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MASTER OF BUSINESS ADMINISTRATION
AWARDED BY NOTTINGHAM TRENT UNIVERSITY
INTERNATIONAL CONSULTANCY PROJECT
Topic: Analysis of Effectiveness of Mass Customization in KOMARK Corporation
(Interim Report)
Group Members
1. Bing Tuck2. Muhammad Shahid3. Zubair Saleem4. Muhammad Atif Munir5. Satyajeet Das6. Haroon Rasheed7. Ezechukwu Dorath8. Godstime9. Petrick
Supervisor: Dr. Mukunda Kumar
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Table of Contents
Page No:
Executive Summary
1.0 Introduction 01
2.0 Background of KOMARK Corporation Berhad 05
3.0 Literature Review 07
3.1 Defining Mass Customization 07
3.2 Concept of Mass Customization 08
3.3 Levels of Mass Customization 08
3.4 Success factors of Mass Customization 09
3.4.1 Demand or variety and customization 10
3.4.2 Market Condition 10
3.4.3 Value sequence 11
3.4.4 Technological Innovation 11
3.4.5 Customizable products 12
3.4.6 Knowledge Sharing 12
3.5 Advantages of Mass Customization 12
4.0 Analysis 13
5.0 Recommendations and Action Plan (Under Process) 28
6.0 References 29
7.0 Questionnaire 30
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1.0 Introduction
The scope and objectives of this piece of work is to fulfill the requirements of Nottingham Trent
University UK to practically analyze a multinational organization. During this consultancy
project our group will analyze the production line and corporate strategies of KOMARKCORP
Berhad and effectiveness of Mass customization technique in the organization.
KOMARKCORP Berhad is one of Malaysias top manufacturing industry producing printed
labels and automatic labeling machines with a very wide network of its branches in Malaysia
(HQ), Singapore, China, Indonesia, and Thailand. This group of industries are producing and
supplying its products globally since 1998 and have achieved a competitive edge in todays
market with continuous innovation and positive efforts in its production and strategic planning of
the group.
In todays Global market, where global competition, ICT (Information Communication,
Technology) innovation, ISO standards, influence of Global Giants and Continuous
improvement in strategies and supply of quality products are the main focus of almost all the
manufacturing industries. KOMARKCORP Berhad have analyzed its production system and
generated some new innovative ideas to improve its production units and attain customer
satisfaction to sustain and compete in the global market.
On interaction with the management of KOMARKCORP Berhad, we came to know some major
factors/problems as given below and highlighted by the corporate management and the same
problems became reason of our this analysis and study of mass customization and its
effectiveness in the industry.
The organization has received some complaints from customers in quality anddissatisfaction in time required for delivery of products.
The organization has been solving the common and general causes of problems in itsproduction line but wants to sort out the special causes of problems causing above issues.
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The organization looking forward to have a new method of production and analyzing theimplementation of mass customization and technological innovation to solve the issues
and attain competitive edge in global market.
During our analysis we will analyze the internal and external factors influencing the production
line of the organization and effectiveness of mass customization in the organization.
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2.0 Company Background
KOMARKCORP Berhad is one of the Malaysias foremost labeling companies in labeling
industry having 21 years of extensive experience in printing of labels and manufacturing of
automatic labeling machine. The Company operates in two business segments: manufacturing of
self adhesive labels and stickers and trading of related products, and manufacturing of automatic
labeling machineries.
KOMARKCORP Berhad is a self-adhesive label converter and is known to be the only
automatic labeling machine (ALM) manufacturer in South East Asia as it designs and
manufactures its own labeling machines under the house brand "KOMARK".
Company manufactures airline tag and labels, computer labels, fabric labels and prime labels in
reel/sheet. Company also produces a number of machines like automatic label dispenser, label
role rewinding and mini slitting machines. In 1998 KomarkCorp Berhad has promoted Malaysia
to be the first country in South East Asia to manufacture indigenous custom-made automatic
labeling machines, and was awarded Pioneer Status by the Malaysia Industrial Development
Authority (MIDA).
The most imperative contribution KomarkCorp Berhad has made towards the realization of
Malaysia Vision 2020 is the establishment of the Research & Development (R&D) center. This
center has continuously carried out activities on automatic labeling machine and other related
products.
As a total solution provider organization, Komark berhad not only fulfill the demand of the
domestic market but also exports a wide range of product to overseas markets such as Singapore,
Thailand, Indonesia, Philippines, India, Papua New Guinea, China, Japan, USA, Middle East and
other countries.
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Source: Annual Report KOMARKCORP Berhad, 2010
Today, KOMARK Labeling machines have become a hallmark in the label packaging industries.
Currently, company expanding its networking to include Indochina, Central Asia and Latin
America to further balance their existing overseas operation in Singapore, Thailand and China.
Furthermore To enhance KomarkCorp Berhad's role internationally, a wide marketing network
in India, Pakistan and Philippines has been established. The high degree of dedication,
commitment and continuous innovative improvement of KomarkCorp Berhad has sustained
Malaysia in becoming one of the uttermost country in the field of labels and labeling technology
in Asia.
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3.0 Literature Review:
3.1 Defining Mass Customization
Mass Customization is the concept of Producing goods and services to meet individual
customers needs with near mass production efficiency. (Tseng & Jiao, 2001)
Product customization is the method of effectively postponing the task of differentiating a
product for a specific customer until the latest possible point in the supply work. (Chace at el:,
2006)
There are a number of factors mostly focused in a manufacturing organizations corporate
strategy like Product Quality, Process routes, Operation strategies and Product cost. While these
all factors and all operational strategies and corporate strategies follow the customer satisfaction
at the end. Mass Customization is used by organizations to achieve all these competitive
advantages and produce products as per specifications and needs of each customer to achieve
high rate of customer satisfaction and to sustain and compete in global markets.
Mass Customization relates with the ability to provide individually designed products and
services to every customer through high process integration. It used to be as a competitive
strategy by an increasing number of companies (Elsevier, 2001)
Product Customization or Mass Customization is a rational step in the evaluation of product
manufacturing from mass production to Build to Order system, as manufacturing of a product
and its quality is mainly analyzed through the customer satisfaction. Where mass customization
gives a competitive edge to produce the products as per each single customer needs. There are
two main examples of Mass Customization is Nokia and Internet phenomenon. Nokia Mobile,
Dell computers, Adidas, and Coke etc are the largest organizations focuses on mass
customization while producing and introducing its products in global market.
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3.2 Concept of Mass Customization
The concept and broad Visionary of Mass customization was introduced by Davis (1987) and
promoted as the ability to provide products and services based on customers needs through high
process agility and integration. Mass Customization are positioned below the main diagonal
Product and Process matrix of Hayed and Wheel Wrights, , for example, having medium to high
volume process types such as manufacturing cells or assembly lines that are able to deliver the
high product varieties usually associated to functional or fixed type operations.
According to some authors, Mass Customization is a system that uses information technology,
flexible processes, operational strategies, and organizational structures to deliver a wide range of
products and services which assemble specific needs of individual customers at the cost of Mass
produced items.
According to Dr, Ruskin (2008), Mass Customization is seen as a systematic idea involving all
aspects of products sale, development, production and delivery.
3.3 Levels of Mass Customization:
Pragmatists suggest Mass Customization concept only to deliver the products following
customer options, independent of the number of options actually offered. The successful Mass
Customization system must be able to arrange true individualization with high degree and
standard operation processes.
According to Hart (2001), the solution for the contention lies in careful determination of the
range in which a product or service can be meaningfully customized, and how individuals make
options upon this range.
Several authors proposed a continues framework whereupon Mass Customization may be
developed and value chained, ranging from the simple adaptation of products delivery to the
customer, up to total customization of products sale, design, assembly and delivery.
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According to Gilmore and Pine (1996), Mass Customization is summarized in four levels based
mostly on empirical observation, Collaboration, and transparency.
Source: von Hippel, User Toolkits for Innovation 2001
Accroding to Lample and Mintzberg (1996), A continuum of five Mass Customization strategies
involves different configurations of processes, products and customer transactions.
3.4 Success factors of Mass Customization:
The Success factors of Mass Customization depend on a series of internal and external factors.
The existence of these factors shows the use of Mass Customization as competitive strategy and
supports the development of Mass Customization system.
These triumph factors of mass customization are categorized in six divisions as given and
described below.
Relationship Level
(Increase Customer Loyalty)
Cost Level
(Mass production efficiency)
Solution Space Level
(Stable Processes and product Architecture)
Differentiation Level(Customized Products/Services)
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Source: Silveira, at el:, Mass Customization, 2000
3.4.1 Market Demand
The most important factor influences the brand name and corporate goals of an organization are
the demand of the products in global market and by the customer. Whereas, the customer
satisfaction has always been the key success factor for an organizations success.
During production of the products a manufacturer always should focus on two main factors; first
when the time required to manufacture and deliver the products, and the product cost.
Therefore Market demand is the major factor to understand the importance of Mass
customization and its need in production line of an industry.
3.4.2 Market Condition
Todays era reflect a huge competition in manufacturing industries due to globalization,
innovation, new and innovative strategies, and many other factors. In these market conditions an
MassCustomization
1.
MarketDemand
2.Market
Condition
3.
Valuesequence
4.
TechnologicalInnovation
5.customizable
products
6.Knowledge
Management
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organization must have adequate SKA (skills, knowledge, and abilities), Competitive workforce,
new technology, innovative strategies and other competitive advantages to sustain and compete
in todays global market.
Mass customization system follows the same rule of the global market to attain a competitive
advantage to sustain and compete as per market conditions, while the same vice versa reflects the
importance of Mass customization to attain value added services of time and cost effectiveness
and customer satisfaction.
3.4.3 Value sequence
To attain the competitive edge it is must for an organization to attain the competitive edge in
timely delivery of products and cost effectiveness to succeed. While an organization can only
achieve these competitive advantages, if the complete chain or operations operate in proper
efficient manner.
Most prominently pre and post departments i.e. suppliers, distributors and retailers perform their
job with high rate of willingness and readiness as per demand of system, and organization must
show a complete and organized value chain network.
3.4.4 Technological Innovation
Implementation of advanced manufacturing technologies is one of basic strategies to enable the
development of mass customization system to achieve its main objectives to attain the quality of
customized to satisfy the customers.
Mass Customization is one of the best opportunities offered to compete in todays global market
by coordinated implementation of advanced manufacturing technologies which helps to achieves
reduced production cost and customer satisfaction.
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3.4.5 Customizable products
The production units that can be assembled into different forms to produce a modular product,
and successful mass customization the mass customization products must be modularized,
versatile, and constantly renewed.
Although modularity is not the fundamental characteristic of mass customization, but it enables
simpler and lower cost manufacturing of products with similar effectiveness if compared to
successful mass customization. Also mass customization processes need a rapid product
development and innovation capabilities as per typical short life cycles of mass customization
products.
3.4.6 Knowledge Management
Mass Customization is a practically proven successful strategy and depends on the ability to
translate new customer demands into new products and services.
To achieve the customer satisfaction organizations must emphasize on knowledge creation and
knowledge sharing. It needs a dynamic network along with manufacturing, engineering,
expertise, and in house development of new products and advanced manufacturing technologies.
3.5 Advantages of Mass Customization:
First advantage of Mass Customization is, Mass customizers can customize products quickly for
individual customers or for niche markets than mass production efficiency and speed. Second is
using same principles, mass customizers can build to order both customized products and
standard products without forecasts, inventory or purchasing delays.
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4.0 Analysis
Question 1
Are the employees aware of KOMARKCORP Company potential activities and products?
Classification Frequency Percentage
(%)
A Yes 18 60%
B No 12 40%
Total 30 100%
According to above table and Graph it shows that the percentage of employees who are agreeing
with employees awareness of KOMARKCORP Company potential activities and products is
60%. The percentage of Employees who are not agreeing with this statement is 40%.
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Question 2
Do you feel that other companies have done better in reducing the production cost on their
products/services than this company?
Classification Frequency Percentage (%)
A Poor 4 13.33%
B Average 9 30%
C Uncertain 8 26.67%
D Good 6 20%
E Excellent 3 10%
Total 30 100%
According to above table and Graph it shows that the percentage of employees who are agreeing
with Poor rate employees is 13.33%, Average is 30%, Uncertain is 26.67%, Good is 20%, and
the percentage of employees who rated Excellent is 10%.
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Question 3
How would you classify the production cost of this organization to others in the global
market?
Classification Frequency Percentage (%)
A Poor 6 20%
B Average 4 13.33%
C Uncertain 10 33.34%
D Good 4 13.33%
E Excellent 6 20%
Total 30 100%
According to above table and Graph it shows that the percentage of employees who are agreeing
with Poor rate employees is 20%, Average is 13.33%, Uncertain is 33.34%, Good is 13.33%,
and the percentage of employees who rated Excellent is 20%.
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Question 4
What do you think about the manufacturing process and techniques in KOMARKCORP?
Classification Frequency Percentage (%)
A Poor 5 16.67%
B Average 11 36.67%
C Uncertain 4 13.33%
D Good 7 23.33%
E Excellent 3 10%
Total 30 100%
According to above table and Graph it shows that the percentage of employees who are agreeingwith Poor rate employees is 16.67%, Average is 36.67%, Uncertain is 13.33%, Good is 23.33%,
and the percentage of employees who rated Excellent is 10%.
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Question 5
Do you think that channels of product supply are sufficient to support the demand of the
product in your region?
Classification Frequency Percentage (%)
A Yes 21 70%
B No 9 30%
Total 30 100%
According to above table and Graph it shows that the percentage of employees who are agreeing
with Do you think that channels of product supply are sufficient to support the demand of the
product in your region? Is 70%. The percentage of Employees who are not agreeing with this
statement is 30%.
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Question 6
Has the company taken comments/feedbacks seriously in order to improve their products/
services?
Classification Frequency Percentage (%)
A Yes 8 26.67%
B No 9 30%
C Uncertain 13 43.33%
Total 30 100%
According to above table and Graph it shows that the percentage of employees who Rated Yes is
26.67%, No is 30%, and the percentage of employees who rated Uncertain is 43.33%.
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Question 7
Does the company do sufficient research in problem areas encountered by the client and
production cost before mutually agreeing to work together?
Classification Frequency Percentage
(%)
A Yes 11 36.66%
B No 19 63.34%
Total 30 100%
According to above table and Graph it shows that the percentage of employees who are not
agreeing with Does the company do sufficient research in problem areas encountered by the
client and production cost before mutually agreeing to work together? Is 36.66%. The percentage
of Employees who are not agreeing with this statement is 63.34%.
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Question 8
Are you satisfied with the product cost or not?
Classification Frequency Percentage
(%)
A Yes 16 53.34%
B No 14 46.66%
Total 30 100%
According to above table and Graph it shows that the percentage of employees who are agreeing
with, Are you satisfied with the product cost or not? Is 53.34%. The percentage of Employees
who are not agreeing with this statement is 46.66%.
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Question 9
How frequently is the organization willing to carry out the manufacturing of their
products/services activities?
Classification Frequency Percentage (%)
A 1 time/year 7 23.34%
B 2 times/year 10 33.34%
C 3 times/year 8 26.66%
D 4 times/year 5 16.66%
Total 30 100%
According to above table and graph, it shows the percentage of employees who are agreeing with
this statement how frequently is the organization willing to carry out the manufacturing of their
products/services activities? The percentage of once a year is 23.34%, of two times a year
33.34%, three times a year 26.66% and four times a year 16.66% respectively.
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Question 10
How much increases in sales does the company anticipate from mass customization
activities are given serious thought?
Classification Frequency Percentage (%)
A 10% 6 20%
B 20% 7 23.34%
C 30% 14 46.66%
D Above 30% 3 10%
Total 30 100%
According to above table and graph Employees who rated that 10% sales would be increase is
20% of employees out of 100%, who rated that 20% will be increase is 23.34%, who rated that
30% will be increased is 46.66% and who rated above 30% are 10% of total employees.
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Question 11
Will the organization increase the allocated budget in the near future if sales increase?
Classification Frequency Percentage (%)
A Yes 24 80%
B No 2 6.66%
C Not sure 4 13.34%
Total 30 100%
According to the above table and graph the employees who are agreeing or saying yes to this
statement is 80%, the percentage of employees who are not agree with this is 6.66% and who
says not sure is 13.34%.
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Question 12
Do we have sufficient expertise to carry out the manufacturing of the products/services to
this company?
Classification Frequency Percentage
(%)
A Yes 23 76.66%
B No 7 23.34%
Total 30 100%
According to above table and graph the percentage of employees who are agree with this
statement is 76.66%, and the percentage of employees who are not agree is 23.34%
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Question 13
Does the company believe in the importance of keeping good clients and change at any
point in time?
Classification Frequency Percentage (%)
A Yes 4 13.34%
B No 7 23.33%
C Most likely 19 63.33%
Total 30 100%
According to above table and graph the percentage of employees who rated yes is 13.34%, who
rated No23.33% and the percentage of employees who rated Most Likely is 63.33%.
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Question 14
Has the company emulated any other production strategies from other companies?
Classification Frequency Percentage (%)
A Yes 11 36.66%
B No 1 3.34%
C Most likely 18 60%
Total 30 100%
According to above table and graph it shows that the percentage of employees who Rated Yes is
36.66%, percentage of employees who rated no is 3.34%, Percentage of employees who rated
Most Likely is 60%.
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Question 15
Would you agree that as learning organization and also willing to have a change that their
production cost can be reduce in due time?
Classification Frequency Percentage (%)
A Yes 5 16.67%
B No 11 36.66%
C Most likely 14 46.67%
Total 30 100%
According to the above table and graph the percentage of employees who rated yes is 16.67%,
who rated No is 36.66% and the percentage of employees of rated Most Likely is 46.67%.
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5.0 Recommendations and Action Plan (Under Process)
Customization
levelassessment
Mass
customizationin services
Information
management
Quality control
andmonitoring
Reliability
analysis
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Refereces
1. Du, X. and Tseng, M.M. Characterizing Customer Value for Product Customization,Proceedings of the 1999 ASME Design Engineering Technical Conference, Las Vegas
(1999).
2. Duray, R. et al. Approaches to Mass Customization: Configurations and EmpiricalValidation, Journal of Operations Managements, 18 (2000).
3. Frank T. Piller Hart, George and Helen Hart, Mass Customization and PersonalizationStrategies, Dallas: SIL International, (2001).
4. Joseph Lampel and Henry Mintzberg, Customizing Customization, Article, (1996).5. Von Hippel, E. Perspective: User Toolkits for Innovation, The Journal of Product
Innovation Management, 18 (2001)
6. Dr.Ruskin. Mahemanipal Uni, Dubai Campus, 2008
Websites
https://www.xing.com/
http://books.google.com.my/
https://www.xing.com/https://www.xing.com/https://www.xing.com/7/30/2019 International Consultancy Project
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Research questionnaire for ICP at KOMARKCORP Company
Appendix A: Questionnaire for KOMARKCORP Clients
Section A: Client Details
1- Name2- Management Level3- Region of Operation4- Are you? Employee
Section B: Awareness and Recommendation
1. Are you aware of KOMARKCORP Company potential activities or products/services?(A) Yes (B) No
2. Do you feel that other companies have done better in reducing the production cost ontheir products/services than this company?
(A) Poor (B) Average (C) Uncertain (D) Good
(E) Excellent
3. How would you classify the production cost of this organization to others in the globalmarket?
a. (A) Poor (B) Average (C) Uncertainb. (D) Good (E) Excellent
4. What do you think about the manufacturing process and techniques in KOMARKCORP?a. (A) Poor (B) Average (C) Uncertainb. (D) Good (E) Excellent
5. Do you think that channels of product supply are sufficient to support the demand of theproduct in your region? (Gen, Q for employees and customer)
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6. Has the company taken comments/feedbacks seriously in order to improve their products/services?
(A) Yes (B) No (C) Uncertain
7. Does the company do sufficient research in problem areas encountered by the client andproduction cost before mutually agreeing to work together?
(A) Yes (B) No
8. Are you satisfied with the product cost or not?(A) Yes (B) No
9. How frequently is the organization willing to carry out the manufacturing of theirproducts/services activities?
(A) Once a year (B) twice a year (C) 3 times year (D)
4 times a year
10.How much increases in sales does the company anticipate from mass customizationactivities are given serious thought?
(A) 10% (B) 20% (C) 30%
(D) Above 30%
11.Will the organization increase the allocated budget in the near future if sales increases?(A) Yes (B) No (C) Not sure
12.Does the Company have sufficient expertise to carry out the manufacturing of theproducts/services to this company?
(A) Yes (B) No13.Does the company believe in the importance of keeping good clients and change at any
point in time?
(A) Yes (B) No (C) Most likely
14.Has the company emulated any other production strategies from other companies?(A) Yes (B) No (C) Most likely
15.Would you agree that as learning organization and also willing to have a change that theirproduction cost can be reduce in due time?
(A) Yes (B) No (C) Most likely
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