Figure A: Reject Rates Case Study

* Results may vary, depending on
level of investment and
effective plant-wide implementation

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• Practically eliminate your DOAs (Dead On Arrivals)
• Slash your warranty costs by as much as 90%*
• Increase production line efficiency
• Reduce costly re-works with related scrap and OT costs
• Lower labor grade requirements and training costs
• Enable inventory reduction through Demand Stream Technology
• Increase your man/machine hour efficiencies
• Improve brand image and sales through an increase in quality
• Handle numerous models/brands with computer integration
• Empower R&D with reports and real-time data

Let's focus on just one of these for a moment: Warranty costs (In-Field Rejects). According to Warranty Week, in their June, 2003 issue, the average manufacturer spends 1.9% of product revenue, fulfilling warranty claims. That's $1,900,000 for a manufacturer with $100,000,000 yearly sales revenue. Imagine slashing that by 90%*.

Keeping that in mind, let's look at how ECI's Integrated Process Control System (IPCS) can impact those in-field rejects and warranty costs. The numbers shown on these graphs came from a very high volume manufacturer. At the top, before the installation of our IPCS, the in-plant reject codes were in the 17-18% range, and in-field warranty claims were in the 5-6% range. Both of these were undesirable reject rates.

After the IPCS started screening out defective units, the in-plant rejects sky-rocketed and the field claims approached zero. With warranty claims dropping, our client was free to focus their attention on problems in their plant that were causing the in-plant rejects, and they started eliminating them one by one. They called in their suppliers and talked to them about their component problems. They also improved the assembly process, the drawings, and other factors that they found necessary to lower that reject rate. As both of these rates (in-plant and in-field rejects) decreased, their profitability went up. Yours could, too.