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McGraw-Hill/Irwin Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
44
Product and Service Design
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Learning ObjectivesLearning Objectives
Explain the strategic importance of product and service design.
List some key reasons for design or redesign.
Identify the main objectives of product and service design.
Discuss the importance of standardization. Discuss the importance of legal, ethical, and
environmental issues in product and service design.
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Learning ObjectivesLearning Objectives
Briefly describe the phases in product design and development.
Describe some of the main sources of design ideas.
Name several key issues in manufacturing design. Name several key issues in service design. Name the phases in service design. List the characteristics of well-designed service
systems. Name some of the challenges of service design.
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Major factors in design strategy Cost Quality Time-to-market Customer satisfaction Competitive advantage
Product and Service DesignProduct and Service Design
Product and service design – or redesign – should be closely tied to an organization’s strategy
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1. Translate customer wants and needs into product and service requirements
2. Refine existing products and services3. Develop new products and services4. Formulate quality goals5. Formulate cost targets6. Construct and test prototypes7. Document specifications
Product or Service Design ActivitiesProduct or Service Design Activities
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Reasons for Product or Service Reasons for Product or Service DesignDesign
Economic
Social and demographic
Political, liability, or legal
Competitive
Cost or availability
Technological
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Objectives of Product and Objectives of Product and Service DesignService Design
Main focus Customer satisfaction Understand what the customer wants
Secondary focus Function of product/service Cost/profit Quality Appearance Ease of production/assembly Ease of maintenance/service
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Taking into account the capabilities of the organization in designing goods and services.
Failure to take this into account can: Reduce productivity Reduce quality Increase costs
Designing For OperationsDesigning For Operations
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Legal FDA, OSHA, IRS Product liability Uniform commercial code
Ethical Releasing products with defects
Environmental EPA
Legal, Ethical, and Environmental Legal, Ethical, and Environmental IssuesIssues
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Regulations & Legal ConsiderationsRegulations & Legal Considerations
Product Liability - A manufacturer is liable for any injuries or damages caused by a faulty product.
Uniform Commercial Code - Products carry an implication of merchantability and fitness.
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Designers Adhere to GuidelinesDesigners Adhere to Guidelines
Produce designs that are consistant with the goals of the company
Give customers the value they expect Make health and safety a primary
concern Consider potential harm to the
environment
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Other Issues in Product and Other Issues in Product and Service DesignService Design
Product/service life cycles How much standardization Mass customization Product/service reliability Robust design Degree of newness Cultural differences
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Life Cycles of Products or ServicesLife Cycles of Products or Services
Time
Introduction
Growth
Maturity
Saturation
Decline
Dem
and
Figure 4.1
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StandardizationStandardization
Standardization Extent to which there is an absence of
variety in a product, service or process
Standardized products are immediately available to customers
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Advantages of StandardizationAdvantages of Standardization
Fewer parts to deal with in inventory & manufacturing
Design costs are generally lower
Reduced training costs and time
More routine purchasing, handling, and inspection procedures
Quality is more consistent
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Advantages of Standardization Advantages of Standardization (Cont’d)(Cont’d)
Orders fillable from inventory
Opportunities for long production runs and automation
Need for fewer parts justifies increased expenditures on perfecting designs and improving quality control procedures.
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Disadvantages of StandardizationDisadvantages of Standardization
Designs may be frozen with too many imperfections remaining.
High cost of design changes increases resistance to improvements.
Decreased variety results in less consumer appeal.
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• Mass customization: A strategy of producing standardized
goods or services, but incorporating some degree degree of customization
Delayed differentiation Modular design
Mass CustomizationMass Customization
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• Delayed differentiation is a postponement tactic Producing but not quite completing a
product or service until customer preferences or specifications are known
Delayed DifferentiationDelayed Differentiation
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Modular DesignModular Design
Modular design is a form of standardization in which component parts are subdivided into modules that are easily replaced or interchanged. It allows:
easier diagnosis and remedy of failures
easier repair and replacement
simplification of manufacturing and assembly
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ReliabilityReliability
Reliability: The ability of a product, part, or 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
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Improving ReliabilityImproving Reliability
• Component design
• Production/assembly techniques
• Testing
• Redundancy/backup
• Preventive maintenance procedures
• User education
• System design
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Product DesignProduct Design
Product Life Cycles
Robust Design
Concurrent Engineering
Computer-Aided Design
Modular Design
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Robust Design: Design that results in products or services that can function over a broad range of conditions
Robust DesignRobust Design
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Taguchi Approach Robust DesignTaguchi Approach Robust Design
Design a robust product Insensitive to environmental factors either in
manufacturing or in use. Central feature is Parameter Design. Determines:
factors that are controllable and those not controllable
their optimal levels relative to major product advances
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Degree of NewnessDegree of Newness
1.Modification of an existing product/service
2.Expansion of an existing product/service
3.Clone of a competitor’s product/service
4.New product/service
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Degree of Design ChangeDegree of Design Change
Type of Design Change
Newness of the organization
Newness to the market
Modification Low Low
Expansion Low Low
Clone High Low
New High High
Table 4.3
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Cultural DifferencesCultural Differences
Multinational companies must take into account cultural differences related to the product design.
Notable failures: Chevy Nova in Mexico Ikea beds in U.S.
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Global Product DesignGlobal Product Design
Virtual teams Uses combined efforts of a team of designers
working in different countries Provides a range of comparative advantages
over traditional teams such as: Engaging the best human resources around the world Possibly operating on a 24-hr basis Global customer needs assessment Global design can increase marketability
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Phases in Product Development Phases in Product Development ProcessProcess
1. Idea generation
2. Feasibility analysis
3. Product specifications
4. Process specifications
5. Prototype development
6. Design review
7. Market test
8. Product introduction
9. Follow-up evaluation
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Idea GenerationIdea Generation
Ideas Competitor based
Supply chain based
Research based
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Reverse EngineeringReverse Engineering
Reverse engineering is the
dismantling and inspecting of a competitor’s product to discover product improvements.
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Research & Development (R&D)Research & Development (R&D)
Organized efforts to increase scientific knowledge or product innovation & may involve: Basic Research advances knowledge about
a subject without near-term expectations of commercial applications.
Applied Research achieves commercial applications.
Development converts results of applied research into commercial applications.
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ManufacturabilityManufacturability
Manufacturability is the ease of fabrication and/or assembly which is important for:
Cost
Productivity
Quality
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Designing for ManufacturingDesigning for Manufacturing
Beyond the overall objective to achieve customer satisfaction while making a reasonable profit is:
Design for Manufacturing(DFM)
The designers’ consideration of the organization’s manufacturing capabilities when designing a product.
The more general term design for operations encompasses services as well as manufacturing
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Concurrent EngineeringConcurrent Engineering
Concurrent engineering is the bringing together of engineering design and manufacturing personnel early in the design phase.
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Computer-Aided DesignComputer-Aided Design
Computer-Aided Design (CAD) is product design using computer graphics. increases productivity of designers, 3 to 10
times
creates a database for manufacturing information on product specifications
provides possibility of engineering and cost analysis on proposed designs
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Design for manufacturing (DFM) Design for assembly (DFA) Design for recycling (DFR) Remanufacturing Design for disassembly (DFD) Robust design
Product designProduct design
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Recycling: recovering materials for future use
Recycling reasons Cost savings Environment concerns Environment regulations
RecyclingRecycling
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RemanufacturingRemanufacturing
Remanufacturing: Refurbishing used products by replacing worn-out or defective components. Remanufactured products can be sold for 50% of
the cost of a new producr Remanufacturing can use unskilled labor Some governments require manufacturers to
take back used products Design for Disassembly (DFD): Designing
products so that they can be easily taken apart.
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Component CommonalityComponent Commonality
Multiple products or product families that have a high degree of similarity can share components
Automakers using internal parts Engines and transmissions Water pumps Etc.
Other benefits Reduced training for assemble and installation Reduced repair time and costs
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Quality Function Deployment Voice of the customer House of quality
Quality Function DeploymentQuality Function Deployment
QFD: An approach that integrates the “voice of the customer” into the product and service development process.
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The House of QualityThe House of Quality
Correlation matrix
Designrequirements
Customerrequire-ments
Competitiveassessment
Relationshipmatrix
Specificationsor
target values
Figure 4.3
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Customer Requirements
Importance to Cust.Easy to close
Stays open on a hill
Easy to open
Doesn’t leak in rain
No road noise
Importance weighting
Engineering Characteristics
Ene
rgy
need
ed
to c
lose
doo
r
Che
ck f
orce
on
leve
l gr
ound
Ene
rgy
need
ed
to o
pen
door
Wat
er r
esis
tanc
e
10 6 6 9 2 3
7
5
3
3
2
X
X
X
X
X
Correlation:Strong positivePositiveNegativeStrong negative
X*Competitive evaluation
X = UsA = Comp. AB = Comp. B(5 is best)
1 2 3 4 5
X AB
X AB
XAB
A X B
X A B
Relationships:Strong = 9Medium = 3Small = 1Target values
Red
uce
ener
gy
leve
l to
7.5
ft/lb
Red
uce
forc
eto
9 lb
.
Red
uce
ener
gy to
7.5
ft/l
b.
Mai
ntai
ncu
rren
t lev
elTechnical evaluation(5 is best)
54321
B
A
X
BAX B
AX
BXA
BXABA
X
Doo
r se
al
resi
stan
ce
Acc
oust
. Tra
ns.
Win
dow
Mai
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el
Mai
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House of Quality ExampleHouse of Quality ExampleFigure 4.4
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Kano Model
Customer Needs
Cu
sto
mer
Sati
sfa
cti
on
Excitement
Expected
Must Have
Kano Model
Customer Needs
Cu
sto
mer
Sati
sfa
cti
on
Excitement
Expected
Must Have
The Kano ModelThe Kano ModelFigure 4.5
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Service DesignService Design
Service is an act Service delivery system
Facilities Processes Skills
Many services are bundled with products
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Service DesignService Design
Service design involves The physical resources needed The goods that are purchased or consumed
by the customer Explicit services Implicit services
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Service DesignService Design
Service Something that is done to or for a customer
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 The physical resources needed to perform
the service
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Tangible – intangible Services created and delivered at the same
time Services cannot be inventoried Services highly visible to customers Services have low barrier to entry Location important to service Range of service systems Demand variability
Differences Between Product Differences Between Product and Service Designand Service Design
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Service SystemsService Systems
Service systems range from those with little or no customer contact to very high degree of customer contact such as: Insulated technical core (software development) Production line (automatic car wash) Personalized service (hair cut, medical service) Consumer participation (diet program) Self service (supermarket)
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Service Demand VariabilityService Demand Variability
Demand variability creates waiting lines and idle service resources
Service design perspectives: Cost and efficiency perspective Customer perspective
Customer participation makes quality and demand variability hard to manage
Attempts to achieve high efficiency may depersonalize service and change customer’s perception of quality
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Phases in Service DesignPhases in Service Design
1.Conceptualize
2.Identify service package components
3.Determine performance specifications
4.Translate performance specifications into design specifications
5.Translate design specifications into delivery specifications
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Service BlueprintingService Blueprinting
Service blueprinting A method used in service design to describe
and analyze a proposed service
A useful tool for conceptualizing a service delivery system
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Major Steps in Service Major Steps in Service BlueprintingBlueprinting
1. Establish boundaries
2. Identify sequence of customer interactions
• Prepare a flowchart
3. Develop time estimates
4. Identify potential failure points
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Characteristics of Well Designed Characteristics of Well Designed Service SystemsService Systems
1. Consistent with the organization mission
2. User friendly
3. Robust
4. Easy to sustain
5. Cost effective
6. Value to customers
7. Effective linkages between back operations
8. Single unifying theme
9. Ensure reliability and high quality
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Challenges of Service DesignChallenges of Service Design
1. Variable requirements
2. Difficult to describe
3. High customer contact
4. Service – customer encounter
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Guidelines for Successful Service Guidelines for Successful Service DesignDesign
1. Define the service package2. Focus on customer’s perspective3. Consider image of the service package4. Recognize that designer’s perspective is different
from the customer’s perspecticve5. Make sure that managers are involved6. Define quality for tangible and intangibles7. Make sure that recruitment, training and rewards
are consistent with service expectations8. Establish procedures to handle exceptions9. Establish systems to monitor service
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1. Increase emphasis on component commonality
2. Package products and services3. Use multiple-use platforms4. Consider tactics for mass
customization5. Look for continual improvement6. Shorten time to market
Operations StrategyOperations Strategy
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Shorten Time to MarketShorten Time to Market
1. Use standardized components
2. Use technology
3. Use concurrent engineering
