03. product design
TRANSCRIPT
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Product Design 1
Product Design
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Product Design 2
Humorin Product Design
As the customer
wanted it.As Marketing
interpreted it.
As Engineering
designed it.
As Operations
made it.
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Product Design 3
Whats a Product?
Need-satisfying offering of an
organization
Example P&G does not sell laundry detergent
P&G sells the benefit of clean clothes
Customers buy satisfaction, not parts May be a good and/or service: a product
service bundle
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Product Design 4
Product Components
Product
Product
Idea Package
Physical
Good Features
Quality
Level
Service
(Warranty)
Brand
(Name)
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Product Design 6
Product Life Cycle
Intro-
ductionGrowth
Time
Sales
1995 Corel Corp.
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Product Design 7
Product Life Cycle
Intro-
ductionGrowth Maturity
Time
Sales
1995 Corel Corp.
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Product Design 8
Product Life Cycle
Intro-
ductionGrowth Maturity Decline
Time
Sales
1995 Corel Corp.
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Product Design 9
Product Life Cycle
Intro-
ductionGrowth Maturity Decline
Time
Sales
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Product Design 11
LEARNING OBJECTIVES
Demonstrate your understanding of the cross-functional linkagesinvolved in designing product-service bundles
Describe the tasks involved in designing product-service bundles Summarize the traditional approach to designing product-service
bundles
Describe the modern approach to designing product-service bundles Compare and contrast a variety of tools that are useful in the designprocesses, and use break-even analysis
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Importance of Product Design
THEREFORE
THE DESIGN OF GOODS ANDSERVICES ARE CRUCIAL TO SUCCESSIN TODAYSGLOBAL COMPETITION
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Product Design 14
INTRODUCTION
Designing product-service bundles is facilitatedby managing white spaces
Development of a product-service bundlerequires completion of a defined set of tasks
Customers are less likely to accept partialsatisfaction of requirements
Product-service bundle design is an ongoingprocess
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Product Design 15
Product Decisions
Involve selecting products to offer,defining products, & designing products
Objective
Meet marketplace demand with a producthaving a competitive advantage
Affect entire organization
Example: equipment, layout, skills etc.
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Product Design 16
Product Decisions
ENTAILS EVALUATION OF
COMPETING PRODUCT CONCEPTS
AND/OR MAJOR MODIFICATION OF
CURRENT PRODUCTS
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Product Design 18
TASKS IN THE DESIGN OFPRODUCT-SERVICE BUNDLES
Doing market research
Performing basic scientific research
Choosing or developing a technology
Developing specific applications,systems, and/or products and services
Testing performance of new systemsand/or products and services
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Product Design 19
TASKS IN THE DESIGNOF PRODUCT-SERVICE BUNDLES
Creating a value-adding system:
product creation processes
delivery systems maintenance and support services
allied service and product deliverysystems
supplier capabilities
distribution system
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Ensuring legal and regulatorycompliance of new applications,systems, and/or products and services
Obtaining patents, trademarks, andcopyrights
Develop marketing plan:
place, price, promotion customer education
TASKS IN THE DESIGNOF PRODUCT-SERVICE BUNDLES
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HE TRADITIONAL APPROACH TO THE DESIGN OF PRODUCTSERVICE BUNDLES
Over-the-wall approach set of sequentially related tasks
each task represented by different function
each function works in isolation from others
Trends that challenge the traditionalapproach
globalization of business
rapid technological change shortening product life cycles
e-commerce
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Product Design 23
THE MODERN APPROACH TO THE DESIGNOF PRODUCT-SERVICE BUNDLES
Over-the-wall approach spans whitespaces; it doesnt manage them
Greater emphasis on management of
all functions throughout the designprocess
Cross-functional design team typically
manages the entire design process Concurrent team approach
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Product Design 24
DESIGNING PRODUCT-SERVICE BUNDLES:MODERN APPROACH
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TEAM STRUCTUREINSTEAD OF FUNCTIONAL STRUCTURE
Each function spins in its contribution Customer is seen as part of the design
team
Functional excellence remainsimportant, but is subordinate tocustomer satisfaction
Ability of members to make significantcontributions at each stage of the design
process Concurrent team approach is not alwayseasy
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Product Design 26
CONCURRENT ENGINEERINGINSTEAD OF SEQUENTIAL/HIERARCHICAL ENGINEERING
Concerns of more than one functionare considered simultaneously
Concurrent EngineeringStrategies/Methods: Design for manufacturing (DFM)
Taguchi methods
Design for disassembly Design for procurement
Design for environment
Life cycle analysis
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Product Design 27
GROUP TECHNOLOGY ANDADDITIONAL DESIGN STRATEGIES
Group technologybased on commonalities
Modular designconsiders an itemscomponents or subsystems independently
Product simplification improvesmanufacturability, serviceability or reliabilityby reducing the complexity
E-commerce plays a role in the designprocess
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QUALITY FUNCTION DEPLOYMENT (QFD)
Used to integrate customer expectations withproduct design decisions
Competitive analysis gathers information on
customer satisfaction Technical analysis gathers information on
production technologies, reliability, andperformance
Design targets are used to position the product-service bundle to best advantage
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GENERIC HOUSE OF QUALITY
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Product Development Stages
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Product Development Stages Idea Generation
Market Requirements
Functional Specification
Product Specification
Design Review
Test Market
Introduction Life Cycle Management
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0
500
1000
1500
2000
Few Successes
Market
req.Functionalspec.
Product
spec.
Successful
product
Design review,Testing, Intro.
1750
1000
500
10025 1
Development Stage
Number
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Idea Generation Stage
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Idea Generation Stage
Provides ideas that provide basis forentry into market
Sources of ideas
Market need (60-80%); engineering &operations (20%); technology;competitors; inventions; employees
Follows from marketing strategy Identifies, defines, & selects best market
opportunities
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Factors Creating MarketOpportunities
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Market Requirements Stage
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Functional Specification Stage
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Functional Specification Stage
Defines product in terms of how the product would meetdesired attributes
Identifies products engineering characteristics
Example: printer noise (dB) Prioritizes engineering characteristics
May rate product to competitorsProduct
Char.
Customer
Req.
House of Quality
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Product Specification Stage
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Product Specification Stage
Determines how product will be made
Gives products physical specifications
Example: Dimensions, material etc.
Defined by engineeringdrawing
Done often on computer
Called Computer-Aided Design (CAD)
Component
Spec.Product
Char.
House of Quality
C t Aid d
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Computer AidedDesign (CAD)
Designing products ata computer terminal orwork station
Design engineerdevelops roughsketch of product
Uses computer todraw product
Often used with CAM 1995 Corel Corp.
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Benefits of CAD/CAM
Shorter design time
Database availability
New capabilities Example: Focus more on product ideas
Improved product quality
Reduced production costs
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Designing for
Product ReliabilityDesign Issue
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Reliability
Often a desired attribute of customers Probability that a component or
system will function for a given time
Ways to increase Improve individual components
Responsibility of design engineering& purchasing
Provide redundancy
Design includes backup components
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System Reliability
System: a group of interacting parts
Reliability depends on two factors
Number of components
Component reliability
Equation
Rs= R1x R2x R3x ... x Rn 0 Ri 1
Components are independent
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System Reliability
System: a group of interacting parts
Reliability depends on two factors
Number of components
Component reliability
Equation
Rs= R1x R2x R3x ... x Rn 0 Ri 1
Components are independent
Ri= Reliability of
component i
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Failure
Change in product or system fromsatisfactory to below standard
)N(FRMTBF
operatedhoursunitNo.
failuresNo.)N(FR
%testedunitsNo.
failuresNo.(%)FR
1
100
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Redundancy
Increases system reliability
Means at least 1 component has a backup
(duplicate) Reliability of component with backup
= P(1stworking) + [P(2ndworking x P(1stfailing)]
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Redundancy Example
What is the reliability of this system?
.95
.92
.98
.89
.90
Backup
components
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Redundancy Example
What is the reliability of this system?
.95
.92
.98
.89
.90
R = [.95+ .92(1-.95)] [.98] [.90+ .89(1-.90)]
= (.996) (.98) (.989) = .965 = 96.5%
Backup
components
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Design Review Stage
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Design Review Stage
Determines how product will be madeeconomically & quality robust
Shows steps in process
Example: Drill hole to 1/4diameter
Often uses value
engineering toreduce costs
House of Quality
Production
Process
Component
Spec.
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Life Cycle Management Stage
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Life Cycle Management Stage
Involves adjusting strategies to deal withopportunities & threats
Uses product-by-value analysis
Lists products in descending order of unit & totalcontribution ($)
Reasons for product failure Competitive response
Changes in market environment Insufficient return on investment (ROI)
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COST VOLUME BREAK-EVEN ANALYSIS
Y= 55X
Y= 5000 + 45X
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Organization for New Product
Development
INTEGRATING OPERATIONS MANAGEMENT
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INTEGRATING OPERATIONS MANAGEMENTWITH OTHER FUNCTIONS
Historical functions most involved indesigning products and services:
marketing involved in identifying customer
requirements engineering involved in actually producing
Modern design processes draw on
cross-functional teams separating design from other operationaldecisions can hinder efforts to satisfycustomers
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Organizing for New
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Organizing for NewProduct Development
Team approach works best
Composed of marketing, engineering etc.
Product development teams Responsible for product during all stages of
life cycle
Design for manufacturability &value engineering teams
Responsible for improving product design toreduce costs
Required Factors
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Required Factorsfor Team Success
Support of top management
Qualified, experienced leadership
Formal team organization
Training in product development
Diverse, yet cooperative members
Adequate staffing, funding, & vendorassistance
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Strategic Importanceof Product Development
Importance
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Importanceof New Products
48%
34%
11%
26%
0%
10%
20%
30%40%
50%
60%
Industry
Leader
Top 1/3 Middle
1/3
Bottom
1/3
Percent of Sales from New Products
Position of Firm in Industry
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Time-Based Competition
Competing on the basis of the speed inbringing products to market
May be new or existing products
Faster developers have competitiveadvantage
Companies differentiate themselves byintroducing newer products faster
Example: Intel 386, 486, & Pentium chips
Time-Based Competition
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Time-Based CompetitionExample
0 10 20 30 40 50
GM
Ford
Honda
Toyota From
conceptapproval to
production
Months
Company
46
37
36
27
Mean Passenger Car Development
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End of Chapter
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