Product and Service Design
Trends in Product & Service Design:
Ø Customer satisfaction
v Designing
products & services that are “user friendly”
ü User friendly software
Ø Reducing time to introduce/produce new
product or service
v PhD degree in 6 months
Ø The organization’s capabilities to
produce or deliver the right item on time
v Compaq could not deliver enough laptops
in mid 90s
Ø Environmental concerns
v Designing products that use less
material
ü Toyota Prius
Product and Service Design
Ø Major factors in design strategy
v Cost
v Quality
v Time-to-market
v Customer satisfaction
v Competitive advantage
Product and service design – or redesign – should be closely tied
to an organization’s strategy.
Product and service design – or redesign – should be closely tied
to an organization’s strategy.
Activities
of Product or
Service
Design
Ø Translate customer wants and needs into
product and service requirements
Ø Refine existing products and services
Ø Develop new products and services
Ø Formulate
v quality goals
v cost targets
Ø Construct and test prototypes
Reasons for Product or
Service Design
Ø Economic
v Low demand, excessive warranty claims
ü SUVs easily topple over and have high warranty claims
Ø Social and demographic
v Changing tastes, aging population
ü SUVs for generation X people who age but want to stay
dynamic
Ø Political, liability, or legal
v Safety issues, new regulations, government changes
ü SUVs easily topple over and manufacturers are sued
Ø Competitive
v New products and services in the market, promotions
ü SUV sales are increased with promotions.
ü The profit margins on SUVs are huge so a lot of room
for promotions
Ø Cost or availability
v Raw materials, components, labor
Ø Technological
v Components, production processes
Objectives of Product and
Service Design
Ø Main focus
v Customer satisfaction
Ø Secondary focus
v Function of product/service
v Cost/profit
v Quality
v Appearance
v Ease of production/assembly
v Ease of maintenance/service
Design For Operations
Ø Taking into account the
capabilities of the organization in designing goods and services
v Location of facilities
v Suppliers
v Transportation fleet
v Current workforce
v Current technology
v Standing contracts
ü All can all limit the implementation of a new design
Legal, Ethical, and
Environmental Issues
Ø Legal
v IRS, FDA, OSHA
v Product liability: A manufacturer is
liable for any injuries or damages caused by a faulty product.
v Uniform commercial code: Products carry
an implication of merchantability and fitness
Ø Ethical
v Releasing products with defects
ü Releasing Software with bugs
ü Sending genetically altered food to
nations suffering food shortages
Ø Environmental
v EPA
Designers Adhere to Guidelines
Ø Produce designs that are consistent with
the goals of the company
Ø Give customers the value they expect
Ø Make health and safety a primary concern
Ø Consider potential harm to the
environment
Forthcoming Aspects of
Product Design
Ø Product Life Cycles
Ø Standardization
Ø Mass Customization
Ø Modular Design
Ø Robust Design
Ø Concurrent Engineering
Ø Computer-Aided Design
Other Issues in Product and
Service Design
Ø Product/service life cycles
Ø How much standardization
Ø Product/service reliability
Ø Range of operating conditions
Life Cycles of Products or
Services
Design for low volume
Standardization
Ø Standardization
v Extent
to which there is an absence of variety in a product, service or process
Ø The
degree of Standardization?
Ø Standardized
products are immediately available to customers
Calculators & car wash
Advantages of Standardization
Ø Fewer
parts to deal with in inventory & manufacturing
v Less
costly to fill orders from inventory
Ø Reduced
training costs and time
Ø More
routine purchasing, handling, and inspection procedures
Ø Need for
fewer parts justifies increased expenditures on perfecting designs and
improving quality control procedures.
Disadvantages of Standardization
Ø Decreased
variety results in less consumer appeal.
Ø Designs
may be frozen with too many imperfections remaining.
Ø High
cost of design changes increases resistance to improvements
v Who
likes optimal Keyboards?
Ø Standard
systems are more vulnerable to failure
v Epidemics:
People with non-standard immune system stop the plagues.
v Computer
security: Computers with non-standard software stop the dissemination of
viruses.
Mass Customization
Mass
customization:
v A
strategy of producing standardized goods or services, but incorporating some
degree of customization
v Delayed differentiation
Mass Customization I: Customize Services Around
Standardized Products
Mass Customization II: Create Customizable Products
and Services
Mass Customization III: Provide Quick Response
Throughout Supply Chain
Mass Customization IV: Provide Point of Delivery
Customization
Delayed Differentiation
Ø Delayed
differentiation is a postponement tactic
v Producing
but not quite completing a product or service until customer preferences or
specifications are known
Ø Postponing
the completion until customer specification are known
Ø Examples:
Wheeled loaders
Postponement Case Study: Hewlett & Packard
Ø H&P
produces printers for Europe market. Product manuals (different languages),
labels and power supplies (plugs are different for UK, Continental EU and US)
were used to be packaged along with printers in US.
Ø HP
postpones commitment of a printer to a certain geographic market by producing
universal printers and then applying power supplies and labels (the parts that
differentiate printers for local markets) at the last stage once demand is more
certain
Ø Packaging
was postponed to local distribution centers in each European country. Packaging
is closer to demand (in location and time) so H&P can respond faster and
redistribute the supply:
v Ireland
has 1600 with demand 1100
v Portugal
has 800 with demand 1000
v Send 200
from Ireland to Portugal
Ø For more
read: H.L. Lee and C. Billington, "Evolution of Supply Chain Management
Models and Practice at Hewlett-Packard Company," Interfaces, 25, 5,
1995: 42-63.
Delayed Differentiation=Postponement
Ø Postponement
is delaying customization step as much as possible. Producing but not quite
completing a product or service until customer preferences or specifications
are known.
v (Salad)
+ (Dressings ={1000 Islands, Vinaigrette, …})
Ø Need:
v Indistinguishable
products before customization
v Customization
step is high value added
v Unpredictable,
negatively correlated demand for finished products
v Flexible
processes to allow for postponement
Modular Design
Modular design is a
form of standardization in which component parts are subdivided into modules
that are easily replaced or interchanged. It allows:
v easier
diagnosis and remedy of failures
v easier
repair and replacement
v simplification
of manufacturing and assembly
Disadvantage: variety decreases
Modular Design
Modular design is a form of standardization in
which component parts are subdivided into modules that are easily replaced or
interchanged.
v A bad
example: Earlier Ford SUVs shared the lower body with Ford cars
Due to standardization, it allows:
v easier
diagnosis and remedy of failures
v easier
repair and replacement
v simplification
of manufacturing and assembly
Types of Modularity for Mass Customization
Mass Customization V: Modularize Components to
Customize End Products
Reliability
Ø Reliability: The
ability of a product, part, or system to perform its intended function under a
prescribed set of conditions
Ø Failure:
Situation in which a product, part, or system does not perform as intended
Ø Normal
operating conditions: The set of conditions under which an
item’s reliability is specified
v A
regular car is not to be driven at 200 mph
v A bed is
not to be used as a trampoline
Improving Reliability
Ø Good
component design improve system reliability
Ø Production/assembly
techniques
Ø Testing
v To
figure out defectives / weak units
v Dell
tests each computer’s electric circuitry after the assembly
Ø Redundancy/backup
v Exactly
why your car has a spare tire
Ø Preventive
maintenance procedures
v Medical
check-ups to discover potential diseases
Ø User
education
Ø System
design
Robust Design
Design
that can function over a broad range of conditions
Taguchi’s Approach:
Ø Design a
robust product
v Insensitive
to environmental factors either in manufacturing or in use.
v Columbia
parkas with fleece inside
ü For
skiing and rainy weather: Take out the fleece use the outer shell
ü For dry
cold air: Wear the fleece without the outer shell
ü For a
snow storm: Wear the fleece with the shell
ü When you
put on weight: Ease the belts for a relaxed fit
ü When you
are sweating: Open air ducts for breathing your body
Ø Central
feature is Parameter Design. How to set design parameters?
v Design
of experiments – a Statistics concept
Ø Determines:
v factors
that are controllable and those not controllable
v their
optimal levels relative for good product performance
Phases in Product Development Process
1.
Idea generation
2.
Feasibility analysis (Demand,
cost/profit, capacity)
4.
Process specifications (produce in
economic way)
5.
Prototype development
6.
Design review
7.
Market test
9.
Follow-up evaluation
Idea Generation
Sources of Ideas for Products and Services
Ø Internal
v Employees
v R&D
department
Ø External
v Customers,
sometimes misleading
v Competitors
ü Reverse
engineering is the dismantling and inspecting
of a competitor’s product to discover product improvements.
of a competitor’s product to discover product improvements.
ü Both can
be classified as environmental scanning activity
v Suppliers
& Customers,
ü Ford
helps its suppliers in designing components
Research & Development (R&D)
Ø Organized
efforts to increase scientific knowledge or product innovation & may
involve:
v Basic
Research advances
ü Universities,
IBM research centers
v Applied
Research
ü Motorola,
Alcatel
v Development
ü All
companies
Manufacturability
Ø Manufacturability
is the ease of fabrication and/or assembly which is important for the
following aspects:
v Cost
v Productivity
v Quality
Design for Manufacturing
Beyond the overall objective to achieve
customer satisfaction while making a reasonable profit is:
The more general term design for
operations encompasses transportation, services as well as
manufacturing.
“Over the Wall” Approach vs
Concurrent Engineering
Concurrent Engineering
Concurrent Engineering
Concurrent engineering:
Bringing
engineering design and manufacturing personnel together early in the design
phase.
v Manufacturing
personnel helps to identify production capabilities, selecting suitable materials and process, the
conflicts during production can be reduced.
v Early consideration of technical feasibility.
Product design
Ø Design
for manufacturing (DFM)
Ø Design
for assembly (DFA)
number of parts, methods, sequence.
Ø Design
for recycling (DFR)
Ø Remanufacturing
Ø Design
for disassembly (DFD)
Computer-Aided Design
Ø Computer-Aided
Design (CAD) is product design using computer graphics.
v increases
productivity of designers, 3 to 10 times
v creates
a database for manufacturing information on product specifications
v Simplifies
communication of a design. Design
teams at various locations can work together.
v provides
possibility of engineering and cost analysis on proposed designs
Ø Transonic
Systems Inc. manufactures customized medical devices; pomps, blood vessel,
blood pressure measurement equipment.
ü Design
to manufacturing was long, problematic, designers and manufacturing engineers could
not work on designs simultaneously, some of the previous designs were lost
(talking of knowledge management).
ü Savior:
CAD
Recycling-Remanufacturing
Ø Recycling:
recovering materials for future use
Ø Recycling
reasons
v Cost
savings
v Environment
concerns
v Environment
regulations
Ø Remanufacturing:
replacing worn out parts in used products
v Kodak
cameras
Ø Design
for disassembly is considering ease of disassembly while designing a product
Ø Reverse
supply chains
Quality Function Deployment
Ø Quality
Function Deployment
v Voice of
the customer
v House of
quality
QFD: An
approach that integrates the “voice of the customer” into the product and
service development process.
The House of Quality
Quality Function Deployment
A
structured and disciplined process that provides a means to identify and carry
the voice of the customer through each stage of product or service development
and implementation
QFD is for:
Ø Communication
Ø Documentation
Ø Prioritization > breakthroughs
House of Quality Example for a Car Door
The QFD and Kano Model
Ø Japanese
QFD Results
v Design
time reduced by ¼ to ½
v Problems
with initial quality decreased
v Comparison
and analysis of competitive products became possible
v Communication
between divisions improved
Ø The
Kano Model
v Product
Characteristics:
ü Must
have = Order qualifiers
ü Expected
= Order qualifiers, winners
ü Excitement
= Order winners
1. Make
sure that you have the order qualifiers
2. Determine
the level of order winners with a cost/benefit analysis
Service Design
Ø Service
is an act
Ø Service
delivery system
v Facilities
v Processes
v Skills
Ø Explicit
services
v Core of
the service: Hair styling
Ø Implicit
services
v Excitement
characteristics: Courtesy
v Many
services are bundled with products
v Maintenance
services
v Conecpt
of selling solutions: Products and Services
ü E.g. IBM
Phases in Service Design
1.
Conceptualize
2.
Identify service components
3.
Determine performance specifications
4.
Translate performance specifications
into design specifications
5.
Translate design specifications into
delivery specifications
Service Blueprinting
Ø Service
blueprinting: A method used in service design to describe and analyze a
proposed service
Ø A useful
tool for conceptualizing a service delivery system
Ø Major
Steps in Service Blueprinting
1.
Establish boundaries
2.
Identify steps involved
3.
Prepare a flowchart, see the next page,
source in justice-flowchart.pdf
4.
Identify potential failure points
5.
Establish a time frame
6.
Analyze profitability
Characteristics of Well Designed
Service Systems
Service Systems
Challenges of Service Design
Ø Variable
requirements
v Criminals
and the cases are different
Ø Difficult
to describe
v How do
you describe a criminal action?
v We need
the court system.
ü Descriptions
are not exact because they are based on words.
Ø High
customer contact
v Service
cannot be inventoried
Ø Service
– customer encounter
Differences Between Product
and Service Design
and Service Design
Most often product and services are provided together.
Products vs. Services are
Ø Tangible
– intangible
Ø Services
cannot be inventoried
Ø Services
highly visible to customers
Ø Services
have low barrier to entry
Ø Location
important to service
v Ambiance
v Convenience
Service Variability & Customer
Influence Service Design
Influence Service Design
Operations Strategy
Ø Shorten
time-to-market
Ø Package
products and services
v Sell
“solutions” not products
Ø Increase
emphasis on component commonality
Ø Use
multiple-use platforms
Ø Consider
tactics for mass customization
Ø Look for
continual improvement
Summary: Product design
Ø Remanufacturing-recycling
Ø Robust
design
Ø Design
for manufacturing (DFM)
Ø Design
for assembly (DFA)
Ø Design
for disassembly (DFD)
Ø Design
for recycling (DFR)
Ø Reliability
Practice Questions
Ø True/
False:
1. One of
the main advantages of standardization is that it increases the potential
variety of products.
2. Product
failures can be easier to remedy with modular design.
3. Quality
function deployment (QFD) is based on a set of standards
which relate customer requirements to
company capabilities.
1. Answer:
False
2. Answer:
True
3. Answer:
False
Ø Multiple-Choice:
4. The
term standardization is closely associated with:
A) Customization
B) High cost
C) Longer lead times
D) Variety
E) Interchangeability
Answer: E
5. A
formal way to document customer requirements is:
A) Consumer surveys
B) Quality function deployment (QFD)
C) Focus groups
D) Delphi technique
E) sales/marketing matrix
Answer: B
6. The stage in a product or service life cycle
where some firms adopt a defensive research posture is:
A) Incubation
B) Growth
C) Maturity
D) Saturation
E) Decline
Answer: E
Reliability
Ø Reliability: The ability of a product, part, or system to perform
its intended function under a prescribed set of conditions
Ø Failure:
Situation in which a product, part, or system does not perform as intended
Ø Normal
operating conditions: The set
of conditions under which an item’s reliability is specified
Ø Reliability
is a Probability, that the product or system will:
v Function when activated
v Function for a given length of time
Ø Independent
events
Ø Redundancy;
Why to have spare tires on the car?
Parallel vs Serial Components
Example: Reliability Diagram
Determine the reliability of the system shown
Compare this diagram to that of Example S-1
The system can be reduced to a series of three
components
By collapsing parallel components
Failure Rate:
Personal life expectancy – Strike life expectancy
Personal life expectancy – Strike life expectancy
Figure 4S-1
Exponential Distribution for Life X
Use Exponential Distribution
to Model Lifetime
to Model Lifetime
Ø Exponential
distribution is a simple density used to model lifetimes
Ø Its
failure rate is constant
v So does
not apply to human life. Insurers use more complicated densities.
Ø The
reliability of each part in a system
Reliability=P(Part
works at T)=1-F(T)
Ø Once
reliabilities are computed for all parts, combine parts according to whether
serial or parallel
Improving Reliability
Ø Component
design
Ø Production/assembly
techniques
Ø Testing
Ø Redundancy/backup
Ø Preventive
maintenance procedures
Ø User
education
Ø System
design
How much of reliability is good? Cost-benefit
analysis.
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