The Ripple Effect

In a fictional world, we see John, an auto body shop owner, relaxing in his boat, enjoying the beautiful day. John looks at his reflection in the still water below. He is amazed to see how clear the picture is. He can see all the fine details of his reflection, as well as the reflection of the images surrounding him. John sees a defined picture of who he is as a body shop owner and the direction his business must take. But then something changes: John observes that someone has tossed a tiny pebble into the peaceful body of water. He can no longer see his place in the pond as clearly as he once had. In fact, this seemingly tiny pebble caused many ripples, which distorted John’s image and clouded the direction of John’s business. The water began to calm, and John thought he could once again distinguish the image. But another tiny pebble had been tossed into the pond … and then another. These tiny pebbles caused ripples that made John’s boat sway. John quickly realized the image he saw before was no longer stable. He could no longer rely on the reflection in the pond to find his direction. John realized now that he must envision the direction of his business himself and not rely on the pond to guide his way.

The collision repair industry has evolved greatly. This can be attributed to the many tiny pebbles tossed into the collision repair industry’s pond. New technology, increased training, environmental concerns and customer demand are a few of many pebbles contributing to this progression. These tiny pebbles have created ripples. Such ripples have caused the evolution of the traditional ‘body shop’ into the new ‘collision repair facility.’

THE NEW ‘COLLISION REPAIR FACILITY’

The new ‘collision repair facility’ is different from the conventional image of a ‘body shop.’ The new collision repair facility operates like any other consumer-driven business. It has a clean and inviting reception area, with friendly staff to greet you upon your arrival. It employs highly-trained, certified technicians who operate new equipment and technology to complete the repair process both efficiently and effectively.

The evolution of the new collision repair facility did not happen by chance. This progression happened because the body shop no longer relies on a reflection in a pond to find direction in its business. The new collision repair facility has a clearly defined path. It has forecasted future steps it must take to grow and continue its business successfully.

The new collision repair facility is defined by up-to-date, modern technology. It is defined as a ‘collision repair facility’ because it has learned how to produce quality, safe repairs at a fair price. It is a collision repair facility because it chooses to focus on its customers – the very same customers the insurance community is serving.

THE FIRST RIPPLE: TRAINING

Collision repair facilities have encountered a number of challenges along the path of their evolution from the body shop stage. For one thing, continual training of body and paint technicians is a cost incurred with no quantifiable results. Repair facilities invest thousands of dollars each year to make sure their staff has the required knowledge to repair vehicles to manufacturers’ specifications. Although there is no government legislation enforcing continuing education, these facilities take it upon themselves to ensure staff is trained for the benefit of our customers (who are also the customers of auto insurers).

THE SECOND RIPPLE: NEW TECHNOLOGY

The new millennium cast the ‘increase-in-technology’ pebble into the collision industry’s pond. Collision repair facilities have invested in software to create an ease of doing business with insurance partners. Investing in this software provides virtually instant communication between the two parties. This instant communication helps to reduce cycle time and allowing for minimum disruption in the customer’s daily routine.

Collision repair facilities have also witnessed technological advancement in the production area. Recently some car manufactures have begun producing vehicles with aluminum frames rather than the standard steel frames that collision repairers are used to. This change in material caused a select few progressive repair facilities to make the immensely substantial investment in equipment to repair these vehicles. These progressive facilities saw a niche market to pursue, even though the return on investment might not be seen in the imminent future.

THE THIRD RIPPLE: THE ENVIRONMENT

The most recent change affecting the collision repair industry is the concern for the environment. Environment Canada is working with paint manufacturers to enforce a new law prohibiting the sale, import and manufacturing of regular Volatile Organic Compounds (VOC) paint materials as early as 2009. Environment Canada believes the newly proposed VOC content regulations can reduce the industry’s VOC emissions by a further two kilotonnes each year. One alternative to the regular, more-polluting VOC paint is waterborne paint, in which water is the major ingredient. According to paint manufacturers who provide waterborne products, there are several advantages to using water-base coatings: they contain and emit less organic solvent into the atmosphere, they may lower insurance costs for the repair facility (since water is the major solvent, the product is less flammable), and they presumably provide certain refinishing benefits and offer lower toxicity. Many repair facilities have already taken the plunge and are well on their way to convert to waterborne paint. Depending on existing equipment, this conversion can be a tremendous investment, but the ripples caused by this pebble cannot be ignored for long.

THE FOURTH RIPPLE: CUSTOMER SERVICE

Customer service has been the most influential ripple contributing to the evolution of the new collision repair facility. A study conducted by J.D. Power and Associates states that one out of every five customers considers switching insurance companies after experiencing the collision repair claims process. This study looked at three processes that provide the foundation for customer satisfaction with the repair experience: claims/estimation (62%), body shop (36%) and rental car (2%). Given that such a high percentage of customer retention relies on a third party (body shop), it is important to ask yourself as an insurer: ‘Is my DRP facility a body shop or a collision repair facility?’

Many collision repair facilities use a third-party Customer Service Indexing (CSI) company to monitor the quality of service they provide. Third-party customer service indexing (CSI) is an easy, legitimate way to ensure your DRP facility is not only meeting your expectations, but the expectations of your customer as well.

MANAGING THE RIPPLES

All of these ripples are occurring simultaneously, and so collision repair owners like ‘John,’ above, must find new ways to deal with the choppy water. Many repair facilities are focusing on the concept of ‘lean production.’ All of us are familiar with Toyota Motor Corporation, often credited as the world’s best manufacturer and creator of the lean production theory. Sakichi Toyoda, founder of Toyota, developed this concept of lean production, which focuses on speeding up business and service processes, reducing waste and improving quality.

Collision repair facilities are beginning to implement lean production to help create a sense of calm in the water. Lean production focuses on producing a more effective workflow, improving quality, increasing safety and reducing cycle time. The implementation of lean production is a life-long journey, but each step directly benefits the customer.

CONTINUOUS EVOLUTION

Most progressive shops have embraced the evolution from body shop to the new collision repair facility. Such facilities welcome the tiny pebbles being tossed into th
e collision industry’s pond. They have the foresight to deal with the ripples in the water before they arrive. The ripples compel the new collision repair facility to continually improve their business, envision their future and refrain from reverting back to the traditional body shop.