Imperial Honda Case Study

Diptesh Subba

2008-09

Present Status of Imperial Honda

• Vehicle Population of Honda:4500• Dealerships :3 in Kolkata• Paint Company Working: 2K Asian PPG• Traffic in Service :400 per month• Traffic in B&P:40 per month• Manpower : Skill Level:Moderate

– Painters:2 Head Painter & 3 Helpers– Denters:5Equipments:

1.Spray Guns:Top Coat:2Primer :2

Dry Sanding Machine:2Grinder :1Paint Booth:1Compressor:1 (7.5 HP)

Where we were?

• Vehicles were not delivered in promised time even for a minor dent & paint.

• No service follow-ups to customers.• Irrational Stock Norms• No KPI Data Available for B&P Section.• High Paint to Labour Ratio, Cycle Time & Usage

of Consumables.• Low Score in Honda Audit.• Low Rank in J.D.Power.

The task before usDirect

Identify thrust areas for the B&P Division

+Identify the ideal product mix

(value proposition for the differential offerings)

+Identify loyalty building programmes which will

ensure Quality traffic inflow

Indirect

Make our Customers Brand Advocate for 2K

Provide a Quality Value Added Service

SWOT Analysis

Strength

Weakness

Opportunity

Threat

Action Plan

To understand the Bodyshop needs, areas of concern, expectations.

• Seeked Permission to conduct Bodyshop Audit to Identify Grey Areas.

– Audits Conducted:» Process Audit» Knowledge & Skill Audit» Equipment Audit» Commercial Audit» Bodyshop Gradation Audit

What we did?• Gave presentation to the Owner• We kept the Bodyshop in Observation mode & we understood

the huge potential of SMART (Small & Medium Area Repair Techniques) for incremental volume & revenue.

• We extrapolated expected sales and framed a Strategy.• Training Calender Freezed• Rationing of Paint & Consumables done for initial 3 months.• Resource Allocation & Optimization (Manpower Scheduling)• Introduced Stock & order System (both HC & SC)• Introduced Bodyshop Tracker (both HC & SC)• Loss Study (Variance Analysis only SC)• Time Study. (Idle Time & NPA)• Introduced Real Time basis KPI Charts (Only SC)• Monthly Meeting with the Owner & joint Honda Audits

Conducted with ASM of Honda .

Introduced Faster Products to improve efficiency

Steps

Body Shop TrackerBody Shop TrackerImplementedImplemented

Consistent Fast and Courteous

Method of Payment Options

Body Shop TrackerBody Shop TrackerImplementedImplemented

Consistent Fast and Courteous

Method of Payment Options

Stock & Order FormatStock & Order FormatMIS

Vehicle TrackingSystems for managing fleets

Emergency services

Stock & Order FormatStock & Order FormatMIS

Vehicle TrackingSystems for managing fleets

Emergency services

Reduced Cycle TimeReduced Cycle TimeManpower

Equipments

Reduced Cycle TimeReduced Cycle TimeManpower

EquipmentsFast Repair CellFast Repair Cell

ImplementedImplementedAll ROs to be connected

and always onlineCentral monitoring and control

Fast Repair CellFast Repair Cell ImplementedImplemented

All ROs to be connectedand always online

Central monitoring and control

CommuniquéCommuniquéHigh quality and reliable

communicationsat lowest costs

CommuniquéCommuniquéHigh quality and reliable

communicationsat lowest costs

Training CalendarTraining CalendarFreezedFreezed

Fully owned RPL networkTechnology Driven Controls

Training CalendarTraining CalendarFreezedFreezed

Fully owned RPL networkTechnology Driven Controls

Satisfied Imperial Honda

Audits Conducted

To understand the status of the BODYSHOP

Process Audit

Equipment Audit

Knowledge and Skill Audit

• Fade Out Technique – Correct Process.• Colour training to Head Paint Technicians.• Reverse Masking Techniques.• Spraying Parameters to be set.

Infrared Drying Equipment for fast repair required. Dehumidifier (Drier) not available. Improper maintenance of Paint Booth.

Quality of Final Finish to be improved. Inadequate Infrastructure : Body Aligner/Dent

Master/Drier/IR Lamp/Orbital Sanders,etc. Stock & Order format - Not maintained.

Wet Sanding of Putty & Primer. Hack Saw Blades & files used by the Dent

Beaters. Non application of Guide Coat.

Gradation of the Body Shop Audit

Initiatives Taken• Formed a Core Team for SMART Cell:-

– Surveyor 1– Fast Repair Paint Technicians 2– Denter 1(on Adhoc Basis)Service Advisors Training :

All the service advisors training were imparted training on Basics of Painting & 2K process.

• Training being imparted to stores personnel & fast Repair Zone Coordinator - Mr.Balmiki on 2K painting process.

• Taught Paint Technicians various Control Measures.• Taught the basics of SMART to the core team.• Arranged for dry sanding of primer training by 3M.• Product Stewardship Training – Safety • Our team Camped there for 5 days to perform similar roles and

guided them throughout the Process till they became confident of doing it themselves.

Post Implementation of Body Shop Improvement PlanResults

Quality AuditQuality Audit

Commercial AuditCommercial Audit

Fast Repair Concept

(S.M.A.R.T)

Target CustomerTarget Customer

Insurance Companies

Fleet or Leasing

CompaniesB & P Repair

Customer Types

Vehicle Owner/Private Customer

New Car Scratch Repair in

Short Turnaround

Time

Original EstimateOriginal Estimate

Labour Estimate

Labour Estimate

Paint Estimate

Paint Estimate

PrepareLetter

PrepareLetter

Job File Job File FolderFolder

Other Document

Other Document

Picture

Provide The Invoice

Provide The Invoice

• Convincing TGT Customers • Same Day Delivery• Discount on Paint Cost• No Documentation• Free Polishing Coupons• Payment term – Cash• Doorstep Delivery• Linkage Schemes from Ganges Ford on Washing

• Convincing TGT Customers • Same Day Delivery• Discount on Paint Cost• No Documentation• Free Polishing Coupons• Payment term – Cash• Doorstep Delivery• Linkage Schemes from Ganges Ford on Washing

Telecalling for Scratch RepairTelecalling for Scratch Repair

FRC is a Concept of doing up the Minor B&P damages n Service Vehicles along with its Periodic Maintenance Service, backed by the latest Technology and Process.

• Faster repairs compared to conventional techniques.

• Same day repair

• Low consumable and labour costs.

• Accurate and Quality work finish.

• High turnover and profit.

SMART - Fast Repair Cell BENIFITs

WHAT IS SMART?Small & Medium Area Repair Technique

SMART Training Input SMART Training Input ResultsResults

Customers also prefer FRC for Quick, Efficient & Relatively Inexpensive solution to keep his car spunky.

• SMART repair provides a balance between high revenue medium/large repairs and quick turnover of smaller repairs. This in turn create an ideal scenario for the bottom-line.

Customers also prefer FRC for Quick, Efficient & Relatively Inexpensive solution to keep his car spunky.

• SMART repair provides a balance between high revenue medium/large repairs and quick turnover of smaller repairs. This in turn create an ideal scenario for the bottom-line.

Scope of SMART RepairScope of SMART Repair

Understanding of Minor repair concepts.Understanding of Minor repair Cost Estimation.Identify & Categories Different repair types.Make sound Product Choices to deliver vehicle in time.Learn Techniques that allow high quality minor repair in time.

Damage must be within 10 cmComplete Repair area is not more Than A4 size paperRepair should be completed Within 90 minsCost of repair should not be More than Rs.7000/-

Minor body Repairs

Tinkering Spot Repair and Painting

( Supported by latest Dent Pulling Equipments)

( Supported by ICI Paints)

Reception

Damage Inspection/Estimation

Part Disassembly Frame Repair

Paint Mixing

Panel Repair

Surfacer

Final Painting Drying

Polishing

Reassembly

Final Inspection

Washing

Delivery

Putty shaping

Masking

B&P Shop FlowB&P Shop Flow

Reception and

Estimation

Waiting for Service

Conduct B & P Repair

Final Inspection

Heavy Damage Parking

Damage InspectionWashing

Space

Smooth OperationSmooth Operation

Waiting for

Delivery

Customer arrival/Estimation

Waiting for customer/ Insurance approval

Inspection by Insurance company

Appraisal Paint Scheduling

Appointment in B&P ShopAppointment in B&P Shop

Parts availability

Production L/T

Technician availability

Major process of appointment in B&P Shop is to :

‘’ Manage the B&P repair units after estimation approval’’

An incoming customer survey was conducted on all the service vehicles for minor dents or kissing scratches

Reception and Damage Reception and Damage InspectionInspection

Provide estimation Based on Honda Standard

Remove customer Doubt of “tricky repair”

On be-half of customerNegotiate with the Insurance company

Remove customer image of “hard to

repair”

Offer free estimationand follow up

Maintain communicationand updated database

During Reception Merit

Offer courtesy carIncrease customer

satisfaction

Incoming Customer survey Results Showed that………

Days Day1 Day Day3 Day4 Day5

Day6

Total No of Service veh

50 43 36 45 44 43

No of Damages

35 37 30 34 33 36

• Total no of Vehicles for service – 261

• Total no of minor damages noticed – 205

The Incoming Customer survey revealed that…….• About 80% of service vehicles comes with minor dents or

kissing scratches!

• No Body is bothered on small repairs and concentrate only on large accidental repair.

• A massive 90% market potential was Found left untapped.

• Customers perceive High Cost & duration of Repair.

• Insurance Claim Hassels

• No Claim Bonus

• Compulsory Excess

Task at hand• All customers must be Educated to do up

minor repairs and Keep the Car in its Pristine Condition.

• Fast and Quality Repair Job and Ensure same day delivery.

• Offer Affordable Prices to the Customer.

• Develop an alternative method for Quick repairs.

• Still make it profitable also.

Process Audit – ObservationsNon Recommendations :

• Hack saw blades & files used by the dent beaters.

• Wet sanding of Bare Metal.• Wet sanding of Polyester Putty.• Usage of non recommended Hand Blocs• Usage of N.C Putty over Polyester Putty.• 1K Acrylic filler used with N.C Thinner• No Application of guide coat

Contd.

EstimationEstimation

Quarter Panel Replacement

Labor Cost : Labor Cost : Total time valueTotal time value x Labor x Labor

raterate

Paint type : 2P (2 Coat Pearl)

Extra : Body sealant and

rustproof wax

Observations

• Improper Baking Time given.

• Proper Fade out process not followed• Anti static cleaner / Flexible additives not used during

Plastic Painting.• Sanding of Putty / Primer done near the paint booth.• Mixing scales not being used.• SAFETY GADGETS –

GOGGLES,MASKS,UNIFORM,SHOES,NITRILE

GLOVES not used.

Paint Cost : Paint Cost : ((Total time valueTotal time value

x x Labor rateLabor rate) + ) + Material CostMaterial Cost

EstimationEstimation

EstimationEstimation

Overall Estimation Process (Conduct by B&P Shop Estimator/Surveyor)

Verifying vehicle details

Conduct Paint Audit at

Inspection bay

Preparing Estimate

Assessing Damage

Taking Photograph

Determining repair method

Calculate total repair cost

Estimate sheet

CorrectionCheck the items

on estimation sheet

Real Case Study

Body & Paint FRC Results at Imperial

Honda

All customers were educated to do up minor repairs and keep their car in pristine condition.

Customers were also made aware of the fast and low cost repair procedure for minor damages.

- The General service advisors educated the customers on this when they arrived for periodic maintenance of their

vehicles.

2K Team organized specific Training Programs for Service Advisors

All customers were educated to do up minor repairs and keep their car in pristine condition.

Customers were also made aware of the fast and low cost repair procedure for minor damages.

- The General service advisors educated the customers on this when they arrived for periodic maintenance of their

vehicles.

2K Team organized specific Training Programs for Service Advisors

CustomerCustomerEducationEducation

Affordable Affordable PricePrice

Fast and Fast and Quality JobQuality Job

Higher Higher Revenue and Revenue and ProfitProfit

Initiatives undertaken at Ganges Ford

CustomerCustomerEducationEducation

Affordable Affordable PricePrice

Fast and Fast and Quality JobQuality Job

Higher Higher Revenue and Revenue and ProfitProfit

Faster repairs made possible

• Using the spot repair concept normally the work was completed in 60% less time than by the conventional method!

• Vehicles could be delivered on the same day

• In the case of insurance claims it takes more than 3 days!

2K Team carried out rigorous Training and rendered on job technical support

60% less

CustomerCustomerEducationEducation

Affordable Affordable PricePrice

Fast and Fast and Quality JobQuality Job

Higher Higher Revenue and Revenue and ProfitProfit

Drastic Reduction in the input Paint Cost

0.310.27

0.290.3

0.27

0.31

0.29

0.32

0.490.59

0.6

0.48

0.5

0.31

0

0.1

0.2

0.3

0.4

0.5

0.6

0.7C

on

su

ma

ble

/Sp

ot

rati

o

Effect of Modified Paint Process Implementation by ICI

The consumables cost to spot labour ratio is decreased by 54% after Implementation.

BEFORE

AFTER

Conventional method- Painting the entire door

Flow chart (Activities) Cost Time

1. Paint stripping 60/- 15 m

2. Removal of door pad 40/- 10 m

3. Tinkering process (Hammer and set) 120/- 30 m

4. Applying Body filler (50g) 40/- 5 m

5. Dry sanding process 65/- 15 m

6. Surface preparation (putty 75g, primer 60 ml ) 135/- 120 m

7. Spray painting and drying process ( 75 ml) 165/- 50 m

Total 625 4 Hrs

• A Comparison is made for a dent (4’’*4’’) on the ft door with conventional and spot painting methods

Spot Repairing Method- Repairing only the spot

Flow chart (Activities) Cost Time

1. Paint stripping and dry sanding process 30 15 m

2. Dent removal process (with dent pulling machine)

40 10 m

3. Surface preparation (putty 30g, primer 25 ml )

75 90 m

4. Spot painting and drying process (50ml) 110 50 m

Total 255 2hrs 45 mins

60% of cost and 38% of time is saved by the process without considering insurance time !

CustomerCustomerEducationEducation

Affordable Affordable PricePrice

Fast and Fast and Quality JobQuality Job

Higher Higher Revenue and Revenue and ProfitProfit

4.29

3.84

4.75.48

6.94

7.1

7.71

8.3

9.39.4

7.6

7.85

1.89

1.22

1.552.36

4.23

4.26

4.85

5.06

6.05

5.83 4.94

4.95

0

2

4

6

8

10

Jan Feb Mar Apr May June July Aug Sep Oct Nov Dec

MonthsQRC Labour(in lacs)

Profit (in lacs)

BEFORE

AFTER

Impressive growth in Revenue and Profits

The results of rejuvenated Ganges Ford…

• The concept is now contributing to a profit of 50 to 60 thousand by its own every month !

• Customer retention and more importantly employee retention increased to the maximum.

• Quality Traffic inflow increased for B&P.

• A/c size grew by 40% in a span of One year

Retaining the Body shop without any Investment for 14 Months

• Excellent Service• Implementation of Fast Repair Cell• Successful implementation of Stock & order System• Successful implementation of Body shop Tracker• Monthly Meeting with the Owner & Quarterly meeting

with the Ford Officials for BIP which is a way of life in Ganges Ford.

• Hence BIP is a process ..it has a beginning ,a middle,but never an end,for it is a process.You improve it ,perfect it,change it,even pause it.But we can’t stop it completely.But we can win & retain a Bodyshop which becomes a special achivement for us.