Background

A automotive cable supplier faced significant challenges due to the lack of a claim management system. They had no visibility into how much money their customers owed them due to unrecognized contract deviations, such as unachieved contracted volumes. This resulted in unprofitable projects due to underutilized machines, lack of amortizations and undetected cost creeps.

Challenges

• No Claim Management: Absence of a structured claim management process.

• Lack of Visibility: No insight into open claims or the amounts owed by customers due to contract deviations.

• Financial Loss: Inability to track and recover owed amounts, leading to significant financial losses.

Implementation

The implementation was straightforward:

• Data Integration: The system was fed with contractual agreements. The volumes, already in the system for sales planning, were easily integrated.

• Expert Training: The entire sales organization received comprehensive training from Digital Automotive experts to maximize success in active claim management. Executives were trained on using the "Open Claim" and "Claim Performance" reports for optimized steering towards successful compensation. Sales managers and key account managers were trained to navigate the claim process in Digital Automotive with ease.

Solution

The cable supplier implemented the Digital Automotive Claim Process, which provided a comprehensive solution to address these challenges:

• Automatic Claim Detection: Implemented automatic claim detection, revealing that customers owed them amounts in the three-digit million euros range.

• Automatic Claim Damage Calculation: based on the missing contribution margin the damage is automatically calculated (no more manual work)

• Standardized Claim Process: Established a standardized process to help sales managers keep track of claims.

• Real-Time Open Claim Reports: Provided real-time reports on open claims, enabling persistence until compensation is received.

• Claim Performance Report: Introduced performance reporting, fostering a claim-focused culture.

Results

• Enhanced Claim Management: Transitioned from having no claim process to an automated and effective claim management system.

• Increased Financial Recovery: Identified and recovered significant amounts of money owed by customers.

• Improved Sales Manager Performance: Sales managers stayed on track and persistent with claims, leading to higher recovery rates.

• Cultural Shift: Developed a claim culture within the organization, with a focus on tracking and recovering owed amounts.

• Transparent Operations: Achieved transparency in claim management, leading to better tracking and accountability.

• Boosted Profitability: Over 15% of annual sales were linked to successful claim management efforts.