An attractiveness index based approach for warranty optimization

Purpose – The purpose of this paper is to develop an attractiveness index-based warranty cost model considering decision variables as design alternatives, warranty duration and support level. Design/methodology/approach – A warranty optimization approach is illustrated using a real life example of an automobile engine with Mean Time Between Failures and Warranty Attractiveness Index as constraints. Findings – It will help to improve the customer satisfaction by giving a more attractive warranty compared to that being offered by the competitors. Practical implications – Approaches that consider the effect of decision variables on attractiveness of a warranty policy in a quantitative manner have received relatively less attention. The paper attempts to capture the attractiveness of warranty from the manufacturer as well as customer point of view. Originality/value – The proposed approach will help manufacturers to take appropriate decisions related to warranty parameters and component selection at the design stage.