IDC Manufacturing Insights Survey Reveals Few Manufacturers Consistently Benchmark Warranty Operations; Less Than Half of All Companies View Warranty Management as Critical to Brand’s Image

FRAMINGHAM, MA – May 4, 2011 – A new study published by IDC Manufacturing Insights, Methods and Practices: Warranty Capabilities Maturity Model(Document #MI227896) reveals that while most product companies recognize the criticality of effective warranty management practices, very few companies are addressing the problem effectively.

Key findings from IDC Manufacturing Insights' Worldwide Warranty Survey, conducted in conjunction with WarrantyWeek.com, include:

Most product companies do not consistently benchmark their warranty organizations, with less than 20% of companies even benchmarking internally.

Low product quality and poor warranty coverage and repair can significantly tarnish a brand. However, only a little over half of leading companies and less than 20% of laggards use warranty management proactively to improve their brand image.

Nearly all (92%) of leading companies are pursuing opportunities to improve accrual management, but only 61% of laggard companies do.

Approximately 60% of leading companies employ proactive means to improve warranty performance through the use of fraud detection methods and early quality warning systems. Less than 20% of laggard companies do.

"Based on our research, the manufacturing industry's ability to drive warranty improvement is minimal," said Joe Barkai, practice director for IDC Manufacturing Insights' Product Lifecycle Strategies research service. "The use of benchmarking to assess performance and implement continuous improvement is disappointedly low and the application of IT tools to manage warranty transactions, perform warranty and quality analysis, and improve financial management is very inconsistent. Until now, the industry has not had a set of best practices to rely upon."

The significant gaps between leading and lagging companies and the dire need for a robust methodology to improve warranty operations has led to the development of the recently released Warranty Management Capability Maturing Model to help companies assess the capabilities of their warranty organization, develop a continuous improvement roadmap, and accelerate business transformation. (To read more about the maturity model, please visit Document #MI227896).

"Our survey results emphasize the need for organizations to take deliberate actions to elevate the considerable financial and management burden of warranty operations," said Sheila Brennan, program manager, Product Lifecycle Strategies. "The Warranty Management Capability Maturity Model can help companies begin an improvement journey and provide insight into what to measure, what to invest in, and how to organize, in order to improve their warranty operation."

Join IDC Manufacturing Insights on May 5th for a complimentary webinar to discuss the Warranty Management Capability Maturity Model and study findings. Click here to register.

For additional information contact Sarah Murray at 781-794-3214 or sarahbethmurray@gmail.com. IDC Manufacturing Insights reports are available to qualified members of the media. For information on purchasing reports, contact insights@idc.com; reporters should email sarahbethmurray@gmail.com.

About IDC Manufacturing Insights

IDC Manufacturing Insights assists manufacturing businesses and IT leaders, as well as the suppliers who serve them in making more effective technology decisions by providing accurate, timely, and insightful fact-based research and consulting services. Staffed by senior analysts with decades of industry experience, our global research analyzes and advises on business and technology issues facing asset intensive, brand oriented, technology oriented, and engineering oriented manufacturing industries. International Data Corporation (IDC) is the premier global provider of market intelligence, advisory services, and events for the information technology market. IDC is a subsidiary of IDG, the world's leading technology, media, research, and events company. For more information, please visit www.idc-mi.com, email info@idc-mi.com, or call 508-988-7900. Visit the IDC Manufacturing Insights Community at http://idc-insights-community.com/manufacturing.

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