Operations

Management

Product Design
Chapter 3
Prepared by : Shatina Saad OPM 533
3-1
 Outline
♦ Goods and services selection
♦ Generating new products
♦ Product development
♦ Issues for product design
♦ Time-based competition
♦ Defining the product
♦ Documents for production
♦ Service design

Prepared by : Shatina Saad OPM 533

3-2
 Learning Objectives
When you complete this chapter, you
should be able to :
Identify or Define:
♦ Product life cycle
♦ Product development team
♦ Manufacturabililty and value
engineering
♦ Robust design
♦ Time-based competition
♦ Modular design
♦ Computer aided design
♦ Value analysis
♦ Group technology
♦ byConfiguration
Prepared : Shatina Saad management
3-3 OPM 533
 Learning Objectives -
Continued
When you complete this chapter, you
should be able to:
Explain:
♦ Alliances
♦ Concurrent engineering
♦ Product-by-value analysis
♦ Product documentation

Prepared by : Shatina Saad OPM 533

3-4
 Humor in Product
Design
As the customer As
wanted it. Marketing
interpreted
it.
© 1984-1994 T/Maker Co. © 1984-1994 T/Maker Co.

As Operations As
made it. Engineering
designed it.

© 1984-1994 T/Maker Co. © 1984-1994 T/Maker Co.

Prepared by : Shatina Saad OPM 533

3-5
 What is 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 or a service

Prepared by : Shatina Saad OPM 533

3-6
 Product Strategy
Options

♦ Product differentiation

♦ Low cost

♦ Rapid response

Prepared by : Shatina Saad OPM 533

3-7
 Generation of New
Product Opportunities
♦ Economic change
♦ Sociological and demographic
change
♦ Technological change
♦ Political/legal change
♦ Changes in
♦ market practice
♦ professional standards
♦ suppliers and distributors
Prepared by : Shatina Saad OPM 533
3-8
 Product Components

Product

Brand Product
Package
(Name) Idea

Physical Quality Service

Features
Good Level (Warranty)

Prepared by : Shatina Saad OPM 533

3-9
 Product Life Cycle

♦ Introduction
♦ Growth
♦ Maturity
♦ Decline

Prepared by : Shatina Saad OPM 533

3-10
 Product Life Cycle
Introduction

♦ Fine tuning
♦ research
♦ product development
♦ process modification and enhancement
♦ supplier development

Prepared by : Shatina Saad OPM 533

3-11
 Product Life Cycle
Growth

♦ Product design begins to stabilize

♦ Effective forecasting of capacity
becomes necessary
♦ Adding or enhancing capacity may
be necessary

Prepared by : Shatina Saad OPM 533

3-12
 Product Life Cycle
Maturity

♦ Competitors now established

♦ High volume, innovative
production may be needed
♦ Improved cost control, reduction in
options, paring down of product
line

Prepared by : Shatina Saad OPM 533

3-13
 Product Life Cycle
Decline
♦ Unless product makes a special
contribution, must plan to
terminate offering

Prepared by : Shatina Saad OPM 533

3-14
 Product Life Cycle,
Sales, Cost, and Profit
Cost of
Development
.

& Manufacture
Sales, Cost & Profit

Sales Revenue

Profit
Cash flow
Loss
Time

IntroductionGrowth Maturity Decline

Prepared by : Shatina Saad OPM 533

3-15
 Product-by-Value
Analysis

♦ Lists products in descending order

of their individual dollar
contribution to the firm.
♦ Helps management evaluate
alternative strategies.

Prepared by : Shatina Saad OPM 533

3-16
 Product Development
Stages
♦ Idea generation
♦ Assessment of firm’s ability to
carry out
development team

♦ Customer Requirements
Scope of product

♦ Functional SpecificationScope of design

♦ Product Specifications for
♦ Design Review manufacturabilit
y and value
♦ Test Market engineering
♦ Introduction to Market teams
♦ Evaluation
Prepared by : Shatina Saad OPM 533
3-17
 Quality Function
Deployment
♦ Identify customer wants
♦ Identify how the good/service will
satisfy customer wants
♦ Relate customer wants to product
hows
♦ Identify relationships between the
firm’s hows
♦ Develop importance ratings
♦ Evaluate competing products
Prepared by : Shatina Saad OPM 533
3-18
 QFD House of Quaoity

Prepared by : Shatina Saad OPM 533

3-19
 House of Quality
Sequence Indicates How
to Deploy Resources to
Achieve Customer
Requirements

Prepared by : Shatina Saad OPM 533

3-20
 Idea Generation Stage

♦ Provides basis for entry 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

Prepared by : Shatina Saad OPM 533

3-21
 Customer
Requirements Stage
♦ Identifies & positions key product
benefits
Stated in core benefits proposition
♦
(CBP)
♦ Example: Long lasting with more
House of Quality
♦ Identifies
power detailed list of
product attributes
(Energizer Die Hard Battery)
Product
desired by customer Characteristics
♦ Focus groups or
1-on-1 interviews Customer
Requirements

Prepared by : Shatina Saad OPM 533

3-22
 Functional
Specification Stage
♦ Defines product in terms of
how the product would
meet desired attributes
♦ Identifies product’s
engineering characteristics
♦ Example: printer noise (dB)
House of Quality
♦ Prioritizes engineering
characteristics Product
♦ May rate product compared Characteristics

to competitors’ Customer
Requirements

Prepared by : Shatina Saad OPM 533

3-23
 Product Specification
Stage
♦ Determines how product will be made
♦ Gives product’s physical specifications
♦ Example: Dimensions, material etc.
♦ Defined by engineering
drawing
♦ Done often on computer House of Quality
♦ Computer-Aided
Component
Design (CAD) Specifications

Product
Characteristics

Prepared by : Shatina Saad OPM 533

3-24
 Quality Function
Deployment
♦ Product design process using
cross-functional teams
♦ Marketing, engineering, manufacturing
♦ Translates customer preferences
into specific product characteristics
♦ Involves creating 4 tabular
‘Matrices’ or ‘Houses’
♦ Breakdown product design into
increasing levels of detail
Prepared by : Shatina Saad OPM 533
3-25
 Organizing for Product
Development
♦ Historically – distinct departments
♦ Duties and responsibilities are defined
♦ Difficult to foster forward thinking

♦ Today – team approach

♦ Representatives from all disciplines or
functions
♦ Concurrent engineering – cross
functional team

Prepared by : Shatina Saad OPM 533

3-26
 Manufacturability and
Value Engineering
♦ Benefits:
♦ reduced complexity of products
♦ additional standardization of
products
♦ improved functional aspects of
product
♦ improved job design and job
safety
♦ improved maintainability of the
product
Prepared by : Shatina Saad
3-27 OPM 533
 Issues for Product
Development

♦ Robust design
♦ Time-based competition
♦ Modular design
♦ Computer-aided design
♦ Value analysis
♦ Environmentally friendly design

Prepared by : Shatina Saad OPM 533

3-28
 Robust Design

♦ Product is designed so that small

variations in production or
assembly do not adversely affect
the product

Prepared by : Shatina Saad OPM 533

3-29
 Modular Design

♦ Products designed in easily

segmented components.
♦ Adds flexibility to both production
and marketing

Prepared by : Shatina Saad OPM 533

3-30
 Computer Aided Design
(CAD)
♦ Designing
products at
a computer
terminal or
work station
♦ Design engineer
develops rough
sketch of product
♦ Uses computer to
draw product
♦ Often used with
Prepared by : Shatina Saad
3-31
© 1995 Corel Corp.
OPM 533
 Benefits of CAD/CAM

♦ Shorter design time

♦ Database availability
♦ New capabilities
♦ Example: Focus more on product ideas
♦ Improved product quality
♦ Reduced production costs

Prepared by : Shatina Saad OPM 533

3-32
 Extensions of CAD
♦ Design for
Manufacturing and
Assembly (DFMA)
♦ 3-D Object Modeling
♦ CAD/CAM – CAD info
is translated into
machine control
instructions (CAM)

© 1995 Corel Corp.

Prepared by : Shatina Saad OPM 533
3-33
 Virtual Reality

♦ Computer technology used to

develop an interactive, 3-D model
of a product.
♦ Especially helpful in design of
layouts (factory, store, home,
office)

Prepared by : Shatina Saad OPM 533

3-34
 Value Analysis

♦ Focuses on design improvement

during production
♦ Seeks improvements leading
either to a better product or a
product which can be more
economically produced.

Prepared by : Shatina Saad OPM 533

3-35
 Environmentally
Friendly Designs
♦ Benefits
♦ Safe and environmentally sound
products
♦ Minimum raw material and energy
waste
♦ Product differentiation
♦ Environmental liability reduction
♦ Cost-effective compliance with
environmental regulations
♦ Recognition as good corporate citizen
Prepared by : Shatina Saad OPM 533
3-36
“Green” Manufacturing

♦ Make products recyclable

♦ Use recycled materials
♦ Use less harmful ingredients
♦ Use lighter components
♦ Use less energy
♦ Use less material

Prepared by : Shatina Saad OPM 533

3-37
 Time-based
Competition

♦ Product life cycles are becoming

shorter.

∴Faster developers of new

products gain on slower
developers and obtain a
competitive advantage

Prepared by : Shatina Saad OPM 533

3-38
 Product Development
Continuum
External Development Strategies
Alliances
Joint Ventures
Purchase Technology or Expertise by
Acquiring the Developer
Internal Development
Strategies
Migrations of Existing Products
Enhancement to Existing
Products
New Internally Developed
Products←----------------------Cost of Product Development
Internal
---------------------→ Shared
Lengthy ←--------------------Speed of Product
Development---------------→Rapid and/or
Existing
←-------------------------
HighPrepared by : Shatina Saad
Risk3-39
of Product Development OPM 533

-----------------------→ Shared
 Product Documents

♦ Engineering drawing
♦ Shows dimensions,
tolerances, & materials
♦ Shows codes for Group
Technology
♦ Bill of Material
♦ Lists components,
quantities & where used
♦ Shows product structure
© 1984-1994 T/Make
Prepared by : Shatina Saad OPM 533
3-40
 Make-or-Buy Decisions

♦ Decide whether or not you want

(or need) to produce an item
♦ May be able to purchase the item
as a “standard item” from another
manufacturer

Prepared by : Shatina Saad OPM 533

3-41
 Group Technology
Characteristics
♦ Parts grouped into families
♦ Similar, more standardized parts
♦ Uses coding system
♦ Describes processing & physical
characteristics
♦ Part families produced
in manufacturing cells
♦ Mini-assembly lines

Prepared by : Shatina Saad OPM 533

3-42
© 1984-1994 T/Maker Co.
 Group Technology
Benefits
♦ Improved product design
♦ Reduced purchases
♦ Reduced work-in-process
inventory
♦ Improved routing & machine
loading
♦ Reduced setup & production
times
♦ Simplified production planning &
control
Prepared by : Shatina Saad
3-43 OPM 533
 Production Documents

♦ Assembly
Drawing
♦ Assembly chart
♦ Route sheet
♦ Work order

Prepared by : Shatina Saad OPM 533

3-44
 Engineering Change
Notice (ECN)

♦ A correction or modification of an
engineering drawing or bill of
material

Prepared by : Shatina Saad OPM 533

3-45
 Configuration
Management

♦ A system by which a product’s

planned and changing components
are accurately identified and for
which control and accountability of
change are maintained

Prepared by : Shatina Saad OPM 533

3-46
 Service Design -
Nature of Customer
Participation

Prepared by : Shatina Saad OPM 533

3-47
 Improving Customer
Relations at a Drive-up
Window
♦ Be especially discreet when talking with customer
through the microphone
♦ Provide written instructions for customers who
must fill out forms you provide
♦ Mark lines to be completed or attach a note with
instructions
♦ Always say ”please” and “thank you”
♦ Establish eye contact with the customer if the
distance allows it
♦ If the transaction requires that the customer park
Prepared by : Shatina Saad OPM 533
3-48
the car and come into the lobby, apologize for the