Warranty implementation and evaluation: a global firm's case

Abstract

PurposeThis case study aims to develop and empirically test a general framework for the implementation and evaluation of a warranty policy (i.e. implementation, support structure, and evaluation stages) within the context of a high‐tech global firm.Design/methodology/approachThe sample consisted of the employees of an anonymous US‐based global high tech firm.FindingsThe findings for the implementation stage report that the cost and profit centers should have their costs allocated on the basis of activity. For the support structure, there is a negative response to outsourcing as an option for implementing the warranty policy. For the evaluation, findings report that US firms should reevaluate their pricing, quality, and warranty strategy for domestic and international markets.Research limitations/implicationsThis case study can be expanded by examining how companies balance the cost/quality/warranty ability of the product, the techniques used to allocate warranty costs, and to evaluate multiple companies/industries, perhaps with a longitudinal focus.Practical implicationsFindings report that the budgeted costs should be allocated depending on the type of incident. The majority of outsourcing opponents consisted of service personnel while those in favor were from product marketing departments. Also, the US firms need to provide written warranty information to their customers.Originality/valueThe proposed framework will satisfy a current, critical need to provide guidelines for the steps needed to implement and evaluate a warranty policy within a context of a high tech global company. Additionally, this case research study's key contribution lies in its attempt to address warranty management processes within a multitude of a firm's departments. Furthermore, the anonymous high tech company used in this study was chosen as a sample because the company offered a wide range of products, warranties, and service options. The company also utilized a vast reseller base to sell and service its products. This method offered the potential to gain better insight with regards to the role of resellers in a warranty program. It also marketed products and services to six specific industries: financial, retail, transportation, manufacturing, communications, and the public. This broad industrial perspective gave the study added cross‐industries' insight in reference to implementation and evaluation of a good warranty policy since the anonymous high tech company considers these industries to be sustainable industries in the USA and abroad.

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