Product design process and management

Product design process

• Companies continuously bring new product to market

• Product design is integral to success

• Product design differs significantly depending on the industry

• Companies often outsource major functions

Contract manufacturer

An organization that performs manufacturing and/or purchasing needed to produce a product or device not for itself but as a service to another firm.

• Core competence: the one thing a company can better than its competitors

  1. It provides potential access to a wide variety of markets

  2. It increases perceived customer benefits

  3. It is hard for competitors to imitate

6 phases of the generic development process

0. Planning

1. Concept development

2. System level design

3. Design detail

4. Testing and refinement

5. Production ramp up

0. Planning

1. Concept Development

2. System Level Design

3. Design Detail

4.Testing and Refinement

5.Production Ramp Up

Variants of generic product development process

• Technology push products

• Platform products

• Process intensive products

• Customised products

• High risk products

• Quick build products

• Complex systems

Technology push products

Firms begins with new technology and looks for a market

Platform products

Built around a preexistent technological subsystem

Process intensive products

• Production process has an impact on the properties of the product

• Product design cannot be separated from process design

Customised products

New products are slight variations of existing configuration

High risk products

Technical or market uncertainties create high risks of failure

Quick build products

Rapid modeling and prototyping enables may design build test cycle

Complex systems

Systems must decomposed into several subsystems and many components

Variant of Generic Product Development Process

Quality Function Deployment

• Interfunctional teams from marketing, design engineering, and
  manufacturing

• Begins with listening to the customer

  • Uses market research

• Converts the expectations and demands of customers into clear
  objectives

  • These are then translated into specifications

• Customer requirements forms the basis for the house of quality

Value Analysis/ Value Engineering (VA/VE)

• Purpose is to simplify products and processes

• Objective is to achieve better performance at a lower cost while
  maintaining all functional requirements defined by the customer

• Involves brainstorming such questions as:

  • Does the item have any design features that are not necessary

  • Can two or more parts be combined into one?

  • How can we cut down the weight?

  • Are there nonstandard parts that can be eliminated?

Designing Products for Manufacture and Assembly

• Traditional approach

  • “We design it, you build it” or “over-the-wall”

• Concurrent engineering

  • “Let’s work together simultaneously”

3 Criteria Against which each part must be examined

1. During the operation of the product, does the part move relative to all other parts already assembled?

2. Must the part be of a different material than, or be isolated from,
other parts already assembled?

3. Must the part be separate from all other parts to allow the
disassembly of the product for adjustment or maintenance?

Ecodesign

• Ecodesign: the incorporation of environmental considerations in the design and development of products or services

  • The whole life cycle is considered

  • The product is considered as a system

  • A multi-criteria approach is used

  • An extension of other important requirements such as quality, costs,manufacturability, functionality, and so on

  • Application of ecodesign can benefit business

Services

Why ? Because services are unique each time as they depend on customer interaction.

What ? Co production.

How ? By understanding what makes a good customer journey.

Designing Service Products

• Service products are very different

• Direct customer involvement introduces significant variability in the
  process

• Questions to address:

  • How will this variability be addressed?

  • What are the implications for operational cost and the customer service
    experience?

Similarity to current services

New service should fit into the current service experience for the customer

Similarity to current process

• Even the greatest service ideas require operational support to execute

• The more similar they are to the current process, the more of that support is already in place

Financial justification

• New services are costly and should be financially justified

Complexity

the number of steps involved in a service and the possible actions that can taken at each step

Divergence

the number of ways a customer/ service provider interaction

• The result may be a combination of higher complexity/divergence on some steps and lower complexity/divergence on others

• Can be used to determine ≠ resource requirements such as worker skills, layout, and process controls.

Process Alternatives for a Family Restaurant

Economic Analysis of Project Development Costs

• Economic analysis is useful in at least two different circumstances
  1. Go/no-go milestones
  2. Operational design and development decisions

• Building a base-case financial model

  • Compute net present value

  • Good estimates of cash flows

• Sensitivity analysis for “what if” questions

  • Calculates change in NPV corresponding to a change in the factors included in the model

  • Can be used to model different scenarios

Possible Sensitivity Analysis Scenarios

• Longer product development time

• Higher/lower sales volume

• Higher/lower sales price

• Higher/lower development costs

Measuring product development performance

• A steady stream of new products is important to competitiveness
• Firms must respond to changing customer needs and competitor
moves
• Ability to identify opportunities and bring new products to market is
critical and Must also be efficient

Time to market

There are two aspects to this, the frequency of new product
introductions and the time from initial concept to market introduction

Productivity

Such measures as the number of engineering hours, the cost
of materials, and tooling costs are used in these measures

Quality

Measures that relate to the reliability of the product in use,
the product's performance features compared to customer
expectations, and the ability of a factory or service process
to produce the product

Summary

• Product development is a major challenge that directly impacts the
  long-range success of a firm

• Many companies today outsource product design to companies that specialize in different industries

• Product development is a multistep process that is unique to each organization

• Different sets of criteria drive the design of a product

  • Criteria that relate to customer wants are fundamental

  • Criteria related to cost, manufacturability, and impact on the environment are also important

• Service products are different because direct customer involvement in the process introduces variability

Summary continued

• Financial justification of service features ensure that customers can be retained while the company is making a profit

• Economic analysis that consists of estimating the timing and magnitude of future cash flows is used to understand the financial implications of a product development project

  • Sensitivity analysis can be used to answer “what if” questions that relate to project timing and costs

• Generating a steady stream of new products to market is important to the competitiveness of the firm

• Measures that relate to time to market, costs, and quality be used to evaluate product development success