LINE56 - A Sears Service Story

Service and warranty processing proves an opportunity to claim previously derelict revenue and drive new cost efficiencies

By Demir Barlas

Service is more than a cost center; it's an opportunity to draw customers closer and create lifetime, high-value relationships. That's the kind of thinking practiced Sears Home Services, which recently discussed its services automation practices with Line56.

Sears Home Services handles all the service calls for Sears and does third-party service for Whirlpool and other companies as well. This translates into a high volume of calls, more than a million a year.

Until recently, Sears Home Services was tackling this volume with "an application developed a decade ago," according to Craig Reilly, director of operations for Sears Home Services. The application simply wasn't equipped to handle the kind of volumes that prevail today, which explains why the national claims center had 48 employees pitching in to process claims manually.

Worse than the inefficient allocation of labor was the fact that Sears Home Services was leaving money on the table. "We had about 10 percent of claims that we weren't sure was capturing completely," says Reilly. What he means is that, in those cases, Sears was handling service calls on behalf of manufacturers but failing to bill them properly. When you keep Sears Home Services' volume in mind, that means a lot of revenue wasn't being captured properly.

For Sears Home Services, the solution was to install specialty e-business software from ServiceBench. "The logic within ServiceBench looks at a claim and determines whether a service order is claimable or not, and who it is claimable against," says Reilly. Most orders are claimable, and ServiceBench automates these; the rest are put into a queue for employees to examine individually. Since the system is Web-based, it can be accessed from anywhere, unlike the previous desktop-based application.

As a testament to the efficiency of ServiceBench's automation, Sears Home Services now has only 12 employees processing claims in place of the 48 from years past. Most importantly, Sears Home Services is winning revenue that went unclaimed previously. "We're letting the system and system logic work through better processes," Reilly concludes.

Used with permission of: Line 56,10940 Wilshire Blvd., Suite 600 Los Angeles, CA 90024 www.line56.com