I also have a Volvo with the B&W audio system and it sounds fantastic. What specifically needs "improvement "
You can try messing with the equalizer. I did tweak that to get the color my ears prefer.
Everyone who said the iPhone is sending a digital signal not going through the iPhone DAC is correct. That said your iPhone may be running the sound through algorithms in its software driver that is sending out the digital through your usb.
I have both iPhone with car play and Samsung galaxy with android auto. I noticed they do not sound the same as each other even though they are playing the same track in the same car
The android operating system resamples audio to 48KHz before finding the digital signal out. It may be that ios is somehow messing with the digital data as well. I was able to get an app that bypasses all of android's sound processing and sends things out bit perfect if you have hardware that supports it. There may be something similar for ios and tidal streaming is directly built in to the app.
I'm very picky and studied audio engineering in school. This system sounds phenomenal once you tweak the eq to your liking. Also I don't recommend the studio or concert hall sound modes.
I base my judgment on level of detail, spaciousness of sound image, tightness of bass and dynamic range (how low the lowest volume sound is compared to the maximum. In the track
Previous systems I have had and also loved were the $7K B&O system in my audi a8 the lexicon in my equus, and every other genrration of Volvo premium sound since the 850 turbo I had in college. I think the one in my 2011 C70 actually sounds the best but it is really close. The premium audio in my explorers, edges, and escape are awful.
One surprising stand out is the base system in Hyundai sonata.
Hope this helps you achieve the sound you are looking for