© 2005 wiley chapter 3, part 1 product design operations management by r. dan reid & nada r....
TRANSCRIPT
© 2005 Wiley
Chapter 3, Part 1 Product Design
Operations Managementby
R. Dan Reid & Nada R. Sanders2nd Edition © Wiley 2005
PowerPoint Presentation by R.B. Clough - UNH
© 2005 Wiley
Designing Goods and Services
The core product may be a good or a service
Product design should support the business strategy
Product design should meet the needs of a target market.
Product design should give the company a competitive advantage.
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Designing Goods
Form design: Sensory aspects of the product (aesthetics) Size, color, shape, sound "Look and feel" – "smoothness", quality
impression Functional design: how the product
performs
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Functional Design of Goods
Fitness for use: performs basic functions as intended
Durability: how long the product lasts
Reliability: consistent performance
Maintainability: ease and cost of repairs
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Technical Specifications for Goods
Dimensions Examples: length, diameter Target value: ideal or desired value
for a dimension Tolerance: how much can the actual
dimension vary from the target value without affecting performance or aesthetics?
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Designing Services
Physical elements: facility, equipment and furnishings, inventories
Sensory and aesthetic aspects Psychological benefits Quality standards
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Steps in Product DesignStep 1: Idea Development
Identify a need and a product to fill that need.
Ideas can come from customers, marketing, research and development, suppliers, or analysis of competitive products
Product benchmarking: comparing your product with those of competitors
Reverse engineering: disassembling a product to analyze its design features Your product design should not infringe
on a competitor's patents.
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Steps in Product DesignStep 2: Product Screening
Marketing issues Current and future size of target market(s) Market share Pricing Effect on the firm's competitive position
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Steps in Product DesignStep 2: Product Screening
Operations issues Product technology Process technology
Is new equipment needed? Can we build it or buy it?
Would we need a new or modified facility? Can the firm make this product with
consistent quality at a price that customers are willing to pay?
Does our labor force have the needed skills?
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Steps in Product DesignStep 2: Product Screening (2)
Financial analysis: what you need to know Profit margin Ability to finance any needed
investment Breakeven point: the volume at
which costs = revenue Return on assets Return on sales Return on investment
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Step 2: Product Screening (3)Financial Analysis (continued)
Break-Even Analysis
Compute quantity of goods that must be sold to break-even
Compute total revenue at an assumed selling price
Compute fixed cost and variable cost for several quantities
Plot the total revenue line and the total cost line
Intersection is break-even Sensitivity analysis can be
done to examine changes in all of the assumptions made
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Steps in Product DesignStep 2: Product Screening (4)
Financial analysis: check assumptions Identify all costs and all cost savings. If the firm does not introduce this
product, will it lose market share? How much?
Cost and revenue estimates are not exact. Perform the calculations using different sets of assumptions (called sensitivity analysis or case analysis).
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Steps in Product DesignStep 3: Preliminary Design and
Testing
Develop technical specifications for the product
Develop and test prototypes Computer-assisted design (CAD) lets
engineers test a virtual model of the product
Physical prototypes are also used
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Steps in Product DesignStep 3: Preliminary Design & Testing
(2)
Computer-aided design (CAD): use of computer software to design products Similar software is used to make
animated films Computer-aided engineering (CAE):
use of computer software to evaluate and improve product designs
Specialized CAD/CAE software is used by architects and landscape architects
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Steps in Product DesignStep 3: Preliminary Design & Testing
(3)
Advantages of CAD and CAE Products can be designed, tested, and
brought to market faster Reduces design and testing costs Lets the firm test more designs better
products Lets designers in different places and
different companies work together Can be linked with computer-aided process
planning (CAPP) and computer-aided manufacturing (CAM)
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CAPP and CAM
Computer-aided process planning (CAPP): software that uses product specifications generated by CAD and CAE to develop manufacturing instructions for CAM
Computer-aided manufacturing (CAM): the use of computer software to control manufacturing equipment
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Steps in Product DesignStep 4: Final Design & Transition to
Production
Product specification Equipment selection Layout Job design Employee selection and training Supplier selectionSome steps will not be needed for
minor product variations
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Design for Manufacture
Value engineering: Eliminate product features that add cost but do not add value to the customer.
Reduce the number of parts. Reduces the cost of ordering, purchasing,
and storing parts. Reduces the space required to hold inventory Reduces the number of tools and operations
required Reduces the time required to make the
product
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Design for Manufacture (2)
Example of reducing the number of parts, operations, and tools.
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Design for Manufacture (3)
Modular design: Design products to be assembled from standard components.
Use standard parts to reduce design costs and purchasing costs.
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Concurrent Engineering
Design the product and the process at the same time.
Use a design team that includes marketing, operations, engineering, operations, and suppliers. Stay in touch with customers during the
design process. Requires good project management and
coordination among all groups involved.
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Advantages of Concurrent Engineering
Increases the chances of a successful product.
Shortens time to market. Takes advantage of supplier
expertise. Reduces design costs. Reduces the need to make expensive
changes in the product and the process later.
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The End
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