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Design of Goods Services

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Design of Goods Services

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    1. Design of Goods & Services

    2. Humor in Product Design

    3. 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 What is a Product? This slide provides an opportunity to introduce the complex nature of a product. There are a number of examples one can discuss here: McDonald’s/ Burger King/Wendys (their product is more than hamburgers); your particular college or university; Microsoft; auto manufacturers.This slide provides an opportunity to introduce the complex nature of a product. There are a number of examples one can discuss here: McDonald’s/ Burger King/Wendys (their product is more than hamburgers); your particular college or university; Microsoft; auto manufacturers.

    4. Generation of New Product Opportunities Economic change Each of the items listed forms the basis for developing a new product idea. Ask students to provide examples of products fitting each element.Each of the items listed forms the basis for developing a new product idea. Ask students to provide examples of products fitting each element.

    5. Product Components One might remind students that a product is defined not only by what it has, but also by what is missing.One might remind students that a product is defined not only by what it has, but also by what is missing.

    6. Product Life Cycle Introduction Growth Maturity Decline This slide begins an in depth study of the product life cycle.This slide begins an in depth study of the product life cycle.

    7. Product Life Cycle Introduction Fine tuning research product development process modification and enhancement supplier development

    8. Product Life Cycle Growth Product design begins to stabilize Effective forecasting of capacity becomes necessary Adding or enhancing capacity may be necessary

    9. 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

    10. Product Life Cycle Decline Unless product makes a special contribution, must plan to terminate offering

    11. Product Life Cycle vs. Sales, Cost, and Profit Previous slides have related the product life cycle to various management issues. This is the first to relate it to cash flow. Ask students for suggestions as to how one might eliminate the loss occurring toward the end of the product’s life cycle.Previous slides have related the product life cycle to various management issues. This is the first to relate it to cash flow. Ask students for suggestions as to how one might eliminate the loss occurring toward the end of the product’s life cycle.

    12. Percent of Sales From New Product This slide suggests that product innovation is a “way-of-life” for industry leaders. Does this suggest that one of the most important activities in which a company engages is that of “adaptation”? If so, will this become more or less of an issue in the future?This slide suggests that product innovation is a “way-of-life” for industry leaders. Does this suggest that one of the most important activities in which a company engages is that of “adaptation”? If so, will this become more or less of an issue in the future?

    13. Products in Various Stages of Life Cycle This slide gave a reasonable depiction of the growth stage for these products when it was created. Does it still? Ask students to consider the length of the lifetime of each of the products listed. Are the lifetimes similar? What ranges of lifetime would they estimate for these products?This slide gave a reasonable depiction of the growth stage for these products when it was created. Does it still? Ask students to consider the length of the lifetime of each of the products listed. Are the lifetimes similar? What ranges of lifetime would they estimate for these products?

    14. This slide suggests the relatively small number of product concepts that actually become successful. Ask students to suggest reasons for such a poor success rate. Can they also suggest ways by which the success rate might be improved?This slide suggests the relatively small number of product concepts that actually become successful. Ask students to suggest reasons for such a poor success rate. Can they also suggest ways by which the success rate might be improved?

    15. Product-by-Value Analysis Lists products in descending order of their individual dollar contribution to the firm. Helps management evaluate alternative strategies. Product-by-value analysis helps identify appropriate priorities.Product-by-value analysis helps identify appropriate priorities.

    16. Product Development Stages Idea generation Assessment of firm’s ability to carry out Customer Requirements Functional Specification Product Specifications Design Review Test Market Introduction to Market Evaluation This slide indicates the stages in the product development process. It also attempts to indicate organizational teams assigned to accomplish specific elements. Students might be asked to consider the utility of having the process broken down among several work groups. Would success be improved if all these activities were carried out by a single “project team” from start to finish, rather than sequentially by teams of specialists?This slide indicates the stages in the product development process. It also attempts to indicate organizational teams assigned to accomplish specific elements. Students might be asked to consider the utility of having the process broken down among several work groups. Would success be improved if all these activities were carried out by a single “project team” from start to finish, rather than sequentially by teams of specialists?

    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

    18. QFD House of Quality

    19. House of Quality Sequence

    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 One notion which might be discussed at this stage is the attempts by manufacturers to add information to an existing good rather than develop a new good.One notion which might be discussed at this stage is the attempts by manufacturers to add information to an existing good rather than develop a new good.

    21. Customer Requirements Stage Identifies & positions key product benefits Stated in core benefits proposition (CBP) Identifies detailed list of product attributes desired by customer Focus groups or 1-on-1 interviews Here begins the attempt to link the product directly with the customer. You might specify a product and ask students to identify first the attributes of interest to the customer, and second the “benefits” to the customer.Here begins the attempt to link the product directly with the customer. You might specify a product and ask students to identify first the attributes of interest to the customer, and second the “benefits” to the customer.

    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) Prioritizes engineering characteristics May rate product compared to competitors’ At this point we have to start adding precision to our specifications. If we want a product to be “easy to use,” what exactly does that mean? To use by whom? With what level of preparation? Etc.At this point we have to start adding precision to our specifications. If we want a product to be “easy to use,” what exactly does that mean? To use by whom? With what level of preparation? Etc.

    23. Determines how product will be made Gives product’s physical specifications Example: Dimensions, material etc. Defined by engineering drawing Done often on computer Computer-Aided Design (CAD) Product Specification Stage At this point, we have to develop the information necessary to actually produce the product - and, to know that it has been produced appropriately.At this point, we have to develop the information necessary to actually produce the product - and, to know that it has been produced appropriately.

    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

    25. You’ve been assigned temporarily to a QFD team. The goal of the team is to develop a new camera design. Build a House of Quality. House of Quality Example

    26. House of Quality Example

    27. House of Quality Example

    28. House of Quality Example

    29. House of Quality Example

    30. House of Quality Example

    31. 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 teams including research, development, manufacturing process design, etc.

    32. 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 robust design Manufacturability and value engineering encompass many issues. You may wish to stress the point that we consider in detail not only what the product is, but how it is to be produced and maintained - the best design is optimized across all these activities, not just one or another. Manufacturability and value engineering encompass many issues. You may wish to stress the point that we consider in detail not only what the product is, but how it is to be produced and maintained - the best design is optimized across all these activities, not just one or another.

    33. Cost Reduction of a Bracket via Value Engineering This slide illustrates changes made over a series of iterations in design. Cost is obviously reduced. You might ask students if the perceive any change in quality as the design iterations progressed and the cost was reduced.This slide illustrates changes made over a series of iterations in design. Cost is obviously reduced. You might ask students if the perceive any change in quality as the design iterations progressed and the cost was reduced.

    34. Successful Value Engineering: Support of top management Qualified, experience leadership Formal organization of the value engineering function Training programs to teach the skills and techniques to those assigned to teams A diverse, cooperating team Adequate staffing, funding, and vendor assistance

    35. Issues for Product Development Robust design Time-based competition Modular design Computer-aided design Value analysis Environmentally friendly design “Green” manufacturing This slide introduces some of the issues of product development.This slide introduces some of the issues of product development.

    36. Robust Design Products are designed so that they may be manufactured uniformly and consistently despite adverse manufacturing and environmental conditions. After discussing the concept of robust design, you might identify a product and ask students to identify the use of robust design in its production. (One example is the use of the plastic seal on the inside of soda bottle caps)After discussing the concept of robust design, you might identify a product and ask students to identify the use of robust design in its production. (One example is the use of the plastic seal on the inside of soda bottle caps)

    37. Time-based Competition Product life cycles are becoming shorter. ? Faster developers of new products gain on slower developers and obtain a competitive advantage Ask the students to consider the effect of time-based competition not only on the producer, but also on the customer. Assume that you order two computers, through a catalog, directly from the factory. If you place one order today, and a second two days from now (for the same model, etc.), you may well receive two machines sufficiently different that the installation procedure for one will not work on the second. The producer has to deal with the issue of producing a constantly evolving product, but you also have to manage the problem created by the increasingly short and perhaps in a sense, artificial, product lifetimes.Ask the students to consider the effect of time-based competition not only on the producer, but also on the customer. Assume that you order two computers, through a catalog, directly from the factory. If you place one order today, and a second two days from now (for the same model, etc.), you may well receive two machines sufficiently different that the installation procedure for one will not work on the second. The producer has to deal with the issue of producing a constantly evolving product, but you also have to manage the problem created by the increasingly short and perhaps in a sense, artificial, product lifetimes.

    38. Modular Design Products designed in easily segmented components known as modular designs Adds flexibility to both production and marketing Examples: Airbus – wings Fast food – buns, vegetables, etc. Dell computer Ask your students to suggest examples of products that are produced in modular fashion. Certainly microcomputers provide a good example; also cars, motorcycles, and hamburgers.Ask your students to suggest examples of products that are produced in modular fashion. Certainly microcomputers provide a good example; also cars, motorcycles, and hamburgers.

    39. Designing products at a computer terminal or work station Design engineer develops rough sketch of product Uses computer to draw product Often used with CAM Computer Aided Design (CAD) CAD can be viewed both as a sophisticated design tool, and as the first step in developing a completely integrated production process. CAD=>CAM=> ... CIM.CAD can be viewed both as a sophisticated design tool, and as the first step in developing a completely integrated production process. CAD=>CAM=> ... CIM.

    40. Benefits of CAD Shorter design time Database availability New capabilities Improved product quality Reduced production costs Extensions Design for Manufacturing and Assembly (DFMA) 3-D Object Modeling CAD info is translated into machine control instructions (CAM) CAD & CAM You might point out here that modern CAD systems with 3D representation and virtual reality capability allow one to “consumer test” a product before it is produced. Students will probably be familiar with some of the televised automobile company ads.You might point out here that modern CAD systems with 3D representation and virtual reality capability allow one to “consumer test” a product before it is produced. Students will probably be familiar with some of the televised automobile company ads.

    41. Virtual Reality Computer technology used to develop an interactive, 3-D model of a product Especially helpful in design of layouts (e.g. factory, store, home, office, etc.)

    42. 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 You might suggest that your students view value analysis as value engineering during, rather than prior to, production. Value analysis helps continually improve both design and production methodology.You might suggest that your students view value analysis as value engineering during, rather than prior to, production. Value analysis helps continually improve both design and production methodology.

    43. 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 Environmental issues are becoming more important in product design. Ask students for example of companies which stress environmentally sound design and production practices. Also ask them to suggest some examples of companies which have a very poor environmental record. Why does such a difference exist?Environmental issues are becoming more important in product design. Ask students for example of companies which stress environmentally sound design and production practices. Also ask them to suggest some examples of companies which have a very poor environmental record. Why does such a difference exist?

    44. “Green” Manufacturing Make products recyclable Use recycled materials Use less harmful ingredients Use lighter components Use less energy Use less material

    45. Product Development Continuum

    46. Engineering drawing Shows dimensions, tolerances, & materials Shows codes for Group Technology Bill of Material Lists components, quantities & where used Shows product structure Engineering Change Notice (ECN) A correction or modification of an engineering drawing or bill of material Product Documents This slide introduces the concept of “product documents.” Examples will be found in subsequent slides.This slide introduces the concept of “product documents.” Examples will be found in subsequent slides.

    47. Monterey Jack (a) U.S. grade AA. Monterey cheese shall conform to the following requirements: (1)Flavor - Is fine and highly pleasing, free from undesirable flavors and odors. May possess a very slight acid or feed flavor. (2)Body and texture - A plug drawn from the cheese shall be reasonably firm. It shall have numerous small mechanical openings evenly distributed throughout the plug. It shall not possess sweet holes, yeast holes, or other gas holes (3)Color - Shall have a natural, uniform, bright and attractive appearance. (4)Finish and appearance - bandaged and paraffin-dipped. The rind shall be sound, firm, and smooth providing a good protection to the cheese An excerpt from the specifications for Monterey Jack cheese. You might ask students to compare their perception of several other cheese to this excerpt, and note the differences.An excerpt from the specifications for Monterey Jack cheese. You might ask students to compare their perception of several other cheese to this excerpt, and note the differences.

    48. Engineering Drawing Example You might note to the students that the engineering drawing contains all dimensions necessary to produce the product - but specifies nothing about the production process.You might note to the students that the engineering drawing contains all dimensions necessary to produce the product - but specifies nothing about the production process.

    49. Engineering Drawings - Show Dimensions, Tolerances, etc.

    50. Bill of Material Example Remind students that the Bill of Material indicates all parts or kits required to assemble a unit of the product and that bills of materials at multiple levels are required to fully specify each and every individual part contained in the finished unit. (The bill of material portrayed on the slide specifies a “frame assembly,” but does not tell us what pieces are required to produce the assembly. This information would be contained in a lower level bill of materials.)Remind students that the Bill of Material indicates all parts or kits required to assemble a unit of the product and that bills of materials at multiple levels are required to fully specify each and every individual part contained in the finished unit. (The bill of material portrayed on the slide specifies a “frame assembly,” but does not tell us what pieces are required to produce the assembly. This information would be contained in a lower level bill of materials.)

    52. 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 At this point, one can raise the arguments for producing in-house versus purchasing. It might be useful in this instance to look both at manufacturing and services. Useful examples can be developed from: - the publishing industry where the publisher may perform the editing and project management, but contract virtually everything else out; - the role of production in house versus that of purchasing services outside in developing a distance education program, or staffing a hospital; - the procedure followed in the development of the Microsoft Windows 97 operating system, versus that for the Linux operating system. You might also ask your students to consider the relationship between the make-or-buy decision and the concept of the virtual organization.At this point, one can raise the arguments for producing in-house versus purchasing. It might be useful in this instance to look both at manufacturing and services. Useful examples can be developed from: - the publishing industry where the publisher may perform the editing and project management, but contract virtually everything else out; - the role of production in house versus that of purchasing services outside in developing a distance education program, or staffing a hospital; - the procedure followed in the development of the Microsoft Windows 97 operating system, versus that for the Linux operating system. You might also ask your students to consider the relationship between the make-or-buy decision and the concept of the virtual organization.

    53. Reasons for Making lower production cost unsuitable suppliers assure adequate supply utilize surplus labor and make a marginal contribution obtain desired quality remove supplier collusion obtain a unique item that would entail a prohibitive commitment from the supplier maintain organizational talent protect proprietary design or quality increase/maintain size of company

    54. Reasons for Buying lower acquisition cost preserve supplier commitment obtain technical or management ability inadequate capacity reduce inventory costs ensure flexibility and alternate source of supply reciprocity item is protected by patent or trade secret frees management to deal with its primary business

    55. Parts grouped into families Similar, more standardized parts Uses coding system Describes processing & physical characteristics Part families produced in manufacturing cells Mini-assembly lines Group Technology Characteristics You might ask your students to consider the requirements necessary for the concept of group technology to be successful.You might ask your students to consider the requirements necessary for the concept of group technology to be successful.

    56. Group Technology Code Example

    57. Group Technology Schemes Enable Grouping of Parts

    58. Improved product design Reduced purchases Reduced work-in-process inventory Improved routing & machine loading Reduced setup & production times Simplified production planning & control Simplified maintenance Group Technology Benefits You might ask your students to consider the “downside” to group technology. Are the limitations it places on development and production significant or important?You might ask your students to consider the “downside” to group technology. Are the limitations it places on development and production significant or important?

    59. Production Documents Assembly Drawing Assembly chart Route sheet Work order This slide introduces the notion of production documents.This slide introduces the notion of production documents.

    60. Shows exploded view of product Assembly Drawing

    61. Assembly Drawing and Chart This slide depicts both an Assembly Drawing and and Assembly Chart. Note that the Chart depicts both the relationship of the pieces and the sequence of assembly.This slide depicts both an Assembly Drawing and and Assembly Chart. Note that the Chart depicts both the relationship of the pieces and the sequence of assembly.

    62. Route Sheet Lists all operations Note that the Route Sheet depicts both operations and timing.Note that the Route Sheet depicts both operations and timing.

    63. Work Order

    64. 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 One might point out to students that as the market environment tends to evolve more rapidly, configuration management will become an even more important issue.One might point out to students that as the market environment tends to evolve more rapidly, configuration management will become an even more important issue.

    65. Service Design – Customer Participation Ask students to suggest example of services showing the various degrees of customer interaction in design. You might also ask students whether they would anticipate some the the notions of service design (customization, for example) to become important in manufacturing (mass customization?)Ask students to suggest example of services showing the various degrees of customer interaction in design. You might also ask students whether they would anticipate some the the notions of service design (customization, for example) to become important in manufacturing (mass customization?)

    66. Decision Trees & Product Design Particularly useful when there are a series of decisions and outcomes which lead to other decisions and outcomes. Considerations: Include all possible alternatives and states of nature - including “doing nothing” Enter payoffs at end of each branch Approach determining expected values by backward induction & “pruning” tree This slide should probably be used simply to provide a reason for studying decision trees at a later time (Module A)This slide should probably be used simply to provide a reason for studying decision trees at a later time (Module A)

    67. Transition to Production First issue: knowing when to move to production Second issue: must view product development as evolutionary, not the responsibility of single individual or department Third issue: expect to need a trial production period to work the bugs out Fourth issue: recognize that responsibility must also transition This slide introduces the problem of transitioning a product from design and development to production. It would probably be helpful to use this slide as the basis for a discussion of each of the issues. Points to be made might include: - the point in time at which to transition must be chosen by consensus of both design/development and production staff - while we should view product development as evolutionary, we may be required to view the transition as iterative - where, as unforeseen problems develop in production, design changes may be required. - product design/development teams must expect to contribute to problem solving in production - product design/development staff must recognize that once the transition to production has taken place, the main responsibility for the project has also shiftedThis slide introduces the problem of transitioning a product from design and development to production. It would probably be helpful to use this slide as the basis for a discussion of each of the issues. Points to be made might include: - the point in time at which to transition must be chosen by consensus of both design/development and production staff - while we should view product development as evolutionary, we may be required to view the transition as iterative - where, as unforeseen problems develop in production, design changes may be required. - product design/development teams must expect to contribute to problem solving in production - product design/development staff must recognize that once the transition to production has taken place, the main responsibility for the project has also shifted

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