Syncata Promises Easier TREAD Act Compliance

    EL SEGUNDO, Calif.--July 16, 2002--Business consulting and systems integration firm Syncata Corp. (http://www.syncata.com/tread/registration.asp), which specializes in servicing vehicle and equipment manufacturers, released several new service offerings which make it easier for original equipment manufacturers and suppliers to comply with recently announced federal reporting rules and regulations.
    The new reporting requirements, imposed under the Transportation Recall, Enhancement, Accountability and Documentation Act (TREAD), require manufacturers and suppliers to submit quarterly reports to the National Highway Traffic Safety Administration (NHTSA). These reports will contain summaries of hitherto company-proprietary information such as warranty claims, consumer complaints, field reports, and legal claims against the company.
    NHTSA plans to use this "early warning data" to improve the safety of vehicles through early part-failure detection. The reporting requirements will go into effect January 1, 2003. The first quarterly reports are due August 30, 2003.
    "Until now, there has been no practical way for vehicle manufacturers and suppliers to comply with TREAD's data reporting requirements cost-effectively and efficiently," said Marianne Grant, director of the Syncata business innovation center. "Syncata's TREAD offerings bring compliance within reach, delivering a full set of capabilities to meet the specific reporting requirements -- from integration and collation of the source data to the production and submission of formatted reports. However, our approach also provides tools that deliver significant value beyond compliance, including company-internal early defect detection, warranty fraud detection, workflow automation, and insight into the service provided to customers by dealers and support teams."
    TREAD was enacted by Congress "...as a direct consequence of hearings before the Committee on Energy and Commerce on the safety of Firestone tires and related matters," said Jeffrey W. Runge, M.D., administrator of The National Highway Traffic and Safety Administration (NHTSA), in his address to the Subcommittee on Commerce, Trade and Consumer Protection in February. NHTSA, a federal agency formed to underpin safe and secure vehicle travel, issued their final ruling detailing the specific reporting guidelines automakers will be required to satisfy on July 10, 2002.
    Runge went on to say, "...NHTSA could have detected the problems with the tires sooner if it had obtained reports about the tires' problems in a timelier manner." As a result, the implementation of the TREAD Act will require vehicle and equipment manufacturers to file quarterly reports with NHSTA including, but not limited to, summary information about claims for death or serious injury, property damage claims, consumer complaints, product manufacturing information, warranty claims and field reports.
    In addition to the proposed ongoing quarterly reporting requirements, vehicle and equipment manufacturers will also be required to file, by October 2003, historical data-reports that cover information gathered over the previous three years. The projected cost of assembling these historical reports has caused considerable debate between federal regulators and the automotive industry. NHTSA estimated one-time historical data reporting costs to be less than $120 thousand per light vehicle manufacturer. But automotive manufacturers said it could cost as much as $10 million per manufacturer and, in the end, the final ruling from NHTSA did in fact relax some of the requirements in order to relieve this projected burden.
    At the core of the debate was how manufacturers would sort through and classify the copious free-text (narrative) records that they have accumulated. With the use of one of Syncata's optional modules, advanced automated text processing software can address this challenge and help offset the costs by providing the industry with an alternative to highly error prone manual or keyword-based searching and sorting technologies.
    For example, TREAD requires manufacturers to report all field reports and legal claims that relate to fire. But going back through three years of text records to identify which ones actually relate to fire based on keywords is easier said than done. After all, a fire may be described in different terms like smoldering, explosion, eruption, or flames or by explanations that omit these terms altogether. Even after the historical reporting is completed, there are requirements for ongoing reporting of these records and also quarterly reporting on the contents of customer complaints that are typically even more text-heavy than the other documents.
    "Syncata's TREAD solution incorporates text-analysis technologies that go beyond keywords," said James Intriligator, Ph.D., Advanced Analytics Subject Matter Expert at Syncata. "This sophisticated text-analysis component, along with a rich reporting and analysis capability and comprehensive management dashboards allow original equipment manufacturers and suppliers to unlock a virtual storehouse of valuable business intelligence never before available. Once this intelligence is available, in addition to satisfying the requirements of the TREAD legislation, opportunities arise for things like rapid part-failure detection, workflow automation, and dealer abuse detection. These benefits go beyond compliance and can both generate significant cost savings and also lead to a reduction in the number of defect or warranty related problems. For many companies even a 2% reduction in warranty costs would add millions of dollars to the bottom line."

    About Syncata Corporation

    Syncata (http://www.syncata.com/tread/registration.asp) provides business consulting and systems integration services that help companies plan and implement innovative demand and supply chain solutions. The firm help clients collaborate effectively, plan adaptively, and respond rapidly to enhance business performance and realize measurable value. Syncata helps clients assess strategic options and guides them through the detailed business and technology issues involved in delivering practical solutions. Syncata has over a decade of experience working across specific industries including automotive, high-tech manufacturing, financial services and insurance.