General Motors tracks warranty problems the way the Centers for Disease Control tracks disease.
Five years ago GM (gm.com) studied the way the CDC (cdc.gov) tracks outbreaks of disease.
The CDC uses reports from key states to spot outbreaks and look for trends. That led GM to set up a statistical tracking method to discover warranty problems.
GM says it has seen a 40 percent decline in the number of warranty repairs at its dealerships and a 23 percent cost reduction.
GM would not reveal its annual warranty costs, but in 1999 The Wall Street Journal reported the automaker's warranty costs at about $3.5 billion a year.
Renee Stevens, director of GM's quality data analyst group, says warranty repairs are at the lowest level the company has seen in years.
"We're focused on how we service our vehicles and how to bring costs down," Stevens says.
Two hundred high-volume dealerships make GM's central reporting unit. The dealerships are divided up into groups by brand. Each group participates in a daily conference call with team leaders. If there is a problem, the dealership sends the automaker a report.
Typically if a dealership has a lot of claims, the home office will send a problem solver to help pinpoint the trouble.
The watchdog for warranty issues is a group of more than 1,000 employees called the Red X team. Team members are trained to track and find solutions to warranty problems within 24 hours.
GM's nerve center is a windowless conference room, called the Warranty War Room, at its Tech Center in Warren, Mich. The room contains computers with access to a database containing photos of problem parts.
As a result, a problem part spotted at, say, a Tennessee dealership can be seen by the staff of eight troubleshooting engineers in Michigan. The Internet allows fast communication among parties.
Says Stevens: "We're trying to get finer in our analysis and catch those problems quicker."
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