WoD (Warranty on Demand) Series – Configuring Payment Rules
WoD (Warranty on Demand) – is a cloud based warranty management system developed by Tavant Technologies to automate and optimize warranty process of global organizations. WoD’s comprehensive list of functions can make it one of the best warranty management system to resolve the warranty related problems of different organizations The high configurability of the system allows users to easily build business rules to adapt to the corresponding OEM’s warranty processes. One such key process is Claim Payment and the logic toward arriving at the payment amount. The service network structure varies from organization to organization. Contracts between OEMs and their servicing dealers may also vary which will result in their labor being different. Regulations may vary from country to country resulting in added surcharges and taxes. The complexity starts when OEMs want to calculate the claim payment using these small adjustments and their inability to adjust. WoD has the capability of resolving complex scenarios of different organizations efficiently. In WoD, users can create customized logic to calculate their claim payment using multiple rules. Here, the claim payment is divided into three segments so that configurations can be done for every scenario effectively. The three segments are: OEMs can create and configure all cost categories that is required at the time of calculating claim payment. These cost categories will determine the values that a dealer can enter while filing a claim. Examples of cost categories are: labor cost, travel cost, parking cost and meals cost. OEMs may configure multiple cost categories in the system but every claim may not require all cost categories to calculate payment – so, an OEM can specify the cost categories that the system will account for calculating payments. Pre-defined cost categories are linked with policies and based on the rules created, system will calculate the claim payment by selecting a policy for a particular claim. Modifying the payment information is generally linked to the cost categories selected for calculation of claim payment. This is a set of rules that an OEM may create if they want to change the payout for a particular dealer and/or machine/part claim. These attributes make it possible to override a claim payment previously calculated with basic payment rules. As WoD brings the agility of Salesforce.com with it, organizations will find it extremely easy to use as it can be accessed from anywhere due to its cloud functionality. If we consider warranty management in a global scale – the scope is changing rapidly and the main aim of building WoD is to focus on understanding the future of warranty management. WoD is already loaded up with all new releases provided by Salesforce till date and periodic feature upgrades from our experts make it a dynamic system for resolving warranty management issues.
Streamline Your Supplier Recovery Process
Many industries have been able to overcome their challenges by using the recent developments in data technology. It has helped organizations by providing them access to real-time data and streamlining most of their communication channels. Warranty service is one of the significant areas to have improved due to such developments. Manufacturers now depend on the cloud, real-time data, extensive databases, and interactive technologies. Customers expect quick turnarounds and zero hassle when they need a vehicle part replaced through warranty. Manufacturers earlier felt unprepared to meet such expectations because recovering the cost without occasional misses was difficult. Missed opportunities in supplier recovery result from sluggish processes. Although protocols and contracts between suppliers and manufacturers exist, customer often feel neglected due to disputes. This difficulty can be resolved with an IT implementation that puts the manufacturers in an interactive mode with their suppliers. To support such a system, accurate verification and rules-based algorithms are necessary. Sourcing history is an important data set in warranty technology used by manufacturers. Machine and vehicle parts can be assigned unique codes and mapped to specific suppliers for accurate identification when the need arises. Although this process can be automated, the system can be complemented with an interactive dispute management system. It will help the two parties resolve exceptions in real time. As soon as a warranty claim is raised, the verification process can take into consideration if a supplier needs to be charged or penalized for low quality products according to the contract. This is possible if a complaint is recognized and mapped to its root cause analysis. With an automation system designed to perform checks, manufacturers can reduce their supplier recovery turnarounds to days, or even a single day, in spite of accurate and rigorous verifications. Even now, many manufactures are riddled with tedious methods of supplier identification and managing inventory risk. They can be the biggest hurdles to delivering prompt warranty service, especially with the kind of consistency that will help the brand value. Manufacturers need to avoid the rigmarole of supplier recovery and also avoid delays and disputes so that turnarounds are under control and superior warranty service results from streamlined supplier recovery management. Technology plays a key role in making a difference. Warranty management systems are required to facilitate manufacturers with adequate data so that they can identify failure and standards violation patterns and never incur a loss due to their suppliers. To avoid blurry interpretations of contracts, a rules-based, interactive cloud system can help resolve issues quickly when warranty claims are being processed.
Five Improvements Required for Warranty Revenue in Vehicle Manufacturing
Vehicle problems arise out of parts manufactured either by the automobile company or a parts supplier. The process of warranty inspection involves a validation process and communication protocols. The manufacturer should be able to validate, or turn down the warranty claim, and revert to the distributor with the right message and reasoning. And, at the same time, ensure customer satisfaction so that no complaints ensue. Transparency and turnarounds are the key factors behind customer satisfaction. Besides offering user-friendly interfaces for different players in the value chain, technology can save time and costs with real-time communication and a rules-based claims validation module. The latest systems also allow manufacturers to deal with supplier recoveries and shipment within short turnarounds in an inexpensive way. (Image credit: en.wikipedia.org) Simply improve these processes for better warranty revenue: Validation – When the customer routes a warranty claim (through a dealer and/or distributor) to the automobile manufacturer, it should determine the liability. In order for the automobile company to avoid a long turnaround, it needs an integrated cloud system to receive the claim details, identify the cause, notify the liable party, and revert to the customer, all within minutes. Service dispatch – Once the manufacturer is able to verify the claim and prepare a service team for repairs, the step involves shipment of parts and/or the vehicle. The service teams require mobile devices to access information, and do the required job. The service team should also be able update the manufacturer on the possibility of misuse, if any, and get further directions through the integrated mobile interface. Parts tracking – If required, the manufacturer should track the liable supplier for parts replacement, and inform the right supplier personnel on the issue. Technology should enable accurate identification with secure user IDs, as well as process and product IDs. Identifying the nature of the customer’s problem becomes easy with a technology which uses claims history to help identify fraudulent claims. Communication – The service team has to resolve the problem within quick turnarounds, and allow the KPI data to be appropriately filled. For this, the manufacturer should be able to measure customer satisfaction accurately. Issues like minor delays and dissatisfactory results should be taken into account through a real-time reporting system. Continuous improvement – Repair costs are difficult to control on the ground, and manufacturing improvements over the future are a must. Software technology can develop a claims history to let manufacturers identify areas of improvement in the manufacturing phase. This will enhance brand value and improve reliability over the long run. Vehicle manufacturers must not only check for technical issues related to the customer’s problem, but ensure that replacement and repair services are dispatched cost and time-effectively. That is when customers will stop thinking about going to the local mechanic to avoid the warranty rigmarole. Technology can make quick communication a completely transparent process. With globally distributed service stations of manufacturing companies, what’s required is a solution that uses GPS to identify cost-effective ways of dispatching services, and a transparent system that allows the customer to know everything from claim to billing. Technological support for such purposes requires integration over cloud: be it for the dealer, the special-parts supplier, the distributor, or the automobile warranty unit. As the need for improvement in such a vast value chain is bound to be felt, agile software development is a highly suitable practice for vehicle warranty management.
How to Ensure Customer Satisfaction with Technology in the Warranty Business
Software development efforts are usually directed at reducing overheads and increasing ROIs, but when technology is used to improve the value chain through better customer satisfaction, the approach required is essentially number driven. The need to improve customer satisfaction can be met if operational complexity was lower and measurability was easier for manufacturing personnel. Technology can make business performance measurable. The improvement brought about by such technology has to be persistently felt across the warranty chain. The need for measurability Experience improvement across the value chain occurs as the result of integration and transparency, which can be brought about by a user-friendly and integrated technology. However, without KPIs or measurability in it, personnel will remain in the dark about improvements. Error-free and time-effective processes involving dealers and special-parts suppliers are necessary as well. Manufacturers should detect inefficiencies and production defects, and consequently, make modifications that improve customer experiences. What are the software requirements? 1.OEMs first need an integrated system in order to obtain relevant data from the value chain. Access to data that lets managers use customer satisfaction as a KPI is only possible when a real-time system involving telematics, simple user interfaces, and the cloud can update the warranty system at the manufacturer’s end. 2.A capable technology must also use warranty data for internal calculations. Warranty intelligence helps identify patterns and leads to higher measurability, easing the process of operational control and performance scoring. When the data is real-time, pre-emptive corrections can lead to long-term profitability and brand value. 3.Warranty spends are contained within appropriate limits as the result of fraud detection. Data intelligence can help detect frauds by identifying customers’ behavior over time, and create transparency between OEMs, dealers, and suppliers on fraud issues. The need for agile software development Imitating the dynamism in any given business environment is understandably a difficult challenge in enterprise software development. IT suites for warranty management should feature user-friendly interfaces, which can be used by OEM personnel without technical expertise. While they should be able to set their warranty rules without the assistance of a software developer, algorithmic changes should be available from a software provider instantly. A capable provider should be able to deploy the changes within days or weeks by the virtue of Software as a Service (SaaS). Similar changes from legacy system providers can take months and overheads easily eat into profits. A vast scope of improvement lies in warranty intelligence. As your system gathers a massive source of cumulative data, algorithmic refinements can identify profitable distribution points, unproductive policies, scopes of fraud, supplier-recovery risks and let you score them regularly and accurately. Remember, refinement in algorithms helps organizations to improve continuously. In a nutshell Your warranty management system must drive your organization towards being better informed, so that you can avoid misunderstandings, take the right decisions, and deploy the right investments after quantifying performances. Moreover, a good software system is one that enables clarity and predictability in the value chain with ease.
Tavant Support: Evolution & Growth Of Warranty System
While application support in the global software services industry is often treated as status quo maintenance, at Tavant, we see this as an opportunity to showcase continued improvement and excellence. We consider application support as no different from an innovation lab where new ideas are generated and implemented. In this blog, we will discuss Tavant Warranty Management System (TWMS) during its support phase and analyze its growth and evolution over the years. On November 21, 2005 TWMS went live and in 9 years of Tavant Support, the system has seen tremendous growth. Milestones in TWMS’s evolution (2006 to 2014): The Warranty system auto processed a hundred times more claims than it did in the year 2006 The Recovery module registered seven time’s growth The system processed 235 percent more claims, i.e. over 29 percent average annual growth Recovery claims were generated for 7 percent of the warranty claims in 2007 versus 21 percent today The TWMS has so far processed 1.7 million claims, i.e. net worth US$791 million In Tavant, we have always believed in holistic growth, and this is evident in our application development and support processes. TWMS and its accompanying accomplishments were possible because care was taken to ensure that innovation happened in every module to offer efficiency, automation and better performance. Processes that enable these accomplishments: Processes that enable these accomplishments: TWMS helps businesses to process claims faster and with minimal effort, by ramping up to automatically process claims Auto-processing is achieved through complex business rules using a powerful business rules engine It simplifies the process through which a dealer or user can file claims. TWMS helps to save claim filing and processing time by auto-populating known fields with the help of an intelligent processing engine It has effective recovery generation options and auto recovery initiation engines It offers multiple admin configuration setups to tweak the system flow as per business needs Tavant Warranty Management System is only an example of how Tavant Support evolves an application and helps businesses to grow. We believe excellence is not something to be achieved, but to be continuously pursued.
Understanding the Relationship between Warranties and Customer Satisfaction
Original Equipment Manufacturers (OEMs), equipped with the latest and best product knowledge, help in enhancing customer value and product quality. Aberdeen Group, a well-recognized business-intelligence research organization, presented a study recently. It said one of the top priorities for organizations is to improve customer satisfaction, after which comes the objective of managing costs, improving product quality and increasing revenue. But how can manufacturers be equipped with the knowledge to meet these objectives? A warranty management approach can be the solution for these OEMs. If a warranty or service contract solution can generate a product record history, it becomes easy to track the product history throughout its service life-cycle. With this information, manufacturers can gain valuable insight into the product life-cycle, which in turn provides insight for service improvements. That is why manufacturers, nowadays, are looking at warranty solutions with a strategic perspective. To achieve these objectives, manufacturers need to upgrade their existing and isolated legacy systems to integrated warranty systems, which can use advanced analytics services to churn warranty data into meaningful information. Such information helps the OEM to improve its service offerings to the customers. With real-time analytics in place, manufacturers can gain substantial productivity, increase operational efficiency, and retain customer value. The Challenge A large automobile manufacturer was facing challenges with its equipment warranty services and parts logistics system. The customers were not satisfied with the quality of equipment and hence, there were frequent customer complaints. Additionally, the response time to service requests was high compared to competitors. The organization was unable to achieve the Key Performance Indicators (KPI) for equipment warranty and service parts. The biggest blow was that both, internal and external customers were complaining about the process lapse. Some of them were turning to competitors. The Solution With immediate effect, the OEM incorporated a warranty system for the client. Streamlining of processes and communication channels ensured that the equipment warranty KPIs were met. Furthermore, the analytics system traced products throughout their life-cycles and provided key insights to assess supplier performance throughout the supply chain. Moreover, it helped the OEM capture the service time taken by each of the servicing dealers, thereby keeping a check on the service turnaround time. It generated an effective internal process and helped immensely in managing and engaging internal and external customers. The Benefits Customer management & engagement Comprehensive reporting & analytics Reduced costs & customer complaints Process enhancement Proactive response to customers Development of contingency plans Improved efficiency of onsite service requirements Lesser turnaround time Increased brand credibility
Warranty Management – A Strategic Business Advantage
While warranty solutions began as a way to attract customers, their scope and application have seen radical changes over the years and organizations now realize that warranty management is a source of competitive business advantage. It offers a multitude of benefits like faster claims processing, decreased fraudulent claims, better operations management, and increased bottom-line results leading to improved satisfaction of customers and service providers. However, many fail to understand that effective functioning of warranty is hampered by a silos-based approach. Most organizations adapt the silos approach for warranty without giving it the focus it deserves. The fragmented approach to warranty leads to dissatisfied service providers and customers, greater turnaround time, high operating costs (which otherwise could have been avoided). A detailed analysis of the holistic approach can easily reveal the strategic impact it bears on each of the value chain functions, such as manufacturing, quality, sales, service, and finance. When the warranty-management process is integrated with all the key business functions, it can turn around the revenue chart of the business and multiply profitability. A holistic approach to warranty has various benefits: Improved customer satisfaction – Integrated information ensures greater connectivity, timely information and history recall for customers during product lapses. It, therefore, helps to increase commitment and boosts brand perception and organizational credibility. Faster claims processing – A closed-loop approach helps in streamlining the claims process and reduces operational discrepancies. It assists in tracking warranties across the product lifecycle and helps in optimizing product pricing while minimizing warranty costs. Decreased fraudulent claims – Processes and policies can be integrated into business logic. Streamlined processes lead to better visibility of warranty information. Integration minimizes warranty costs while enhancing the early error-detection process, thus widening the scope of improving product quality, well in time. Decreased operational cost & increased bottom line – An integrated warranty package minimizes process errors that rob organizations of strategic business focus. Product lapse trends can be closely examined for proactive measures to ensure quality and process control. An efficient warranty management solution fosters collaborative solutions, enhances product quality and customer satisfaction, addresses quality concerns, and improves partner relationships, thereby increasing operational efficiency and bottom-line results. The Client A global organization that specializes in providing diversified services to domains like home comfort, transportation & preservation of food & perishables, and securing homes & commercial properties. The Challenge The organization comprised multiple business units, each of which had diverse business requirements and ran on multiple legacy systems. Due to the market’s demand, the organization accepted additional responsibilities of spreading its services to Europe, North America, Asia, and Lagos. It faced a series of challenges in keeping up with requirements, as it lacked an inventory management system, coupled with ad-hoc retrieval systems, resulting in lack of transparency. All this led to inefficient realization of ROI. The organization was in need of a robust and comprehensive central solution to standardize the warranty management process. The Solution Massive data from all the business centers was integrated into a centralized platform. The analytics solution ensured timely projections across the value chain functions and helped in faster claims processing. It reflected early warnings of failures and identification of root causes to minimize product failures that were impacting the entire product lifecycle. The closed-loop solution transformed performance data into strategic intelligence, directly enhancing operational efficiency, decision making, customer satisfaction, reporting, and communication capabilities to identify and detect issues early. It also minimized warranty costs and enhanced business profitability. The Benefits Increased customer satisfaction & retention Better communication and collaboration Reduced warranty costs & claims processing errors Lesser turnaround time for settlement of warranty claims Greater process and operational efficiency Therefore it is crucial for organizations to ward off the one-dimensional perspective and move towards a holistic approach to warranty solutions. The integrated approach leads to a 360-degree perspective of information, efficient claims processing, better analytics, and reduced manual intervention. It also helps in achieving optimal business results and accelerated warranty management. It enables organizations to run their business functions with strategic alignment and purpose that can streamline their processes, enhance customer satisfaction, brand perception, and maximize scalability.
How to Manage Warranty Costs
Minimizing warranty costs has always been one of the most pressing concerns for organizations. While minimizing the warranty spend helps, it is also important to make an objective estimation of the costs involved. Due to the lack of information about every single step involved in the business process and the associated costs, a principle barrier becomes evident in charting the right budget. Cost mismanagement in warranty can rise from ad-hoc estimation techniques and planning for warranty reserves. The elements impacting warranty costs go beyond product repair and overflow into other areas. To estimate such hidden costs accurately, without some kind of integrated business logic, is extremely complex. The need of the hour is quantifiable strategies and techniques that can optimize the effectiveness of the warranty process. Time and again, warranty analytics have proved to show remarkable results by integrating data that helps to improve product and process performance. That helps not just in managing costs, but optimizing overall business profitability as well. Integrated technology can reflect warranty costs and assist in better operational and strategic business execution. That aids in formulating streamlined warranty management processes, building brand images, reducing operational costs, improving product quality and optimizing organizational efficiency. Business Case The Client One of the world’s fastest-growing automakers. The Challenge The existing warranty management system lacked a comprehensive analytics system that could integrate data across business functions. The organization faced a substantial revenue loss, maximizing ROI was a challenge, and organizational credibility was at stake. The team handled issues on the basis of client demands while using traditional legacy systems. The Solution With an intention to mitigate warranty costs, the organization integrated warranty data across all the business units into a single process with common business rules. The analytics solution helped reduce costs drastically and provided the organization with quantifiable data that highlighted areas profitable to the business, and the pain points that required immediate process upgrading. The outcome of the analytics system was a whopping cost reduction of close to 40% across all regions. Additional benefits included: Customer satisfaction Greater process transparency Scalable solutions Standardization of systems Quantification of results
How to make Warranty Claims Management work for you?
It is accepted that managing warranty claims is one of the most daunting tasks in the warranty lifecycle. Managing large amounts of data brings the possibility of errors at different levels. Such errors can impact the image and overall functioning of an organization. Current trends in managing warranty claims The current trend of managing warranty claims data involves manual management. The challenge of a manual approach is its failure to integrate with the ongoing enhancements in business processes. Several other negative implications include cost mismanagement, operational discrepancies, customer dissatisfaction, and quality issues. Is there a right approach? Due to erroneous processing of warranty claims, organizations have to incur huge revenue lapses. The right approach to correcting and maintaining warranty claims is to automate all key business policies and procedures through a comprehensive warranty claims solution. A robust system will improve the claims process and assist in building strategic plans to detect product failures early. That will help shorten the claims-processing cycle and maintain the ongoing improvement of end-to-end warranty claims management. In greater numbers, organizations are opting for a closed loop warranty systems that direct, process, and track warranties as well as provide feedback for continuous improvement across product lifecycles. This helps in optimizing product pricing and improving customer satisfaction while minimizing costs. Industry Example A specialist technology provider of manufacturing advanced food-processing equipment had plans to expand its service operations across South European regions. Implementing common processes and operations of manufacturing equipment was highly critical. This would assist in streamlining the processes, building a brand image, and gaining better control of the business and revenue management. Business Challenge The organization was exploring options to enhance its productivity by scaling the existing processes. One of the processes that needed immediate improvement pertained to the warranty claims management system. As the process was managed through a manual legacy system, it hampered productivity tremendously. Problems the company faced: Ineffective claim management due to manual tracking and management systems Communication channels were not automated which led to process errors Turnaround time and resources for project completion increased Inefficient management of the highly customized legacy due to lack of manpower. As a corrective measure, and to improve product quality, customer satisfaction, and profitability, the organization decided to implement comprehensive warranty enhancement solutions. The Solution A warranty management solution with advanced predictive techniques was implemented to identify fraudulent and inappropriate claims. New rules were added to improve claims precision and ROI. The solution provided rich functionality for registrations, claims management, returns & supplier management, and parts returns. The results were astounding. 95% of warranty issues were resolved. Warranty claims dropped by more than 60% in less than 2 years. The client experienced a series of business benefits such as effective cost, time and customer management, and saved huge amounts in customer service costs. The new system was flexible, easy to maintain, and highly scalable for future business enhancements.
Warranty Analytics – Integrating Value with Returns
The global economic downturn is impacting organizations across all industries and businesses are struggling to improve bottom line results. The automobile industry is no different. Managing costs, tracking fraudulent claims, and improving customer satisfaction are some of the major concerns for organizations in the warranty management environment. Close to 70% of the warranty expenses dwindle due to repetitive failure in the performance of parts. Identifying the root cause of such failures is the one of the biggest challenges in the industry today. How can organizations thrive in such an environment? Warranty Analytics is the only solution. Making correct use of the opportunity requires robust warranty analytics that can integrate raw data into actionable plans to accomplish the desired results. Successful organizations leverage that as the key to increasing revenue and optimizing customer success. Analytics is the application of statistical tools that convert raw data into business solutions. It incorporates a predictive technique to review future trends and improvise current processes. Insights gained through analytics add value to all the key spectrums of a business, including customer management, product quality, and process enhancement. Analytics solutions give a microscopic view into key business functions along with statistical features, predictive analyses, and forecasts for optimal business decisions. Analytics helps assess gaps and analyze the root cause of individual elements that hamper overall processes. Detecting the root cause enables companies to determine the best course of action and save on costs through early detection of failures. It further helps organizations improve resource allocation and realign focus on core strategic functions. Business Case Study A leading manufacturing unit with operations in 26 countries specializes in products and services across industries. It offers services such as protecting food and perishables, securing homes, and enhancing industrial efficiency and productivity. Each business function has multiple units with varied requirements. Those units used ad hoc retrieval methods that resulted in inefficiency in tracking failure patterns and measuring ROI from individual units. The organization had also branched out lately to wider geographical boundaries. The lack of inventory management and a centralized system proved a potential business threat. The organization needed a comprehensive warranty system that maximizes the utility of data for optimal business growth. The Solution A centralized web-based warranty solution was integrated to obtain a clearer perspective on parts failures, fraudulent claim processing, and better customer management. The software-based analytics system helped in providing operational feedback, turnaround time, parts performance, and determining the warranty cost per product. Some of the benefits experienced through warranty analytics: • Improved customer loyalty, product quality & brand image • Early detection of parts failures with an increase in bottom line results • Effective management of claims processing and warranty reserves • Predictive analysis to increase financial performance • Warranty cost management to understand and manage expenses • Smoother transactions between units and greater information flow • Faster and easier settlement of warranty claims Those benefits when enjoyed together can bring an organization exceptional advantage. Much like the manufacturing organization in the case study, Warranty Analytics is being used by more and more businesses that aim to thrive with higher returns and greater customer success.