Product Planning; Production Operation

1. PRODUCT
PLANNING

2. RESEARCH AND DEVELOPMENT
• Research and development in industry are not limited to
pure and applied research in science.
• Research can be defined as work devoted to learning the
laws and idioms. It is possible to further classify research as
pure or applied, depending upon its purpose.
• Pure research is undertaken without regard for how the
knowledge gained will be used.
• Applied research endeavours to find basic answers to more
or less specific problems.
• Development is a technical activity concerned with non
routine problems which are encountered in translating
research findings of other general specific knowledge into
products or processes.

3. MANAGEMENT OF R & D
• Research is not easy to manage
scientifically, since it is most
difficult to state objectives
explicitly. Thus, the work
necessary to achieve those
objectives cannot be planned or
controlled very precisely.

4. PLANNING FOR RESEARCH AND DEVELOPMENT
• Planning the research and development activity
requires two (2) steps;
1. The determination of the total budget amount
and;
2. The selection of specified projects.
• Projects budgeting assists planning in several ways.
1. It requires that each projects be concretely
planned and be formally reviewed on a definite
schedule.
2. It helps coordinate research activities.

5. CONTROLLING RESEARCH AND DEVELOPMENT
ACTIVITIES
• The traditional attitude of management toward
control of research and development work has been
a hands off policy.
1. Would rather work under relatively close
administrative controls.
2. Have urgent need to know precisely what
management expects of them.
3. Exhibit the personal traits found generally in
ambitious nonspecific personnel.
4. Resent being classified as business freaks.

6. • In controlling the costs of an
operation, a manager must
consider two primary questions.
1. Is the operation producing
what it should be producing?
2. Is it producing its intended
output efficiently?

7. • Budget versus actual cost comparisons serve four
(4) purpose;
1. To show how much money has been spent
and what relationship this amount has to be the
original R & D plan.
2. To provide valuable assistance in appraising
the R & D program and the proportion of the
company’s resources spent in the various areas.
3. To assemble and report costs which can be
as a basis for projecting future R & D operations.
4. To enable technical R & D personnel to
present a status or accomplishment export in
physical and qualities terms.

8. • Budgetary reports should be
prepared frequently and should be
used to eliminate out of control
situations.
• Controlling usage of time, usage of
supplies and services, and indirect
costs should be considered in the
evaluation of research an
development efforts.

9. ORGANIZING THE RESEARCH AND
DEVELOPMENT GROUP
• When organizations charts are reduced to their bare
essentials, there are two basic types of corporate
structure- the functional and the divisional.
• A functional structure is one of the most common
organizational structures. Under this structure, the
organization groups employees according to a
specialized or similar set of roles or tasks.
• The divisional structure is a type of organizational
structure that groups each organizational function into
a division. These divisions can correspond to either
products or geographies.

10. DIRECTING RESEARCH AND
DEVELOPMENT
• The role of the manager of the research and
development department varies. The manager
could be the financial analyst insofar as
budgeting is involved, or the researcher when
he is concerned about gathering data for a
successful research.
• The department head is also responsible for
expenses. Total funds for research are planned
and controlled by the budget.

11. FOR STRONG PROGRAMS. TOTAL
APPROPRIATIONS ARE DETERMINED AS
FOLLOW;
1. Managers must establish a general target figure
on “how much to spend.
2. Managers must select projects which achieved a
proper balance between research which simply
protects the profits of present products in
existing markets and research which creates
technology to open profitable new markets for
the company.
3. Finally, managers must see that the fundamental
research program is active in those specific
areas.

12. DEVELOPING A MARKETABLE PRODUCT

13. THE PRODUCT CYCLE
• Market development- this is when a new product is
first brought to the market, before there is a proven
demand for it, and often before it is before it has been
technically proven in all respect.
• Market growth- demand begins to accelerate and the
size of the total market expands rapidly.
• Market maturity- demand levels off and grows, for the
most part, only at the replacement and new family
formation rate.
• Market decline- the product begins to lose consumer
appeal and sale drift downward.

14. THE PRODUCT CYCLE

15. •Development Stage
•Growth Stage
•Maturity Stage
•Decline Stage

16. IMPORTANCE OF PREPLANNING
• Failure Possibilities
-The More Unique Or Distinctive The New Product,
The Longer It Generally Takes To Get It Successfully Off
The Ground.
The Following Are The Conditions Most Likely To Slow
Things Up And Create Problem.
1. Complex Product.
2. Distinctive Product.
3. Large Number Of People Influencing A Single Buying
Decision.
4. Costly And Greater Shifts In The Customers Present
Methods.

17. •Success Chances
•Competitive Pressures
•Profit Squeeze
•Stage Recognition
•Sequential Action

18. COST AND REVENUE ASPECTS
OF R & D
• The product life cycle must be
examined with an eye toward
expected cost and revenue.
• Product research is costly; a great
deal of money must be invested
before any remuneration is
forthcoming.

19. STANDARDIZATION
•Plays an important role
product design because it
allows the manufacturer to
obtain cost savings through
volume production.

20. VALUE ANALYSIS
• Advancing technology compels a firm to
continually review its products and process for
possible improvements in cost and function.
• A techniques called “value analysis/value
engineering”, has been developed to reconcile
the functional and economic aspects of product
design.
• The value analysis philosophy brings to light the
higher order goals for the firm.
• Value analysis can be used in the original design
of the product or in reviewing existing product.

21. VALUE ANALYSIS JOB PLAN
• Efforts to reduce costs are not new to
manufacturing engineers, of course, but these
efforts are all too frequently hazard and
uncoordinated.
1. Information Phase
2. Creative Phase
3. Evaluation Phase
4. Program Planning
5. Reporting Phase

23. Chapter 5
-Thalia Marie Jacob