Final Tollgate for Safelite® Solutions

Abhishek ChattopadhyayShuang Guan

Mohamed Karamoko

February 13th, 2015 2

Project Charter

Problem statement:- Strategic/National Sales team not being able to dedicate at

least 80% of their time towards solution selling

Goal:- To reduce % of non-selling time to 20% (Current mean: 37%)- To improve utilization of Client Care in order to bolster sales

for Insurance SAM’s by 0.47%, Insurance NAM’s by 0.45%and Commercial NAM’s by 0.47%

- To work with Safelite management, SAM/NAM, NAMCommercial and Client Care to identify and implement quickwins

Problem/Goal Statement

Gate Review Schedule

Impact

Scope

- Potential to increase sales by $3.4 Mfor Insurance SAM’s, $0.17 M forInsurance NAM’s and $0.5 M forCommercial NAM’s

Tollgate Scheduled Revised CompleteDefine: 02/13/15 02/13/15 02/13/15

Measure: 03/06/15 03/23/15 03/23/15

Analyze: 03/27/15

Improve: 04/10/15 -

DMAIC: 04/24/15 04/24/15 05/01/15

Team Leader: Abhishek Chattopadhyay

Team Members: Mohamed Karamoko, Shuang Guan

1.0 DEFINE PHASE

RACI (R-Responsible, A-Accountable, C-Consulted, I-Informed) chart for Safelite

Process Maps for Safelite Solutions

0.0 Claims Resolution Process

15.0 Complaint Resolution Process

15.9 SAM/NAM Complaint Resolution Process

Yes

Yes No

NO

0.0 Claim Resolution Process

Who Step End Customer SAM/NAM/Client care/EST Customer Care Non-affiliate shops Affiliate shops

Need

1.0 File

2.0 Receive

3.0 Upload

4.0 Review

5.0 Coordinate

6.0 Coordinate

7.0 Service

8.0 Invoice

9.0 Service

10.0 Invoice

11.0 Bill

12.0 Send

13.0 Review

14.0 Send

15.0Resolve

Complete

File claims

Receive orders

Upload data into system

Review warranty issues

Coordinate with affiliate shops

Is it a warranty issue?

Coordinate with non-affiliate shops

Service issues

Invoice through EDI

Service issues

Invoice through EDI

Bill through EFT

Send survey

Review complaints through survey & other sources

No issues?

Send to SAM/NAM /Client care/EST

Customer repair job complete

Customer repair job

Resolve customer complaints

Who Step

No No Yes

Yes No

Yes

Yes

15.0 Complaint Resolution Process

End Customer EST NAM Commercial SAM/NAM Client Care

Need

15.1 Check

15.2 Assign

15.3 Recheck

15.4 Review

15.5 Send

15.6 Send

15.7 Send

15.8 Resolve

15.9 Resolve

15.10 Resolve

Rectify

Send to Client care

Send to NAM Commercial

Send to SAM/NAM

Resolve issues

Complaint rectified

Resolve customer complaint

Resolve issues

Resolve issues

Is it an insurance claim?

Is the issue not severe?

Not resolved?

Check CR2

Assign to EST representative

Recheck customer’s issues within 24 hours

No

Step End customers Insurance clients SAM/NAM Client care

Need

15.9.1 Dtermine

15.9.2 Delegate

15.9.3 Detect

15.9.4 Report

Resolve

15.9 SAM/NAM Complaint Resolution Process

Who

Need to resolve issues of insurance clients

Determine to escalate to SAM/NAM/Client care

Does the client want SAM/NAM support?

Detect root causes of issues

Detect root causes of iusses and delegate to Client care

Issues resolved

Report results to client

Yes

No

2.0 MEASURE PHASE

Classification of Safelite’s activities

0%

20%

40%

60%

80%

100%

120%

0

100

200

300

400

500

600

Pareto Chart for non-selling time per month (Based on Oct, 2014)

Amount of time Cumulative percent(hrs)

Non-Selling Activities Affinity Diagram

37%

12%9%

9%

7%

7%

7%

5%5% 2%

Breakdown of non-selling activities

Customer service/billing issues

Client management reporting

New client programimplementation

Non Glass programactivities/implementation

expense reports

corporate meetings/conferencecall

HR related activities

AutoGlass inspection programs

Litigation response activities

(66%) (8%) (26%)

Analysis of Variance (ANOVA) and Baseline Capability Analysis for Safelite’s non-selling activities

(Based on time study conducted in October,2014)

Non-value added time (NVAT)

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Interpretation of ANOVA Tables

P Value close to 0.00 in each of the three cases (circled in yellow)indicates that mean Non-Value Added Time (NVAT) spendtowards non-selling activities such as handling escalated issues isdifferent across SAM/NAM associates. Thus, due to lack ofstandardization in the process, there seems to be discrepancyamongst SAM/NAM’s about the degree to which Client Careshould be involved post escalation of issues

14

Baseline Capability Analysis

15

3.0 ANALYZE PHASE

Root Cause Analysis

People

Time ProcessClient care utilization discrepancy amongst

SAM/NAM

Infrequent time study analysis

Excess reporting (litigation, legislation,

administrative activities)

Lack of ownership/accountability

Shortage of client care staff to support insurance NAM,

insurance SAM and commercial NAM

Lack of client care training to handle all escalated

issues

Limited access to database

Lack of continuous improvement

Technology

Excess motion and complexity due to redundancy in

handling escalated issues

Different nature in escalated claims

Mean NVAT 37% (model NVAT upper

limit 20%)

Fishbone diagram for non-selling activities

Regression Analysis

Relationship between revenue and selling time Finalized model taking into account square and cubic terms of time

Fitted Line between revenue and selling time

Polynomial (cubic) fitted line

explains the model more accurately (Higher R-Square

value of 65.1%) which indicates lack of standardization

in processes and/or flawed measurement of time

Linear fitted line does not explain the model accurately (Low R-Square value of 22.7%)

Financial Impact and Sensitivity Analysis for adding Client Care members

Calculation of number of client care employees to be added

Let y be the number of employees that we wish to add to client care

Ratio of transactions handled by Client Care to that handled by SAM/NAM’s = 2:1 (Therefore let us assume that client care handles 2x number of transactions and SAM/NAM’s handle x number of transactions)

Client Care time allocation towards issues (average %runtime); = 28%; SAM/NAM time allocation (NVAT/TotalTime) = 39.1%

Therefore

2x*(5+y)*28 = x*17*39.1

Therefore y = (39.1*17)/(28*2) – 5 = 6.86

Therefore we suggest that 7 client care employees be added to buttress the current client care team of 5 people. Therefore total suggested client care strength = 12

Profitability

Total Transactions handled by Insurance SAM between 2010-14 = 14,582,770

Total Transactions handled by Insurance NAM between 2010-14 = 764,644

Total Transactions handled by Commercial NAM between 2010-14 = 3,145,544

Ratio of transactions handled by Insurance SAM to Insurance NAM to Commercial NAM = 10:5:2

Therefore, based on the ratio of transactions, number of client care employees to be dedicated to Insurance SAM, Insurance NAM and Commercial NAM are 7, 3 and 2 respectively. However, taking into account operational and financial feasibility, we suggest a phased and sequential implementation of the plan of adding client care employees and start from adding 3 extra client care employees, of which 2 employees would be dedicated to Commercial NAM and the rest would be dedicated to Insurance SAM’s and NAM’s based on the ratio of transactions handled by them respectively (2:1). Let us go through a sensitivity analysis to look at the impacts on profitability and margins.

Sensitivity AnalysisPotential revenue increases for Insurance SAM, Insurance NAM and Commercial NAM

4.0 IMPROVE PHASE

Suggested Improvements and Quick Wins

Phased Implementation Plan

Add 3 client care employees initially Re-evaluate with time study data to check whether proportion of value-added time for SAM/NAMs has

increased

Conduct frequent time study analysis to check trends of value-added time Conduct weekly quality circle meetings to fine-tune process and continually monitor improvements If possible, calculate metrics such as utilization of Client Care at every stage of the issue resolution process to

identify bottlenecks and standardize process

Establish a detailed communication plan- Educate customers about the utility of Client Care through active and passive communication. This would

encourage them to contact Client Care instead of SAM/NAMs- Re-direct every issue to buttressed Client Care team and let customers judge their competence through surveys

- Have a dedicated SAM/NAM individual for training Client Care in order to handle all kinds of issues If all the above steps are implemented and are successful, add more client care employees if required to bolster

margins

Suggested sequential algorithm (Cradle to grave)

5.0 CONTROL PHASE

Post-Mortem

Control Plan

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