For most of us, keeping track of the warranties we hold on dishwashers, cars, and other household items isn't a big deal. A manila folder stored in a handy spot usually does the trick. But for manufacturers managing a large network of production assets or finished products out in the field, it's another story. Without a system to keep track of warranty information and analyze related quality problems, many manufacturers that issue warranties are finding that either their costs are rising or customer satisfaction is suffering.
At the same time, without systems and processes for tracking warranty information, manufacturers managing lots of assets often find themselves asking whether it is even worthwhile to pursue a warranty claim when something goes wrong. But, in today's economic climate, where every bit of capital counts, it's more important than ever to get a handle on warranty-related costs and opportunities.
In a recent survey of 170 service and warranty organizations conducted by research firm Aberdeen Group, 56% said effective warranty management is more important to them than it was two years ago. The same survey found that 38% of all service work orders involve either original or extended warranties. So what can manufacturers do to help balance the need to meet customer satisfaction goals with minimizing warranty-related administrative costs and product defect rates?
To begin with, for manufacturers that extend warranties to customers, it's critical that warranty information and processes be tied in with other business processes, such as sales order entry, purchase orders, and return materials authorization, says James Jones, product manager for EAM product lines at Infor, a provider of enterprise software that offers warranty management functionality as part of its EAM suite.