Introduction to operations and supply chain management 3e bozarth chapter 15

 Describe the five phases of product and service development and explain the difference between sequential development and concurrent engineering..  Describe some of the most common ap

Developing Products and Services

Chapter 15

Chapter Objectives

Be able to:

 Explain why product design is important to the success of a business.

 Describe the six dimensions of product design that are of particular interest to operations and supply chain managers

 Describe the five phases of product and service development and explain the difference between sequential development and concurrent engineering

 Discuss the different roles played by areas such as engineering and accounting during the development process.

 Describe some of the most common approaches to improving product and service designs, including the Define-Measure-Analyze-Design-Verify (DMADV) process, quality function deployment (QFD), design for manufacturability

(DFM), and target costing

Product Design and

Development

 Product Design – The characteristics or features of a product or service that determine its ability to meet the needs of the user.

 Product Development Process– The overall process

of strategy, organization, concept generation,

product and marketing plan creation and

evaluation, and commercialization of a new

product. © Product Development and Management Association

Four Reasons for Developing New Products and Services

 New products or services can give firms a

competitive advantage in the marketplace.

 New products or services provide benefits to the firm.

 Companies develop new products or services to exploit existing capabilities.

 Companies can use new product development to block out competitors.

Product Design Dimensions

Product Design Dimensions

Product Design Dimensions

 Product Volumes

 Expanding firm’s operations by building facilities, hiring

workers, buying new equipment, or planning with key

suppliers

 Product Costs

 Obvious costs – Easiest to see and manage

 Hidden costs – Not easy to track but can have a major impact

• Number of parts in a product

• Engineering changes

• Transportation costs

Product Design Dimensions

 Match with Existing Capabilities

 Product design flexibility

• Easy to add features?

• Easy to upgrade?

 Process flexibility

• Share processes / parts?

• Will upgrades make current operations obsolete?

Development Process

 Concept development phase – The company

identifies ideas for new or revised products and services.

 Planning phase – The company begins to address the feasibility of a product or service.

 Design and development phase – The company starts to invest heavily in the development effort and builds and evaluates prototypes.

Development Process Phases

Sequential Development

vs Concurrent Engineering

 Sequential development – A process in which a

product or service idea must clear specific hurdles before it can go on to the next development phase.

 Concurrent engineering – A process where activities

in different development stages are allowed to

overlap with one another, shortening the total

development time.

Concurrent Engineering

Figure 15.1

Organizational Roles

 Engineering – Provide the expertise.

 Marketing – Understanding the marketplace.

 Accounting – Play the role of “scorekeeper.”

 Finance – Judge the financial impact and determine how to acquire the needed capital.

 Designers – Handle product design and create “identities” for companies, environments, and service experiences.

 Purchasing – Identify the best suppliers and sign them up

early in the process Act as a consultant for materials.

DMADV

 Steps:

 Define – Measure – Analyze – Design – Verify

• Define the project goals and customer deliverables

• Measure and determine customer needs and

specifications

• Analyze the product or process options to meet the

customer needs

• Design the product or process

• Verify the results

Quality Function Deployment

 Quality function deployment – A graphical tool used to help organizations move from vague notions of what customers want to specific engineering and operational

requirements

 Also called the House of Quality

Quality Function Deployment

 QFD Matrix:

 Left side: Shows customer requirements and their relative importance to target customers.

 Along the top: Lists specific product characteristics.

 Main body: Shows how each of the product characteristics does or does not support the customer requirements.

 Roof: Shows synergies between some of the features.

Quality Function Deployment

QFD Matrix

for a Cell

Phone

Quality Function Deployment

Computer-Aided Systems

 Computer-aided design (CAD) – An information

system that allows engineers to develop, modify,

share, and even test designs in a virtual world.

 Computer-aided design/computer-aided

manufacturing system (CAD/CAM) – An extension of CAD where CAD-based designs are translated into machine instructions, which are then fed

automatically into computer-controlled

Design for… Approaches

 Design for manufacturability (DFM)

 Considering manufacturing issues in design and development.

• Parts standardization, modular architecture.

 Design for maintainability (DFMt) –

 Considering maintainability issues over the

product’s projected life cycle during the design

Design for… Approaches

 Design for Six Sigma (DFSS)

 Considering achieving Six Sigma quality levels in product and process design.

 Design for the environment (DFE)

 Considering environmental, safety, and health issues over the product’s projected life cycle

during the design and development process.

Target Costing and

Value Analysis

 Target costing – The process of designing a product to meet a specific cost objective.

 Setting the planned selling price and subtracting the

desired profit as well as marketing and distribution costs.

 Value analysis – The process of examining all elements of a component, an assembly, an end product, or a service to

make sure it fulfills its intended function at the lowest total cost.

Developing Products and Services

Case Study

Design for Supply Chain

Programs

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