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assumes, is true, that the probability that the problem is a production-related one is roughly %1. Of course, the quality of service is reflected

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assumes, is true, that the probability that the problem is a production-related one is roughly %1. Of course, the quality of service is reflected by their consultancy fees, which are $20,000 and $60,000 respectively. If the company opts to go with the second option, the process of testing installations can be carried out using two methods: online checks and on-site inspections. Online checks can be conducted either with or without informing the customers. If conducted without the customers' knowledge, there is a possibility that the situation may be noticed. Alternatively, the company can visit customers in person to perform real-world inspections. In this case, it is crucial to disclose the purpose and nature of the inspection, ensuring transparency and building trust with the customers. In order to assess the popularity and demand for different hardware and software products, Tech Innovations has gathered sales data across the cities that can be effected from the situation (see Table 2) City TI Hub $1 TecHub Eco TecHub Ultima TIManager V2 HomeBrain 37 91 59 78 18 63 00 50 City A City B City C City D 59 65 96 60 54 76 36 40 59 122 87 50 Table 2: Sales data for hardware and software products in different cities In a previous incident, Tech Innovations experienced a significant customer loss of 150 out of 800 individuals, resulting in an approximate cost of $37,500 ($250 per customer). It is worth noting that the lost customers encompassed not only those who were utilizing the devices affected by the security vulnerability but also included all customers across the board, due to the fact that the company's overall trustworthiness was shaken, causing suspicion among all customers regarding the presence of a security vulnerability in their own systems. Additionally, each customer visit incurred an extra expense of $120 per technical support personnel involved in each visit, provided that 2 personnel should be involved at visits. Moreover, when tests were conducted remotely with prior customer notification, it resulted in intensive work for customer service representatives, amounting to an additional aggregate cost per city of approximately $8000. It is important to note that conducting tests without notifying the customers may lead to potential legal implications, as customers might accuse the company of jeopardizing their personal data. In such a scenario, Tech Innovations could potentially face a penalty of $100 million. The probability of this situation being detected by a customer is estimated to be only 0.001%. It is known that 15% of the lost customers and 20% of the costomers who did not opt-out were visited at their homes. Due to the limited time available, 100 of these customers were visited on the first day, and the others on the second day. Also, back than 85% of the lost customers were subjected to remote interventions with prior information, and 60% of the customers who were not lost belong to this group. As the manager of the R&D department of the company, it is expected that you advise the company whether the analysts' claim on the source of the vulnerability is reasonable. Also, ignoring the in-company test results, you are expected to determine a road map on how to deal with this issue. The objective here is to determine which alternative is more cost-effective.

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Option 1 Online check consulting with notification to the customer Fees for consultation 20000 Costs associated with customer visits 20 of customers who did not opt out and 15 of lost customers made h... blur-text-image

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