Goods And Service Design - Notes

Fuel efficiency and environmental concerns are important in developing nations.
Consumers want low-cost vehicles with high quality, reliability, and style.
Design should consider unique consumer needs and affordable prices.
Strategic decisions about goods and services determine a firm's growth and profitability.
Every design project involves trade-offs between technology, functionality, ambition, and affordability.
Customer benefit packages require high-level coordination throughout the value chain.
Design for value involves complex decisions about engines, equipment, safety add-ons, materials, and designs.
Sales, maintenance, and financing should be examined for new ideas.

Companies use a structured process to design and improve goods and services (Exhibit 4.1).
The designs of both goods and services follow a similar path.
The critical differences lie in the detailed product and process design phases.

Strategic directions and competitive priorities should be consistent with the firm's mission and vision.
These steps require research and innovation involving marketing, engineering, operations, and sales functions.
Customers, suppliers, and employees should be involved throughout the value chain.
The data and information from this effort provide the key input for designing the final customer benefit package.

Firms have a variety of choices in configuring a customer benefit package (CBP).
CBP design and configuration choices revolve around understanding customer needs and the value customers place on attributes like:
- Time: Self-service checkout to reduce customer waiting time.
- Place: Convenient store locations or on-site day-care centers.
- Information: Providing internet search capabilities or a telephone hotline for expert advice.
- Entertainment: Rock-climbing walls or piano serenades.
- Exchange: Options for buying goods in-store, online with delivery, or online with in-store pickup.
- Form: Physical characteristics of the good, addressing aesthetics.

Each good or service in the CBP, as well as the process that creates it, must be designed in more detail.
The design of a manufactured good focuses on its physical characteristics (dimensions, materials, color).
The process by which the good is manufactured is designed as a separate activity.
Service design cannot be done independently from the process by which the service is delivered.
The process by which the service is created and delivered is the service itself.
Service design must be addressed from two perspectives: service delivery system and the service encounter.
This phase usually includes prototype testing, where a model is constructed to test the product's performance and consumer reactions.
Rapid prototyping uses advanced technology to build prototypes quickly to reduce product development cost and time to market.

The final bundle of goods and services is advertised, marketed, and offered to customers.
For manufactured goods, this includes making the item in the factory and shipping it to warehouses or stores.
For services, it might include hiring and training employees or staying open an extra hour.
For many services, it means building sites such as branch banks, hotels, or retail stores.

Constantly evaluate how well the goods and services are selling and customers' reactions to them.

The design of a good or service should reflect customer wants and needs (customer requirements).
Customer requirements, as expressed in the customer's own words, are called the voice of the customer.
The design process must translate the voice of the customer into specific technical features.
Technical features are expressed in the language of designers and engineers (materials, size, strength, service procedures, employee behavior).
Quality function deployment (QFD) is an approach to guide the design, creation, and marketing of goods and services by integrating the voice of the customer into all decisions.
QFD can be applied to a specific manufactured good or service, or to the entire CBP.
The process is initiated with a matrix called the House of Quality.

Identify the voice of the customer and technical features of the design.
Evaluate how each technical feature relates to each customer requirement.
The roof of the House of Quality shows the interrelationships between technical features.
Assess the importance of each customer requirement and how competitors' products compare.
Identify technical features with the strongest relationships to customer requirements.
Prioritize those technical features to be