Term Paper: Kimura K. Can This Customer Be Saved

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Kimura, K.k.: Can this customer be saved?

Kimura K.K.

Pramtex's main problem is Kimura's refusal to place a second order for three more Spartacus machines. Despite being enthusiastic about the quality and quantity of the outcome achieved by the new system implemented at the factory in Osaka, Mr. Kimura, the company's president, chooses to opt for other manufacturers in order to purchase the machines needed at his factory in Taiwan. The fax that John Reef (product manger and Pramtex representative in Japan) receives is quite confusing because it doesn't contain the reasons for such a sudden change of attitude. The message is even more puzzling because of the following paradox: Mr. Kimura admits that Pramtex has the best and most technologically advanced equipment in the market. Additionally, Jim Craig (John's supervisor) has accepted to offer a 10%-discount to Kimura because of the finance director's statement that the Japanese company has received better offers from other firms.

But the problem doesn't end here. Because of Kimura's strong reputation and relationships with major competitors like Sony and Matsu*****a, Pramtex could fail to establish business contacts with some of the most important Japanese companies if Mr. Kimura shares his depreciative opinions regarding the Australian company.

Consequently, the bottom line is as follows: Pramtex has lost one of the most significant and influential customers - Kimura, and implicitly, risks to miss other business opportunities on the Asian market because of its negative fame. The question which arises under these circumstances is whether Pramtex can save this customer and its corporate image (reputation) among Japanese corporations.

Situational analysis

In order to provide an accurate analysis of the situation undergone by Pramtex, a SWOT chart could prove extremely useful.

The main strengths that Pramtex takes pride in encompass:

a) the advanced technology used for producing the optical disk manufacturing lines - at this chapter, one of the most important innovations is the Spartacus machine - "the Rolls Royce of the turnkey DVD production system" - whose fame is mainly due to the RX72 metalizer's revolutionary features b) the uniqueness and ownership of the Spartacus concept - Pramtex is the exclusive owner of the innovation appraised by scientists and partners c) the great stress it lays on research and development and the valuable human resources that this activity engages - Pramtex's star researcher seems to be Dr. Max Scorse, an elitist physicist who has dedicated his career to discovering revolutionary technologies d) Pramtex's strategy which focuses on emerging technologies and close relationships with customers for developing exquisite systems and being one step ahead of its competitors e) the possibility of setting premium prices due to the advanced technology it uses.

Yet, Pramtex has multiple weaknesses which explain its failure to attract an additional order from Kimura. Most weak points derive from the inappropriate manner in which the company handles its relationship with customers and post-sales services. These comprise:

a) the top scientist's refusal to travel to the new factory in Taiwan in order to take notice of Kimura's specific requirements b) the total absent-mindedness of Max Scorse who considers innovating to be the one and only activity deserving his attention - e.g. he doesn't even bother to remember Dr. Komoda (Kimura's chief of production)'s name c) John Reef's failure to timely ensure the link between Kimura and Pramtex when the Japanese company seems to desperately need the Australian company's help or advice (e.g. John receives Dr. Komoda's phone call pointing out at an urgent technical problem on Saturday but he tries to reach his company on Monday; he also forgets to send a second quotation to Mr. Hashimoto despite having promised him to do so after talking to Dr. Komoda).

A d) the inability to cope with deadlines - even though Dr. Nomura stresses the importance of delivering the Spartacus machines by the end of July, the merchandise arrives on August 9 e) the inability to promptly offer assistance when customers most need it - Dr. Komoda complains about the fact that his engineers can't solve the problem encountered at the Spartacus machinery on August 12 and Pramtex specialists arrive on August 17.

A f) the failure to coordinate Pramtex's actions and Kimura's requests - when Dr. Komoda announces that his engineers have identified the problem and need a spare part, John insists to wait for the two engineers sent by Pramtex in order to have a confirmation; thus, precious time goes by g) the inability of Pramtex's warehouse to timely supply new parts for the machineries sold - after wasting enough time because of the arrival of the two engineers, the spare part can not be found in the warehouse from Sydney; moreover, Max Scorse dares to say that Pramtex is not responsible for the respective part as this has been purchased from a supplier h) the lack of team work and, implicitly, the impossibility of providing assistance in the absence of the top scientist - when John calls at the central lab and asks for help, David Loan, one of the people who have heard of Spartacus, states that the absolute holder of the technical details is Dr. Scorse who has left for Brisbane i) the lack of communication - all the phones are switched off (including Dr. Scorse's) when John desperately attempts to signal the problem occurred j) the unprofessional linkage personnel - secretaries, call-center operators, receptionists and so forth act like robots which focus on speaking rather than listening; they are incapable of taking part in solving a certain problem because they simply ignore their discussion partner who becomes increasingly annoyed with the Vivaldi concerto to which he must listen over and over again before talking to the right person k) the unprofessional accountants who don't have a clear situation of the payments received l) the difficulty and high cost generated by servicing and maintaining the machinery which claims a considerable number of specialized engineers due to its numerous electrical parts m) the controlling system which is not so easy-to-use (this weakness may be inferred from John Reef's finding regarding the enhancements brought by Kimura's operators to this part of the assembly).

The main opportunity consists of the Japanese market's increased demand for more advanced DVD formats which must be qualitative enough to bare the burden of the contracts awarded by famous Hollywood studios.

Pramtex seems to face two major threats:

a) increased vulnerability to competitors because of their attempt to develop revolutionary optical disk manufacturing systems b) Pramtex's negative image on the Asian market as a result of Kimura's dissatisfactory experience with the Australian company (despite not being clearly mentioned in the case study, this consequence may be guessed from several information regarding Mr. Kimura's position of President of Japan's Optical Disk Experts Manufacturing Association, his close relationship with competitors and Sony's decision to choose Marubeni over Pramtex).

Identifying, evaluating and choosing alternatives

Being given the dilemma with which Pramtex is confronted, the questions which arise are the following: "Can this customer be saved?," "What are the most viable solutions to such impasse?," and "How much time do they need to produce effects?."

In my opinion, the answer to the first question is a positive one. Indeed, Kimura could be re-included in Pramtex's portfolio but the period of time needed for such an achievement is going to be quite long because the Japanese company's bitter taste is too recent to be forgotten.

For handling this problem, Pramtex has two options:

either it significantly reduces price in an attempt to obtain immediate effects or it redesigns the entire customer servicing process in order to meet the clients' requirements which occur after buying a Pramtex product.

The first alternative is likely to produce short-term consequences as it takes into account Kimura's finance director's complaints about cost. Still, there is a slight chance to make Japanese go back on their word. As Edward Hall has highlighted in one of his papers, the Japanese culture is a high-context culture. This means that much of the information conveyed is in the person. Consequently, despite having the best product on the market, the Pramtex personnel's conduct and inability to provide assistance when this is urgently needed will surely determine Kimura to opt for another supplier which pays higher attention to its customers. For instance, Dr. Nomura himself, known as a sort of ambassador for Pramtex at Kimura, states that Singulus has given a red-carpet treatment to Mr. Kimura during his visit in Germany. Therefore, the company is ready to overlook an inferior quality due to the supplier's commitment to closely cooperate with the customer for solving any problems that might occur.

In conclusion, if we take into account all these presumptions, we could state that Pramtex has to start from scratch in order to regain Kimura's confidence.

First of all, the company must understand that being the best is not the only thing that matters. Appropriately interacting with partners is an issue that has at least an equal importance. Such rationale also touches upon the research and development… [END OF PREVIEW]

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