A system perspective on warranty problems within a supply chain

Warranty is important financially to American manufacturers, especially automotive companies. Carmakers and suppliers must work aggressively to improve their warranty management approach as warranty cost often equals or exceeds their investment in engineering. This thesis focuses on studying warranty management in a supply chain from a systems perspective. Warranty data in the automotive industry, focused upon a "Tier one" supplier, is analyzed to obtain general warranty trends and typical failure types. Following the data analysis and hypothesis formation, a sequential series of surveys and interviews within the supplier are conducted in attempt to determine the root causes of warranty failures. A major finding of the study is the lack of a cross-company and long-term approach for dealing with warranty. Other root causes (though not as deeply imbedded as that noted first) include the lack of design discipline, design knowledge, and resources in the product development process. In addition, unclear accountability, poor communication, and lack of a supplier management process delay the warranty resolution process. Furthermore, the culture and mindset in an organization is a critical element in effective warranty management. A reactive warranty firefighting mindset is inadequate to attack the significant warranty issues. Based upon solving the root causes found in the research, the thesis provides five specific recommendations. These recommendations appear likely to be useful to a wide variety of automotive companies as well as manufacturers in other industries.

Department dc:contributor.department

System Design and Management Program.

Grantor dc:publisher

Massachusetts Institute of Technology

Year dc:date.issued

2005

Authors dc:creator

• Cheng, Wangquan
• Shen, Wei

Advisor dc:contributor.advisor

• Christopher L. Magee.

• System Design and Management Program.

Statement dc:rights

• M.I.T. theses are protected by copyright. They may be viewed from this source for any purpose, but reproduction or distribution in any format is prohibited without written permission. See provided URL for inquiries about permission.

Licence dc:rights.uri

• http://dspace.mit.edu/handle/1721.1/7582

Language dc:language.iso

eng

Handle dc:identifier.uri

http://hdl.handle.net/1721.1/59520

OAI identifier oai:identifier

oai:dspace.mit.edu:1721.1/59520