on geographical area
PARTNERSHIP
2 The biggest container customer; good at what they do; no interests except they are
good customers,
3 Loyalty is important; volume does not matter; use of advance notices
STRATEGIC 4 Would not create an alliance with a container company; interest conflicts can
ALLLIANCES occur; no discounts
AND CO-CREATE
VALUE
5 Can´t tie themselves to one customer; only possibility is to buy Kjelland

43
 RELATIONS 6 Information about prices is not shared; the more volume the better price; volume is
WITH prioritized;
STAKEHOLDERS
Table 18. Statements found in cooperation and partnership with stakeholders, own.

5.3.3 Business model

To understand how Alabanza and Kjelland Transport can cooperate questions were asked
about Kjelland Transport’s business model and operations, and how Alabanza’s requirments
on them can be met. 19 questions was asked in the topics of business model, revenue streams,
facilitating activities for the operations, business processes, business model alignment and
development of price that fits Alabanza’s needs. See table 18 on following page.

44
TOPIC Q STATEMENT
BUSINESS 1 Carrier services; Self developed carriers for efficiency; selective hiring process;
MODEL
2 No plans of developing the business model further

REVENUE 3 Fixed price; calculated hour price; customers pay for the time
STREAM
FACILITATING 4 Customers should order through our website; advance notice; no need for better
ACTIVITIES communication with Alabanza; information about container number and location is
important

BUSINESS 5 Booking process is digital; booking is made by phone if the customer don´t have a
PROCESSES computer on a construction site etc.
6 No need for further digitalization or digitization in carrier services;
7 Information systems are used but not for the operations
8 Telematics are used; tom tom for fleet management and logistics; GPS in the
trucks; surveillance in webfleet;
9 End-customers should not have to much information, makes it complicated for the
customer
BUSINESS 10 We can work in Alabanza’s system if we integrate it; can rationalize time; positive
MODEL if more customer do it
ALLIGNMENT
11 A meeting with Alabanza about data integration and cooperation
13 Would require more from Alabanza; guidelines in the delivery process; we need to
understand Alabanza’s work methods and routines;
14 A business model allignment is 100% possible
15 Agreements can be made after a meeting
REQUIRMENTS 15 No, the basis of fixed price it that sometimes they earn from it, sometimes not; we
FROM can carry two 10 feet containers for the same price as one 20 feet container;
ALABANZA
16 No, we must make sure that the it is the right crane on the carrier and truckdriver;
location matters
17 Carry two different containers might require two different cranes; we ask different
questions than Alabanza to the end-customer; Alabanza don´t have the same
information
18 Not the pricing chart; delivery process might go wrong; our responsibility;
Table 18. Statements found in Kjelland Transport’s business model, own.

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6 Analysis
The analysis and discussion are formed by the different areas that were investigated in the
interviews and Alabanza’s customer database.

6.1 Customer segments and customer relations

Result extracted from the customer database gives insight into three different areas:
1. Customer segments
2. Container demand
3. Profitability

A company that focuses on a mass-market does not differentiate their customers (Osterwalder
& Pigneur, 2010). Alabanza wants to keep equal relations with all customers but to eliminate
Essve. In customer relations, a statement refers to Essve as a resource-consuming customer.

Customers represent certain separate segments if their needs require and justify a distinct
offer, require a different type of relationships, or give Alabanza substantially different
profitability (Osterwalder & Pigneur, 2010). Alabanza is creating value for Essve, by
supplying them with mobile retail construction containers. Essve is only contributing to
5,60% of the mobile storage business volume, even though it has 90 containers in service at
the moment. Essve has completely different other needs than the other customers and is a
separate segment. Opportunism is using other stakeholders to only maximize your utility,
which Essve seems to do now (Bosse et al., 2008). Only Essve has a separate relation.

The automotive industry and construction industry are the most valuable industrial segments
with a higher volume of revenue stream. A respondent called out the need for targeting the
construction industry more. To reach them by a separate distribution channel, might increase
sales but would also require separate relations with them. The relationship could benefit
CRM and personalization for customer experience (Gil-Gomez et al., 2020). There is a low
expectation of customer service on the container, but access to support in delivery and return
of the container is important. Customer relations should be established for each customer
segment in a business model (Osterwalder & Pigneur, 2010). CRM allows companies to
integrate and centralize their customer data, which contributes to more effective marketing
activities and loyal customers. There are no signs of CRM activities in the organization,
instead, it shows that homogenous relations are preferred; the implication of which is that it

46
does not consider the possibility of personalization of software tools, increasing customer
loyalty (Gil-Gomez et al., 2020).

The private customers, on the other hand, are profitable but do not bring as large cashflows as
the companies. Private customers are more likely to not pay the carrier fee, which is a hinder
to improving the carrier price in a new business model. The price brings a negative customer
experience, which decreases customer loyalty (Palmer, 2010). Companies, on the other hand,
have more financial ability to pay the carrier fee.

In common for the two segments are that they have the same basic needs, storage for
temporary or permanent use. Table 6 and table 8 tell us that the 20 feet container is by far the
most popular, even though less so for private customers.

Forming a value proposition should be granulated down to a customer segment level.

Questions five and six points out that the value delivered by Alabanza is to satisfy “storage
needs, permanent and temporary”, and long-term customers are the most important
customers. The lack of patterns on the topic of customer segments is concerning since an
optimized value proposition can only be made with a more granular perspective of
segmentation (Payne et al., 2017).

Customers want to be contacted by email and partners. Facebook and google are Alabanza’s
two main channels for marketing activities and reaching the customer with their value
proposition. The customer channels are the main income of feedback, and Alabanza does not
have a method to centralize data collection. That partly makes it unable for Alabanza to
create multisided value propositions for strategic renewal (see what Warner and Wäger,
2019) and use benefits of CRM (Gil-Gomez et al., 2020).

6.2 Alabanza’s digital transformation, business model and business processes

Analysis on Alabanza’s digital transformation, business model and business processes is

investigated in this section. Alabanza’s view on partnership and cooperation, needs and
requirements on stakeholders is in chapter

47
6.2.1 Digital transformation
Alabanzas digital transformation is in progress as they use digital systems and tools.
Alabanza have two different business models, mobile storage, and magazine storage. The
magazine storage is almost completely automated by digital technologies, except for a
manual check routine for surveillance of the process and is thereby digitized. To go
completely digital, mobile storage and magazine storage needs to be completely digitalized.
So far, it is still digitized. (Nwaiwu, 2018).

6.2.2 Strategic goal

Patterns were found in Alabanza’s strategic goal with the DT, which are to gain growth and
become a market leader in price. These factors can be considered the driving factors of the
digital transformation, according to (Morakanyane et al., 2017). Statements do as well point
to the driving factor to improved work methods and routines, and with the adoption of
intelligent automation and more automated processes by replacing manual tasks. The
workload in BPM, cost, human resources, and operational time can be reduced with
automation (Ng et al., 2021).

A similar view on the strategic goals of the digital transformation but misses the aspect of
which business dimensions that should go digital. The business model, the compromising of
processes and decision making in operations, the skills and talent of the company, and the
value system of the business needs to be evaluated for reaching superiority and
competitiveness (Ismail et al., 2017). Therefore, the pattern in the topic of digital
transformation is a positive sign in one aspect, because it highlights the need of digitalizing
the business model of mobile storage. If a digital transformation strategy is approached half-
heartedly, firms may lose their scope and may encounter operational difficulties (Matt et al.,
2015). Further strategic planning need to be made by Alabanza.

6.2.3 Use of new technologies

New technologies are positive for the improvement of the business but can as well be
challenging. Alabanza is creating their technology in the form of a system, but since an IT-
system is already an invented technology it should not be considered as their own created
technology. Using existing technologies that fits business objectives, creates an ability to
exploit new technologies. (Matt et al., 2015)

48
6.2.4 Changes in value creation
Alabanza seems to have decided on how much digital activities can interfere with their
analogue activities. Assuming the company would decide on the patterns found, Alabanza
should develop conditions to exploit technologies in their business processes. It contributes to
a better customer experience and creates an emotional tie in the brand to its customers
(Gentile et al., 2007).

The changes can interfere with the booking and delivery process, but surveillance of
operations need to be done to prevent fraud. The company needs to decide on how much the
new technology (digital activities) can interfere and deviate from their current – often still
analogue – core business. No signs on further changes in value creation are described. The
digitization of products and services can require or enable different forms of monetization, as
well as adjustments to the company’s business scope if new customer segments are
addressed. (Matt et al., 2015)

One respondent stated that value could be captured and created in the digital ecosystem
which the author interprets business ecosystem. Regarded as a foundation of a company’s
competitive advantage it requires an exchange of resources between stakeholders to create
and capture value (Yi et al., 2022). The idea of a digital ecosystem is positive since it is
important for value propositions (Gimpel et al., 2018). Developing the digital ecosystem
would put Alabanza in need for more strategic planning. The assessment of risk, number of
resources to invest, and take the lead in developing innovations in the business model that can
evolve with digital complements from actors in the ecosystem (Mäkinen & Dedehayir, 2012).
This would lead to the statement “it is purely a burden in terms of resources and focus”.

6.2.5 Structural changes

The new technologies that Alabanza want to pursue can create a new brand or business units’
results demonstrate. It is completely dependent on how much the new value creation and
technological activities can be integrated in their current company, otherwise they shall
consider creating a subsidiary within the firm (Matt et al., 2015). Strategic planning need to
be executed before decisions are made.

49
6.2.6 Financial aspects
Financial resources can make losses affordable in business model innovation because they
create valuable lessons (Chesbrough, 2010). Financial resources are also the key for the
transformation as a driver and bounding force, and companies should confront the need of the
transformation, so they don’t lack ways to finance it (Matt et al., 2015). Alabanza lack external
resources now and can thereby not make a transformation without private investments from
the owners with risk initiatives. They are openly confronting the need of digitalizing mobile
storage but should gather financial resources for the growth they are aiming at with the
transformation. The former three dimensions of the framework from Matt et al. (2015) can
only be transformed after considering the finance of the transformation.

6.3 The redesigned business model

The redesigned business model of Alabanza is the constructed with questions from
Osterwalder & Pigneur (2010) business model canvas.

6.3.1 Value proposition

The value proposition is the reason why a particular customer is willing to pay for a product or
service (Remane et al., 2017:42). It is a strategic tool to communicate with the customer how
they aim to provide value, and makes a significant contribution to their business performance.
The supplier determined value proposition is a value proposition based on delivering a product.
A value proposition should be the main principle of the organization (Payne et al., 2017). One
respondent demonstrates that no decision has been taken yet for a new value proposition.
Alabanza’s value proposition today is temporary and permanent needs of storage. “Digital
services for transportation of goods” is referred to Alabanza’s other business model, magazine
storage, but improved carrier prices are a value proposition that the company want to create.

Delivery of product is slow today for the customers, but a financial easement for the customer
is a problem-solving solution. Understanding what problem, you solve for the customer, is an
important step toward forming a value proposition (Osterwalder & Pigneur, 2010). Two
respondents also lift the importance of self-service, something that can be made with self-
service technologies (SST) which can as well contribute to faster delivery and co-value with
the customer (Hilton et al., 2013).

50
Temporary and permanent needs of storage is a problem-solving activity but not that
differentiated compared to other competitors. The value proposition could be optimized with a
digital experience. Personalization refers to tailoring an offer for the user with digital
technologies (Bock & Wiener, 2017).

An idea is presented that could fit in to the value proposition from the topic revenue model.
The digitalization of transportation of goods from the customer to the magazine storage. Even
though magazine storage is part of Alabanza’s second business model, the idea is valuable. It
can complete the digitization of magazine storage to full digitalization. Provide revenues and
value-producing opportunities with digital technologies is digitalization (Nwaiwu 2018).
Alabanza could strengthen its position by digitalizing the network in the ecosystem, creating
an IT-platform whereas companies that work with transportation of goods can use their service
and can co-create value together (Mäkinen & Dedehayir, 2012). With the right partners and
suppliers, the business model could work, for example, a strategic alliance with a moving
company. It would require business model innovation, to capture value from the current
business model of mobile storage and create new value in a digital platform (Chesbrough,
2010). A digital business model is usually reproduced at a low cost (Remane et al., 2017).

6.3.2 Revenue model and cost structure

The revenue streams are the cash flows a company receives from each customer segment
(Osterwalder & Pigneur, 2010). Most of the customers are companies and contribute with
more financial volume. The revenue model of mobile storage is today partly digitized, some
of the analogue process steps have done the digital step to use online bills and payment
methods. Another statement shows the author that the company are willing to pay for square
meters and the type of container.

The cost structure is shared by all respondents and statements point at expensive prices for
carriers, resources for development and consultants, carrier costs and an extraneous cost for
IT-system development. Carrier is not a cost, since it is the customers that pay for the
transportation of a mobile storage. The cost structure is all costs incurred to operate a business
model (Osterwalder & Pigneur, 2010).

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6.3.3 Key Resources, Key Activities and Channels
The key resources for developing a digitalized mobile storage business model are container
supply and competencies in business development and IT-development according. It is
correct in one aspect, the digital business model will not function without these assets, but in
another aspect, the underlying fundamental basis for the digital transformation of financial
resources is not considered (Matt et al., 2015). The exchange of resources of various
stakeholders to create and capture new value for business model innovation is also passed on
(Yi et al., 2022) except that two of the respondents mention effective carriers.

Key activities are described as “business supporting partners and IT-system” in pattern one,
and “price mechanism and digital business processes” in pattern two, whereas question 22
underrepresents the need for relations with customers. In a statement by two respondents, the
supply of containers and procurement is important. Business supporting partners is indeed a
valuable tool to expand the business but should only be included in channels since it is an
approach to reaching customers (Osterwalder & Pigneur, 2010). The IT-system, is a digital
technology and could increase the customer experience, or develop a self-service process
(Hilton et al., 2013) and is a key activity that makes the digitization of mobile storage possible.

Two other statements are “expanding business activities” and “trust building activities” but
neither of them is concrete directions to business model that functions. Rather it is to reach out
to new customers and reaching more growth. Channels are how a company communicates with
their customers and reaches them with the value proposition (Osterwalder & Pigneur, 2010).
Alabanza has marketing activities and IT-infrastructure implemented in their business which
is contributing to their sales and operations. With CRM, more effective marketing activities
could be accomplished (Gil-Gomez et al., 2020).

52
6.4 Business Processes

Goals of improving the company’s processes should aim at reducing lead time and cost
(Vergidis et. al 2008). The allocation between a customer and container in the booking process
should be digitalized, and statements show that “requirements and booking process”. The
function would require Alabanza to digitize the business process from order to the retrieval of
the container. The allocation would need a database in the technological architecture that can
distribute a specific container to the specific customer (Pinheiro et. al., 2021). Alabanza must
separate their business model with the two tools of digital transformation. The processes
Alabanza will automate is converting analogue processes to digital processes through
digitization. Moving to a digital business, with the use of digital technologies to change a
business model and provide new revenues, is digitalization (Nwaiwu, 2018).

To automate business processes is a digitized solution a company can offer to its customers
and is a digital offering (Gentile et al., 2007). It would strengthen Alabanza’s value
proposition´s digital dimension; with a physical product with complimentary digital services
(Bock & Wiener, 2017). The definitions in table 1, support the assumption that digital
technologies used in business processes are a major step toward digital transformation. An
initial step to improving the business processes is to specify the system, identify the
performance bottlenecks and choose a possible modification to resolve the performance
bottleneck (Vergidis et. al, 2008). Booking, delivery, calculation of carrier cost, and credit
checking needs to be automized in the business processes for efficiency and digitization, and
statements shows that the calculation of carrier costs. To calculate the carrier costs depends on
Kjelland Transport, but the credit checking could be made with digital credit services. To
improve the processes Alabanza have to analyze and use digital tools.

6.5 Kjelland Transport

Following section analyses Kjelland Transport’s digital transformation and business model.
Kjelland Transport’s view on partnership and cooperation and response on requirments will
be analyzed in chapter 6.6.

6.5.1 Digital transformation

Kjelland Transport follows market change with digital technologies for efficiency in
operation but does not create its own digital technologies. The use of new technologies
considers a company’s ability to exploit new technologies and its attitude towards it. The

53
company have moved from analogue processes to digital processes, with a self-booking
system and clock in system for the truck drivers. IT-strategies are the management of IT-
infrastructure within the firm (Matt et al., 2015). Further on, they are having a positive
attitude toward new technologies that increases efficiency and saves financial resources. An
example is their use of telematics and information system, which can increase the efficiency
and monitoring of their logistic operations (Grabara et al., 2014). From a financial aspect, the
CEO has decided to not invest any further in the digital transformation because they recently
invested in ownership of servers instead of cloud solutions.

6.5.2 Business model

The integrated digital technologies in the business processes for automation and optimization
show us that the carrier company's business model is partly digitized (Mwaiwu, 2018).
Kjelland Transport’s value proposition is self-developed carriers for efficient carrier services.
They have no plans of developing the business model further. Their revenue model is based
on a fixed price and the customers pay for the time a carrier needs to operate. A value
proposition is the company's organizing principle (Payne et al., 2017) and the CEO is very
selective in his hiring process for truck drivers and procurement processes of new trucks to
match efficient carrier services.

Facilitating activities in operations is to book the carrier through the website with clear
communication with the use of advance notice. Information about container number and
locations is important. Even though the business processes have been automized, booking is
made by phone at some points when the customer doesn´t have access to a computer. This
indicates that sometimes the core business is analogue (Matt et al., 2015). Telematics is used
to collect data for Kjelland Transport for surveillance of the operations, with an open system
with GPS and an open system to allow communication between the carriers, customers, and
the company. The use of telematics and information system increases efficiency in operations
(Grabara et al., 2014). There are no signs of smart transportation in the operations that
optimize the routes for the carriers (see what Zantalis et al., 2019).

6.6 Stakeholder management

The stakeholders of the redesigned business model are identified in the introduction of the
paper. Both Alabanza and Kjelland Transport were asked about what the new digitization of

54
business processes and redesigned business model would require from the different
stakeholders’ customers, Alabanza, and Kjelland Transport.

6.6.1 Alabanza’s view on partnership and cooperation

Alabanza’s key partners were identified in the business model area as their suppliers for
resources of “digital development and logistics”. The suppliers referred to, is the sister
company responsible for marketing and IT-development, and the logistic services in carriers.
Co-development partnership is an important mechanism for innovating the company’s business
model (Chesbrough & Schwarz, 2007). Key partnerships describe the network of suppliers and
partners that makes the business model work (Osterwalder & Pigneur, 2010). Alabanza has
marketing activities and IT infrastructure implemented in their business. The logistic activities
are functioning, but the statements are pointing at they need effective carrier companies to
make the business model function. Statements are different, whereas one mentions they are not
that dependent on partners now, and another one is expressing a need for partnership building.
While redesigning a business model for a new value proposition, companies are increasingly
relying on stakeholders (Yi et al., 2022).

One respondent is referring in his statements to other companies integrated with their
business network, such as builders’ merchants, construction companies, real estate brokers,
and moving and cleaning companies. These stakeholders are identified in the customer
database and could be important partners because of their contact with private customers with
storage needs. An external stakeholder can benefit Alabanza with organizational learning (Yi
et al., 2022). The question is on what level Alabanza should start configuring with these
customers for collaboration. Stakeholders for a cooperation can create positive reciprocity
and more value (Bosse et al., 2008). The managers of the company can use these customers
to jointly create and trade value. This is a complex situation since the locus of value capture
and value creation has shifted to a business ecosystem composed of stakeholders such as
suppliers and customers (Parmar et al., 2010). Starting to innovate the business model with
the customer of mobile storage can threaten the ongoing value of the company (Chesbrough,
2010). Customers in need of extra storage at Alabanza magazine could be reached for new
value creation with the digital transportation service, but companies are at the same time
valuable customers.

55
6.6.2 Kjelland Transport’s view on partnership and cooperation
Kjelland Transport is operating all over Sweden, even if they can’t use their carriers in some
geographical areas. In that case, they hire other carrier companies in their business network.
One type of partnership is strategic partnerships between competitors to make the business
model work. Another type of partnership is strategic alliances with non-competitors
(Osterwalder & Pigneur, 2010). Containertjänst, Alabanza’s competitor and Kjelland
Transport's largest container customer, is not an interest for the CEO of Kjelland Transport
except they create a lot of financial volumes. For good cooperation with a customer, Kjelland
Transport values loyalty and good communication. A partnership with Kjelland Company to
co-create value with a strategic alliance is not possible for Alabanza because it could cause a
conflict of interest between Kjelland Transport and its current customers. A detrimental
relationship can risk the wealth-creating capacity (Parmar et al., 2010) and managers are likely
to resist business experiments that threaten the ongoing value of the company (Chesbrough,
2010). Kjelland Transport is keeping the relations equal, and information of prices is not shared
between customers. Large financial volume providing customers are prioritized in their
relations, and the more valuable you are for Kjelland Transport the more negotiable the price
on carriers is. Stakeholders interact to jointly create value and increased trust leads to fewer
transactions (Parmar et al., 2010). Kjelland Transport interact a lot with containertjänst because
of their large volume and good relationship.

6.6.3 Requirements and response to cooperation

Alabanza wants to automize its business processes for booking of mobile storage, delivery of
the mobile storage and lower the carrier cost in their value proposition with a digitized
calculation process (see chapter BPM). There is as well a statement that the checking of the
process could be made as well to facilitate the carrier companies. The digitization of
container booking and specifically the automated booking of carrier transport would be
embraced by the CEO of Kjelland Transport. It can rationalize away time which saves money
and increases efficiency. Hence, they first need to understand Alabanza’s work methods and
routines, as well as data architecture so the API can communicate with their backend servers
(Mathijssen et al., 2020).

To implement a co-development partnership, the companies must define their business

objectives, assess the capabilities each part requires, determine the degree of business model
alignment and think of future collaborations instead of just the current need (Chesbrough &

56
Schwarz, 2007). For the customers, the redesigned business model requires accuracy in the
booking process and an honest explanation of conditions from the customer so the carrier
company can have an efficient operation. Integration of business models could be integrated to
a degree of 100% according to the CEO of Kjelland Transport, but for that, a meeting needs to
take place for data integration and cooperation.

To integrate the business model with Kjelland transport, would require integration of data
processing so they can work in Alabanza’s IT-system. It is also important for the stakeholders
of Alabanza that their commercial terms based on calculation and demands on carriers are
accepted. Improved prices in carriers are much harder to accomplish and hinder Kjelland
Transport’s revenue model. A possibility would be to carry two 10 feet containers for the price
of one 20 feet container. Problem is that when carrying two containers to two different
locations, the right crane on the carrier and a truck driver that operates nearby needs to be used.
With an exchange of resources, firms can create and capture value (Yi et al., 2022).

Kjelland Transport has a different requirement process from the end-customer, compared to
Alabanza which provides them with additional information about the destination’s
requirements on the carrier. If Alabanza would use the same questions about delivery to the
end-customer (the customer of Alabanza), the complexity occurs in the payment process. If
something goes wrong in the delivery process, the payment is already fixed between
Alabanza and the end-customer and extra cost will affect Kjelland Transport. Therefore,
Alabanza must identify the transportation process in detail (Grabara et al., 2014). Another
approach would be to integrate tools in their booking system, that gives Kjelland Transport
ability to secure quality in their transportation process.

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7 Discussion
This chapter contains an argumentation on what measures and actions Alabanza should do to
formulate a digital business model with a digital value proposition, two possible business
models and how those models suit a digital transformation strategy. It also contains a
discussion about prerequisites for a digital business model.

7.1 Digital business model

To transform a business model to a digital business model, the tool digitalization needs to be
used, and not digitization. The use of digitization is a way to digitalize your company and is
major step to a digital transformation by automating processes with digital technologies, but
not a step toward a digital business model. To create a platform, with revenue streams that are
created by digital key activities, is a digital business model. To create a platform that
automizes processes for revenue streams from a physical end-product, is not fully digitalized.

The process of moving to a digital business model requires the whole business model to
circulate a digital solution in a digital value proposition, that solves customer problems with
IT-applications and software connected to a physical value chain. Key activities in a digital
business model need to be digital to solve the customer problem. Without a digital solution,
the business is regular business model, or a digitized business model.

To create a digital business model for the business ecosystem, relations with stakeholders
need to be defined. Without relationships personalization software tools can not be
developed. It is neither possible to understand other stakeholder’s relation to each other in the
business ecosystem. Customers can serve as the main income for feedback and development
of the business model to co-create value. Business model innovation and external technology
partnerships exploited, to provide value for the whole ecosystem.

7.2 Guideline for the redesign of business model

To develop the business model, business model innovation needs to be used. Customer
relations, stakeholder relations, key partners, and a value proposition needs to be defined and
decided. Reaching new customer segments can be made with new partners that functions as a

58
distribution channel for the product. There are two business models Alabanza can create
according to the analysis. One is digitized and one is digitalized.

7.2.1 Mobile storage

The redesigned mobile storage is a digitized business model. It would strengthen Alabanza’s
value proposition digital dimension and is a major step towards digital transformation. It is a
supplier determined value proposition. It would also contribute to a digital customer
experience and competitiveness, if Alabanza can differentiate its value proposition with an
automated booking carrier, which can rationalize time away for both Kjelland, Alabanza, and
the customers. To develop the digitized model mobile storage, Alabanza needs to sit down
with key partners to determine data integration for the automation of processes. Both
companies would need to identify their processes. Kjelland Transport and Digital Dominance
(the sister company) are key partners to deliver the value proposition of mobile storage for
permanent and temporary use identified in this paper. Without these partners, a digitization of
mobile storage is not possible, because Alabanza itself does not have the required resources.
See figure 7.

Figure 7. Overview of actions to digitized business model.

59
Other partners need to be identified, depending on the market Alabanza want to reach. If
Alabanza wants to reach more customers, they need to establish customer relations for each
segment to enhance marketing activities. Construction companies and automotive companies
shall have a separate relationship, which must be carefully handled to not risk detrimental
relationships with other customers. To develop the channels, company customers, and their
ability to work as a distribution channel need to be identified, serving as key partners in the
channels. Joint ventures could be created for geographical expansion, with Alabanza as a key
resource for business.

A customer to terminate is Essve. Their low profitability and resource-consuming

relationship is a hinder for expansion and growth. A termination would lead to more key
resources in container supply, and with the right customer requirements in the booking
process, two 10 feet containers could be delivered at the same time. That would lower the
carrier fee and increase volume, but a digital interaction between the two customers,
Alabanza and most importantly Kjelland Transport for the right crane type is required.

For the customer, a potential booking by the phone function could also be developed, to
eliminate analogue activities like phone calls and emails, and would as well differentiate their
business model. Complementing services can be developed as digital revenue streams, but
needs more investigations in the customer segments to find their needs. The customer
experience need to be evaluated as well with a deeper investigation of the customers’ needs
and behaviors. Customer relations need to be established with different customer segments.

7.2.2 Nissar Alabanza Transportation Technologies (NATT)

Identified in the topic revenue model, Alabanza wants to create a digital transport solution for
goods to and from their magazine storage. The most advocate for this business model, is the
value proposition and the co-creation of value in the digital ecosystem. It is supplier
determined, and multisided value proposition which contributes to strategic renewal. It is a
completely digital solution, that solves problems for two stakeholders. The customers, that
require transportation for their goods and possible even a storage solution, and the company
that moves the customer's goods. It could, moreover, create value for competitors, that wants
to use Alabanza’s transportation for goods.

60
Some key resources are established, such as storage for the goods and IT-development.
Resources of financial capital, telematics for operators, and carriers of goods need to be
established. These resources could be established with a company that is in contact with
private customers that has a need for storage. Business model innovation is required and an
understanding the relationship between stakeholders in the new business model, to co-create
value and for the best possible digital transport solution.

Figure 8. Illustrated business model canvas, own.

Important to bear in mind is that the development and marketing activities for a platform
leader can cover a geographical expansion. Alabanza can start small, but the change would
need a subsidiary due to its a completely different business model, with completely different
technologies than Alabanza’s current business models. Digital business models can be
reproduced at low cost, but development costs are high. Lots of resources in form of
investments would need to be made, as well as networking, focus and time. On the other side,
owning a technology creates the foundation of being a platform leader, where other actors
can create value for them.

7.3 Transformational strategy

Alabanza’s ambition for a digital transformation of the business model “mobile storage” was
not digitally mature enough to make it completely digital. On the plus side, digitization of the

61
business model is still classified as a step toward digital transformation. There are different
consequences of deciding between the complete digital business model “Alabanza transport
technologies, or the digitized business model “mobile storage” for Alabanza’s overall
company transformation strategy.

“Mobile storage” is by far the easiest way to reach a digital transformation but is not a digital
business model. Referring to the framework developed by Matt et al. (2015), the use of new
technologies is using automation technologies and data integration which are existing
technologies. The change in value creation is decided on, the digital technologies can
interfere with the delivery process, but frauds need has to be prevented by monitoring.
Structural changes is not needed for “mobile storage” since the digital technologies can be
integrated into the company’s business processes, and the business concept remains the same.
Alabanza lacks financial resources at the moment, and owners need to decide whether or not
to invest in digitization of “mobile storage” and make an assessment of risk and payback. A
more efficient process leads to cost reduction but also improvement of lead time, which was a
problem in the solution today. A decision needs to be made which evaluates the strategy, with
the aim for growth. The more volume of carrier needs Alabanza can deliver to Kjelland, the
lower they set the price.

“NATT” business model is more difficult to develop. It would reach a complete digital
transformation of the business model, but other factors need to be evaluated. First, no
decision is made on a new value proposition for customers. The use of new technologies is
not decided for this business model and would have the need for telematics and automation of
processes, as well as self-service on the depot facilities. Digital technologies are embedded in
this business model, and therefore a structural change with a subsidiary is required. Changes
in value creation would consider using the storage in the parent company Alabanza and
creating a business ecosystem for transportation services. Above all, creating a platform
requires a great amount of risk, experiments with the business wealth-creating activities, and
financial resources. Alabanza lacks financial resources for that now.

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8 Conclusions
8.1 Limitations and purpose

This research paper was limited to the stakeholders’ employees of Alabanza, owners of
Alabanza, the stakeholder Kjelland Transport and the customers. All research that contributes
to the key concepts digital transformation, business model, and stakeholders that leads to the
phenomena digital business models is considered valuable. This paper aimed to investigate
the needs and requirements of the stakeholders for a digital business model, on which
transporters, customers and Alabanza can interact. It also aims for integrating a digital
transformation strategy, highlighting the needs and requirements of important stakeholders in
the business ecosystem for business model alignment, and formulating prerequisites for a
digital business model.

8.1.1 What are the prerequisites for a digital business model?

The prerequisite for a digital business model is a solution that solves a customer problem
with digital technologies. Revenue streams and value is created by providing a digital
solution that can be developed further with business model innovations. Mobile storage can
be digitized since it only includes the automation of business process with digital
technologies. NATT can be digitalized since it circulates around a digital value proposition.

8.1.2 Why should stakeholders cooperate to innovate a business model?

Stakeholders need to cooperate in redesigned business models to integrate business processes
or co-create new value with partnership business model innovations that benefits stakeholders
in the business ecosystem. Communication to understand the relations between stakeholders
are needed to create positive reciprocity in the business ecosystem for better company
performance and mutual beneficial relationships.

8.1.3 How can Alabanza adapt its business model and business processes aligned with a
digital transformation strategy?
Alabanza must decide if they want to create a digital business model, or a digitized business
model, because both examples demonstrated in discussion lead to a digital transformation but
only one to a transformation of the business model itself. The business processes will be
digitized in both business models which is a major step towards digital transformation.
Assessments of risk, capacities, structural change, technological competence, and finance shall
be evaluated to create the best solution for viable growth.

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9 Future directions for research

To formulate a strategy that leads to a digital transformation the company Alabanza, should
investigate areas and create action plans for:
• Business process management
• Interface
• integration of API
• customer relations
• customer experience
• Co-creation partnerships
• Digital process management
Alabanza need model their business processes in detail to identify areas which shall be
improved. KPI:s and goals with improvement should be defined to reach a better efficiency in
the company. Therefore, Alabanza is in need of business process management. One manual
step in the process can be eliminated, but that would require an integration of API with Kjelland
Transport. Different methods, consequences and risks should be evaluated while making an
integration of data. As mentioned in the analysis, the customer relations are not defined. This
research paper did not either investigate the different customer segments that can create a
customer experience, which is beneficial for competitiveness. Some of the customers could as
well be partners, but an evaluation of which customers that would be an optimal alternative for
a co-creation partnership in a redefined business model. Digital process management should
be investigated to find the right self-service technologies, tools and techniques automation that
can improve and digitize business processes. Interface for the customers should be designed to
create a customer experience.

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11 Appendices

11.1 List of tables

1. Definitions of digital transformation (Morakanyane et al., 2017)

2. Length of interviews, own.
3. Top customers of Alabanza, collected from the database.
4. Overview of company customers, own.
5. Industries that use mobile storage, own.
6. Company demands on container type, own.
7. Overview of private customers, own.
8. Private customers demand on container type, own.
9. Patterns found around digital transformation, own.
10. Statements found in digital transformation, own.
11. Patterns found around the redesigned business model, own.
12. Statements found around the redesign of business model, own
13. Patterns found around improvement of business processes, own.
14. Statements found in around improvement of business processes, own.
15. Patterns found in requirements on stakeholders, own.
16. Statements found in requirements on stakeholders, own.
17. Kjelland Transport’s digital transformation, own.
18. Statements found in cooperation and partnership with stakeholders, own.
19. Statements found in Kjelland Transport’s business model, own.

11.2 List of figures

1. Key concepts, own.

2. A framework for digital transformation, (Matt et al., 2010)
3. The business model canvas, Osterwalder and Pigneur (2010).
4. An interlacing of the business model, own.
5. Overview on research method, own.

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 6. Operationalization of keywords, own.
7. Overview of digitization of business model, own.
8. Illustrated business model canvas, own.

11.3 Pattern finding

Digital Transformation
Q1: How developed is alabanza in their digital transformation?
Digital tools and systems are applied

Whats left is to digitalize Moblie storage

There are still some analog areas in admin

Automate the integration of economy and booking system

Q2: What is the strategic goal with a digital transformation?
To gain growth and become market leader in price

For the customer experience

To improve work method and routines

From start, is was to settle in to the business

Q3: What is your attitude towards using new technologies?
Open to new technologies

It contributes to effective operations

It improves business processes

There are barriers now for new technologies

It creates security in operations

Q4: Would you like to create own technologies or use existing ones?
Create conditions for exploiting new technologies

Already created our own system

To small to set own standards

Exploiting new technologies for the business

Using new technologies for customer experience

Q:5 What technological changes are you willing to do in your value creation activities?
New value creation activities

Changes in the delivery process

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Changes in the customer experience

Different values can be created with a digital business ecosystem

Capture value in the digital business ecosystem

Eliminate manual value creating processes

Q:6How much can the digital activities interfere with your current analog activities?
To develop effective operations and competitiveness

It is a burden purely in terms of focus and resources

It can interupt, but manual checks for security needs to be done

Q: 7 Can the digital transformation force structural changes in your company?
It can create a new brand

It is challenges to develop operative business units

It is challenges with dividing assets in two companies

Can drive Operative business units or aggregators

I only need to adapt and change the routines

Q:8 How much does your company afford to invest in digital transformation?
Lacks financial resources now

Depends on external financial resources

Keep investing at the right pace

Q: 9Is it worth it investing in digital transformation?
As much as the owners can afford related to risk

Yes, to stay competitive in a long-term it is important for the business

Yes, but we need to adapt the pace of investments for digitalization

No, because of the shortage of containers in the market

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The redesigned business model
View on value proposition
Q1: What value proposition would you like to develop with a digitalization of the business model?
Improved prices in carriers

Digital services and customer offer

No decision taken yet

Self service

Digital communication .

Quick deliveries and respondence

Q:3 What customer problem do you solve?
Extra storage

Customers in need of storage for construction materials

Storage for car tires

Customers in need of storage for renovations

Q:4 What does the customer think is problematic today with your solution?
Problems with customer expectations

Delivery of products is slow

Expensive carrier fee

View on customer segments
Q:5 For whom do you create value today?
Private storage for urgent needs

Private persons with permanent storage needs

Construction companies

Tyre-shops

Restaurant with temporary needs

Essve

Companies that want a cheaper solution for permanent needs

Temporary needs in retail

Q:6 Who are your most important customers?
Mobile retail (essve)

Long term continuing customers

Companies

Associations

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Carshops

Customers with low rate starting cost

Q:7 Do you see any potential new customer segments in a digitalization of the business model?
Rather become attractive for more segments

The entertainment industry

More construction companies but no new segments

View on customer channels
Q: 8Through which channels does your customers want to be reached?
Email

Partners that are already connected with the customer

Telephone

Facebook

Google
Q9: How can your customers evaluate your offer?
In need of new approaches for feedback on services

Information about the price, products, and service

Simplicity in carrier services

Q:10 How do you make it possible for the customer to buy your product?
On the webpage

Over the phone or email for persuasion

Q:11 How can the customer get support in a digital business model?
Email and chat services

At the webpage

New technologies at the facilities

Thread based communication

Customer relations
Q:12 What expectation does your customers have on your customer relations?
Low expectations for a non-technological product

Access to support in delivery or return of container

Q:13 Is it any customers that are more resource intensive?
Mostly individual customers

Essve, because of their lack of performance and capacity consumption

Non digital aware customers

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Q:14 What relations are established today?
Essve, but they need to be liquidated because of lack of business model alignment

We want homogenic relations

Essve, we help them with their operations and have a good relation
Revenue model
Q: 15 What value are your customers willing to pay for?
Square meters and the type of container

Services we have not delivered yet

Low price products

Companies usually don´t complain over carrier costs

Q:16 How do they pay today?
Automatic e-bill or direct debit, which is positive

Analog bill, which we don´t prefer

Credit card, which is negative due to rising costs

Q:17 How do you think they would prefer to pay?
The simplicity with automatic payments is appreciated

Some customers are in need of control

Private customers might prefer swish or credit card

Q:18 Is it any new revenue models you would like to develop?
No decision is made yet

Transport customers goods to the magazines with digital service

Carrier transportation

Insurance of goods

To create franchises with a reciprocally agreement

Q:19 Would you consider having different prices for different customer segments?
A homogenic pricing is the best solution

Private customers pay less historically

It could work if a customer segment is especially differentiated

Homogenic pricing, except for good customers

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Key resources
Q: 20 What new resources does your new value proposition require?
Resources for developing the IT-system

Resources for development of business concept

Organizational competences

Container supply

Effective carriers

Resources for properties and real estate development

Key activities
Q: 21 What key activities does your new offer require?
Supply of containers and procurement processes

Business supporting partners

IT-system for economy and operations

Expanding business activities

Price mechanism for product

Digital business processes

Activites targeting customers

Q: 22 What key activities does your customer relations require?
Web based communication

With strong growth and stable customer inflow the partners is the main relation

Trust building activities

Key partners
Q: 23 Do you have any key partners today?
Important suppliers and subcontractors

The transportation companies

We are not that dependant on partners at the moment

In need of partnership building

Q: 24 Who could be potential partners?
Effective carrier companies

Real estate companies

As long it is a balanced relationship

Construction and renovation companies

real estate brokers

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Builders merchants

Cleaning, moving
Q: 25 Who are your key suppliers?
The sister company responsible for marketing and IT

Container suppliers

Kjellands Carriers
Q: 26 What key resources do you acquire from partners and suppliers?
Digital Dominance, for marketing and digital development

Logistic activities, could be improved more

Property area for the depot

Not that much at the moment

Surveillance on carriers in a digital platform

Cost structure
Q: 27 What are your most important costs today?
The cost of capital

direct costs (salaries, projects)

Indirect costs, properties, cost of administration

Q: 28 What key resources are the most expensive?
The resources of consultants and development

To lease properties, might cause relocation

Q: 29 What key activities are the most expensive?
Carrier cost

The most expensive cost is to build new systems, an extraneous cost

The onboarding process due to lacking efficiency

Marketing activities

To build the depot facilities is the most capital demanding

Business process management

Q:1 Which processes would you like to digitalize?
The customer requirement and booking process

Calculation of carrier cost and booking a carrier

Allocation between customer and container

Customer contracting and payments

Communication with customer

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Customer cancellation notice

Checking of container

Intergration of business and booking system

Q:2 What processes would you like to automate?
The customer booking of container

Booking of carrier and delivery date

Credit checking of customer

Allocation between customer and container

Customer service
Cooperation and partnership
Q: 1 What would that require from the customer?
Accuracy in the booking process

Being honest with the transporter

Explaining the conditions

Not that much, it´s like a e-store checkout process

Q: 2 What would that demand from the carriers?
Integration of API

Working in our IT-system

Ability to take orders

Accepting commercial terms based on calculations

Ready to apply hands on activities

Accepting demands on carrier

Q: 3 What does that require from Alabanza?
To develop a well functioning system

Integration of data and API

Potential profit sharing

Price reductions for customers

Find carrier partners

Give volume to carrier partners

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11.4 Kjelland Transport interview

Digital transformation
How developed is Kjellands digital transformation?
We are following with everything that’s new as tools. Four years ago, we started
using a transportation program where the customer can themselves book carrier with
and follow their order, and we have a salary system where the truckdrivers clock in.
What is your attitude towards new technologies?
Everything that we can earn money on and is contributing to efficiency is good.
Are you investing at the moment in digitalizing your company?
No not right now. We have bought servers so we can keep software and data on our
own servers.

Cooperation and partnership

Where in Sweden do you operate?
We operate all over Sweden. But most of the times, if we need a crane truck for
containers, we hire someone through our business network. It costs less. Most of the
times, if we transport containers, the customer does not either require a crane
because they have them on site”.
What is your relation to containertjänst AB?
“It is our biggest container customer. The biggest in Sweden, I assume. I think they
are the best in the business because they are good at what they do, with the right
staff, communication, have a hell of a lot of containers and contacts, are driven and
take good decisions. I do not have any interests in them except they are a good
customer”.
What do you consider as a mutual beneficial cooperation?
With my customers, it is simple. They need to be loyal and prioritize us. Does not
matter if they call here once a year or 100 times a year. I consider Alabanza as a
good customer, because just like containertjänst they use advance notice. You need to
plan for container transportations, it is not like ordering a cab”.
Would you consider having a strategic alliance with a container company?
No, because it competes with other customers I have. We are very careful about that.
I would never ally myself like that. That would create a conflict of interest between

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 my customers. They can compete with quality, leasing and price, but never with
carrier price. I never give out special prices or discounts, even if the customer has 20
containers to transport the same day. We need to work like that I think, otherwise we
would not have so much work to take on.
Are you open to create value with another noncompeting company?
No, because then I would tie myself to one single customer. I don´t want that. We
have a principle of driving for all customers. They only possibility would be if the buy
Kjelland.
How do you keep good relations with your stakeholders?
Well, I don´t tell anyone that competes about the prices they receive from us. Because
prices can be different. One big customer uses index pricing, which can sometimes be
more expensive for them and sometimes cheaper. And of course, if a customer is
making up 15-20 millions of our revenue, they get a better price. Everything else
would be strange. I can not prioritize the smaller ones. When they make money, we
make money

Development of business model alignment

Can you explain your business model?
Well, we drive what people want us to drive. Since 15 years ago when I bought
Kjelland, I have been developing our carriers design so it can fit our needs and
become more effective. We have competitors in Stockholm, but we are very selective
when we hire people. They are responsible for our interaction on site with the
customers.
Do you have any plans to develop the business model further?
No not really, as long it is jobs to take on we expand as much as we can. Then we
have a government that knocks on the door with rasing taxes and such so it is not that
easy. We have a problem with the price on diesel, which brings big costs for us.
What price mechanism do you use?
We use hours, and I have been counting on what every truck needs to cash in, and
minus 20% that we can not invoice from the customer. The monthly cost for every
carrier is calculate, and then we calculate an hourly fee, for an estimation of the fixed
price, how long it takes to transport a container to a destination.

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Which facilitating activities can a container company do to contribute for more cost
effective operations?
Order through our website, which Alabanza do, and to order with a quite good
advance notice. Information about the place on the container, and the number on it.
Another thing that would facilitate is if they would have a crane on the depot to
unload the containers. We do not lift close to electrical cables, because of the safety
for our truck drivers. We are not in need to develop the communication more today.

Is your booking process digital?

Yes it is, most of our orders come through the webpage, but some call in if they don´t
have access to a computer out on a construction site for example.
Is it something that you would like to digitalize or automize in your company?
Yes, but not on the container sector. We would like to have a digital inventory system
from our suppliers of rental equipment services. Today it is manual when we deliver
and pick up equipment, but that is something we think could be solved with tags. Like
DB Schenker and postal services.
Do you use different information systems?
Yes, we use Åkeriföreningens index. We have the digital salary agreements, new
regulations for the transport sector.
Do you use telematics in your operations?
We use TomTom for fleet management and logistics, GPS in all our trucks, so we can
see them in our transport software, WebFleet. Our customers can log in with their
customer number and see the status on the order.
Do you think it´s possible to make Alabanza’s end customer to see the status on
transport instead?
Then they would need to log in to Alabanza’s customer number, which I don´t think is
such a smart thing. It is not either that good with too much information. If a end
customer can for example follow times, our route can be completely different from
theirs.
Alabanza want to digitalize their booking process, but it requires Kjellands to work in
their system. What would be the complications of that?
That is not too hard, but we need to integrate our systems, so they send their orders
digital to us. It works, but we need their system to communicate with ours. I would be

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positive to a change like that, and I would like to see our other customers to make
that change. The affair would be more effective for their recipients, and would
rationalize time away.
What would that require from Alabanza?
We should sit down and talk, about what their API looks like, how our looks like and
where the data should be sent in our system.
What would you like Alabanza to know more about transport and logistics?
Not that much, because our cooperation works out fine. They don´t stress too much
like other rental companies
What would the digitalized booking process require from the end customers?
The capacity of carriers is enough to transport the next day, but that is only in
exceptional cases. Other customers have implemented guidelines for their customers
on the delivery process. I think it would put more demand on Alabanza than the end-
customers, and I would like to sit down with their recipents to understand their work-
methods and routines.
How much can you integrate your business model with Alabanzas business model?
100%, since it is only about integrating our systems to each other.
Would a sit down contribute to a reprical cooperation in your business models?
Yes, that would make it work even better. Then we can make agreements. There been
problems with the end-customer not having effective communication with our
customer because of lacking guidelines.
Would it be possible to carry two containers for two different customers in the same
area, and have a price reduction?
No, fixed price basis is that sometimes we earn from it, sometimes they earn from it,
but if we carry two 10 feet containers we will take the same price as for a 20 feet
container.
So it is not possible to route from one customer to another?
No, because we never know what carrier that is taking the job. We will take the
carrier that is closes and fits for the route, and we also must make sure the carrier’s
truckdriver is a residential on the right side of Stockholm. If a truck driver lives at the
south side, and has the last delivery at the north side, he will be stuck in traffic and
that costs me money.

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So it´s not possible for you to transport a container from our depot in Vallentuna to
two nearby destinations in Åkersberga for a price reduction?
No. Because at one customer, the container might need to be lifted 2 meters from the
carrier. At the other customer, it might need to be lifted 15 meters. Then we might
need two different carrier types, and we don´t know that beforehand. Alabanza does
mostly not know how long it will be lifted, that is information we receive when we
speak to the end-customer over the phone. This is logistics that Alabanza does not
notice, because we don´t ask Alabanza questions about that. It does not add any value
for us to ask Alabanza about that information, because they don´t ask the end-
customer the same questions as we do.

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11.5 Alabanza as is and to be processes

As is processes:
1. Marketing activities on internet
2. Responding to an offer.
3. Will be reconnecting with customer
4. Create a digital agreement with the customer
5. Sign the customer with BANK-ID
6. reconnect with the customer and agree with the delivery date.
7. Adding transport during the driving schedule
8. to confirm with the customer in before we send out the container that we can actually
receive
9. Booking transport
10. confirming with the haulage company that it has been delivered/picked up
11. Invoice the customer for transport and hire

To be processes:
1. Marketing activities
2. Customers place a completed order online.
3. credit check is done directly in check out.
4. Customer puts in that they want a pickup
5. the transport company receives a booking request
6. the company confirms the booking to the customer
7. the container is delivered to the customer
8. I receive a notification that a transport has been completed
9. invoice the customer
10. Monitor the process

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