Fortune Electric Co

FORTUNE ELECTRIC CO. AFTER-SALE SERVICE IMPROVEMENT PLANNING

Amy J.C. Trappey, Yi-Kai Kuo, Yi-Liang Lin, Yu-Sheng Chang

Department of Industrial Engineering and Engineering Management

National Tsing Hua University

Hsinchu (300), Taiwan

ABSTRACT

In this paper, we choose Fortune Electric Co. as a study case. Fortune Electric is one of the professional heavy power companies in Taiwan. They are eager to integrate their global transformer business into a uniform and e-Business based system. They also want to improve their response time to emergency or regular demands. We observed the current maintenance and repairment services and used INCOME software to build up an as-is model then discussed is there any improvement space. We then analyzed the as-is model and decided to implant a CRM system. For the help of integration by CRM, we propose a to-be model which combines IT technology and FE’s business processes. Now, FE’s performance is much better than before because of shorter response time and higher customer satisfaction degree. In the future, there are some extensible function can be done like GSM-SMS-GPS application, Remote-Terminology-Unit (RTU), hotspot prediction, loss of life…etc.

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1. INTRODUCTION

Fortune Electric Co. was founded in 1969 in TuCheng, Taiwan, manufacturing distribution transformers. FE was approved public stock offering by the Security Exchange Committee in 1997. There are three plants in Chung Li and Guan Yin in Taiwan, an office in North America, and a plant in Wuhan, China. In 2003, FE participated with the contractual and commissioning work of 6th Power Transmission Engineering Substation of Taiwan Power Company actively.

Fortune Electric is one of the professional heavy power companies in Taiwan with complete product line. FE began to step into the field of Six Sigma in 1999 under the help of GE. After 2 years, FE became the only qualified ODM supplier of GE among South and East Asia. The result not only pushed the self-sufficient of relevant products in domestic but also became the No. 1 in export sales among the same business. The two main developmental directions of FE are high efficiency and energy saving and smaller in size. In order to increase additional value and competitiveness, FE uses best materials in manufacturing and applies strict quality controls. Because of the persistence on good quality, FE can keep competitive advantage from opponents, and hence, receive trusts and orders continuously from customers the entire world.

1. LITERATURE REVIEW

CRM, or Customer Relationship Management, is a company-wide business strategy designed to reduce costs and increase profitability by solidifying customer loyalty. True CRM brings together information from all data sources within an organization (and where appropriate, from outside the organization) to give one, holistic view of each customer in real time. This allows customer facing employees in such areas as sales, customer support, and marketing to make quick yet informed decisions on everything from cross-selling and upselling opportunities to target marketing strategies to competitive positioning tactics.

Software used in a CRM system:

(1) Sales Force Automation

• Contact management
  Contact management software stores, tracks and manages contacts, leads of an enterprise.
• Lead management
  Enterprise lead management software enables an organization to manage, track and forecast sales leads. Also helps understand and improve conversion rates.

(2) eCRM or Web based CRM

• Self Service CRM
  Self service CRM (eCRM) software enables web based customer interaction, automation of email, call logs, web site analytics, campaign management.
• Survey Management Software
  Survey software automates an enterprise's electronic surveys, polls, questionnaires and enables understanding customer preferences.

(3) Customer Service

• Call Center Software
• Help Desk Software

(4) Partner Relationship Management

• Contract Management Software
  Contract Management Software enables an enterprise to create, track and manage partnerships, contracts, agreements.
• Distribution Management Software

“Firms, even ones in relatively heavy industries, seem to be moving in a direction in which information technology (IT) is becoming more and more integrated into their organizations……firm that appears to be getting better by recognizing IT per se as an actor in its after-sales organization. Both a smarter product and IT produced evolutionary changes in its after-sales operations.” Peter Zackariasson and Timothy L. Wilson indicated the tendency in heavy industries toward to after-sale on Industrial Marketing Management. Take a look of “after-sale service” at online business dictionary website “BNET”: “Customer support following the purchase of a product or service. In some cases, after-sales service can be almost as important as the initial purchase.” and we can easily understand how important after-sale service is in business field. Combine two messages above we know that after-sale service is important and even heavy industries had pay attention to it. In power supply or distribution industries, economic loss is inestimable due to temporarily shut down. Some losses that cannot be quantized are much more serious. “Transformer is important equipment on power supply service…... It’s made loss and failed cost of inestimable when power off, hence the power supply department pay much attention to transformer repairing, ascertainment of failed cause in time and taking effective action in time to avoid service failure.”,as Wang mentioned,it is necessary to improve after-sale quality in power-related industries.

1. MODELDISPLAY AND ANALYSISIN INCOME4 SYSTEM
2. As-is Model

Now, we will introduce the Fortune’s after-sale service As-is model by the INCOME system, which is a practical software using in constructing business model and simulating the process. By INCOME system, the model can be divided into three models, there are behavior model, organization model and object model.

3.1.1.Behavior Model

After we build the As-is model of our case by INCOME4, we can use the behavior model to illustrate activities and objects. Details are described below (Table 1, Table 2, Figure 1 and Figure 2):

Figure 1.INCOME4 As-is Behavior model

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1. Quality assurance department receives the Repair order from customers.
2. Staffs in quality assurance department confirm the context in the order.

1. Maintenance department receives the maintenance order from customers.
2. Staffs in maintenance department form a standard maintenance order according to maintenance regulation

1. This activity can be drilled down to a more detailed procedure to form a formal quotation
2. First, received orders be sent to procurement department in forming a temporarily quotation. Second, the quotation has been checked by technology department.

1. This activity can be drilled down.
2. The outcome of technology department will be checked and saved when through business department and sent to customer for confirm. After receiving the check from customer, the order turned to repair form.

1. Maintenance department contact with customer for servicing date.
2. Providing services to customer according to pre-checked schedule.

Table 1.The activity detail

Table 2.The Object detail

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The following figures are the detail of the processes including“estimating cost”,“quotation confirming”and “repair service”after drilled down. (See figure 2, figure 3 and figure 4)

Figure 2.The estimating cost process drill down model

Figure 3.The quotation confirming drill down process

Figure 4.The repair service drill down process

Each process has relationship with upstream process and downstream process. After combining these processes, we can see the overview of the As-is model.

3.1.2.Organization Model

The model is build to show the whole structure of the intra-company organization architecture. It usually spans from the top management to the basic level, we also called it tree diagram.(See figure 5)

The following diagram is the Fortune’s simple organization model:

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Figure 5.The organization model

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Management has the greatest powerin whole enterpriseand controls all the company’s activity.

Finance Departmentdeals with the accounting process and budget management. Any other departments who need to cash out, it is necessary to get the finance department’s agreement.

Information Technology department, they manage all the hardware and software of computer which enterprisehas. In the Fortune, they also maintain the online server and database which contains customer’s data, product’s data,order details and supplier’s data.

The production department manages the producing process of the products, making sure that process is working and trying to reduce the product defects.

Business Department is the window between the customers and the enterprise. In the Fortune, it is very important to the customers’ relationship management, also we called that CRM, and Business Department plays a critical role in this field. Sales should visit their customers frequently and take records of the products’ situation, because of the high-valued products. Since the customers are from worldwide, the Business Department is divided intooverseas part and domestic part.

The last one technology department is mainly in dealing with the problems that are about the technological aspect, for instance, periodically transformer maintenance or product function inspection. Therefore, the department can also partition into Maintenance and Quality Control section. In after-sale service, most of the service will operate in the Technology Department; hence, we will focus on this department in the system.

3.1.3.Object Model

Object model shows the main information for each databases and details which are used in our process. On the other hand, the object model also denotes the relationship between databases and details. There are eight tables in object model, which includes sales record, company, HR, maintenance, BOM, after-sale quotation, contact and product table.(See figure 6)

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Figure 6.The object model.

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Sales record table has eight attributes, order ID, order date, sales, quantity, price, customer, company and HR. Among them, HR and company is also relate to sales record table.

Company table is records of the company who have been trade with Fortune. This table has nine attributes, company ID, company name, industry, telephone, company address, tax number, website, person in charge and date of establishment.

HR table contains seven attributes, job type, staff name, job title, ID, staff ID, gender and department ID. These attributes are concern about human resource in the Fortune.

Maintenance table has six attributes, which include maintenance ID, maintenance description, maintenance customer, maintenance date, product and BOM. This table can link to product table and BOM table.

BOM table represents the need of material in every order. It has seven attributes, last order, material quantity, material name, material ID, material type, location and company. Company table can be linked to BOM table.

After-sale quotation table contains eleven attributes, which include quote title, shipping address, quote status, quote date, lead name, quote price, quote ID, deliver date, company, contact and maintenance. Company, contact and maintenance table can be linked from after-sale quotation table.

Contact table has general information about contact name, gender, telephone, job title, contact ID, e-mail and Company. Company table also can be linked from contact table.

Product table contains seven attributes, product ID, product name, price, description, product type, cost and BOM. BOM table can be linked to product table.

Base on the above, every table has relationship between each other. Through the figure 6, we can understand how one table can be linked to another table.

3.1.4.Problem of the As-is model

After we analysis the As-is model of the Fortune after-sale process, we found out that it is inefficient to deal with all the works. There are some points we need to improve. First, most of data they have now are still writtenin notes or saving in EXCEL sheets, lack of systematically management and integration. Second, the communications of each department are not efficient, since they don’t have a common platform to view and check the operating cases’ situation.Furthermore, it’s hard to give a rapid response when customers have problem or request withAs-is model, giving customers bad impression.

How to improve this model becoming to a greater one? It is the problem that we are going to solve.We construct a To-be model making the process more efficient.

3.2.To-be Model

The To-be model that we are planning is focus on improving the weakness that old model has. We build up an online system, which can integrate all the process into a horizontal platform. All the roles have their own authority to login in this system, and all the activities and data are also integrated. Hence, the process will become more efficient; moreover, company can interact with customers immediately, and increase additional value for each other.

3.2.1.Behavior model

After TO-BE model are established in INCOME4. We can show the after-sale server activities in behavior model below.

Figure 7.TO-BE behavior model

1. This activity can be drilled down.
2. FE’s procurement department and technology department will estimate repair cost, and finally generate the after-estimating quote form.

1. This activity can be drilled down.
2. FE will follow the repair pre-schedule, providing repair service step by step.

Table 3.The activity detail

Table 4.The Object detail

In TO-BE model, we also have drill down processes. The following figures are the detail of the processes including “Estimating repair cost” and “Repair” after drilled down. (See figure 2 and figure 4)

Figure 8.The estimating repair cost process drill down process