Many organizations lose thousands in revenue leakage every year due to warranty claims processing issues. According to a Warranty Week report from 2019, U.S.-based companies paid a total of $25.9 billion in claims in 2019. Especially in the ever-dynamic universe of field service organizations, it is important to expect the unexpected and make serious work of your warranty and claims management processes.
Warranty claims management is an integral part of business operations in the field services industry. But the way in which warranty claims are being processed and automated has drastically changed in the wake of the digital revolution that has transformed societies and businesses all over the world.
Modern field service organizations need a reliable and closed-loop claims management process that administers, processes and tracks all warranties throughout their lifecycle to improve customer satisfaction, increase product quality and reduce service costs.
In this article, we will show you how service organizations can optimize their warranty and claims management processes. We’ll also introduce you to IFS Field Service Management, a comprehensive warranty management software that allows field service organizations to optimize warranty processes, warranty replacement, product and (spare) parts management, customer claims management and installed equipment management.
What is warranty management
To understand the unique challenges of warranty management, we should first define what the term means. Warranty management is the process that focuses on the effective creation and implementation of warranties for businesses. Traditionally, many field service organizations viewed warranty management as a cost of doing business.
But this has changed. Nowadays, more and more companies realize that warranty management is a separate revenue stream. Best practices in warranty management have reduced the cost of service part delivery, leading to an increase in customer satisfaction.
They have also generated an independent revenue stream of warranty services. The warranty management process for field service organizations has several components:
- A service parts management team handles customer claim management and serves as the primary contact point for the customer. The team usually consists of a customer desk (support teams), technicians and engineers.
- A warranty management and claims processing system. A service warranty database and tracker, service request registration and authorization module, but also several management modules (parts inventory, purchase order, repair and vendor management) should be part of your warranty management process.
- Subject matter experts. These professionals determine the nature of the technical support required to be assigned. They also draw up timelines for service issue closures.
- A dedicated department or team for parts procurement and logistics.
Why warranty management is so important
But why is proper warranty management such an important part of your business proceedings? First of all, good warranty management ensures that the warranty promise you made to your customers on their purchases is protected. This increases customer satisfaction and fuels customer loyalty.
A good warranty process and warranty management system also improves operational efficiency. The room for error is reduced and issues are resolved in a quicker fashion. This allows you to improve visibility into the claim status and payment processing. Warranty management systems give technicians the opportunity to focus on their job in a quick and efficient manner while not having to worry about handling claims.
A good and streamlined warranty management process and the right warranty management software also save field service organizations valuable time. You can speed up the claim adjudication and verification process, as well as the payment process. Professional customer claim management also helps you to better eliminate (potential) fraud.
How to optimize your warranty management process?
There are several ways to optimize and improve your warranty and claims management process. Let’s take a look at the best and smartest ways.
Review your current warranty management system
Start with taking a look at your current warranty management system. Is it easy to understand? Does it allow you to measure the success and effectiveness of your current approach? And are there any barriers that are holding you back or costing you money?
Automate your warranty and claims process
Automation makes the process of warranty and claims management a lot easier and more efficient. You can automate warranty agreement generation (for example, by linking a product’s inventory class to a template for the warranty terms and entitlements), warranty registration workflows, and the management of warranty expiration and renewals.
Provide your field technicians with the right mobile technology
Since your field service technicians are your front line employees who work directly with the customers, they would certainly benefit from auto-generated warranty agreements and easily accessible information and data. You should provide them with a fully mobile solution, allowing them to access and manage warranty data across all devices and from every desired location.
Choose the right warranty management software
Use the right warranty management software. The software should be able to use real-time data, logic and analytics, and it should detect fraud in an easy and effective manner. The solution should also provide real-time adjudication and validation features.
Make warranty management a company priority
Effective warranty management should be ingrained in your company culture. Carefully document the benefits of an effective system for your organization and provide specific examples of how your organization will benefit from a more effective warranty management system.
The challenges of warranty and claims management
Warranty and claims management comes with a number of challenges. The first one is redundant data entry. The information silos that often exist within company structures lead to procedures that involve entering the same data and information in multiple places.
The result? A lack of insight and a slow, time-consuming and sloppy warranty and claims management process. A fragmented information landscape also increases the risk of claims falling through the cracks of your warranty management system.
Dealing with fraudulent claims is another major challenge. Overpaying due to invalid or fake claims and increased warranty costs make the process wasteful, expensive and time-consuming. A lack of real-time coordination and ineffective reporting intensifies these problems, resulting in longer claim cycle times and, eventually, in more manager-escalated customer complaints due to growing dissatisfaction with the resolution progress.
The benefits of good warranty management
Upping your game in the field of warranty and claims management has a lot of benefits.
- Increased efficiency. You can track the progress of every customer claim and increase visibility into all aspects of the warranty claims process.
- Automating repetitive and error-prone warranty management tasks saves costs and eliminates needless errors that negatively impact customer satisfaction.
- Professionalizing warranty management and using the right warranty management software makes it easier to detect and stop fraudulent activities.
- Good warranty management increases customer satisfaction. This allows you to build a bigger and more loyal customer base.
Seamless warranties and claims management with IFS Field Service Management
From first call to final sign off, your customers expect a personalized, connected service that takes proper care of their warranty claims. To deliver this level of service, you need a true end-to-end solution that improves business efficiency, ensuring fast response times and real-time reactivity.
Through the automation of warranty claim handling and installed base asset tracking, IFS Field Service Management enables service organizations to create, administer, process and track warranties, claims and assets through their full life-cycles.
As a result, third parties can submit valid claims and receive credits, your customer service can verify coverage and initiate recovery, and field technicians are able to track asset histories and replace in-warranty parts. The warranty and asset management functionality in IFS Field Service Management does it all!
Would you like to know more about IFS Field Service Management and how the solution can help you perfect your warranty and claims management processes?
Feel free to contact Eqeep. You can give us a ring at +31 (0) 344 767 170 or send an email to email@example.com.