7 Point Checklist for a Warranty Management System
Markets have become deeply customer focused. Manufacturing and shipping products is only half the job. An equal half lies in warranty management and services throughout the product’s lifetime. Tight control over operations and holistic awareness of customer events are essential to perform at par with popular manufacturing companies.
Modern warranty management solutions are built in the cloud and served as a service. The advantage is you won’t have to invest much in software or maintain an IT team to manage the system. Instead, you can pay a subscription and rest assured that the system is always up and running. But that alone will not suffice. You need to ensure that your service provider is capable of all the seven key components for effective warranty management:
1 - Warranty Administration Functionality
This takes care of rates, policies, contracts, warranty registrations and campaigns.
2 - Extended Warranty Functionality
An extended warranty component involves functions like dynamic pricing, sales promotions, quotations management, modifications, cancellations, renewals, and claims management.
3 - Warranty Intelligence Functionality
This makes use of dynamic analytics and triggers early warnings about quality issues and fraudulent claims. Analytics helps estimate, forecast, and maintain optimum warranty reserves. The dashboards and performance metrics make it easy to rate and understand the whole chain of suppliers, dealers, and service providers by considering their quality, cost, and reliability.
4 - Claims Management Functionality
This facilitates submission of claims, pre-authorization, automated processing, monitoring for fraud and duplicates, adjudication, and crediting.
5 - Parts Return Functionality
This involves taking care of the reverse logistics including RMA (return merchandise authorization), parts tracking, parts diagnostics, and disposition.
6 - Supplier Recovery Functionality
This functionality helps track the entire gamut of suppliers and the parts each has supplied. In the event of a quality issue, malfunction, replacement, or repair, the system can map each component to its supplier and recover costs quickly and effortlessly.
7 - Service Contract Functionality
This manages scheduling services, invoicing, revenue recognition, performance visibility, claims management, contract management, and contract reconciliation.
All seven functions can only work cohesively and smoothly if the solution is built on a robust platform with the right intelligence. Dynamic business rules, workflow engine, and data warehouse integration are critical to quality and performance.
A robust CRM platform has many advantages on this front. Although CRM and warranty management have traditionally been separate functions, there is a profound link between the two. CRM software and services are essential to call-center operations, which are critical to warranty management. CRM software can keep track of call records and basic warranty information like validity periods. Adding functionalities like analytics, forecasting, performance metrics, business rules engine, and parts tracking to a cloud-based CRM software like Salesforce.com makes all the more sense for enterprises already using an existing CRM system.
Effective warranty lifecycle management and real-time customer engagement require highly intelligent or agile warranty management systems. Such a system can help you reduce warranty costs and reserves. It can also speed up supplier recovery with accuracy, enhance warranty forecasting accuracy, and predict suspicious claims such as warranty fraud. If you decide to acquire a warranty management system, make sure you discuss the seven components above with your potential provider before you make a purchase decision.