Executive Summary
Recent quality related issues have put Samsung Electronics, one of the world’s largest technology companies at risk. These quality concerns, spiked through recent recalls and external complaints, have generated a flow of bad news coming to the desk of quality director Kevin Sarni. The issues most commonly found within the complaints related to display issues, customer service support, faulty electric components, audio, and safety. Of the main issues, display and customer service support appeared to be the most detrimental. Once the patterns and themes became visible, Samsung and its quality director Kevin Sarni were challenged with immediately identifying root causes. This was not an easy task, although with the help of a Six Sigma Black Belt consultant, Sarni was able to begin further qualitative analysis to determine where action is necessary.
Problem Identification
In April of 2012, Samsung Electronics, and its quality director Kevin Sarni faced a number of quality related problems with their LCD televisions. The problems first surfaced after a recent LCD TV recall. Shortly thereafter, complaints were generated through other sources online, as well as Samsung’s internal complaint database. ConsumerAffairs, the main source of external customer complaints, was an independent consumer news and blogging website. Sarni couldn’t believe the emotions encapsulated within the complaints found on ConsumerAffairs, and was concerned about the public quickly developing a negative perception of Samsung’s products. In the past, Sarni had worked specifically on quantitative manufacturing data and therefore, lacked experience with the analysis of qualitative measures. Samsung’s dwindling quality and increasing number of complaints had to be stopped, and as the quality director, Sarni knew he had to attack them, but was faced with the question of how to do so.
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Problem Analysis
After further analysis of the thirty-three complaints posted on ConsumerAffairs, there appeared to be some significant patterns. In order to unpack the list of complaints it was necessary to construct a table listing the main categories of issues. The five main categories identified were display, customer service, electronic components, audio, and safety. After the main categories were established, subcategories were created (Appendix 1).
The subcategories are simply smaller scale issues that relate to a bigger picture problem. Some complaints actually included multiple aspects, and are therefore placed in more than one main category. After categorizing and analyzing the complaints, an affinity diagram was created (Appendix 2).
Next, a pareto analysis was constructed in order to demonstrate the cumulative percent and individual frequencies of the complaints (Appendix 3).
Both the affinity diagram and the pareto analysis show the two largest categories being display issues and customer service issues.
These two categories alone amounted to 75% of the issues addressed within the complaints. The largest issues in terms of display were lines through the screen, no picture at all, and a fluttering picture. Although there is no strict evidence, it is highly likely that a faulty electronic component installed in the television could cause display issues. Customer service on the other hand was quite sporadic in terms of low frequencies in the subcategories except for expired warranty/service plans and non-refundable situations. These particular complaints of expired service seem to be the most emotional of all, and most likely the ones that could develop a negative perception in the eyes of the public. Other subcategories, such as audio and safety, were relatively low in frequency, and therefore should not be the immediate problems to address. Lastly, to aid in identifying root causes, a cause-and-effect diagram was created (Appendix 4).
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Action Plan
Due to such a high frequency in display issues, Sarni must address them with immediate attention. Assuming that many of the display issues are caused by faulty components, such as the main board, it is important to identify where in the process these faulty components are coming from whether it be internal manufacturing processes or suppliers. Since suppliers happen to be at the beginning of the supply chain it would be necessary to begin there. Sarni, along with cross-functional teams from Samsung must immediately schedule a visit to their main suppliers of components such as the main board. Once the visits are scheduled, Sarni and the cross-functional teams will conduct extensive audits of the supplier’s processes and systems. The audits will consist of detailed examinations of the supplier’s equipment, process capability, facilities, and personnel. Each supplier they visit, Sarni along with another manager, will be responsible for grading each supplier.
The grading metrics should consist of defects per day, damage, flexibility, responsiveness, and communication. Grades will be recorded on a supplier scorecard and then electronically documented upon return to Samsung’s office. Dependent on the findings, Sarni may be faced with choosing another supplier, that is, one who is consistently able to meet design specifications. Eventually, once a quality supplier is developed within Samsung’s network of partners, Sarni must direct significant effort in monitoring their performance.
To monitor the supplier’s performance overtime, Sarni will set formal goals and measure the particular supplier’s performance against these goals on a regular basis. Although this particular supplier audit process may take a few weeks, it must begin immediately. Ultimately, it will provide Sarni a definite answer of whether the faulty components are supplier related, or internally related, such as Samsung’s manufacturing process. If indeed the faulty components continue to be experienced after the supplier audit process, Sarni must begin an immediate inspection and audit of Samsung’s in-house manufacturing processes.
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After immediate action, the following term must also be considered. The next most important issue to address is Samsung’s level of customer service. Assuming Sarni doesn’t have direct authority over the call center employees, the customer service director will be in charge of addressing customer service improvements. The first step in improving customer service will be the implementation of an etiquette course required for each and every call center employee. The etiquette course will be administered electronically and will have a completion deadline. The course will include new guidelines and protocol relating to holding time, redirecting calls, taking responsibility, and being empathetic towards the customer. Upon the completion deadline, the customer service director must implement a recording system on all incoming phone calls to the call center in order to monitor employee’s etiquette towards customers.
Failure to abide by etiquette guidelines and protocol upon taking the etiquette course, would result in termination of employment. After basic etiquette is established with the call center employees, the customer service director must begin empowering his employees to take on larger responsibilities and roles. The majority of customer complaints from ConsumerAffairs were directed towards the call center and their inability to help. Through employee empowerment, the customer service director will allow employees to issue a refund or replacement whether or not the customer’s warranty or service plan is expired. Not only will this greatly improve customer service, but it could also improve employee morale because employees will feel a greater sense of power.
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Lastly, after improving customer service in the call center, further improvements may be aimed at eliminating technicians. Sarni along with top management must make the decision to outsource on-site repairs. Currently, on-site repairs are causing many problems for Samsung as well as its customers. Many times the technician has been unable to repair the TV whether it was because of unavailable parts, incorrect diagnosis, or simply an incompetent repairman. Instead of trying to handle all aspects of the business internally, Samsung must hire an outside firm with more experienced technicians.
To begin outsourcing on-site repairs, Sarni along with top management must conduct research in order to find repair companies that serve each geographical region. Upon selection, Samsung’s customer service director will establish a program to communicate repair orders to the hosting company. This will allow orders to be electronically transferred to the hosting company, who will then be responsible for carrying out the repair from that point on. Samsung’s call center will then await confirmation that the repair has been performed and follow up with the customer. Not only will the outsourcing allow Samsung to focus on its core business practices, but it will also reduce the amount of money tied up in assets such as repair trucks, tools, and parts.
