Zitcong Inc case analysis

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Nov 24, 2024

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1 Zitcong Inc. Case study Question 1 Introduction This report delves into the multifaceted challenges faced by Zitcong Inc., a Taiwanese multinational corporation, as outlined in this case study. Throughout its history, Zitcong has navigated various circumstances, from business diversification and accidents to reputation issues and the impact of global events like the COVID-19 pandemic. The primary objective of this report is to identify and address two critical problems that have emerged within Zitcong's car conversion business in Taiwan. By conducting a comprehensive analysis of data-driven insights and Six Sigma principles, we aim to provide actionable solutions that align with Zitcong's corporate goals, foster operational excellence, and fortify the company's standing in the market. Zitcong Problem One of the most pressing problems facing Zitcong is the recurring safety issues and accidents involving the converted vehicles it sells. The case study highlights a series of accidents resulting in fatalities attributed to mechanical breakdowns, particularly brake failures, in the vehicles sold by Zitcong. These incidents suggest a systemic flaw in the company's quality control and vehicle conversion processes. The implications of these safety concerns are far-reaching and severe: 1. The loss of life and injuries in these accidents devastates families, significantly damages Zitcong's reputation, and erodes customer trust.

2 2. Legal actions from these accidents can lead to substantial financial liabilities, potentially undermining the company's financial stability. 3. The negative media coverage and customer backlash on social media platforms have decreased sales, harming Zitcong's market share and profitability. Zitcong is grappling with a second critical problem related to its negative online reputation and the growing backlash on social media platforms. Customers who have experienced accidents, poor customer service, or other negative aspects of Zitcong's products have taken social media to voice their grievances. The case study mentions that these online groups continue to assail the company's product credibility and customer service. The impact of negative online reputation and social media backlash is significant. While Zitcong maintains strong sales due to competitive pricing, the constant negative coverage on social media platforms hinders potential customer acquisition (Khan et al., 2020). Prospective customers are likely to be deterred from purchasing Zitcong's vehicles due to the perceived risks and poor customer experiences shared online. This incident severely harms Zitcong's reputation, making it harder for the business to attract new customers and retain existing ones. As a result, the company's potential to grow is constrained, and customers need a better impression of its brand. Root Cause Analysis: 5 Whys Safety Issues and Accidents in Converted Vehicles 1. Why are there recurring safety issues and accidents involving converted vehicles? Mechanical breakdowns, specifically brake failures, are occurring.

3 2. Why are there mechanical breakdowns and brake failures in the converted vehicles? The brake systems are not functioning as intended. 3. Why are the brake systems not functioning as intended? The brake components must be of sufficient quality or have been properly installed during the conversion process. 4. Why are low-quality brake components being used or installed improperly? The quality control process during the conversion might need to be improved, leading to subpar components being used or improper installation techniques. 5. Why is the quality control process inadequate during the conversion? The company might need a comprehensive quality control framework, resulting in insufficient testing, monitoring, and verification of conversion processes. Problem 2: Negative Online Reputation and Social Media Backlash 1. Why is there a negative online reputation and social media backlash against Zitcong? Customers are sharing negative experiences and grievances online. 2. Why are customers sharing negative experiences and grievances online? They have had negative experiences with the company's goods or services. 3. What makes consumers unhappy with the company's goods or services?

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4 The products (converted vehicles) must meet customer safety, reliability and quality expectations. 4. Why are the converted vehicles not meeting customer expectations? There might be a breakdown in communication between customer feedback and the company's design, conversion, and quality control processes. Why is there a breakdown in communication regarding customer feedback? 5. Why is there a breakdown in communication regarding customer feedback? The company might need a robust mechanism for gathering, analyzing, and acting upon customer feedback, leading to unaddressed issues and negative experiences. SWOT Analysis Strengths Market Presence and Reputation Zitcong has established a strong brand presence in the car conversion market, contributing to its significant market share and customer base. Diverse Stakeholder Network The company benefits from diverse international stakeholders, including investors and partners, which provides access to resources and expertise. Weaknesses Quality Control Deficiencies Inadequate quality control processes have resulted in recurring safety issues and accidents, eroding customer trust and damaging the company's reputation. Limited Customer Feedback Utilization The lack of an effective mechanism to gather and address customer feedback has contributed to a negative online reputation and social media backlash, hindering the company's

5 ability to improve its products and services. Opportunitie s Safety Technology Adoption By investing in advanced safety technologies and rigorous testing procedures, Zitcong can improve the safety of its converted vehicles, addressing the root cause of accidents. Digital Engagement and Reputation Management Leveraging digital platforms for customer engagement and proactive reputation management can help rebuild the company's online image and address negative sentiments. Threats Intensified Competition The car conversion market is becoming more competitive, and a negative reputation can lead to the loss of potential customers to rival companies. Legal Liabilities Accidents resulting from safety issues could lead to legal actions, substantial financial penalties, and liabilities, potentially impacting the company's financial stability. SMART Solutions Specific Define the specific parameters and benchmarks for vehicle safety, such as acceptable brake failure rates and performance standards. Measurable: Engage a dedicated cross-functional team of engineers, quality control specialists, and data analysts to lead the DMAIC process. Attainable Engage a dedicated cross-functional team of engineers, quality control specialists, and data analysts to lead the DMAIC process. Realistic Collaboratively design and implement improved processes for selecting, installing, and testing brake components, addressing the root causes of brake failures identified in the analysis. Time-bound Complete the DMAIC process within nine months, with continuous monitoring to ensure sustained improvements. Solution 2: Use customer feedback and a proactive reputation management

6 Specific Define clear channels and protocols for collecting, analyzing, and responding to customer feedback, both positive and negative. Measurable Monitor online sentiment through social media, monitoring tools, tracking the volume of negative mentions and measuring sentiment scores. Attainable Train customer support personnel to handle feedback professionally and resolve issues promptly, utilizing lean principles to streamline the process. Realistic Implement a digital engagement strategy that highlights positive customer experiences, addresses negative feedback, and provides timely updates on quality improvements. Time-bound Execute the reputation management strategy within six months, with continuous assessment and adjustments based on evolving customer sentiments. Intervention and Closure of the Consultancy Project The consulting project will be carried out in a planned manner with tight coordination with internal Zitcong teams. The project will be divided into several stages that follow the DMAIC model and Six Sigma concepts (Godina et al., 2021). The strategy will guarantee in- depth issue analysis, data-driven solutions, successful implementation, and ongoing supervision. 1. Define Phase: Through in-depth study, stakeholder interviews, and data evaluation, jointly pinpoint the underlying causes of safety concerns and a bad reputation. Clearly define the project's goals, scope, and deadlines. 2. Measure Phase: Compile pertinent information on safety-related occurrences, consumer opinions, and internet sentiment. To determine the scope of the issues, use Six Sigma methods for data analysis and trend detection. 3. Analyses Phase: Perform a thorough investigation to determine the causes of safety events and reputational problems. Create a thorough strategy to deal with the causes.

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7 4. Improve Phase: Create and implement customized remedies for every issue using Six Sigma techniques. Improve quality control procedures for the safety problem, and develop a strong, feedback-driven reputation management approach for the reputation issue. 5. Control Phase: Track safety occurrences, consumer feedback trends, and online sentiment to assess how well-deployed solutions work. Establish control mechanisms to guarantee the solutions' continuous success. Consultancy Project Termination To enable a smooth transition and knowledge transfer, the consultant project will conclude with a planned closure phase: 1. Results Presentation: To Zitcong's leadership and important stakeholders, the consultant team will present the findings, solutions, and implementation plans. 2. Support for Implementation: The team will aid in the early stages of solution implementation, providing direction, instruction, and support to internal teams. 3. Monitoring and Review: The solutions' development will be followed up on for a specific time, with periodic review sessions to gauge their efficacy and make required modifications. 4. Knowledge Transfer: To make sure that Zitcong's internal teams comprehend the solutions and can handle them independently in the future, the consultant team will organize knowledge transfer sessions. 5. Final Report and Recommendations: A thorough final report summarizing the project's methodology, results, and suggestions for long-term success will be presented.

8 Question 2: Aquatic Taste Restaurant Implementing Kanban System for Inventory Management Implementing a Kanban system for inventory management, a concept based on lean methodology is a highly effective way to increase productivity at Aquatic Taste (Mouaky et al., 2019). The core of this strategy is implementing a visual signaling system that deftly controls the inflow of supplies and ingredients throughout the restaurant. Every component and item will have a specific slot in this system and a quantity threshold set in advance. To avoid the problems of overstocking and stock outs, an automated signal will start an order for replenishment when amounts get close to these predetermined thresholds. Aquatic Taste may minimize waste, maximize resource allocation, and guarantee that the necessary components are always accessible when needed by using this form of inventory management. This creative approach addresses the "Inventory" waste category in the Seven Wastes paradigm. Challenges associated with excess inventory include rising storage costs and the looming threat of ingredient deterioration. On the other hand, stock outs result in operational hiccups that slow down consumer orders and jeopardize overall effectiveness. The Kanban system eliminates these unproductive situations by offering real-time visibility into inventory levels and encouraging a harmonic balance between supply and demand. By adopting a methodical strategy for inventory management, Aquatic Taste will see a significant drop in storage costs while reducing the likelihood of components sitting around past their sell-by date. The Kanban system ensures that necessities are always accessible, preventing the annoyance of delayed orders and enabling the culinary staff to work at their best. As a result

9 of the staff's freedom from the continual pressure of keeping track of inventory levels, the quality of the dining experience as a whole has improved. Using this Kanban system might lead to a lean-driven change in Aquatic Taste's operations, enabling a seamless fusion of resource optimization, cost-effectiveness, and operational excellence. Implementing Standardized Work Procedures Implementing standardized work practices across several restaurant tasks, from food preparation to customer service interactions, is a potent way to increase operational efficiency at Aquatic Taste. This novel method requires creating detailed, step-by-step instructions for every work, including exact time allotments, detailed action sequences, and stringent quality checks (Afriza, 2023). The ongoing evaluation and improvement of these procedures based on employee feedback and the assessment of performance indicators is a dynamic component of this approach. This brilliant technique cleverly solves two essential waste components: "Motion" and "Defects." Unnecessary movements and deviating from optimized procedures are the main causes of inefficiencies within the scope of lean concepts. Similar to how departures from established methods produce flaws and inconsistencies, which necessitate rework and may result in unhappy clients (Juliani & de Oliveira, 2019). Standardized work practices a safeguard, guaranteeing that every food served meets the highest quality standards. This constancy strengthens the unwavering brilliance of Aquatic Taste. These rules significantly reduce the likelihood of mistakes and inconsistencies by offering a clear road map for job performance. Therefore, reduces the need for remakes and consumer complaints overall. Staff members may execute duties correctly, maximize time consumption,

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10 and significantly reduce the requirement for duplicate movements or activities by orchestrating operations through defined standards. Adding lean waste management to standardizing work procedures adds a new level of efficiency to Aquatic Taste's operations. Optimized protocols ensure that duties are completed, providing customers a consistent and enjoyable eating experience. At the same time, the restaurant's resources are used precisely, demonstrating the principles of lean efficiency. Self-Service Kiosks for Ordering From a customer's perspective, integrating self-service ordering kiosks would be a game-changing improvement that might boost the Aquatic Taste experience. This cutting-edge strategy gives customers the power to direct their eating experience, bringing in a new level of efficiency and convenience. Self-service kiosks will be installed inside the restaurant's walls as part of the mechanics, allowing clients to independently browse the menu, customize their orders, and make payments via the kiosk's interface. The ordering procedure is accelerated, and the time needed for order processing significantly decreases when the kiosk smoothly transfers requests to the kitchen after receiving order confirmation (Nazi, 2018). Complementing the First Two Idea Self-service kiosks and the first two principles form a trio of innovations that enhance efficiency and operational excellence. Self-service kiosks work with the Kanban inventory system to ensure ingredient availability syncs with consumer preferences, reducing overstocking and stock outs. With the introduction of self-service kiosks, the integration of standardized work procedures reaches its pinnacle since these digital interfaces guarantee that client orders perfectly follow the restaurant's standardized norms.

11 Self-service kiosks allow quicker order placing, reducing peak-hour waiting times and enhancing the eating experience. Direct order entry from customers significantly reduces the chance of manual order entry mistakes, ensuring the exact fulfillment of consumer requests. Introducing the self-service kiosk idea alters the Aquatic Taste eating experience. It satisfies the modern consumer's need for convenience and perfectly aligns with the restaurant's dedication to lean. In conclusion, introducing established work practices, incorporating self-service ordering kiosks, and creating a Kanban system for inventory management are creative methods to boost productivity at Aquatic Taste. These concepts, which are based on lean principles and target numerous wastes, improve operational effectiveness and help to create happier customers and a more efficient workflow. References Afriza, B. R. (2023). Maximizing Productivity: The Power of Standard Operating Procedure, Work Environment and Communication. PRODUKTIF: Jurnal Kepegawaian Dan Organisasi , 2 (1), 82–92. http://jurnalpustek.org/index.php/sdmo/article/view/89 Godina, R., Silva, B. G. R., & Espadinha-Cruz, P. (2021). A DMAIC Integrated Fuzzy FMEA Model: A Case Study in the Automotive Industry. Applied Sciences , 11 (8), 3726. https://doi.org/10.3390/app11083726 Juliani, F., & de Oliveira, O. J. (2019). Lean Six Sigma principles and practices under a management perspective. Production Planning & Control , 1–22. https://doi.org/10.1080/09537287.2019.1702225

12 Khan, R. U., Salamzadeh, Y., Iqbal, Q., & Yang, S. (2020). The Impact of Customer Relationship Management and Company Reputation on Customer Loyalty: The Mediating Role of Customer Satisfaction. Journal of Relationship Marketing , 21 (1), 1–27. Researchgate. https://doi.org/10.1080/15332667.2020.1840904 Mouaky, M., Berrado, A., & Benabbou, L. (2019). Using a kanban system for multi-echelon inventory management: the case of pharmaceutical supply chains. International Journal of Logistics Systems and Management , 32 (3/4), 496. https://doi.org/10.1504/ijlsm.2019.098333 Nazi, R. (2018, April 1). Adoption of Self-service Kiosks in Quick-service Restaurants . https://atrium.lib.uoguelph.ca/xmlui/handle/10214/12972

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