Operations Management

Session 2

Indian Institute of Management

Lucknow
 Today, we’ll discuss….

 Product Design and Product Development Process

 Aids to Product Design

 Extension of Concept to Services

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 Product Design

 What to Make?

 The translation of an idea into a usable (and

producible and saleable) product

 The first stage in life cycle

 “The structuring of component parts/ activities

such that as a unit they provide a specific value”

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 Sourcing Product Ideas

 “Listening” to the customer

 Internal Development

 Competitive Intelligence

 Buying Technology

 Innovative vs. Imitative designs

 Reacting to others’ innovations, but quick adaptation,

segmentation, mass production etc.

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 Product Life Cycle

Introduction Growth Maturity Decline

Product design and Forecasting critical Standardization Little product
development Product and process Less rapid product differentiation
critical reliability changes – more Cost
OM Strategy/Issues

Frequent product Competitive product minor changes minimization

and process design improvements and Optimum capacity Overcapacity in
changes options the industry
Increasing stability
Short production Increase capacity of process Prune line to
runs eliminate items
Shift toward product Long production
High production focus runs not returning
costs good margin
Enhance distribution Product
Limited models improvement and Reduce capacity
Attention to quality cost cutting

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 Product Development Process
 A broad set of tools, techniques and concepts that enable firms
to bring out new products & services faster and at a lower cost

 Organizations have experienced several tangible benefits from a

good product development process:

◼ While Japanese manufacturers such as Honda and Toyota

introduced as much as 85 models between 1982 and 1989, the
American counterparts were able to introduce only 49 models.

◼ By introducing products six months ahead of the competitors,

a firm can gain as much as three times of the cumulative
profit over the life of the product, compared to introducing the
product along with the competitors

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 Considerations in Product Design

 Functionality: How product “performs”

◼ Capability
◼ Reliability

◼ Maintainability

◼ Upgradability

…
 Form: How it “looks and feels”

 How to “produce”

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 Four Stages of Product Development Process
 Concept Generation: understanding what the customer needs
are and translating them into alternative ideas for products that
services that can be developed

 Design: detailed specifications are first drawn about the

product/service

 Development: physical development of the product; during

this stage, the details arrived at the drawing board are
physically transferred to reality

 Production: ramp ups and regional rollouts after market testing

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 The Design Process …

Product Preliminary Selection

Product
Idea/ Design/ & Freezing
Screening
Concept Specification Specification

“Funnel & Sieve” approach with progressive refinement

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 … The Design Process

Final Downstream Pilot

Process
Detailed Production Production
Selection
Design Decisions & Ramp-up

Seems linear but actually iterative with feedback loops.

Needs to be a significantly multi-disciplinary approach.

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 Historical Approach for Product Development Process

Customers Suppliers

Marketing Design Planning Procurement Production Finance

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 Concurrent Engineering Approach

Planning

Concurrent Engineering
Team Structure

Suppliers

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 Sequential Decision Points
Design
Concept Generation

Idea Feasibility Preliminary

Generation Study Design No
Yes
Product Process Design
feasible? Planning OK?
Yes
No Cost
Planning
Production
Final Yes Prototype
Prototype
Design & Manfg. Development
OK?
Specifications & Testing
No
Commercial
Production Development

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 Aids to Product Design

 “A design is valueless until the means have been

proven to exist through which the design can be
translated into a product/ service to the
satisfaction of the ultimate user”

 Most product introduction problems can be

traced back to early phases of development cycle

 Set of methodologies and technologies to help do

it better, faster, cheaper, …
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 Methodological Aids …

 Design simplification
 Standardization & Variety Reduction
 Interchangeability
 Modularization
 Concurrent Engineering: overlapping different
phases of product development
 Value Analysis/ Value Engineering
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 Technological Aids

 CAx: Computer Aided ..

◼ Drafting (original CAD)
◼ Design (CAD)

◼ Engineering (CAE)

◼ Process Planning (CAPP)

◼ Manufacturing (CAM)

Help to improve productivity and quality of

design process

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 Contemporary Design Approaches

 Rapid Prototyping
◼ Methodology

◼ Domain-specific Technologies

 Taguchi Methods (for Robust Design)

 Quality Function Deployment (Voice of

Customer; House of Quality etc.)

 Failure Mode & Effect Analysis

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3D Printing: Offers many Opportunities
 Economic production of complex products
 No tooling or fixture – Low setup cost
 Different performance based on the material choice and part
design or structure at micro level
 Training and Planning
 Full customization
 Spare parts management
 Local/ On demand Manufacturing
◼ Low Amount of raw material in Supply Chain
◼ Large reduction or elimination of WIP/ FG
 Potential for circular economy by using recycled filament

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 3D Printing Opportunities
 Economic production of complex products
 No tooling or fixture – Low setup cost
 Different performance based on the material choice and part
design or structure at micro level

A jet engine bracket Toyota – Car Seat with Bionic

designed for GE 2,033 Design , Microlattice: lightest metal,
grams to just 327 grams weight 7kg, down from 25kg, extraordinary mechanical
(84% reduction in weight) heat capacity 14.5J/K, from properties 21
35.4J/K Source: Boeing
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 Concept of DFx

 DFx: Design for ..

◼ Manufacturing
◼ Assembly Dell focusses on 3 C’s :
Cube, Content and Curb
◼ Automation
Upcycles ocean plastics
◼ Disassembly/ Service

◼ Environment

 Brainstorming and other creative problem-

solving approaches

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 Design for Manufacturability (DFM)
 A structured approach to
◼ Ensure that manufacturing requirements and preferences are
considered fairly early in the design
◼ Without the need for excessive coordination between the two

 Facilitates Designing a product for easy & economical

production
 Identifies easy-to-manufacture product-design
characteristics

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 DFM Guidelines - three major areas
Variety Reduction Operational Convenience
 Minimize the number of parts  Simplify operations
 Minimize sub-assemblies
 Avoid separate fasteners  Eliminate adjustments
 Use standard parts when  Avoid tools
possible
 Design for minimum handling
 Design parts for multi-use
 Develop a modular design  Design for top-down assembly
 Use repeatable & understood  Design for efficient & adequate
processes testing
Cost Reduction
□ Analyze failures
□ Rigorously assess value

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Guidelines for Environmentally Friendly Designs

 Make products recyclable

 Use recycled materials

 Use less harmful ingredients

 Use lighter components

 Use less energy

 Use less material

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 Value Engineering
 Value engineering
◼ Refers to a set of activities undertaken to investigate the
design of components in a product development process
◼ Strictly from a cost – value perspective
◼ To alert the product development team to alternatives that
⚫ could either bring down the cost or
⚫ increase the value

◼ By improving on the functionalities and performance

without increasing the cost

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 Sheet Metal Yield Improvement Example

EARLIER METHOD

IMPROVED METHOD AFTER VALUE ENGINEERING

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 Service Design

• Service typically includes direct interaction

with the customer
• Increased opportunity for customization
• Reduced productivity
• Cost and quality are still determined at the
design stage
• Delay customization
• Modularization
• Reduce customer interaction, often through
automation
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 Service Design
(a) Customer
participation in design
such as pre-arranged
funeral services or
cosmetic surgery

(b) Customer participation

in delivery such as stress
test for cardiac exam or
delivery of a baby

(c) Customer participation in

design and delivery such as
counseling, college education,
financial management of
personal affairs, or interior
decorating

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 Potential outcomes/benefits
Potential Benefits/Outcomes
Provides unique benefits and features for the
customers
Meets customer expectations better than existing
Customer
products
Dimensions
Provides better quality as perceived by the
customers
Results in innovative offerings to the customers
Simplifies product use and maintenance
Sustained Reduces the cost of use over the life time
Performance Addresses environmental issues pertaining to
manufacture, use and disposal
Simplifies the manufacturing process
Operational Simplifies the assembly process
Advantages Minimises the need for revisions and changes
after introduction
Enables faster new product introduction
Strategic
Reduces the cost of the product
Advantages
Provides capabilities for mass customisation
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Performance Measures in Product Development Process
Target costs achievement status
Cost based Quantum of value engineering efforts
measures Cost of first production run
Cost overrun of prduct development project
Percentage of standard parts & processes
Time to return to normal quality
Design Number of Revisions in the product design
effectiveness Cost of field repair/service during first year after
introduction
Time overrun of product development project
Time to market
Concept to market
Strategic
Number (or rate) of new products introduced
Measures
Percent of new products in the overall product
portfolio
Total Product Cost
Market share of the new product
Market impact
Total Product Sales in the first two years after
introduction
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