Studies on data-driven management of extended warranty service for household appliances

• Main Author: LI, Heng
• Format: text
• Language: English
• Published: Institutional Knowledge at Singapore Management University 2021
• Subjects: Extended Warranty; Pricing; Blockchain; Household Appliances; Business Administration, Management, and Operations
• Online Access: https://ink.library.smu.edu.sg/etd_coll/340; https://ink.library.smu.edu.sg/cgi/viewcontent.cgi?article=1330&context=etd_coll
• Institution: Singapore Management University

Extended warranty is an important part of after-sales service for household appliances. However, due to management reasons and moral hazard, there are various risks in the extended warranty service for household appliances. It is urgent to make a systematic and in-depth study and provide suggestions for improvement of corresponding management measures. In order to improve the current strategy of extended warranty service, this paper systematically and deeply studies the compensation scenario, profit and loss, and pricing of extended warranty service of a household appliance retailer, G-Company. This paper firstly analyzes the data of G-Company's extended warranty service, including the time interval distribution of repair and warranty purchase, the repair characteristics and distribution by region/product/time, then proposes some hypotheses to identify the potential repair frauds. Furthermore, this paper analyzes the relationship between the number of insured and premium, and identifies the optimal pricing scheme under different conditions. Based on the above data analysis, a revenue optimization model and algorithm suitable of extended warranty service for household appliances are proposed to optimize the profit. Finally, based on the data analysis, this paper discusses the relevant management implications, and puts forward the corresponding management countermeasures and implementation approaches. These management approaches are mainly divided into product management in the extended warranty service and overall enterprise management. For example, adjusting the validity period and adding some restrictions at the design stage of warranty products can reduce moral hazard. At the same time, this paper also discusses how to combine the blockchain technology to manage and optimize the business process, so as to avoid the issues such as frauds and false reports in the current process. Furthermore, the evolution and innovation of technology-enabled service model are also discussed. This paper also explores the application scenarios and future research directions, including the application in the field of health insurance and hospital management.