Despite almost every organization (with proper quality management system and strategy) intends to reach zero failure, it is sure, that the elaboration of a warranty claim
management system is necessary. This system ensures, that the claim is listened to, and reacted on.
When a defect generates a customer claim, the affected supplier at least should focus on the prompt and efficient claim management, including fast feedback.
Claim management is a reactive process, containing many important sub-processes:
- Logistics of claimed parts / replacement parts.
- Problem solving process.
- Financial transactions.
- Claim database and statistics.
- Reporting, and feedback.
Having simultaneous sub-processes, claim management is a complex, coherent procedure. The following chart shows a brief summary of the overall claim management process.
The claim management process (Source: qMindset.com)
Major points to be considered:
- Most of the time, customers only see the symptom, and cannot really formulate the problem itself. A resident engineer at
the customer’s site can solve this gap.
- You can already start to collect information, even before the claimed parts arrive (e.g. traceability data, correlations, possible
root cause indication based on the received information).
- In case of complex products (e.g. electrical devices), when you do not know the detailed technical failure (problem), you are not able to start a containment action.
Example: the customer claims, that the device you supply does not turn on. This time you do not know what additional electrical tests you should implement beside your 100%
EOL (end of line test), as you do not know what components failed in your product.
- Warranty analysis is performed in the analysis center or analysis laboratory. The laboratory can be your internal lab, but you can also use certified external labs. The analysis result of the laboratory
can provide the problem (performance gap) that caused the symptom, and further root cause analysis will be needed to find the technical (and management) root cause(s) in your process.
- It is advisable – and many customer request – to give frequent update about the status of the analysis process (after having the warranty analysis, the root cause analysis and the final 8D report). At
most of the companies, this is the task of the customer quality engineer.
- As soon as the claim is proven to be originated from your side, the sending of replacement part (or refund) can be started.
- Claim management through the supply chain: when you are the supplier of a product, and the root cause of the failure can be traced back to your sub-supplier, you start the same claim procedure downwards
the supply chain (especially in the automotive industry, every supplier is responsible for its sub-supplier, so each party raises the claim towards its direct tier supplier).
Claim management through the supply chain (Source: qMindset.com)
If it’s possible, employ a resident engineer at the customer’s site, who can pre-filter many claims that are originated from the customer’s process (customer defect).
Transparent, plausible and fast-response communication can save you time, and can prevent further headache!
Claim management process must be defined in the contract between the companies. Most of the companies (mainly the mid or large size ones) have their "Supplier Quality Manual",
or special terms, containing their requirements concerning claim management.
In case of sub-supplier related defects that slipped through the supply chain, the fast communication is necessary between your supplier and customer quality management
departments. It already takes a huge lead-time (days / weeks) to get to the root cause, so you shouldn’t have any gaps in your organization to make this lead-time bigger and bigger.
If you find out that the defect was caused by your customer (due to improper use, mishandling, etc.), don’t just simply reject the claim and close the issue, but support your
argumentation with facts and data. On top of that, support your customer to avoid the recurrence of such issues.
Depending on which company we are supplying to, the customers give strict deadlines to the claim management process (and problem solving). Example from the automotive industry:
- Prompt feedback after receiving the claim (e-mail, phone) (24 hours).
- Feedback about the warranty analysis results (48 hours after receiving the claimed part).
- Feedback about the verified root cause (10-14 days).
- Final 8D with CAPA (15-60 days,
depending on the OEM or tier 1 customer).