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Product and service design

  1. 1. CH 4. Product and service design. Dr. Najm A. Najm Done by Safaa. Taamsah. Operations Management E.12by William J Stevenson
  2. 2. The strategic importance of product and service design *The essence of a business organization is the products and services it offers, and every aspect of the organization and its supply chain are structured around those products and services. *organizations have a strategic interest in product and service design because organizations that have well-designed products or services are more likely to realize their goals than those with poorly designed products or services. *Product or service design should be closely tied to an organization’s strategy
  3. 3. Factors influence the strategy of design *Cost *Quality *Time-to-market *Customer satisfaction *Competitive advantage As a result marketing, finance, operations, accounting, IT, and HR need to be involved in design.
  4. 4. What Does Product and Service Design Do? The various activities and responsibilities (functional interactions) 1. Translate customer wants and needs into product and service requirements. (marketing, operations) 2. Refine existing products and services. (marketing) 3. Develop new products and/or services. (marketing, operations) 4. Formulate quality goals. (marketing, operations) 5. Formulate cost targets. (accounting, finance, operations) 6. Construct and test prototypes. (operations, marketing, engineering) 7. Document specifications. 8. Translate product and service specifications into process specifications. (engineering, operations)
  5. 5. The key questions of product and service design Is there demand for it? Can we do it ? Known as Manufacturability, serviceability What level of quality is appropriate? Does it make sense from an economic standpoint?
  6. 6. Reasons for Product and Service Design or Redesign The main forces that initiate design or redesign are market opportunities and threats. The factors that give rise to market opportunities and threats can be one or more changes: Economic. Social and demographic. Political, liability, or legal. Competitive. Cost or availability. Technological.
  7. 7. Some of the main sources of design ideas (IDEA GENERATION) Reverse engineering : Dismantling and inspecting a competitor’s product to discover product improvements. Research and development (R&D) Organized efforts to increase scientific knowledge or product innovation. R&D efforts may involve basic research, applied research, or development. Other sources : Customers , employees , distributors and suppliers . customer input can come from surveys, focus groups, complaints, and unsolicited suggestions for improvement. Input from suppliers, distributors, and employees can be obtained from interviews, direct or indirect suggestions, and complaints.
  8. 8. LEGAL AND ETHICAL CONSIDERATIONS Legal : Most organizations are subject to numerous government agencies that regulate them such as Food and Drug Administration, the Occupational Health and Safety Administration, the Environmental Protection Agency. Product liability is the responsibility of a manufacturer for any injuries or damages caused by a faulty product because of poor workmanship or design. Uniform Commercial Code : A product must be suitable for its intended purpose.
  9. 9. LEGAL AND ETHICAL CONSIDERATIONS Ethical “Releasing products with defects “ *Or “vaporware,” when a company doesn’t issue a release of a software or hardware as scheduled as it struggles with production problems or bugs in the software. Organizations generally want designers to adhere to guidelines such as the following: i. • Produce designs that are consistent with the goals of the organization ii. • Give customers the value they expect. iii. • Make health and safety a primary concern.
  10. 10. HUMAN AND CULTURAL FACTORS oHuman consideration : - Safety and liability. - Adding new features to their products or services (CS). oCultural consideration : Product designers in companies that operate globally also must take into account any cultural differences of different countries or regions related to the product .
  11. 11. GLOBAL PRODUCT AND SERVICE DESIGN oAdvantages: Engaging the best human resources from around the world without the need to assemble them all in one place, and operating on a 24-hour basis Global product design can provide design outcomes that increase the marketability and utility of a product oDisadvantages: If it is mismanaged, that can lead to conflicts and miscommunications.
  12. 12. ENVIRONMENTAL FACTORS: SUSTAINABILITY Key aspects include : Cradle-to-grave assessment” life cycle analysis”. End-of-life programs (EOL). The Three Rs: Reduce, Reuse, and Recycle.
  13. 13. ENVIRONMENTAL FACTORS: SUSTAINABILITY Key aspects include : Cradle-to-grave assessment” life cycle analysis” is the assessment of the environmental impact of a product or service throughout its useful life, focusing on such factors as global warming ,smog formation and oxygen depletion. The goal of cradle-to-grave assessment is to choose products and services that have the least environmental impact while still taking into account economic considerations. cradle-to-grave assessment are part of the ISO 14000 environmental management standards.
  14. 14. ENVIRONMENTAL FACTORS: SUSTAINABILITY Key aspects include : End-of-life programs (EOL) programs deal with products that have reached the end of their useful lives. The purpose of these programs is to reduce the dumping of products, particularly electronic equipment in landfills or third-world countries. Example : IBM provides a good example of the potential of EOL programs. Over the last 15 years, it has collected about 2 billion pounds of product and product waste .
  15. 15. ENVIRONMENTAL FACTORS: SUSTAINABILITY Key aspects include : The Three Rs: Reduce, Reuse, and Recycle. Reduce: Value Analysis refers to an examination of the function of parts and materials in an effort to reduce the cost and/or improve the performance of a product. Reuse: Remanufacturing refers to refurbishing used products by replacing worn-out or defective components, and reselling the products . Designing products so that they can be more easily taken apart has given rise to yet another design consideration: Design for disassembly (DFD) Recycling means recovering materials for future use . Companies recycle for a variety of reasons, including Cost savings, Environment concerns, Environmental regulations. Design for recycling (DFR) Design that facilitates the recovery of materials and components in used products for reuse.
  16. 16. OTHER DESIGN CONSIDERATIONS Strategies for Product or Service Life Stages. Degree of Standardization. Designing for Mass Customization. Reliability. Robust Design. Degree of Newness. Quality Function Deployment. The Kano Model.
  17. 17. Strategies for Product or Service Life Stages Most, but not all, products and services go through a series of stages over their useful life, sometimes referred to as their life cycle, as shown in Figure 4.1. Different phases call for different strategies. In every phase, forecasts of demand and cash flow are key inputs for strategy.
  18. 18. 1. Introduction: Proper research and forecasting should be done to ensure the product/service is adequate for a specific market and for a specific time. 2. Growth : Reputation for the product grows and an accurate forecast of demand is needed to determine the length of time the product/service will remain in the market. 3. Maturity : Forecasting should provide an estimate of how long it will be before the market dies down, causing the product to die out. 4. Decline : The last stage involves choosing to discontinue the product/service, replacing the product with a new product, or finding new uses for the product.
  19. 19. Degree of Standardization Standardization refers to the extent to which there is absence of variety in a product, service, or process. Standardized service implies that every customer or item processed receives essentially the same service ,ex : An automatic car wash.
  20. 20. Benefits and Advantages of Standardization Standardized products are immediately available to customers. Fewer interchangeable parts to deal with in inventory and in manufacturing. Design costs are generally lower. Save time and money while increasing quality and reliability. Reduced time and cost to train employees and reduced time to design jobs, scheduling of work, inventory handling, and purchasing and accounting activities become much more routine. Quality is more consistent.
  21. 21. Disadvantages of Standardization 1. Designs may be frozen with too many imperfections remaining. 2. High cost of design changes increases resistance to improvements. 3. Decreased variety results in less consumer appeal.
  22. 22. Designing for Mass Customization “A strategy of producing basically standardized goods, but incorporating some degree of customization” TOW Tactics can make this possible : 1. Delayed differentiation 2. Modular design.
  23. 23. Delayed differentiation IS a postponement tactic: the process of producing, but not quite completing, a product or service, postponing completion until customer preferences or specifications are known. The result of delayed differentiation is a product or service with customized features that can be quickly produced, appealing to the customers’ desire for variety and speed of delivery, and yet one that for the most part is standardized.
  24. 24. Delayed differentiation EXAMPLE : Automobile manufacturers That mass produce base models and add minor customizations when the car is actually ordered. In many cases, customizations such as audio systems may be installed at the dealership.
  25. 25. Modular design Modular design A form of standardization in which component parts are grouped into modules that are easily replaced or interchanged. One familiar example of modular design is computers, which have modular parts that can be replaced if they become defective. Example:“ Dell Computers has successfully used this concept to become a dominant force in the PC industry by offering consumers the opportunity to configure modules according to their own specifications”.
  26. 26. Reliability Reliability : Is a measure of the ability of a product, a part, a service, or an entire system to perform its intended function under a prescribed set of conditions. Failure : Situation in which a product, part, or system does not perform as intended. Normal operating conditions : The set of conditions under which an item’s reliability is specified, Such as: load, temperature, and humidity ranges as well as operating procedures and maintenance schedules.
  27. 27. Normal operating conditions example oUsing a passenger car for too heavy loads will cause excess wear and tear on the car engine.
  28. 28. Improving Reliability Reliability can be improved in a number of ways such as : 1. Improve component design. 2. Improve production and/or assembly techniques. 3. Improve testing. 4. Use backups. 5. Improve preventive maintenance procedures. 6. Improve user education. 7. Improve system design.
  29. 29. Robust Design “Design that results in products or services that can function over a broad range of conditions”. Other def. It is defined as reducing variation in a product without eliminating the causes of the variation. In other words, making the product or process insensitive to variation.
  30. 30. Robust Design “Taguchi’s Approach: Japanese engineer Genichi Taguchi’s approach is based on the concept of robust design.” His premise : is that it is often easier to design a product that is insensitive to environmental factors, either in manufacturing or in use, than to control the environmental factors. The value of this approach is its ability to achieve major advances in product or process design fairly quickly, using a relatively small number of experiments. Taguchi is considered the “Father of Quality Engineering.”
  31. 31. Degree of Newness Product or service design change can range from the modification of an existing product or service to an entirely new product or service: 1. Modification of an existing product or service. 2. Expansion of an existing product line or service offering. 3. Clone of a competitor’s product or service. 4. New product or service. For example : mobile phones products, transportation services.
  32. 32. Quality function deployment(QFD) “(QFD) An approach that integrates the “voice of the customer” into both product and service development”. The structure of QFD is based on a set of matrices. The main matrix relates customer requirements (what) and their corresponding technical requirements (how). This matrix is illustrated in Figure 4.2 . The matrix provides a structure for data collection.
  33. 33. The Kano Model “The Kano model is a theory of product and service design developed by Dr. Noriaki Kano, a Japanese professor, who offered a perspective on customer perceptions of quality”. The model employs three definitions of quality: basic, performance, and excitement. *** Performance quality refers to customer requirements that generate satisfaction or dissatisfaction in proportion to their level of functionality and appeal. ***
  34. 34. PHASES IN PRODUCT DESIGN AND DEVELOPMENT 1. Feasibility analysis : Market analysis (demand) Economic analysis (development cost and production cost, profit potential) Technical analysis (capacity requirements and availability, and the skills needed). 2. Product specifications : what is needed to meet (or exceed) customer wants. 3. Process specifications : specifications for the process that will be needed to produce the product. Alternatives must be weighed in terms of cost, availability of resources, profit potential, and quality. 4. Prototype development: one (or a few) units are made to see if there are any problems with the product or process specifications.
  35. 35. PHASES IN PRODUCT DESIGN AND DEVELOPMENT 5. Design review : At this stage, any necessary changes are made or the project is abandoned. 6. Market test : A market test is used to determine the extent of consumer acceptance. If unsuccessful, the product returns to the design review phase. 7. Product introduction : The new product is promoted. 8. Follow-up evaluation : Based on user feedback, changes may be made or forecasts refined.
  36. 36. DESIGNING FOR PRODUCTION Design techniques that have greater applicability for the design of products than the design of services this include the following techniques : Concurrent Engineering. Computer-Aided Design (CAD). Production Requirements. Component Commonality.
  37. 37. DESIGNING FOR PRODUCTION Concurrent Engineering “Concurrent engineering or simultaneous engineering means bringing design and manufacturing engineering people together early in the design phase to simultaneously develop the product and the processes for creating the product”. The purpose of Concurrent Engineering is : To achieve product designs that reflect customer wants as well as manufacturing capabilities . To achieve a smoother transition from product design to production, and to decrease product development time.
  38. 38. DESIGNING FOR PRODUCTION Concurrent Engineering Advantages of Concurrent Engineering : 1. Manufacturing personnel are able to identify production capabilities and capacities 2. Design or procurement of critical tooling, that might have long lead times ,can occur early in the process.(shortening of the product development process) 3. The technical feasibility of a particular design or a portion of a design can be assessed. 4.The emphasis can be on problem resolution instead of conflict resolution.
  39. 39. DESIGNING FOR PRODUCTION Concurrent Engineering Disadvantages of Concurrent Engineering : 1. Long-standing boundaries between design and manufacturing can be difficult to overcome. 2. There must be extra communication and flexibility if the process is to work, and these can be difficult to achieve.
  40. 40. DESIGNING FOR PRODUCTION Computer-Aided Design (CAD) Definition :“CAD A Product design using computer graphics”. A growing number of products are being designed in this way, including transformers, automobile parts, aircraft parts, integrated circuits, and electric motors.
  41. 41. DESIGNING FOR PRODUCTION Computer-Aided Design (CAD) Computer-Aided Design major benefits : CAD increases the productivity of designers from 3 to 10 times. Creation of a database for manufacturing that can supply needed information on product. Some CAD systems allow the designer to perform engineering and cost analyses on proposed designs.
  42. 42. DESIGNING FOR PRODUCTION Production Requirements Designers must take into account the following aspects :  Production capabilities : e.g., equipment, skills, types of materials, schedules, technologies, special abilities), This helps in choosing designs that match capabilities. Forecasts of future demand can be very useful. Manufacturability :The ease of fabrication and/or assembly, (DFM AND DFA)
  43. 43. DESIGNING FOR PRODUCTION Production Requirements Manufacturability : IS important for cost, productivity, and quality. Design for manufacturing (DFM) : The designing of products that are compatible with an organization’s capabilities. Design for assembly (DFA) : Design that focuses on reducing the number of parts in a product and on assembly methods and sequence.
  44. 44. DESIGNING FOR PRODUCTION Component Commonality Products or services that have a high degree of similarity of features and components such as product families or when a part can be used in multiple products (share parts). Significant Benefits from Commonality : Savings in design time and cost Reduced training for assemble and installation Saving in repair time and cost.
  45. 45. Service design Service refers to an act, something that is done to or for a customer (client, patient, etc.), It is provided by a service delivery system There are many similarities between product and service design. However, there are some important differences as well One major difference is that services are usually Created and delivered simultaneously.
  46. 46. Service design Service delivery system :The facilities, processes, and skills needed to provide a service. Product bundle : The combination of goods and services provided to a customer. Service package that include :  The physical resources needed.  The accompanying goods that are purchased or consumed by the customer, or provided with the service.  Explicit services (the essential/core features of a service, such as tax preparation).  Implicit services (ancillary/extra features, such as friendliness, courtesy).
  47. 47. Over view of Service design Two key issues in service design are : oThe degree of variation in service requirements oThe degree of customer contact and customer involvement in the delivery system. These have an impact on the degree to which service can be standardized or must be customized.
  48. 48. Differences between Service Design and Product Design 1- Products are tangible – Services are intangible 2- Services created and delivered at the same time. 3- Services cannot be inventoried 4- Services highly visible to customers 5- Services have low barrier to entry and exit 6- Location important to service 7- Range of service systems from those with little or no customer contact to those that have a very high degree of customer contact. 8- Demand variability
  49. 49. Phases in the Service Design Process
  50. 50. Service Blueprinting •A method used in service design to describe and analyze a proposed service. • A useful tool for conceptualizing a service delivery system •service blueprint is much like an architectural drawing shows the basic customer and service actions involved in a service operation.
  51. 51. Service Blueprinting
  52. 52. Service Blueprinting Major Steps in Service Blueprinting : 1. Establish boundaries for the service and decide on the level of detail needed. 2. Identify and determine the sequence of customer and service actions and interactions. A flowchart can be a useful tool for this. 3. Develop time estimates for each phase of the process. 4. Identify potential failure points and develop a plan to prevent or minimize them.
  53. 53. Characteristics of Well-Designed Service Systems 1. Consistent with the organization’s mission. 2. User friendly. 3. Robust. 4. Easy to sustain. 5. Cost effective. 6. Value to customers. 7. Effective linkages between back operations. 8. Having a Single unifying theme.
  54. 54. What Are The Challenges of Service Design? Requirements tend to be variable, both in terms of differences in what customers want or need, and in terms of the timing of customer requests. Balancing supply and demand. Services can be difficult to describe precisely and are dynamic in nature.
  55. 55. OPERATIONS STRATEGY Product and service design is a fertile area for achieving competitive advantage and/or increasing customer satisfaction. Potential sources of such benefits include the following : Packaging products and ancillary services to increase sales. "component commonality” . Using multiple-use platforms. Implementing tactics that will achieve the benefits of high volume while satisfying customer needs for variety, such as mass customization. Continually monitoring products and services for small improvements
  56. 56. OPERATIONS STRATEGY Shortening the time it takes to get new or redesigned goods and services to market, by using the approach “first-to-market” approach companies are able to enter markets ahead of their competitors. THIS APPROACH INCLUDE : • Using standardized components to create new but reliable products. • Using technology such as computer-aided design (CAD) equipment to rapidly design new or modified products. • Concurrent engineering to shorten engineering time