Warranty can have a big impact on the bottom line, directly from reserves held to cover warranty and recall expenses and indirectly from the impact incidents have on customer satisfaction. A warranty improvement initiative reduces warranty incident rates and drives down warranty costs by addressing the causes of failure. How do you drive performance improvement through warranty data? The critical success factors to keep in mind are leadership support, customer-centric goals, and organization-wide enablement.
Gain support at the top
The most successful initiatives are driven by an organization’s leaders. Focus from leaders ensures dedicated resources that will sustain the initiative. To captivate leaders at your organization, develop a sound methodology for consistently measuring and forecasting product performance before warranties expire.
Consistent performance measurements are vital to the project’s credibility with management. The ability to access consistent warranty claim and product data from across an organization to compare performance and find common challenges drives synergies and a healthy competition between products. Measurement consistency can also lead to collaboration, which amplifies the drive to desired results.
Leadership can’t wait until the warranty has expired on all machines to measure the failure rate and drive a response. This means you must have a method to forecast the performance trend before the warranties expire, while the trail to the source of issues is still fresh. Your ability to give leadership measures they can trust means the difference between an initiative that succeeds and one that crashes and burns.
Focus on the customer
The most successful warranty initiatives have goals directly tied to the customer. The financial impact of a warranty initiative is persuasive and directly linking the initiative to the impact on customers makes it even more compelling for the entire organization.
Whether you measure the customer experience through customer satisfaction, net promoter score, or five-star ratings, demonstrating the effect warranty has on the customer can add momentum to a powerful warranty improvement initiative. In fact, bringing clarity to the impact of achieving warranty goals in combination with customer testimonials is often a key to maintaining the project over time.
Enable the whole company
A leadership-driven warranty initiative with consistent performance measures and customer-focused goals sets the stage for company-wide engagement. Expanding engagement requires the proper tools to enable continued results. While the tools needed vary from basic dashboards to advanced analytics, three that can help achieve ongoing success include:
- Forecasted rates. Timely, clear, and actionable trend information.
- Early warning. Statistical methods to quickly detect changes in performance.
- Advanced analytics. Multiple methods to quickly gain insight into root causes.
Forecasted rates enable measures of predicted product performance before the warranty expires. This is key to understanding the performance trend and engaging the organization’s leaders.
Early warning alerts uncover issues when they first emerge, allowing problem solving teams to get a head start before the issue has a chance to grow into a major concern.
Advanced analytics applied to warranty data can help a team gain insight through quantifiable, repeatable, and reliable techniques. This enables them to drive action resulting in reduced costs and improved customer experiences.
For example, to uncover the key insights to get to the correct root cause often involves detecting differences in performance across various attributes. It’s often helpful to compare failure rates across many variables like production factory, product configuration, or customer country. Collecting the warranty data, then applying a technique to quickly uncover statistically significant differences in failure rate for multiple variables can help you confirm or refute the cause of failures. Using these insights to inform the root cause investigation helps you resolve problems and arrive at proven solutions quicker so you can support customers.
Analytical techniques can also find relationships between failures. These relationships could be collateral damage from one failure to other components or damage from the repair process. Uncovering analytically derived insights like this can help you understand the broader the impact of a solution on the entire system and the repair procedures.
It all adds up
Warranty improvement initiatives require resources to drive improvements. This can be done through brute force with lots of resources or by employing a more strategic, coordinated, and efficient approach that relies on data and analytics. Driving warranty improvement through a leadership-driven initiative with consistent measures against customer-focused goals while enabling the organization with the right tools can yield the desired results without wasting precious resources.
By: Angie Edgington is a Senior Industry Consultant in the Manufacturing, Transportation, Entertainment, and Services sector at SAS. Connect with her on Twitter and LinkedIn.
About SAS in IoT
SAS empowers organizations to create and sustain business value from diverse IoT data and initiatives, whether that data is at the edge, in the cloud, or anywhere in between. Our robust, scalable, and open edge-to-cloud analytics platform delivers deep expertise in advanced analytics – including AI, machine learning, deep learning, and streaming analytics – to help customers reduce risk and boost business performance. Learn more about our industry and technology solutions at www.sas.com/iotsolutions
