This case examines the operational and strategic transformation of Sushiro, Japan’s largest kaitenzushi (conveyor-belt sushi) chain, under its parent company, Food & Life Companies. The case follows CEO Kohei Nii as he grapples with a major reputational and operational crisis triggered by a 2023 viral “sushi prank,” in which a teenager tampered with food items on the conveyor belt, which caused widespread outrage and a sharp financial loss. The crisis forced Sushiro to reassess its traditional efficiency-oriented model and to rebuild consumer trust amid rising hygiene expectations and digital disruption.

To address these issues, the company developed the Digiro system, an advanced digital dining system that replaced the traditional conveyor belt with digital conveyor belt, express-lane delivery, touch-screen ordering, and interactive digital games. While the innovation helped restore confidence and streamline operations, it also introduced new challenges concerning customer experience, staff engagement, and the brand’s cultural authenticity.

The case ends with Nii’s dilemma: whether to deepen investment in digital automation or to reintroduce human elements that might restore emotional warmth to the dining experience. Students are invited to analyze this decision using the Service Quality Gap Model to explore how technology can bridge or widen service perception gaps.