Did you miss the Corrigo panels at RFMA 2019 in Austin? Don’t worry! Our conversations were so packed with information – and attendees – that we decided to recap them here. Curious about how you can really put your warranties to work? Read on….
The Put Your Warranties to Work panel was hosted by Corrigo’s own Christie Turner along with Christy Webster, Manager, Engineering Facilities & Systems for The Wendy’s Company. Christy generously supplied data and insights gleaned from her experience transforming warranty processes at Wendy’s.
Are Your Work Orders Leaking Money?
Consider this: The very first thing that most facilities managers do after learning that an asset needs repair is to make a potentially costly mistake—they call someone to repair it. Before you dispatch that vendor or tech, do you look for the asset’s warranty?
Putting this one step into your workflow every time can save you significant amounts of money on repairs, replacements or even through refunds.
Generally there are two types of warranties. Service Warranties are automatically added in standard contracts and generally cover the 30 days following a service call. These warranties serve as insurance for you that the vendor got the job done right.
Manufacturer Warranties or Equipment Warranties are part of the purchasing contract and come from the manufacturer. These warranties will cover defects and repairs for a longer period of time than service warranties, often several years from the date of purchase.
Think about it: nearly every asset under your control is attached to some kind of warranty that can save you as much as 100% of the repair cost. Why isn’t everyone using them?
Barriers to Effective Use of Warranties
Ironically, the biggest barriers to effective use of warranties for many FM organizations involve the very thing that they adopt to streamline processes and optimize performance: their CMMS. Adapting to a new CMMS is a big change. Adding in changes to workflow to check warranties is one more thing to adjust to, and many people gloss it over. There are also the issues of keeping warranty information updated after service calls and getting outside vendors to comply with a new process.
Let’s stipulate that change is difficult, even when the change is beneficial. And then let’s take a look at what happened for Wendy’s when it overcame the barriers and made the change to effective warranty management.
How Wendy’s Got Its Warranty Groove Back
Leaders at Wendy’s noticed that there were opportunities to save on almost every service call. To stop leaks, the company built a strategic roadmap with an executive champion to build a new way to view asset management.
The process was gradual, with CMMS implemented to track every asset and manage every vendor. Behaviors don’t change overnight, but Wendy’s took the view that it could prove value by starting with the “heavy hitters” in stores: high-cost items like HVAC and refrigeration and the high-impact pieces like ovens, fryers, grills, hot water heaters and dishwashers.
Now, with a clear focus, Wendy’s can hone in on cost avoidance, manufacturer accountability, and service provider accountability. Christy’s team easily identified $13,000 in 22 equipment types in 12 months of historical data that could have been saved if the warranties had been enforced. So how do you get there?
Getting Started with Warranty Tracking
The first thing to keep in mind, especially if your organization is large, is that you can’t do everything all at once. Start strategically by targeting the equipment most important to you, and then identify each warranty on each equipment type.
Ask yourself: “What are our heavy hitters? What has the highest R&M cost?” Start with these. Review the frequency of repair calls and look for trends. Techs and vendors will often leave comments on service orders, so take those into account too.
Next, get those paper Equipment Warranties into your digital system. One bit of workflow that can be helpful in the long run: ask all manufacturers to include model and serial numbers on all invoices and establish warranty templates for each manufacturer that exists in your CMMS for easy reuse.
Once the warranties are in the system, let the CMMS use it to your advantage. You’ll be notified if there’s a warranty in place for an asset in question, and you can enforce $0 NTE on warrantied work.
Over time, you’ll find that not all warranties are equal. For Wendy’s, one outcome of its process has been to identify which warranties add value, allowing them to determine whether a warranty makes sense for a given task or asset. This is optimization, and it means that you’ve recaptured the money you were leaking and are now recapturing.
What About Service Warranties?
Corrigo’s CMMS automatically applies a 30-day service warranty when a work order is created with any vendor. Invoice rules protect your budget when the same task for the same asset pops up, and $0 NTE is automatically enforced.
How Can You Get Started?
Warranty enforcement is a journey, but the payoff is enormous. The right tools can make it easier than you think to implement, track and save. If you’re leaking money by ignoring warranties, call Corrigo today to schedule a demo.