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Chapter three
Design of goods and
     services
Learning Unit Objectives
 Once this unit is completed you should be able to:-
 Understand the basis of competitiveness in both service
  and manufacturing environments
 Understand the functions of goods and services design
 Understand the application of the steps in product design
  and development
 Apply the processes for the generation of new ideas
 Understand the concept of product-life-cycle management
Learning objectives
• Raise awareness of the concept that satisfying
  customers is perhaps the most important
  competitive goal of any business
• Understand that customers form perceptions of
  the quality of goods and services by comparing
  their expectations with actual outcomes
• Understand the main objectives and importance
  of goods and service design
• Define the product life cycle and the steps in the
  actual design process
Learning objectives
• Explain the concept of a product development
  team
• Explain robust design, manufacturability,
  modular design, and CAD
• Discuss value analysis and configuration
  management
• Explain the principles and practices of kaizen
• Discuss the concepts of mass customisation and
  modular design
• Appreciate that gathering customer information
  is vital to providing a quality service.
Introduction
• What do customers know about their
  customers?
• What makes customers use the good or service
  on offer?
• What factors ensure customer retention?
• DO managers think in terms of which service
  customers use AND in terms of the benefits
  customers seek?
• How do customers judge a quality good or
  service?
    ANSWERS HAVE A DIRECT IMPACT ON
              COMPANY SURVIVAL
3.1 Introduction
• Design of goods and services = key to
  organisational survival and success
• Good design: all activities connected with
  introducing new good to the market
• Service design: all activities connected
  with introducing new service to the market
• Interconnected
• Pressures.
Pressures
Pressures on design managers include:-
Customer and markets, local and
international
Full exploitation of latest technology
available
Globalisation of markets
Change in customer demand patterns
Other applications for existing products
3.2 Basis of competitiveness
Globalisation – no longer guaranteed a firm base of customers

Factors:
   – Technology – keep ahead with latest technology
   – Outside influences – Government legislation i.e.
     environmental controls, trade union activity i.e. health &
     safety measures
   – Economic indicators – other emerging markets i.e. China
   – The competition!!
   – Cost and availability – resources must be right price and
     quality to enable manufacture of goods at right price and
     standard
3.2 Basis of competitiveness (cont.)
• No single factor accounts for customer
  satisfaction
• Customer requirements paramount
  importance
• Marketing & operations departments work
  together to understand customer desires
  during design.
3.3 Functions of goods-and-service
              design
• Clear definition (customers, markets)
• Understanding customers long and short-term
  needs
• Linkages between customer & design,
  production and delivery
• Relationships with customers
• Complaint management processes
• Measurement of customer satisfaction.
3.4 Product development

• Product life-cycle
  – Introduction
  – Growth
  – Maturity
  – Decline
3.4 Product development

Show vide “product lifecycle”
3.4 Product development
• Steps in product design and development
   – Planning – development of design strategy. Technology
     check
   – Concept development – investigate target market and its
     requirements
   – System design - identify all sub-systems required to make
     up the good/service
   – Detailed design – specification of good/service. Product
     and quality specifications. Process plan developed
   – Testing & improvement – prototype production.
     Performance evaluation
   – Production initialisation – production commences.
     Operator training. Product/good launched
3.4 Product development
• Product development team
   – Ensures the product/good that is introduced is a success
   – Does the product/good meet customer requirements?
   – Multi-disciplinary

• System, parameter and tolerance design
   - Process of applying scientific and engineering knowledge to
      produce a basic functional design that meets both
      customer needs and manufacturing requirements
3.5 Robust design

• Blueprint – that can be manufactured to
  specifications during the manufacturing
  process
• Specific purpose
• Reduces probability of failure
• Considers environmental factors.
3.6 Ensuring manufacturability &
         analysis of value
These two activities are inseparable
•Advantages:
  – Cost reduction
  – Robust design
  – Improved operating characteristics
  – Easy maintenance
  – Reduced intricacy
  – Improved safety
3.6 Ensuring manufacturability &
        analysis of value
• DFMA – Design for manufacturability and
  assembly
• Objective – increase quality by ensuring
  goods designed for manufacturing fit
  seamlessly into the manufacturing process
• Simplify the transformation process
3.6 Ensuring manufacturability &
       analysis of value
• Reduce all parts to simplest
• Curtail the number of operations
• Design to only meet customer requirements
• Design product to tie in with competence of
  process
• Include highest level of quality for
  standardised parts
• Minimise use of specialist equipment
• etc….
3.6 Ensuring manufacturability &
       analysis of value
• Generation of new product ideas
  • Creativity
  • Reasons for new products – changes in:
     •   General
     •   Economic indicators
     •   Technology
     •   Customer needs
     •   Politico-legal environment
     •   Environment.
Brainstorming

Uses team participation to spawn
innovative thoughts on specific
subject matter
•No idea should be criticised
•No idea should be belittled
•No idea should be laughed at
Brainstorming

Show brainstorming video
Brainstorming

GROUP EXERCISE

You are asked to design a new
motor vehicle that will be very
energy efficient. Generate some new
ideas for this car.
3.7 Product life cycle management
• Important acronyms:
     PPO – product and process optimisation
     SBU – strategic business unit
     JIT – just in time
     QFD – quality function deployment
     CPI – continuous process improvements
PPO
• Product optimisation is the practice of making changes
  or adjustments to a product to make it more desirable.
• Example
• A product has a number of attributes. For example, a
  soda bottle can have different packaging variations,
  flavours, nutritional values. It is possible to optimise a
  product by making minor adjustments. Typically, the goal
  is to make the product more desirable and to increase
  marketing metrics such as Purchase Intent, Believability,
  Frequency of Purchase, etc
SBU
• An autonomous division or organisational unit,
  small enough to be flexible and large enough to
  exercise control over most of the factors
  affecting its long term performance.
• Because strategic business units are more agile
  (and usually have independent missions and
  objectives), they allow the owning conglomerate
  to respond quickly to changing economic or
  market situations
JIT
a system in which goods are made or
purchased just before they are needed, so
as to avoid carrying high levels of stock.
QFD
Listening to voice of the market (customer). It is a
structured product development process which
translates what the market requires into a
programme to create, manufacture, and deliver it.
In a QFD process, multi-skilled teams collaborate
to arrive at a common understanding of the
customer needs, and determine the appropriate
technical requirements of each stage.
CPI
Ongoing activities aimed at process
simplification, and reduction or elimination of
process waste.
3.7 Product life cycle management
• Managing reprocessing, restructuring or
  re-engineering change
  – Key to managing change is to get an optimal
    balance between types of change:
    •   CPI restructuring or renovation
    •   New product introduction
    •   Strategic technology insertion
    •   Agile and virtual organisational traits
3.7 Product life cycle management
• Managing continuity and configuration
  management
  – Continuity (ongoing similarity)
  – Configuration (arrangement of parts)
  – 3 stages:
    • Development
    • Production
    • Service
3.7 Product life cycle management

• Managing revision changes:
  – Change management
  – Class discussion (see Table 3.1
    p85)
3.7 Product life cycle management

• Managing revision changes:
  – Focusing on customer satisfaction
  – Incorporating lessons learned.
3.8 Mass customisation
• process speedily fabricates parts of
  components that are unvarying
• Could include customised parts
• E.g. MacDonald’s
• Successful when:
  – Modular design
  – Effective scheduling
  – Speedy throughput rate.
Summary
• Considered importance of goods & service
  design
• Competitiveness
• Product development
• Robust design
• Manufacturability & analysis of value (DFMA)
• Product life cycle management
• Mass customisation.
GROUP EXERCISE
In groups of 2 please complete case studies 1 & 2
on page 93
Next Week
1. Read p 95 – 112
2. Write a short paragraph explaining the basics
   of kaizen. How is it implemented in an
   organisation?
3. Write    a    paragraph    describing   mass
   customisation with examples.

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O ps management lecture 3 design goods & services

  • 1. Chapter three Design of goods and services
  • 2. Learning Unit Objectives  Once this unit is completed you should be able to:-  Understand the basis of competitiveness in both service and manufacturing environments  Understand the functions of goods and services design  Understand the application of the steps in product design and development  Apply the processes for the generation of new ideas  Understand the concept of product-life-cycle management
  • 3. Learning objectives • Raise awareness of the concept that satisfying customers is perhaps the most important competitive goal of any business • Understand that customers form perceptions of the quality of goods and services by comparing their expectations with actual outcomes • Understand the main objectives and importance of goods and service design • Define the product life cycle and the steps in the actual design process
  • 4. Learning objectives • Explain the concept of a product development team • Explain robust design, manufacturability, modular design, and CAD • Discuss value analysis and configuration management • Explain the principles and practices of kaizen • Discuss the concepts of mass customisation and modular design • Appreciate that gathering customer information is vital to providing a quality service.
  • 5. Introduction • What do customers know about their customers? • What makes customers use the good or service on offer? • What factors ensure customer retention? • DO managers think in terms of which service customers use AND in terms of the benefits customers seek? • How do customers judge a quality good or service? ANSWERS HAVE A DIRECT IMPACT ON COMPANY SURVIVAL
  • 6. 3.1 Introduction • Design of goods and services = key to organisational survival and success • Good design: all activities connected with introducing new good to the market • Service design: all activities connected with introducing new service to the market • Interconnected • Pressures.
  • 7. Pressures Pressures on design managers include:- Customer and markets, local and international Full exploitation of latest technology available Globalisation of markets Change in customer demand patterns Other applications for existing products
  • 8. 3.2 Basis of competitiveness Globalisation – no longer guaranteed a firm base of customers Factors: – Technology – keep ahead with latest technology – Outside influences – Government legislation i.e. environmental controls, trade union activity i.e. health & safety measures – Economic indicators – other emerging markets i.e. China – The competition!! – Cost and availability – resources must be right price and quality to enable manufacture of goods at right price and standard
  • 9. 3.2 Basis of competitiveness (cont.) • No single factor accounts for customer satisfaction • Customer requirements paramount importance • Marketing & operations departments work together to understand customer desires during design.
  • 10. 3.3 Functions of goods-and-service design • Clear definition (customers, markets) • Understanding customers long and short-term needs • Linkages between customer & design, production and delivery • Relationships with customers • Complaint management processes • Measurement of customer satisfaction.
  • 11. 3.4 Product development • Product life-cycle – Introduction – Growth – Maturity – Decline
  • 12. 3.4 Product development Show vide “product lifecycle”
  • 13. 3.4 Product development • Steps in product design and development – Planning – development of design strategy. Technology check – Concept development – investigate target market and its requirements – System design - identify all sub-systems required to make up the good/service – Detailed design – specification of good/service. Product and quality specifications. Process plan developed – Testing & improvement – prototype production. Performance evaluation – Production initialisation – production commences. Operator training. Product/good launched
  • 14. 3.4 Product development • Product development team – Ensures the product/good that is introduced is a success – Does the product/good meet customer requirements? – Multi-disciplinary • System, parameter and tolerance design - Process of applying scientific and engineering knowledge to produce a basic functional design that meets both customer needs and manufacturing requirements
  • 15. 3.5 Robust design • Blueprint – that can be manufactured to specifications during the manufacturing process • Specific purpose • Reduces probability of failure • Considers environmental factors.
  • 16. 3.6 Ensuring manufacturability & analysis of value These two activities are inseparable •Advantages: – Cost reduction – Robust design – Improved operating characteristics – Easy maintenance – Reduced intricacy – Improved safety
  • 17. 3.6 Ensuring manufacturability & analysis of value • DFMA – Design for manufacturability and assembly • Objective – increase quality by ensuring goods designed for manufacturing fit seamlessly into the manufacturing process • Simplify the transformation process
  • 18. 3.6 Ensuring manufacturability & analysis of value • Reduce all parts to simplest • Curtail the number of operations • Design to only meet customer requirements • Design product to tie in with competence of process • Include highest level of quality for standardised parts • Minimise use of specialist equipment • etc….
  • 19. 3.6 Ensuring manufacturability & analysis of value • Generation of new product ideas • Creativity • Reasons for new products – changes in: • General • Economic indicators • Technology • Customer needs • Politico-legal environment • Environment.
  • 20. Brainstorming Uses team participation to spawn innovative thoughts on specific subject matter •No idea should be criticised •No idea should be belittled •No idea should be laughed at
  • 22. Brainstorming GROUP EXERCISE You are asked to design a new motor vehicle that will be very energy efficient. Generate some new ideas for this car.
  • 23. 3.7 Product life cycle management • Important acronyms:  PPO – product and process optimisation  SBU – strategic business unit  JIT – just in time  QFD – quality function deployment  CPI – continuous process improvements
  • 24. PPO • Product optimisation is the practice of making changes or adjustments to a product to make it more desirable. • Example • A product has a number of attributes. For example, a soda bottle can have different packaging variations, flavours, nutritional values. It is possible to optimise a product by making minor adjustments. Typically, the goal is to make the product more desirable and to increase marketing metrics such as Purchase Intent, Believability, Frequency of Purchase, etc
  • 25. SBU • An autonomous division or organisational unit, small enough to be flexible and large enough to exercise control over most of the factors affecting its long term performance. • Because strategic business units are more agile (and usually have independent missions and objectives), they allow the owning conglomerate to respond quickly to changing economic or market situations
  • 26. JIT a system in which goods are made or purchased just before they are needed, so as to avoid carrying high levels of stock.
  • 27. QFD Listening to voice of the market (customer). It is a structured product development process which translates what the market requires into a programme to create, manufacture, and deliver it. In a QFD process, multi-skilled teams collaborate to arrive at a common understanding of the customer needs, and determine the appropriate technical requirements of each stage.
  • 28. CPI Ongoing activities aimed at process simplification, and reduction or elimination of process waste.
  • 29. 3.7 Product life cycle management • Managing reprocessing, restructuring or re-engineering change – Key to managing change is to get an optimal balance between types of change: • CPI restructuring or renovation • New product introduction • Strategic technology insertion • Agile and virtual organisational traits
  • 30. 3.7 Product life cycle management • Managing continuity and configuration management – Continuity (ongoing similarity) – Configuration (arrangement of parts) – 3 stages: • Development • Production • Service
  • 31. 3.7 Product life cycle management • Managing revision changes: – Change management – Class discussion (see Table 3.1 p85)
  • 32. 3.7 Product life cycle management • Managing revision changes: – Focusing on customer satisfaction – Incorporating lessons learned.
  • 33. 3.8 Mass customisation • process speedily fabricates parts of components that are unvarying • Could include customised parts • E.g. MacDonald’s • Successful when: – Modular design – Effective scheduling – Speedy throughput rate.
  • 34. Summary • Considered importance of goods & service design • Competitiveness • Product development • Robust design • Manufacturability & analysis of value (DFMA) • Product life cycle management • Mass customisation.
  • 35. GROUP EXERCISE In groups of 2 please complete case studies 1 & 2 on page 93
  • 36. Next Week 1. Read p 95 – 112 2. Write a short paragraph explaining the basics of kaizen. How is it implemented in an organisation? 3. Write a paragraph describing mass customisation with examples.