The Cost of Quality

IBIS USA hosted a telling panel session, ‘The cost of quality,’ which invited representatives from the different and sometimes opposing worlds of insurance, manufacturers, bodyshops and consumers to all put forward their own arguments and explain the repair process from their perspectives.

Making the case for insurers, George Avery, CEO of Avery Knows, said an insurer’s main role was to help ‘put people back together’. He said that was their moral and legal responsibility.

However, it’s not as simple as that. When it comes to vehicle repair, he questioned why there were no written rules guiding the estimating process. He called for greater transparency, arguing that without it insurers were simply giving money to repairers to carry out the repair, without having a deep understanding of where that money was being spent.

‘Transparency is trust,’ he said. ‘Transparency between insurers, repairers and the customer is necessary to build relationships.’

He said that bringing cycle times down was the end goal, but it couldn’t be achieved at the expense of the quality of repair. He said this was sometimes a difficult balance, and that’s why an open mindset was fundamental. ‘We need people who are willing to learn. The mindset of, ‘we’ve always done it this way,’ has to stop.’

Transparency was also a key issue for the consumer, according to Harte Logan, partner at CultureSynk. Harte said that customers want to know what is happening to their vehicle, and what the next step of the repair is.

Keeping them informed was critical, Harte said, as social media now means customers have access to about seven billion people and bad news travels fast. He suggested that the number of horror stories about bad repairs that have been published on social media has instilled a natural level of mistrust, and the industry has to work especially hard to counter-balance this.

In terms of reputational damage caused by a poor repair, the OEM is perhaps most at risk. For that reason, explained, David Sosa, body and paint technical business specialist, BMW of North America, OEMs are working overtime to develop the correct processes of repair.

Their approved repair centres are in many respects their contact point with the customer, so ensuring those processes are available to them, and any other support they require is on hand, is critical.

David said, ‘We have to be open to supporting our repair centres. We’re all working together here.’

He said the library of correct repair methods was constantly evolving – with case studies regularly sent to their experts in Germany – and once a new repair was added to the system it was there forever.

However, explaining the why was just as important as explaining the what.

David continued, ‘We are providing more documentations for repair process and instructions, but we need to provide information for more ‘why’ scenarios, which insurers are asking for. We want to give everyone the tools to understand why OEMs want to replace rather than repair certain things, or why they should repair in a certain way.’

However, acknowledging that replacing a part is more expensive that repairing it, he said OEMs are exploring more repair methods and investing in tools that will enable more parts to be repaired in the future.

‘But we want the car to be safe for our customers,’ he added, ‘and this has a certain cost.’

In many cases, bodyshops bare the brunt of that cost.

Randy Stabler, president, Pride Auto Body, admitted that the industry is struggling to keep pace with the technology flooding in. He said the challenge for bodyshops was repairing cars repaired to OEM standards, and doing so on time, and for a profit.

He said the only way to achieve that was by ensuring the culture of the company was right, and that technicians weren’t working for themselves and to their own standards.

‘Putting too much reliance on speed has consequences,’ he warned, ‘and consumers base their decisions on price, not trust.’

IBIS USA was held with the support of partners 3M, Axalta, Solera Audatex, BETAG Innovation, Symach, Enterprise Rent-A-Car, Fix Network World, Mitchell International, PPG, RSG, Verifacts, CARSTAR, Caliber Collision, Chief Automotive, I-CAR, OE Connection, and PartsTrader LLC.