The road to destruction is paved with good intentions."  We all intend to do the right thing, make the right decisions and we certainly all intend to succeed. However intending to do something is not the same as actually doing it!  By taking some time to become your own auditor and by taking an honest look at what might be wrong with your claim handling, you can take the first step toward actually doing something about it.By examining and discussing each of the areas listed below with the dealer, service manager/director, service advisors, technicians and the rest of the shop, you can build confidence that all is going well, or that it is not and you need to  map out corrective procedures.

The hardest part of doing any self-examination is to pretend you are auditing someone else's work.. You probably know the details of individual repairs from working with the technicians, but if the documentation doesn't support the repairs performed, the claim could be in jeopardy during a real audit. So try not to rely on your knowledge of the repair, instead concentrate on what the paperwork says. After all, that's all an auditor will have to go on.

Select about 50 claims from those paid in the past six months. You can easily do claim lists in FMCDealer to find the claims to examine. Make the sample as random as possible, because you will want to extrapolate the results of this review to give you an idea of the true magnitude of the problems discovered.

Fifty R.O.s is a good number to work with because it's not unduly burdensome and usually routine systematic mistakes will begin to show up within that size sample. If you do more than 50, you'll probably begin to see the same errors repeated. Expect that it will take seven or eight hours to complete a review of 50 R.O.s.

Next, look at your 126 report to find how many repairs your shop has been paid for in the past six months. You can find your six-month repair count on the warranty total line. Divide 50 into the total number of claims paid to tell you the percentage size
of your sample. For example, if you had performed 806 repairs in six months, 50
divided by 806 is 6.2 percent. We'll use this percentage later to find out your potential
liability in an audit.

A Mini Self Audit 

These eight points are not intended to be an all-inclusive list of Ford's policies nor what could be charged back in a real audit. Instead we are looking for common errors on a fairly superficial review. But even this casual investigation will open your eyes. Here's what to look for:

1. Complaint.
Do your service advisors accurately record clear and concise customer complaints, or are they using non-specific language to convey the nature of the customer's problem? Complaints such as "CK A/C" or "CK for oil leaks" should be avoided. Service advisors should be able to describe the problem in a way that clearly describes what is troubling the customer. Help out your techs. Get the best complaint description possible.

2. Warranty eligibility.
Do your service advisors know the various warranty coverage limitations and what can or cannot be claimed under these provisions? Don't assume! Look for some standard repair situations and test your advisors. See if they can tell you which warranty applies to the various repair situations, and the proper limits and restrictions. These mistakes often show up as charges to the policy account - or worse - a false warranty claim written to cover the error. If your advisors don't have a clear idea, it's time to teach them what they need to know. For instance, ask them if wear from contact on weatherstriping is covered under warranty. Have them read the passage on weatherstripping (W&P 3-58)
if necessary.

3. Technician documentation. Is each repair order examined before it is closed to make sure the technician has provided enough detail to justify the warranty claim? Technician comments for a repair should explain what the technician did and why the repair was the proper one. Careful attention should be paid to diagnostic procedures and their results. It is not enough to say that a test was performed, you must also explain in detail what was discovered. For instance, don't let the tech get away with just saying that he performed a pinpoint test. Describe the specific test and the results to help validate the repairs that were performed. Readings from test equipment are a must!

4. Time records.
Every shop struggles to get good, accurate time stamps or records from the technicians. Calculate the differences between the time recorded and the labor time paid. Look for excessive efficiency or inefficiency. Both are common symptoms of inaccurate time records. Once the time records are shown to be invalid, all the resulting claims can be questioned as well.

5. Shop authorizations.
Do your technicians know the limit of work that they can perform without service management approval? A good rule of thumb is that the technician should be permitted to perform one "fix" for each single customer complaint written on the repair order. If more work is needed to satisfy that complaint, or if new warranty related problems are noticed, they should get service management approval before proceeding. Do the techs know which repairs
require service management involvement, such as rotor replacements, add-ons, etc.?

6. Warranty parts.
Do you require the parts department to sign off on each scrap warranty part before a technician is paid for the labor on any single repair order? Not having a defective warranty part on hand when it's called for will always result in a chargeback. Also, stacks of scrap or new parts in a tech's work area could be a sign of, or a facilitator of, parts theft. If new parts are not used (even the leftover parts in an overhaul kit), they should be returned to the parts department. Technicians should not be permitted to keep scrap parts. Remove the temptation and demonstrate control. Even with Ford's self-scrap system, you should still have the technicians turning in the parts for scrapping before the claim is closed. Also, while you are looking at parts, make sure that only genuine parts are used in warranty repairs.

7. Comebacks.
Remember when Ford asked your dealership, as part of Blue Oval Certification, to have some kind of comeback identification process for your dealership?  How well does your shop still follow that procedure?  When auditors come in, they expect that potential comebacks are being noted in your log book or whatever system you may have. One of the clues to look for when scanning your 50 claims are words like "customer says the vehicle is again …" or "customer states the vehicle is still …" When Ford sees your shop is properly identifying some potential comebacks, they feel better about the complete process.

8. Adjustments.
Are differences in the amount paid versus the amount claimed investigated? Any situation where you receive a lower payment than what was originally requested should be researched as if it were a claim rejection. Don't fall into the practice of many dealerships where differences are simply taken care of (written off) in accounting without finding out why. These errors will be repeated over and over unless you get to the source and correct them. For example, if Ford is routinely adjusting M-time as excessive, you need to bring the person doing the booking/flagging into the loop.

Once you've gone through all 50 claims, go back and add up the errors. If you can, assign a dollar value to the error. For instance, if a $300 claim has few or no tech comments, then the whole claim would be charged back. Then add up all your mistakes and divide them by the sample percentage we calculated before we began. In our earlier example we found that 50 claims represented 6.2% of the repairs the store was paid for in six months. If we had found $550 worth of bad claims in our sample we could say the potential liability to the store on a six month audit would be $8,871 ($550 ÷ 6.2% = $8,871).

While far from scientific, it helps drive home how big a problem there may be in your store. You can also do this calculation for each of the eight audit points to find your area of greatest weakness.