Operations Management
Tenth Edition
Part One
Directing the operation
Chapter 4
Managing product and
service innovation
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Figure 4.1
This chapter examines product and service
innovation
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Figure 4.2
The relationship between creativity,
innovation and design
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Figure 4.3
The S-shaped curve of innovation
• Begining stage of new ideas
• When ideas reach maturity (Straight line),
new ideas rise with their own S-shaped.
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Figure 4.4: the influences on the
design of a product/service
• There is an influence between design and production
• There is an influence between design and distribution
• There is an influence between design and customer
use
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Strategic role of product/service
innovation
• Opening up new markets
• Market differentiation
• Strenghtening company brand
• Add value to the organization
• Profitability
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Figure 4.5
The product and service design innovation
activity as a process
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Innovation Process and
Performance Objectives
• Quality – Meet customer requirements
• Speed – Manage fast-changing customer
preferences and market stimulation
• Dependability – Manage deadlines, process
bottlenecks and uncertainty
• Flexibility – Cope with internal and external
change
• Cost – Manage scope and on-time innovation
delivery
• Sustainability – Adhere to the triple bottom line
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Figure 4.7:The stages of product/service
innovation – The design funnel
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The stages of product/service
innovation – The design funnel
• Concept generation – From R&D, staff, suppliers,
customers, competitors: open-source (Google,
Amazon, Wikipedia …) and crowdsourcing
• Concept screening – feasibility, acceptability and
vulnerability
• Preliminary design – product/service components:
standardisation and commonality
• Evaluation and improvement – Importance to
customers: Quality Function Deployment (QFD)
• Prototyping/trial and final design = Alpha and beta
testing
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Figure 4.6: Innovation stages of a
video game
• Stage 1: Pre-production
• Stage 2: Production
• Stage 3: Post-production
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Figure 4.8: The component structure for a
remote mouse
Example of preliminary design
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Figure 4.9: A QFD Matrix for a promotional USB
data storage stick
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Product/service innovation
resourcing
• Capacity requirements
• In-house or outsourced innovation
• Technology to support innovation
• Organisational structure support
innovation
• Adequate innovation process
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Figure 4.10
Implications of innovation in-house–
outsourced continuum
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Technology to support innovative
designs
• Generative design – Machine learning and
artificial intelligence (AI) using algorithms
• Compuer-aided design – basic engineering
calculations, physical models using 3D printing
and virtual reality using 3D modeling.
• Digital twins – virtual representation of items for
simulations
• Knowledge management technologies –
Experience-based capabilities
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Organisational structure support
innovation
• Functional organistion, functional matrix, balanced
matrix, project matrix
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Adequate innovation process – Time
to market
• Integrating the design of the offerings and
the design of the process
• Simultaneous development
• Early resolution of design conflict and
uncertainty
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Figure 4.12: Sequential versus
simultaneous stages
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