Warranties

• Overall


  Warranty claims are made against goods that have defects in the goods or services to provides/delivers

  A good way to assess the effectiveness of operations process is to measure the number of warranty claims

  Also apply to services and enable customers to cancel contracts or seek a refund for the unused portion or to be compensated for the reduced value should a major failure occur
• Example


  Case Study: recent recall of cars carrying Takata airbags sold in Australia. The recall of tens of thousands of cars led to the replacement of the faulty bags. However, the s4e rectification costs are expensive. Operations managers need to trace the source of the fault in manufacturing and rectify it. In this way, the warranty claims lead the business to improve transformation processes