Benefits of a Reman/Core Exchange Program Over a Build-New Program
There are many benefits to Build-New Programs. Intuitively, it is just simpler to make a large, lifetime build. However, at ISS we have managed both Build-New and Remanufacturing programs, and experience has taught us that there are several hidden benefits to Remanufacturing/Exchange Programs:
1. Just as Fast
When a program is executed well, a remanufactured unit can be delivered to the dealer just as quickly as a build-new unit.
2. Less Expensive Even after accounting for labor and handling, many times it is much cheaper to replace a faulty $.60 IC component than to scrap a $150 auto part. This reduction in cost results in lower cost to The Client, and lower cost of total ownership to the end user.
3. Less Inventory
To be able to fully replace a radio, The Client must make a lifetime build of every single component that goes into that radio.
To supply remanufacture, however, The Client only needs to maintain inventory of components that are likely to fail. For example, it may only have to inventory a fraction of as many body cases as it does printed circuit boards. Also, much of this inventory can be used to service multiple parts.
4. Less Prone to Recurring Failure
If ISS is notified by The Client in a bulletin of a design flaw in a given unit, it can automatically correct this flaw whenever that unit is sent in for remanufacture. Say a radio is sent to ISS with a faulty LED. The Client has a bulletin stating that a particular IC also should be replaced on this unit. Even though the IC is currently functioning, we can replace it to prevent future failure.
In a traditional Build-New program, the flawed IC may remain in all radios.
5. Better Visibility on Failures
Failure data provided in Build-New replacement parts programs can be spotty and vague. We can organize and present to The Client reporting that precisely documents component failure so that The Client can build greater quality into future products.