Warranties have Significant impact on Revenue and Expense
In SAP Product Life Cycle Management “Warranty management” has been a completely neglected or paper-based, manually tracked, involving huge administrative tasks like processing claims which further cannot be communicated from maintenance departments to different departments for processing from finance and purchasing end.
How to mitigate:
It is necessary to treat warranties as receivables and get organized to collect them, involve other departments in your warranty processes in order to increase revenue or decrease expense, Work with suppliers in order to get their best service.
• Establish a consistent process and centralized repository to administer and track warranty jobs
• Identify warrantable equipment or components through flags in work Orders
• Evaluate existing work orders for warranty eligibility
• Create a Warranty job type to track expenses and recoveries within the same work order
• Prepare a Report for potential claims (backlog), current claims (open work orders), and completed claims (completed work orders)
• Share warranty performance information to promote ongoing reliability analysis and equipment selection process improvements with vendors or suppliers
What’s the Solution?
SAP Warranty claim processing function in Plant Maintenance and customer service is used to handle large number of claims automatically. This module is developed to meet the needs of vendors, suppliers, and manufacturers for all type of products. Warranty claim processing is a complex process because to perform different checks in claim processing.
SAP Warranty claim processing component is closely integrated with Material Management, Sales and distribution, Customer Service, and other processes of Plant Maintenance.
Benefits of SAP warranty Management:
Managing warranties are easy to achieve with “SAP Warranty Management” and integrating SAP PMCS, MM, FI Modules when performing maintenance or service on own or Customer equipment in-house or contract with service providers or the OEMs themselves. SAP Warranty management systems facilitate the coordination and communication of warranty efforts, leading to significant maintenance cost recovery(Expense), lower asset lifecycle costs when integrated to PM module and significant Revenue can be generated when integrated with CS module.
SAP Warranty Management can be used for comprehensive warranty management which can provide additional capabilities. For example, both equipment- and part-level warranty coverages are tracked, including assets that are covered under different warranty terms. Comprehensive solutions identify all warranted products, “For complex equipment, an unlimited number of contracts can be entered into a warranty system, and there is no limit as to how many contracts can be associated with a single vendor. Each contract can have multiple equipment or parts coverages, including calendar-based warranty durations or any number of consumption-based measures, such as mileage, meter readings, or hours in service.
SAP Warranty Management can be implemented in all industries and not limited to below
- Aero space