Managing Business Processes when stakes are high : Analyzing risks in the Homologation process at Scania Korea Group

Sammanfattning: Background: South Korea is one of the countries currently enforcing more strict emission standards for heavy-duty vehicles, as a result of the global push to restrict pollution. In addition, there has been recent scandals involving several well-established automotive companies manipulating emissions tests and not fulfilling regulations. This has resulted in the government increasing the pressure for companies to apply the correct certifications even further. For companies to sell vehicles on the South Korean market, the vehicles must be certified and approved by the government, known as homologation. This process partly involves self-certification, meaning that companies are responsible for applying the correct certification themselves. It is therefore of great importance to have structured and clear processes to mitigate risks of error-making, in order to avoid financial and legal repercussions. Purpose: The study aims to identify and analyze the risks in error-making. Therefore, the purpose is to understand and propose improvement actions to the current homologation processes at Scania Korea Group. Method: The thesis utilized a case study strategy with a descriptive approach to illustrate the process. An exploratory approach was used in combination to identify risks and provide improvement actions. Qualitative data in conjunction with theory around business process improvement were utilized to fulfill the purpose. Firstly, interviews and focus groups were conducted to map the process. Thereafter, a failure mode and effect criticality analysis(FMECA) was used to analyze the process. Lastly, improvement actions were decided based on best practices and benchmarking. Findings and recommendations: The homologation process contain many high severity risks such as certifying the incorrect truck specifications or not complying with regulations, due to not updating the certifications when product changes occur. Furthermore, government approvals incorporate a substantial part of the process lead-time. As such, it is concluded that quality is of utmost importance, both to decrease lead-time and minimize risks with detrimental consequences. The analysis showed evidence of lacking controls/gates in the process, which enables errors and incorrect applications to move through. Improvements regarding increased project structure, planning and communication within SKG were suggested. Further improvement points were an increased number of controls and more clear delegation of responsibility. Recommendations for future studies: We propose to further investigate the root-causes of the inherent risks in the process. Future studies should also look to gather additional data from other heavy-duty automotive companies in South Korea, since it could provide deeper and more generalizable results. Lastly, we recommend future research to utilize a quantitative research approach, providing more statistical evidence.