Spice Giant McCormick
Demand for
traditional spices going down
Adeyl Khan, Faculty, BBA, NSU
Product or Service Design Activities
 Translate customer wants and needs into product
and service requirements
 Refine existing products and services
 Develop new products and services
 Formulate quality goals
 Formulate cost targets
 Construct and test prototypes
 Document specifications
Adeyl Khan, Faculty, BBA, NSU
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Product and Service Design
Strategy
•
•
•
•
Cost
Quality
Time-to-market
Customer
satisfaction
• Competitive
advantage
Organization’s
strategy
Adeyl Khan, Faculty, BBA, NSU
Reasons
• Economic
• Social and
demographic
• Political, liability,
or legal
• Competitive
• Cost or availability
• Technological
4-3
Objectives of P/S Design
Main focus
• Customer satisfaction
• Understand what the customer
wants
Secondary focus
•
•
•
•
•
•
Function of product/service
Cost/profit
Quality
Appearance
Ease of production/assembly
Ease of maintenance/service
Adeyl Khan, Faculty, BBA, NSU
Designing For Operations
• Taking account of capabilities
Failure can:
• Reduce productivity
• Reduce quality
• Increase costs
4-4
Legal, Ethical, and Environmental Issues
Legal
• FDA, OSHA, IRS
• Product liability
• Uniform commercial code
Ethical
• Releasing products with defects
Environmental
 Product Liability
- A manufacturer
is liable for any
injuries or
damages caused
by a faulty
product.
 Uniform
Commercial Code
- Products carry
an implication of
merchantability
and fitness.
• EPA
Adeyl Khan, Faculty, BBA, NSU
4-5
Sample Guidelines of an Organization
Designers to Adhere
 Produce designs that are consistent with the goals
of the company
 Give customers the value they expect
 Make health and safety a primary concern
 Consider potential harm to the environment
…
Adeyl Khan, Faculty, BBA, NSU
4-6
Other Issues in P/S Design
Product/service life cycles
How much standardization
Mass customization
Product/service reliability
Robust design
Degree of newness
Cultural differences
Adeyl Khan, Faculty, BBA, NSU
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Figure 4.1
Life Cycles of Products or Services
Saturation
Demand
Maturity
Decline
Growth
Introduction
Time
Adeyl Khan, Faculty, BBA, NSU
4-8
Standardization
 Standardization
 Extent to which there is an absence of variety in a
product, service or process
 Standardized products are immediately available to
customers
Adeyl Khan, Faculty, BBA, NSU
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Advantages of Standardization
•
•
•
•
•
•
•
•
Fewer parts to deal with in inventory & manufacturing
Design costs are generally lower
Reduced training costs and time
More routine purchasing, handling, and inspection
procedures
Quality is more consistent
Orders fillable from inventory
Opportunities for long production runs and
automation
Need for fewer parts justifies increased expenditures on
perfecting designs and improving quality control
procedures.
Adeyl Khan, Faculty, BBA, NSU
4-10
Disadvantages of Standardization
• Designs may be frozen with too many
imperfections remaining.
• High cost of design changes increases
resistance to improvements.
• Decreased variety results in less consumer
appeal.
Adeyl Khan, Faculty, BBA, NSU
4-11
Mass customization:
• A strategy of producing standardized goods or
services, but incorporating some degree of
customization
• Delayed differentiation
• Modular design
Delayed Differentiation
• Delayed differentiation is a postponement tactic
• Producing but not quite completing a product or
service until customer preferences or
specifications are known
Adeyl Khan, Faculty, BBA, NSU
4-12
Modular Design
• Modular design is a form of
standardization in which component
parts are subdivided into modules that
are easily replaced or interchanged. It
allows:
• easier diagnosis and remedy of failures
• easier repair and replacement
• simplification of manufacturing and
assembly
Adeyl Khan, Faculty, BBA, NSU
4-13
Reliability
• The ability of a product, part, or system to perform
its intended function under a prescribed set of
conditions
Failure
• Situation in which a product, part, or system does
not perform as intended
Normal operating conditions
• The set of conditions under which an item’s
reliability is specified
Adeyl Khan, Faculty, BBA, NSU
4-14
Improving Reliability
 Component design
 Production/assembly techniques
 Testing
 Redundancy/backup
 Preventive maintenance procedures
 User education
 System design
Adeyl Khan, Faculty, BBA, NSU
4-15
Product Design
Product Life Cycles
Robust Design
Concurrent Engineering
Computer-Aided Design
Modular Design
Adeyl Khan, Faculty, BBA, NSU
4-16
Robust Design
• Design that
results in
products or
services that can
function over a
broad range of
conditions
Adeyl Khan, Faculty, BBA, NSU
Taguchi Approach
• Design a robust product
• Insensitive to
environmental factors
either in manufacturing or
in use.
• Central feature is Parameter
Design.
• Determines:
• factors that are controllable
and those not controllable
• their optimal levels relative
to major product advances
4-17
Degree of Newness
•
•
•
•
Modification of an existing product/service
Expansion of an existing product/service
Clone of a competitor’s product/service
New product/service
Degree of Design Change
Type of Design
Change
Newness of the
organization
Newness to the
market
Modification
Low
Low
Expansion
Low
Low
Clone
High
Low
New
High
High
Adeyl Khan, Faculty, BBA, NSU
Table 4.3
4-18
Cultural Differences
 Multinational companies must take into account
cultural differences related to the product design.
 Notable failures:
 Chevy Nova in Mexico
 Ikea beds in U.S.
Adeyl Khan, Faculty, BBA, NSU
4-19
Global Product Design
 Virtual teams
 Uses combined efforts of a team of designers working
in different countries
 Provides a range of comparative advantages over
traditional teams such as:




Engaging the best human resources around the world
Possibly operating on a 24-hr basis
Global customer needs assessment
Global design can increase marketability
Adeyl Khan, Faculty, BBA, NSU
4-20
Phases in Product Development Process
 Idea generation
 Feasibility analysis
 Product specifications
 Process specifications
 Prototype development
 Design review
 Market test
 Product introduction
 Follow-up evaluation
Adeyl Khan, Faculty, BBA, NSU
4-21
Idea Generation
Supply chain based
Ideas
Competitor based
Research based
Adeyl Khan, Faculty, BBA, NSU
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Reverse Engineering
• Reverse engineering is the dismantling and inspecting
of a competitor’s product to discover product
improvements.
Research & Development (R&D)
• Organized efforts to increase scientific knowledge or
product innovation & may involve:
• Basic Research advances knowledge about a subject
without near-term expectations of commercial
applications.
• Applied Research achieves commercial applications.
• Development converts results of applied research
into commercial applications.
Adeyl Khan, Faculty, BBA, NSU
4-23
Manufacturability
 Manufacturability is
the ease of
fabrication and/or
assembly which is
important for:
 Cost
 Productivity
 Quality
Adeyl Khan, Faculty, BBA, NSU
Designing for Manufacturing
• Beyond the overall objective to
achieve customer satisfaction while
making a reasonable profit is:
• Design for Manufacturing(DFM)
• The designers’ consideration of the
organization’s manufacturing
capabilities when designing a
product.
• The more general term design for
operations encompasses services as
well as manufacturing
4-24
Concurrent Engineering
 Concurrent engineering is the bringing together of
engineering design and manufacturing
personnel early in the design phase.
Adeyl Khan, Faculty, BBA, NSU
4-25
Computer-Aided Design
 Computer-Aided Design (CAD) is product design
using computer graphics.
 increases productivity of designers, 3 to 10 times
 creates a database for manufacturing information on
product specifications
 provides possibility of engineering and cost analysis
on proposed designs
Adeyl Khan, Faculty, BBA, NSU
4-26
Product design
 Design for manufacturing (DFM)
 Design for assembly (DFA)
 Design for recycling (DFR)
 Remanufacturing
 Design for disassembly (DFD
Adeyl Khan, Faculty, BBA, NSU
4-27
Recycling
 Recycling: recovering materials for future use
 Recycling reasons
 Cost savings
 Environment concerns
 Environment regulations
Adeyl Khan, Faculty, BBA, NSU
4-28
Remanufacturing
 Remanufacturing: Refurbishing used products by
replacing worn-out or defective components.
 Remanufactured products can be sold for 50% of the
cost of a new producer
 Remanufacturing can use unskilled labor
 Some governments require manufacturers to take
back used products
 Design for Disassembly (DFD): Designing products
so that they can be easily taken apart.
Adeyl Khan, Faculty, BBA, NSU
4-29
Component Commonality
 Multiple products or product families that have a
high degree of similarity can share components
 Automakers using internal parts
 Engines and transmissions
 Water pumps
 Etc.
 Other benefits
 Reduced training for assemble and installation
 Reduced repair time and costs
Adeyl Khan, Faculty, BBA, NSU
4-30
Quality Function Deployment
 Quality Function Deployment
 Voice of the customer
 House of quality
QFD:
Adeyl Khan, Faculty, BBA, NSU
An approach that integrates the
“voice of the customer” into the
product and service development
process.
4-31
The House of Quality
Correlation
matrix
Design
requirements
Customer
requirements
Figure 4.3
Adeyl Khan, Faculty, BBA, NSU
Relationship
matrix
Competitive
assessment
Specifications
or
target values
4-32
Correlation:
Strong positive
X
Positive
X
X
Easy to close
7
Stays open on a hill
5
Easy to open
3
Doesn’t leak in rain
3
No road noise
2
Water resistance
*
Accoust. Trans.
Window
Energy needed
to open door
Check force on
level ground
Customer
Requirements
Door seal
resistance
Energy needed
to close door
Engineering
Characteristics
Negative
Strong negative
X
X
X
Competitive evaluation
X = Us
A = Comp. A
B = Comp. B
(5 is best)
1
2
3
4
5
AB
X
X AB
XAB
A XB
X A
Importance weighting
10
6
6
9
2
3
B
Relationships:
Technical evaluation
(5 is best)
Adeyl Khan, Faculty, BBA, NSU
5
4
3
2
1
B
A
X
BA
X
B
B
A
X
X
A
BXA
Maintain
current level
Maintain
current level
Reduce energy
to 7.5 ft/lb.
Reduce force
to 9 lb.
Target values
Maintain
current level
Reduce energy
level to 7.5 ft/lb
Strong = 9
Medium = 3
Small = 1
BA
X
Figure 4.4
4-33
The Kano Model of Customer Satisfaction
 Classifies product attributes based on how they are
perceived by customers and their effect on customer
satisfaction.
 Useful for guiding design decisions

When good is good enough, and when more is better.
Project activities :
• Identifying customer needs
• Determining functional
requirements
• Concept development
• Analyzing competitive
products
Adeyl Khan, Faculty, BBA, NSU
Other tools:
•
•
•
•
Eliciting Customer Input
Prioritization Matrices
Quality Function Deployment
Value Analysis
34
The Kano Model
A competitive
product meets basic
attributes, maximizes
performances
attributes, and
includes as many
“excitement” attributes
as possible at a cost
the market can bear.
high customer satisfaction
no dissatisfaction
* Cup Holders
customer satisfaction
* fuel economy
A) Satisfied
B) Neutral
C) Dissatisfied
Must haves- no
product differentiation
D) Don’t care
Adeyl Khan, Faculty, BBA, NSU
4-35
Service Design
 Service
 Something that is done to or for a customer
 Service delivery system
 The facilities, processes, and skills needed to provide
a service
 Product bundle
 The combination of goods and services provided to a
customer
 Service package
 The physical resources needed to perform the service
Adeyl Khan, Faculty, BBA, NSU
4-36
Service Design
 Service design involves
 The physical resources needed
 The goods that are purchased or consumed by the
customer


Explicit services
Implicit services
Explicit services
• The benefits that are readily observable by the senses and that consist of the essential
or intrinsic feature of the service. such as absence of pain after a tooth is repaired.
Implicit services
• psychological benefits that the customer may sense only vaguely, or the intrinsic
feature of the services. such as musician in a restaurant, cheerful flight attendant
Adeyl Khan, Faculty, BBA, NSU
4-37
Differences Between Product
and Service Design
 Tangible – intangible
 Services created and delivered at the same time
 Services cannot be inventoried
 Services highly visible to customers
 Services have low barrier to entry
 Location important to service
 Range of service systems
 Demand variability
Adeyl Khan, Faculty, BBA, NSU
4-38
Service Systems
 Service systems range from those with little or no
customer contact to very high degree of customer
contact such as:
 Insulated technical core (software development)
 Production line (automatic car wash)
 Personalized service (hair cut, medical service)
 Consumer participation (diet program)
 Self service (supermarket)
Adeyl Khan, Faculty, BBA, NSU
4-39
Service Demand Variability
 Demand variability creates waiting lines and idle
service resources
 Service design perspectives:
 Cost and efficiency perspective
 Customer perspective
 Customer participation makes quality and demand
variability hard to manage
 Attempts to achieve high efficiency may
depersonalize service and change customer’s
perception of quality
Adeyl Khan, Faculty, BBA, NSU
4-40
Phases in Service Design
 Conceptualize
 Identify service package components
 Determine performance specifications
 Translate performance specifications into design
specifications
 Translate design specifications into delivery
specifications
Adeyl Khan, Faculty, BBA, NSU
4-41
Service Blueprinting
 Service blueprinting
 A method used in service design to describe and
analyze a proposed service
 A useful tool for conceptualizing a service delivery
system
Adeyl Khan, Faculty, BBA, NSU
4-42
CONTACT PERSON
SUPPORT PROCESS (Back Stage) (On Stage)
CUSTOMER PHYSICAL
EVIDENCE
Overnight Hotel Stay
Hotel
Exterior
Parking
Arrive
at
Hotel
Cart for
Bags
Desk
Elevators Cart for
Registration Hallways Bags
Papers
Room
Lobby
Key
Give Bags
Check in
to
Bellperson
Go to
Room
Greet and
Process
Take
Registration
Bags
Adeyl Khan, Faculty, BBA, NSU
Receive
Bags
Room
Menu
Amenities
Bath
Sleep
Shower
Call
Room
Service
Deliver
Bags
Take Bags
to Room
Registration
System
Delivery
Food
Tray
Food
Appearance
Receive
Food
Deliver
Food
Eat
Bill
Desk
Lobby
Hotel
Exterior
Parking
Check out
and
Leave
Process
Check Out
Take
Food
Order
Prepare
Food
Registration
System
Designing Service Blueprints
Step 1
Step 2
Step 3
Step 4
Step 5
Step 6
Identify the
process to
be blueprinted.
Identify the
customer
or
customer
segment.
Map the
process
from the
customer’s
point of
view.
Map
contact
employee
actions,
onstage
and backstage.
Link
customer
and contact
person
activities to
needed
support
functions.
Add
evidence
of service
at each
customer
action
step.
Adeyl Khan, Faculty, BBA, NSU
Back Stage Processes
On Stage Journey
Evidence
Client
Steps
Energy
Provider Steps
Energy
Provider Steps
Backend
Applications
Adeyl Khan, Faculty, BBA, NSU
How will my energy meter help me use
energy more efficiently?
Receiving a home metering device to
measure personal energy
consumption
Basic customer steps and backstage
activities are mapped out
Back Stage Processes
On Stage Journey
Evidence
New Energy
meter arrives
Client Steps
Energy Provider
Steps
Follow meter
instructions
Energy
consumption
visualized
Conduct
normal
appliance
usage
Read
meter
Gee – how would
consumption
differ if I selected
“light” load for
my dishwasher?
Reduced
usage
Run
appliance
again
Read
meter
Install Meter, give
client instruction
package
Energy Provider
Steps
Backend
Applications
Adeyl Khan, Faculty, BBA, NSU
Push feedback of
use to meter in
home
Add readout to data base for
future analytics
Push feedback of
use to meter in
home
Characteristics of Well Designed Service
Systems
 Consistent with the organization mission
 User friendly
 Robust
 Easy to sustain
 Cost effective
 Value to customers
 Effective linkages between back operations
 Single unifying theme
 Ensure reliability and high quality
Adeyl Khan, Faculty, BBA, NSU
4-47
Challenges of Service Design
 Variable requirements
 Difficult to describe
 High customer contact
 Service – customer encounter
Adeyl Khan, Faculty, BBA, NSU
4-48
Guidelines for Successful Service Design
 Define the service package
 Focus on customer’s perspective
 Consider image of the service package
 Recognize that designer’s perspective is different from the
customer’s perspective
 Make sure that managers are involved
 Define quality for tangible and intangibles
 Make sure that recruitment, training and rewards are consistent
with service expectations
 Establish procedures to handle exceptions
 Establish systems to monitor service
Adeyl Khan, Faculty, BBA, NSU
4-49
Operations Strategy
 Increase emphasis on component commonality
 Package products and services
 Use multiple-use platforms
 Consider tactics for mass customization
 Look for continual improvement
 Shorten time to market
Shorten Time to Market
• Use standardized components
• Use technology
• Use concurrent engineering
Adeyl Khan, Faculty, BBA, NSU
4-50
Covers Ch 1,2,3,4
20% MCQ
40% SQ
40% LQ
Adeyl Khan, Faculty, BBA, NSU
51
Learning Objectives
 Explain the strategic importance of product and
service design.
 List some key reasons for design or redesign.
 Identify the main objectives of product and service
design.
 Discuss the importance of standardization.
 Discuss the importance of legal, ethical, and
environmental issues in product and service design.
Adeyl Khan, Faculty, BBA, NSU
4-52
Learning Objectives
 Briefly describe the phases in product design and
development.
 Describe some of the main sources of design ideas.
 Name several key issues in manufacturing design.
 Name several key issues in service design.
 Name the phases in service design.
 List the characteristics of well-designed service
systems.
 Name some of the challenges of service design.
Adeyl Khan, Faculty, BBA, NSU
4-53