Technology Imperatives to Address Product Quality

This clearly seems to be a season of re-calls for the global auto industry.  What with Toyota being saddled with gas pedal and regenerative brake woes, and its competitor from back home battling air bag issues, the situation does look grim. The seriousness of these recalls cannot be underplayed even for a moment, as they wreck havoc with the company’s image and balance sheets, not to mention the strong regulatory gaze that is brought to focus on the organization.

Given the nature of these events companies will start evaluating their manufacturing and service processes to ensure minimization of incidents like the ones mentioned above.  Already it is being heard that companies would begin redoubling their efforts in the realms of testing, quality management and service management. But given the economic climate we live in, will these measures prove to be the proverbial straw that breaks the back of the automobile industry?

We believe that organizations will need to adopt better technology solutions to improve product quality and service, and make significant commitments in the following areas:

Test Data Management – Testing processes would become more rigorous and as a result, more expensive, long drawn and would generate a lot more data than current standards. Auto industry players would need to gravitate towards mature test data solutions that are well connected with the CAE as well as PLM solutions deployed in the organization. These solutions will allow for detailed analysis and substantial reduction in time spent on regulatory compliance.

Quality Compliance – Clearly the focus now, organizations will need to develop an ‘end to end’ system approach. Till now manufacturers have deployed point applications responsible for particular processes or functions (such as SQC and SPC charts). There is a need for evolution of systems that will facilitate the compliance workflow and integration of point applications. As an example we will see the adoption of applications that ensure proper documentation for ISO compliance. Another example could be applications that facilitate and track six sigma initiatives used for reducing process variability.

On Board Diagnostics Systems – Modern automobiles contain extensive electronic components that control and track various parameters during the running of a vehicle. In the new reality, auto firms will need to improve the data collection and data interpretation routines. Hence, at an automobile level, an increasing number of parameters will be tracked, and as an organization, auto firms will evolve processes for centralized collection and analysis of this data.

Automobile eCall – The European Union is spearheading an initiative that ensures automobiles involved in a major accident automatically transmit their exact location to the emergency services. It is believed that this timely information will go a long way in reducing the fatal effects of accidents. The primary impediments to the roll out of this initiative are the number of stakeholders involved, which include the car manufacturers, mobile service providers as well as the emergency services. But it is hoped the European Union’s concerted drive will see this initiative through. A successful roll out will provide incentive for other markets (and therefore car manufacturers) to follow suit.

Warranty Management and Service Management Systems – Warranty claims, service requests and complaints are the key voices of the customer. These allow internal departments of a company to derive critical information to improve product quality, identify customer dissatisfaction, and evaluate supply chain partners and dealers. Effective analytics on such inputs almost always provide a strong early warning that can be acted upon.

To cut a long story short, these technologies certainly can help drive increasing compliance, product quality and ultimately, improved customer satisfaction.

Banking challenges in the new decade-Technology innovation, key to success

As 2010 marks the dawn of a new decade, it brings forth a bouquet of challenges and opportunities for banks to introspect and outperform the decade gone by. While the last decade saw the banking industry adopt technology for cost-cutting measures and large scale adoption of alternate channels, innovation of services through right and timely use of technology seems to hold the key in the new decade.

Thanks to the recessionary trends towards the end of the last decade that held the financial industry by it’s nerves, banks have been reluctant to place innovation at the centre of their strategy for the long-term. Pressure from the regulatory bodies, governments and consumer forums is also partially responsible in driving the banks to adopt a risk-averse strategy. A recent research from Gartner shows that half of the banks will lack a formal innovation program and budget in three years time, severely restricting their growth potential.

The predominant view that IT is only useful for cutting costs should make way for using IT to innovate new services and products that increase customer satisfaction. Shifting their focus from alternate channels, banks need to focus on alternate competitors from the non-banking space like online firms, networking sites and retailers. Banks need to adopt a systematic framework to identify alternate banking trends and be open to partnering and collaborating with existing players rather than build their own networks to meet the competitive challenges. The telecom sector is all set to serve a good example which is geared up to play a vital role in the next generation of banking services.

Another trend to watch out for is the shift in retail banks from brick and mortar to click and virtual branches in order to improve efficiency and cost-to-income ratios. Gartner predicts that 75% of retail banks in North America and Western Europe would shut down 10% or more of their traditional branches by 2013. In this era of open technology, no amount of product innovation is expected to last for more than a couple of quarters as it can be easily mimicked by others. Hence, technology would still remain as the key enabler in sustaining competitive advantage.

Lastly, bank services that run on a central hub and spoke model would make way for more decentralization. With the advancement in messaging standards and other financial frameworks the focus needs to shift from being local to thinking global. With initiatives like cloud computing gaining mass to cover the technology skies, it would enable ‘virtual hubs’ to promote a new culture of share and grow among the financial institutions.