Applying analytics to the emerging wealth of Big Data has become a top agenda item for a growing number of manufacturing executives. Yet, IDC Manufacturing Insights data shows that these initiatives have not progressed as quickly as other major IT initiatives, (cloud and mobile, for example), and this is especially true regarding aftersales service and warranty "Big Data". However, we assert that discrete manufacturers need to escalate this priority considering that for many, 70–90% of total lifetime cost is in asset maintenance and repair, and the majority of these companies plan to have a significant portion of future revenue (and profits) come from service activities to attenuate uncertain product revenues.
By synthesizing field product performance, service and customer data from multiple sources into highly usable information, organizations can create a context by which the warranty and ancillary processes and customer experience can be understood, controlled, and leveraged. Exploiting the wealth of information provided by service and warranty data can benefit many areas and stakeholders across the enterprise and takes many forms including:
- Early detection of product quality issues and focused recalls
- Improved product design
- Advanced supplier recovery
- Optimized spare parts planning
- Minimized suspect and fraudulent claims
- Reduced "remorse returns" and no trouble found (NTF) rates
- Increased reserves forecast accuracy
- Enhanced service quality and service information
- Intensified customer intimacy and next best action
- "Right" pricing and warranty policy insights for sales and marketing
Suprisingly, most companies have yet to recognize the criticality of, and the opportunity that exists in, superior execution of warranty and all service events. Moving service and warranty from an afterthought to a forethought and obtaining C-level support may be the first hurdle many companies need to overcome to gain support for an investment in this area.
Service needs to be an integral part of a company's strategic thinking, which demands greater corporate oversight, facilitated by integrated and optimized global operations and governed by corporate systems. Because many companies still have disparate systems and processes in this area, manufacturers must be prepared to do foundational work to integrate product, service, customer, and enterprise information. Creating this "digital thread" may be the first step in your company's Big Data road map.
In general, we expect these types of projects to potentially include a number of partners to cover the range of software, hardware, and professional services requirements as appropriate. However, coordinating and collaborating among IT suppliers and the internal IT organization will be vital. Selection of vendors should be made based on strategic fit, industry experience, and current relationships, and in the context of planned projects across the enterprise, among other factors, such as timing and cost. Manufacturers may also want to explore options such as Big Data appliances and outsourcing Big Data skills, and consider the benefits of deploying technology through the cloud, as well as the implications on the company's mobility strategy.
Manufacturers that rely on data-driven decision making can achieve higher levels of efficiency and effectiveness and better serve their customers and consumers. To unlock the value in information assets, especially of those in the field in which they do not have direct line of sight, manufacturers must be able to apply Big Data and analytics, be prepared to reengineer business processes for specific use cases, and ensure the availability of appropriately skilled staff. For more data and information on Big Data and analytics adoption, vendors, service providers, and guidance, subscribers can read the detailed report, Making the Case for Big Data and Analytics in Manufacturing Aftersales Service and Warranty. As always, I want to hear your comments and about your company's initatives in this area so please post below. Till next time…