How to turn warranty data into profitable growth
July 22, 2021
July 22, 2021
If you’re a manufacturer, you may be sitting on a goldmine of untapped information that holds the key for driving innovation and creating new value: warranty data. There is an opportunity for supply chain leaders to create a “digital data thread” from aftersales to product design to help improve product quality, increase customer loyalty and reduce warranty costs.
Consider the vast amount of data that manufacturers receive from warranty claims every year, such as part or model numbers and manufacturing dates, and complaints or problem descriptions from customers. This valuable information is a not only a rich source of potential insights into how products function in the real world and what is not working for customers – but it can ultimately be used to decrease the number of warranty claims.
By establishing a feedback loop, the product design teams would be armed with rich insights to be able to make more informed decisions on developing new products and enhancing their existing portfolio. Data-driven product design offers companies the opportunity to create innovative and highly relevant products that delight their customers. But equally important, better designed products are less likely to fail, which can help to eliminate warranty claims and the associated costs.
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Data-driven product design offers companies the opportunity to create innovative and highly relevant products that delight their customers.
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Data from connected products is another area that can impact warranty claims. For example, telematics—today cars, trucks and other vehicles are capable of gathering large quantities of data on how their components and their drivers are performing. This capability will only increase, and when the data starts streaming back to manufacturers in real-time, it has the potential to take product quality insights to a new level.
Having this kind of data available opens the path to move from relying on the reactive analysis of warranty claims to predicting vehicle part failure based on real-time data—then automatically prescribing the actions to fix the issue.
Not only will this eliminate wasted resources in R&D, but it will also create a lower cost-to-serve and a superior customer experience with less product downtime and less need to visit the repair shop. Ultimately – it will decrease warranty claims.
According to our research, only 26% of companies have a digital thread for each product where warranty analytics inform changes in product and service design. That’s a sizeable gap.
Companies are struggling to connect the dots. They’re stuck in a siloed way of working, constrained by legacy technology platforms meaning that data is left untapped and fully exploited and they lack the right tools and talent to extract the powerful insights to drive more informed decision making.
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26% of companies have a digital thread for each product where warranty analytics inform changes in product and service design.
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The way out of this seemingly endless trap is to adopt intelligent warranty operations—connected, automated and customer-centric with data at the core. Indeed, we’re seeing a dramatic shift in how manufacturers think about designing, engineering, monitoring, fixing and enhancing their products. The leaders in the field are already focusing on next-generation customer-centered capabilities, preparing their data, platforms and operating models to support highly automated product quality data feedback loops to predict and meet future customer and business expectations.
For the rest, acquiring these advanced capabilities means going on a journey of ever-increasing digital maturity. And centralized data-driven warranty operations is the perfect place to start. By enhancing its warranty data quality and processes and connecting the dots across the organization, a manufacturer can deliver higher performance, more efficient operations and more satisfied customers and improve profitability.
With so much information at manufacturers’ fingertips, the future holds incredible potential. With more and more devices, machinery, components and products acquiring intelligence and connectivity, the volume of real-time data and insights available to manufacturers is all but ready to explode. And that can deliver improved products and more satisfied customers, driving even more growth. Ultimately the future for supply chain leaders is now, and they need to act now to transform their aftersales function.
Learn more about the power of the connected warranty, or reach out to me to discuss further. firstname.lastname@example.org