Unlike the first two presented sales process frameworks that are in endless cycle, Storbacka’s (2011) proposed value-based sales process is linear, containing four major milestones which are; develop solution, create demand, sell solution and deliver solution (Storbacka, 2011). The framework is recommended to be suitable for firms that are transforming from product sellers to solution providers. And considering the complexity of offering solution and the political tension that may arise between the sales and the production unit, the author further explained, as shown in figure 3 below, how firm can establish balance between customization and industrialization, as well as develop support platform for managing the solution business. In the commercial phase, the capabilities of the solution provider to manage the sales process and receive compensation are described, whereas, in the industrialization phase, the author explained the capabilities required to effectively produce and deliver solutions.
Figure 3. The solution business framework (Storbacka, 2011, p. 703)
In the first phase of the sales process, i.e. develop solution, the solution provider conducts market research, usually through regular planning with lead customers, in order to mutually create new ideas and superior value by combining the customer’s insight with the firm’s capabilities and resources. And, in order to tailor the solution to specific customer’s needs and still achieve mass customization, the basic components of the solution are standardized and modularized; which gives room for flexibility for the provider to easily adapt to different customer’s requirements (Storbacka, 2011). This phase of the model introduce the use of lead customer for new idea creation, which is missing in the first two presented frameworks.
However, similar to the value proposition phase of the Brady and colleagues’ (2005) framework, and the relationship selling and marketing the product phase of the Moncrief and Marshal’s (2005) framework, Storbacka (2011) also suggests that solution provider stimulate customers’ interest and create demand through value proposition at the second phase of the sales process. Strong marketing is needed at this stage for awareness creation and the firm can achieve this by partnering with industry associations and through internal collaboration between product and marketing managers for campaign development (Storbacka, 2011). The value proposition should be based on the specific segment needs identified during market research that was initially conducted for different market segments. And the main differentiation capability is the ability to demonstrate the need for the new solution and the expected impact on the customers’ operation (Storbacka, 2011), and as already established in other frameworks, consulting capability is highly required at this stage (Brady et al., 2005; Moncrief & Marshall, 2005).
At the third stage, the provider move from addressing market segment to individual customer level in order to sell the solution. According to Storbacka (2011), the solution provider needs solution configurators at this stage in order to modify the various modules to fit specific business needs of individual customers (Storbacka, 2011). Similar to what is termed as negotiation by Brady and Colleagues (2011), this stage is done in collaboration with the decision makers of the customer’s organization and it includes value quantification and pricing of the solution (Brady et al., 2005; Storbacka, 2011). The value quantification could either be based on product features, in which case, the product qualities are the differentiator and cost based pricing are most appropriate, on the other hand, value quantification could be customer oriented, and this is based on the customers’ purchasing process, financial situation and industry structure, and this may require the combination of competition-based and value-based pricing (Hinterhuber, 2008; Liozu et al., 2012;
Storbacka, 2011).
The last stage of the sales process includes solution delivery and value verification which is the most obvious difference between Storbacka’s (2011) framework and the two earlier discussed frameworks especially in terms of measuring and verifying the financial impacts of the delivered solution on the customers’ operation. However, the process of value verification is similar to the relationship maintenance and operational services identified in the other two frameworks (Brady et al., 2005; Moncrief & Marshall, 2005; Storbacka, 2011). The use of value verification allows the provider to bargain on performance based compensation with customers and since this is a continuous process, it gives the provider the opportunity to establish long term mutually benefiting relationship with the customer (Burger & Cann, 1995; Storbacka & Pennanen, 2014; Storbacka et al., 2013; Storbacka, 2011). Furthermore, customers that engage in ongoing relationship could be very valuable as reference cases for new customers and the information obtained during value verification could documented and utilized for new solution development that can be replicated and sold to other customers (Storbacka, 2011).
Similar to Storbacka’s (2011) framework; Töytari and colleagues (2011) as well as Kaario and colleagues (2003) also proposed a linear value based sales process but without the support platform. All the three processes share common factors, in terms of customer centricity, value quantification, value verification/validation and value documentation (Kaario, Pennanen, & Storbacka, 2003; Storbacka, 2011; Töytäri et al., 2011). The main
difference is that three important stages of the sales process namely; identification of suitable customer, understanding customer business, and positioning own offering, are visually represented in Töytäri and colleagues’s (2011) framework but not in Storbacka’s framework (Storbacka, 2011; Töytäri et al., 2011).
Additionally, while Kaario and colleagues (2003) suggests that solution effort should be dedicated to understanding and enhancing customers’ business process, Storbacka’s (2011) as well as Töytäri and colleagues’ (2011) framework concentrated on understanding and enhancing customers’ business operation. Another difference is that, Storbacka (2011) recommended that customer research and new solution creation be conducted in collaboration with lead customers, whereas, Töytäri and colleagues (2011), advocated that these activities be done internally within providers organization (Storbacka, 2011; Töytäri et al., 2011). With the inclusion of result maintenance, sustenance and support phase in the sales process, the work of Roune and colleagues (2011) on result selling extends the sales process beyond the value verification phase, which was the final stage in the other reviewed value based sales processes (Kaario et al., 2003; Roune, Bristow, & Terho, 2011;
Storbacka, 2011; Töytäri et al., 2011).