Electronic Leasing of your Company Car

Teaching Note

Prepared by Thomas Kern and Marc Dekker

Here is an extended version of the Kambil & van Heck (1997) e-commerce model that may be used to visualize the various processes that may or are likely to affect an e-commerce start-up like Flexlease.

Case discussion suggestions:

  1. A possible objective might be to apply Kambil & van Heck’s framework as an analytical tool to the case after it has been introduced in class. The case in this context is particularly useful to first highlight the model’s practicality, strengthens and weaknesses, where it could be extended and its possibility of guiding managers’ strategic thinking of processes in an e-commerce venture.
  1. Another objective of the case might be to identify the core processes of an e-commerce business and then discuss how e-commerce startups handle, plan and manage their processes. By focusing on the various process weaknesses and strengths of the business concept, students can be focused on issues to avoid and those to plan for carefully. The case may be particular useful for this type of discussion as it presents quite a holistic view of e-commerce processes in a company context, including external and internal factors
  1. It is possible to use the case to discuss and illustrate how a workflow management system can be integrated into the operations of an e-commerce driven business such as Flexlease. It presents interesting possibilities and opportunities to discuss it along the supply chain concept. Highlighting in particular the various processes that are likely to arise. Moreover, it presents the means to discuss, present and illustrate how Staffware can be used to visualize and model the various flows and processes in an e-commerce business.

Brief analysis of Flexlease using the extended model of Kambil and van Heck (includes a particular focus on integrating Staffware):

Basic trade processes

Search – In the search process customers can access the database using several search parameters, such as brand, price range or model. The workflow application does not support this process.

Valuation – Flexlease uses standard prices, which may be adapted to certain customer demands. The lease price depends on the price the dealer wants for the car and the expected depreciation. If the customer is willing to pay a higher price he/she can buy additional flexibility, depending his/her requirements. The workflow management application does not support this process, as there is no direct interaction with the customer yet.

Order – The order process of Flexlease has been discussed in detail. Using Staffware, the order process is supported with workflow management.

Logistics – The internal electronic logistics are handled by Staffware, which routes the information through the organization. The external logistics are minimized by leaving the delivery of the car as a matter to be resolved by the dealer and customer. It is possible to have the car brought to the customer, but the dealer will generally take care of this. The workflow management application does support this process in terms of identifying a communication channel.

Payment and settlement – By signing the contracts that Flexlease sent, the customer agrees to transfer the monthly lease amount to Flexlease’s account. There is no support here by the workflow application.

Authentication – Flexlease has the WebTrust seal on its site, which is supposed to emphasize its trustworthiness. Also PCL and NetlinQ are the founding corporations. Both have been in existence for a number of years providing a sense of security about Flexlease’s business. Furthermore, Flexlease requires for the leasing process a Chamber of Commerce registration number to authenticate the customers’ company. The workflow application is expected to support this authentication process of the customer at a later stage. The holistic system, once operational will then automatically compare the information from the customer with data from the Chamber of Commerce.

Flexlease recognized early on the importance of creating confidence in its business. In turn, they applied for third party validation. They are thus the first Dutch website that has been granted the WebTrust seal. When this seal is present on a website, Verisign, who controls it, guarantees that the information on the website is correct, and that the personal data provided by potential customers will not be distributed without the approval of the customer. In other words, when the WebTrust seal is clicked, a connection is established with Verisign who confirms the identity of the website (Doorenbosch, 1999).

Trade context processes

Representation

Flexlease provides a car description that is limited to the features of the car, not technical details that can be found on specialized sites. By using a clearly structured website that does not need much scrolling, Flexlease wants to be an easy-to-use site. The workflow application does not support this process.

Legitimization

Flexlease now only sells in the Netherlands, thereby avoiding difficulties like tax and law regulations. In combination with other parties there are plans to start websites in other countries too. Before that, Flexlease must first have a clear overview of related tax and lease regulations. The workflow application does not support this process at this time, when digital signatures become legal, the system will support this process to some extent.

Influence

This process is implemented by the WebTrust seal and a blanket agreement between the customer and Personal Car Lease. The process is not supported by a workflow management system.

Customer service, including dispute resolution

The service that is offered with the lease contract is the same as that with any other lease product, including damage, insurance, etc. In the near future it will be possible to submit damages and other claims by the Internet, thereby avoiding office hours. The workflow system is not used to support this process yet, but through its functionality it may be possible in an extended version to include this aspect.

  • Flexlease will generally use the workflow management system as means to integrate and establish links between several of its applications. This way the company can monitor the flow of all its leasing cases and automate the entire ordering process.

Supply chain issues

According to the data and Jeff Visser, it is clear that Flexlease aims eventually to link a number of different companies into an extended supply chain. The base of this supply chain is the linkage of a number of information systems. The objective of linking through the existing information systems is to use the advantages the Internet offers, but also more importantly, thereby, be able to offer a product very cost-efficiently as the amount of profit margin left at the end of the day is very small.

The Internet, i.e. WWW is playing a vital role in shaping the supply chain as it will operate primarily on the basis of data and information exchange along a predefined communication channel between customers and dealers. Flexlease in this supply chain will pose chiefly as the interfacing mediator between its various participants. In the end it will be likely that a community of dealers and customer companies will evolve.

Teaching NotePage 1