Sub-Zero Chills Its Warranty Issues with SAS Solutions

Upscale refrigerator maker taps business intelligence apps to improve product quality, reduce warranty costs

Upscale refrigerator maker taps business intelligence apps to improve product quality, reduce warranty costs

Cary, NC  August 10, 2005  Upscale refrigerator company Sub-Zero Freezer and its corporate companion, Wolf Appliance Company, have implemented solutions from business intelligence specialist SAS as part of a drive to create a consistent categorization system for warranty claims and reduce the time it takes to identify and address product defects.

Sub-Zero, a manufacturer of luxury residential refrigeration and wine storage units, realized that harnessing warranty data is key to improving overall product quality and keeping its customers happy. Sub-Zero chose SAS as its business intelligence partner for warranty analysis to deploy a system that automatically pushes messages to staff members, giving them an early warning about even the most minute quality issue.

Specifically, the company has deployed SAS's Warranty Analysis and Text Miner solutions to help in this initiative to improve product quality and reduce overall warranty costs.

Detecting Emerging Issues

Warranty Analysis integrates warranty data with key customer, production and geographic information in a manner that allows organizations to identify questionable warranty claims to detect fraudulent activity, automatically detect emerging issues earlier, determine the root cause of problems so that company resources are focused on the right areas and forecast warranty costs.

The addition of SAS Text Miner provides Sub-Zero with a set of text mining tools to uncover the underlying themes or concepts that are contained in large collections of documents. With this solution, documents are automatically clustered into groups and classified into predefined categories so that they deliver insight into the business issues at hand, SAS said. Predictive models can be built with this data to forecast the outcome of a response variable based on the contents of the text.

To date, Sub-Zero has seen 14 percent reduction in warranty costs and significant savings in issue detection time with SAS. "We're already seeing benefits from the SAS system," said David Bien, Sub-Zero reliability director. "We believe the system will pay for itself in 14 months or less. With SAS, we feel that we can be more proactive, reduce warranty expenses and, most importantly, keep our customers satisfied."

Avoiding Catastrophic Payouts

The new SAS system produces a proactive emerging-issues report to highlight new patterns in the previous month's warranty claims. Potential issues are assigned to product engineers for investigation. In addition, Sub-Zero engineers from other departments can sign up for e-mail alerts on any of the company's hundreds of product components.

Thomas Roehm, senior director of SAS supply chain intelligence solutions, said that analytic foundation in Warranty Analysis can help a company like Sub-Zero to avoid catastrophic warranty payouts by finding the problems before they become pervasive.

"Rather than the typical online analytical processing (OLAP) or rules-based text analysis offered by most other solutions, SAS offers customers a comprehensive business intelligence platform for data-driven, in-depth analysis on text and other data to identify and resolve issues faster than ever," Roehm said.

Founded in 1945, Sub-Zero is a privately held, family-owned company in its third generation of ownership. Headquartered in Madison, Wis., Sub-Zero also operates a manufacturing facility in Phoenix and has more than 1,100 employees. Fitchburg, Wis.-based Wolf Appliance, a maker of ranges, ovens, cooktops and grills in the United States, is more than 70 years old and has been an affiliate of Sub-Zero since March 2000.

Additional Articles of Interest

 For additional examples of companies implementing warranty management solutions to reduce costs and improve product quality see the daily news items on Carrier, auto supplier ArvinMeritor, retailer Sears and appliance manufacturer Whirlpool deploying these types of solutions.

 For more information on solutions for the service and support chain, see the articles "In the Field and All Grown Up," the Net Best Thing column in the June/July 2002 issue of iSource Business (now Supply & Demand Chain Executive), and "Time to Prove It," the Net Best Thing column in the April/May 2003 issue of the magazine.

 For best practices in service parts management, see the article "Three Keys to Successful Service Parts Management."