A DMAIC Project to Improve Warranty Billing's Operations: A Case Study in a Portuguese Car Dealer

Abstract

This article describes and analyzes how a big Portuguese car dealer group successfully used all the stages of a Six-Sigma DMAIC (Define, Measure, Analyze, Improve, Control) project to improve the warranty billing process (paid by Car Brands). It shows that the project allowed car dealers managers to understand that financial metrics in use did not control compliance standards for Car Brands, in warranty services, or assure a good cash-flow for the car dealers. Necessary changes and new metrics (% time compliance to do the service and bill it, % time compliance reception, % time to find a defective part in an audit) generated time benefits and consequently a more controlled cash flow. These new metrics may be common to any car dealer with warranty services.

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