Design of Products and Services* OPS 370 *Note much of the material from this chapter is NOT in the textbook.

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Presentation transcript:

Design of Products and Services* OPS 370 *Note much of the material from this chapter is NOT in the textbook

“You have to have products that sell” Product Design is a Business Issue “We are really pleased with our revenues but our goal isn't to make money. It sounds a little flippant, but it's the truth. Our goal and what makes us excited is to make great products. If we are successful people will like them and if we are operationally competent, we will make money” Jonny Ive, Apple Sr. VP of Industrial Design to British Embassy Creative Summit, July 2012 Unknown Attribution

Why Firms Develop New Products 1. Competitive Advantage 2. Market Share Gain 3. Higher Profitability 4. Enhancement of Brand 5. Faster Competitive Response 6. Improved Operating Cost & Resource Utilization

Competitive Advantage

Market Share Gain

Higher Profitability

Enhancement of Corporate Image and Brand Name

Faster Competitive Response ?

Single Item (Industry)Product Life Cycle

Lower Ops $ and Better Utilization of Capacity

Radical and Disruptive Innovation Radical Innovation: Disruptive Innovation:

Examples of Disruptive New Products

Elements of Product Design: Mass Customization

Elements of Product Design: Design for Production (Manufacturability) and Rapid Prototyping Design for manufacturability: Rapid prototyping:

Elements of Product Design: Design Simplification (a) The original design Assembly using common fasteners

Design Simplification (a) The original design Assembly using common fasteners (b) Revised design One-piece base & elimination of fasteners

Design Simplification (a) The original design Assembly using common fasteners (b) Revised design One-piece base & elimination of fasteners (c) Final design Design for push- and-snap assembly

Standardizing parts among different products at Ford Product# before# afterSavings/veh Air filters18 5 $0.45 Carpet 9 3 $1.25 Cigarette 141 lighters &$1.16 Trunk carpet 7 1 Annual savings = $3M + $9M + $5M = $17M

Environmentally Friendly Designs

Where Do New Product Ideas Come From? Traditional sources: customer surveys analyzing warranty claims, customer complaints surveys of suppliers, distributors, and salespersons

Modern Sources Benchmarking –comparing product/service against best-in-class Reverse engineering –dismantling competitor’s product to improve your own product Early Supplier Involvement (ESI)

Customer Choice Analysis

Product Reliability Analysis An approach for assessing the overall integrity of a product based on the configuration of its components

Product Reliability Analysis

Quantifying Reliability

What Is the Reliability of the Product Below? (Component Reliabilities Shown) A (0.9) B (0.95) C (0.9)

Quantifying Reliability How to Improve Reliability? – Add Redundancy! A (0.9) B (0.95) C (0.9)

Quantifying Reliability A (0.9) B (0.95) C (0.9) Backup to A (0.8)