business Archives - Page 32 of 40

Warranty

Warranty: A real covenant binding the grantor of an estate and the grantor’s heirs; a collateral undertaking that a fact regarding the subject of a contract is or will be as it is expressly or by implication declared or promised to be; something that authorizes, sanctions, supports, or justifies; a usually written guarantee of the integrity of a product and of the maker’s responsibility for the repair or replacement of defective parts. Middle English warantie, garantie, to warrant.

U.S. federal law establishes minimum legal standards for warranties on products. Some companies, however, offer warranties (for purchase or for free) that exceed the legal minimum by covering a broader array of problems the buyer might face.

For example, Apple’s standard iPhone warranty includes one year of hardware repairs and 90 days of telephone support. However, an extended warranty can be added that provides full hardware and phone support coverage for two years. Private companies also offer warranties on electronics and other high value goods.

Every Toyota vehicle is supported by a 36-month/36,000-mile limited warranty coverage. In addition, most individual Toyota parts have 12-month coverage, a fairly standard warranty for new vehicles.

Most manufacturer warranties for electronics, appliances, etc. cover only products that fail due to defects in construction or malfunctions of the item’s hardware. Some consumers want more protection, so retailers like Best Buy offer protection plans that go beyond the manufacturer’s warranty. Best Buy‘s Geek Squad Protection Plan, for example, covers normal wear and tear, no lemon policy, accidental, and damage from handling. Since these plans cover a much wider spectrum of potential problems, they tend to be quite expensive.

In order to remain competitive, American retailers offer generous return and exchange policies. Most companies print their policy directly on the receipt and use phrases like „easy returns and exchanges,“ „no hassle returns“ or „100% satisfaction guarantee.“ Some companies, like outdoor supplier REI, allow customers to return products for a full refund or exchange at any time for any reason.

Many retailers (WalMart, Target) do not require a receipt for returns or exchanges. If no receipt is available, stores generally refund the credit on gift cards that can only be used at the store.

These generous policies highlight the importance that American consumers assign to customer-centered policies that are clearly communicated and executed in a friendly manner. Retailers, on the other hand, encourage buyers to spend first and think later. They give consumers confidence that satisfaction with a particular product or brand is guaranteed.

Designed in U.S. Made in China

American businesses have a history of designing products in America, but then sending the designs to companies abroad, especially to third world countries, to be assembled. Why would a first world country, with the capacity for better materials and production processes, outsource the building of their products to lesser developed nations? The answer is simple: cost.

One of the most common countries for assembling American-designed products is China. In 2011, there was an article in Forbes titled “Buying from China is in Fact Buying American.” In this article, the author talks about his friend Johnny, a middle class American who owns a couple of small restaurants.

Most of the cooking utensils and furniture in Johnny’s restaurants were made in China. Like most middle-class Americans, he shopped at stores that sold primarily Chinese-made merchandise. Johnny’s reason for using these Chinese-assembled products: they were cheap and “good-enough.”

The article went on to talk about different American companies that sell products that are made in China (Apple, Dell, Gap, Hasbro, Nike, etc.) and how, according to a San Francisco Federal Reserve study, an average of 55% of the value of American imported goods from China goes to American companies and workers.

This is compared to 36% for American goods in general. Not only can companies that outsource to China sell their goods at a cheaper price, but they actually make a lot more money in the process.

Processes provide clarity

Processes provide clarity. They allow employees to concentrate on core activities. They lead to cost reductions by identifying and eliminating unnecessary work steps. Thinking in terms of processes – how the work should be done – strengthens conscientious work and allows for quality control.

Well documented processes are critical for orienting new employees. Processes make transparent, make understandable, each and every segment of complex work methods. They are the basis for optimization, for reducing mistakes, for root cause analysis of systemic errors. All of these benefits lead to increased product quality. Work processes, however, must be understood and accepted by those doing the actual work.

In Germany it is critical that processes do not take on the character of laws, but instead remain guidelines. German workers expect a certain level of freedom in terms of how they perform their daily tasks. Processes should not become a kind of straightjacket.

Business travel

Business travel via airplane or automobile remains extremely common in America despite rising airline ticket and gasoline prices. Businesses remain committed to approving business travel, appreciating the importance of face-to-face contact.

Although companies often work to cut costs, they are increasingly thinking about travel in terms of its carbon footprint. These companies are responding to customers’ increasing demands for sustainable business practices. Some companies are scheduling longer, less frequent business trips to cut down on air travel or using communications technology to decrease the need for frequent air travel.

Upgrades

There are a lot of American websites that describe ways to make use of old products after upgrading to newer models. If you type “creative ways to reuse things” into Google, you are met with over 20 million websites with such titles as “40 Awesome Ways to Reuse Old Stuff” and “534 Ways to Reuse Things You’d Normally Throw Away.” These sites have suggestions for reusing everything from bicycles to wrenches, and even to fruit peels.

Some of the suggestions listed on these websites include: Using an old bicycle as a sink stand. Turning an old cassette tape into a coin purse. Bending old wrenches into wall hooks. Cutting old credit cards into guitar picks. Turning an old suitcase into a chair. Grinding old egg shells to make sidewalk chalk.

“March to our own beat”

WordPress software powers 70 million websites. Just about half of the biggest blogs in the world run on WordPress. Automattic – owner of WordPress – is not your typical Silicon Valley Web start-up.

“We march a little to our own beat, and sometimes it’s out of sync with Silicon Valley — and that’s been to our advantage and disadvantage,” co-head Toni Schneider said.

“We don’t get sucked into the latest thing, while some of our competitors are distracted by the latest shiny object. The disadvantage is sometimes we’re against the grain of what everyone else is excited about, and people ask ‘Why don’t you have x yet?’ — but we go at our own pace.”

Another way that Automattic is unusual is its extraordinarily low rate of staff changeover. It currently has 106 employees — and it has only ever hired 118 people.

Automattic was founded by Matt Mullenweg. From Houston. An American with a German background.

DIN

The German Institute for Norms (Deutsches Institut für Normung – DIN) sets voluntary standards for material and immaterial things.

DIN norms are suggested typically by German industry. They are set only when all parties to the discussion are in agreement. DIN norms are to Germany what ISO and EN norms are to international and European industry respectively.

The first DIN norm was set in March of 1918. By 1927 the Germans had settled on more than 3,000 norms. In 1948 the number reached 8,200. As of 2012 there are over 33,000 DIN norms, most of which are in the areas of mechanical engineering, construction, air and space, information technology, environmental protection, optics and professional services.

Each year produces roughly 2,000 new DIN norms. Each and every norm is reviewed every five years as to whether it is necessary and or meets current standards. The DIN system has begun the process of integrating itself with European and international standardization systems.

A subtle difference

Normierung – norm-ing – is defining a unified measurement (dimensions, proportions) for products and processes. Norms are not only practical, they save money. Up to 17 billion Euros per year, according to the German Institut of Norms (DIN).

DIN is well known to all Germans, even if they don’t think about it. DIN-norms were introduced to them as early as grammar school when they began to work with stardardized pape sizes such as the A4.

But what exactly is a norm?

The German Chamber of Commerce writes (loosely translated): “A norm is a rule (regulation, code of practice). It is legally accepted. It was established via a standarized process. It solves a problem, addresses a situation, addresses factual circumstances.”

Manufacturers can invoke or refer to a norm in order to save time and money. However, noone is obligated to follow a norm. They are often, nonetheless, written into production contracts, thus defining measurements and processes.

In that sense production proceeds deductively, base on theory or the norm. Industry norms are more firm, more binding, than industry standards, which are not generally accepted, which can be defined by manufacturer to manufacturer.

Interestingly, the English language does not distinguish between a norm and a standard. Perhaps this gives us deeper insight into German thinking.

Manufacturing without compromise

How the German company innotool&greminger markets their medical products provides insight into how important internal processes – how the work is done – are to Germans.

Their website states Fertigung ohne Kompromisse: Perfektion im Produktionsprozess – literally Manufacturing without Compromise: Perfection in Production Processes. They then spell that out.

“In medical diagnostics and therapy the key to quality of results is Handwerkszeug (the tools of craftsmanship). It is no different in the manufacturing of medical products.”

Our solutions are based on expert technical staff, high-performing physical plant and systems, and automated production, optimized for manufacturing medical implants and delicate instruments. With the help of CAD-CAM software we maximize the potential of our knowhow. We deepen that expertise via modernization and continual training of our staff. For quality doesn’t happen by itself.”

Instead of emphasizing the quality of their products, innotool&greminger focuses on the production processes which determine that quality.

United Breaks Guitars

In 2008, United Airlines baggage handlers damaged Dave Carroll’s guitar. After the airline refused to pay to fix the damage to his instrument, he and his band wrote a song called “United Breaks Guitars” and put it on YouTube.

Within two days it had more than 24,000 views (and more than 14 million views by 2015), and it was estimated that the bad press cost United Airlines around $180 million the following year (2009).

This incident also inspired Carroll to co-found Gripevine – a company that helps customers use social media to expose their complaints and convince companies to give better service.