Enduring knowledge is the key to decision making, doesn’t matter which industry. In fact, nowadays, the biggest asset of companies is digital data. Although manufacturing expertise does play a big role in business, knowledge about business dynamics turns out to be even more crucial. Some companies, although devoid of manufacturing practices, are performing formidably, only because they know how to source goods, handle logistics, and use big data to sell in a well-targeted manner.
In the warranty business, customer desires are just a part of that knowledge. Keen understanding of the entire supply chain is crucial.Just like retailers need to know customers demands, warranty decision makers need to be aware of supplier issues, distribution practices, customers’ complaint patters and so on. Unlike in most other specializations, warranty involves the use of data across the entire supply chain.
Data analytics or the lack of it has a direct effect on warrant revenues. Be it in fleet management, or consumer vehicle warranties, manufacturers need to maintain their reputation by drawing a balance between customer satisfaction and dollars spent in resolving issues. It involves understanding claim patterns, supply faults, development &production issues, and a host of other parameters, which are constantly affecting productivity. Changing policies in a judicious way requires big data insights.
Most warranty software till the last decade had been concerned with warranty operations only, or how to let personnel manage the operations efficiently. However, it is important to recognize data patterns as well.
An entire supply chain, which is linked to a particular OEM,can now depend on a single software application. It is possible because of cloud connectivity between beneficiaries and their software providers. The setup enables OEMs to tailor their warranty policies, maintain consistent communication across the chain, identify areas of improvement, and use data-driven insights to adjust the policies. That is why OEMs are now buying software as a service, to which they can link their suppliers and distributors as well as their data through the cloud. What ensues from that is better transfer of knowledge and efficient use of data.
Testing your warranty software for such capabilities from time to time helps in improving your warranty revenues. Firstly, better data insights imply better understanding of manufacturing drawbacks, below-par suppliers, probable misuse by customers, servicing pitfalls and other areas of improvement.Given that such insights are available through software as a service, the returns on investment in the long run are handsome, to say the least!
Going forward, OEMs should know that extended warranty services are also available to facilitate fleet expansions in transport companies. When vehicle manufacturers have to supply additional vehicles to transport companies, the manufacturers need to study the proportional change in risks. Consequently, they will need software providers to enable OEM personnel to be able to generate those insights through a user-friendly interface. Minor data entry work should generate insights such as the subsequent need for change in service contracts, supplier contracts, and the warranty policy itself.
The importance of data insights can never be undermined in the warranty business, because it depends on long-term revenues and subtle changes for what might be a smarter approach.
About The Author
Anand Subramanian, Senior Business Architect at Tavant Technologies. Anand has worked in several process improvement projects involving multi-national teams for global customers. He has over 15 years of experience in warranty management systems, as SME, client advisor, IT consultant, business analyst and as a practicing manager of business analysts and has successfully executed several projects in logistics management, logistics integration, reverse logistics, supplier collaboration and Warranty Administration.