Chapter 3 Product and

Service Design
By:
C.M. Dhakal
1. Concept on Product and Service Design.
Producing or designing new product or service is key
activities in any organization.
Designing appropriate goods and services
determines the success of organization.
In case of designing product or services, designer
should aware on customer’s demographic changes,
quality, cost, process and so on.
Organization should design new product because of:
 Existing product has certain life.
 Customer’s needs and preferences are changing
 Continuous market penetration by competitors.
1.1 New Product Design Process.
Product types and production technology are rapidly
changing due to change in customer’s preferences, cost
effectiveness, productivity and intense competition.
Operation Management is being very dynamic and
operation manager should keep organization’s
production facilities up to date to address these
changes.
A new product does not always mean a new
conceptual product.
To develop new conceptual product, a pure research
and huge amount of investment is required.
 Cont..
Organizations conducted applied research to modify
existing product and their new uses.
The following steps are required to design new
products:
1. The design of new products.

2. The redesign of existing products.

3. The identification of new uses.
4. Improvements of packaging of existing products.
1.2 The Interaction of Research.
The various types of research are conducted while
designing new products and services.
The various types of research and their interrelation
is:
1. Pure research
2. Applied research
3. Product configuration by the help of market research
and production process.
4. Pilot run
 2. Product Development Process.
Designing and developing new product is very
complex and costly process.
The various steps for product development are:
1. Need identification
2. Feasibility study- preliminary activities
 Preliminary market analysis.
 Creating alternative concept of product.
 Clarifying operational requirements.
 Establishing design criteria.
 Estimating logistic requirements.
 Cont..
3. Advance design – examined technically
4. Product development and engineering
 Functionality
 Reliability
 Maintainability
 Manufacturing
5. Process design and development
6. Production evaluation and improvements
7. Product use and support.
 3. Design of service
Some service characteristics are different from product
i.e. tangibility, storage, quality etc.
Availability of service capacity is another major
consideration in service design.
The service designing involves following steps:
1. Identification of customer requirements.
2. Developments of service concepts.
3. Detailed design
4. Process technology
5. Redesign of process technology.
4. Differences Between Product and Service
Design
Some considerations may similar and some are
different in case of product and service design.
The differences between product and service design
are:
1. Tangibility – tangible, intangible
2. Storability – stored, can not stored
3. Quality – in terms of data, experience
4. Measure – in terms of output, outcomes
5. Repeatable – standardize process, not repeatable
6. Patent
 5. Emerging Issues in Product and Service
Design
In recent time, various factors, making product or service
designing more challenging.
The various emerging issues in product or service design
are:
a. Value analysis.
 It process of systematic review that is applied to existing product
design in order to compare the function of product required by
customer and meeting their requirement at lowest cost.
 It focuses on:
 Systematic and organized process

 Concerns the function of product

 Understanding the use of products

 Cont..
b. Concurrent engineering
 Concurrent engineering is method of product design where the different
stages are run simultaneously.
 In concurrent engineering, product design is done with collaboration
between all individuals, groups and departments.
 It helps to gain competitive advantages, enhance productivity, fulfillment
of need of customer and improve product quality.
c. Quality function deployment
 It is process of translating customer requirements into product or service
design
 It is formal process that help to understand user needs and facilitates in
production development process.
 It is team oriented methodology to understand user needs, develop
proactive way and involve employee.
 6. Waiting Line Theory
Waiting line theory is concerned with study of queue
or waiting line of customers and service center.
In organizational setting, managing waiting line is
essential because customers are waiting for getting
services or service facility wait for customer.
The problem in waiting line is to make trade-off
between cost of service capacity and waiting line cost.
It can be presented as:
 Cont..
Total cost of system

Cost of service capacity

Total cost

Waiting line cost

Optimal service level

Service Capacity
 Cont..
The various characteristics of waiting line are:
 Average arrival rate

 Average service rate.

 Average length of queue

 Average waiting time

 Average time spent in system

 6.1 Waiting Line (Queuing) System and Its
Essential Elements.
Waiting line theory involves the various essential elements, Which are
a. Input sources
 Size of calling population
 Behavior of arrival
 Pattern of arrival
b. Queuing process
 Number of queue and length
c. Queue discipline
 First-come, first served (FCFS)
 Last-come, first-served (LCFS)
 Service in random order (SIRO)
 Priority service
 Pre-emptive priority
 Non-pre-emptive priority
 Cont..
d. Service process (or Mechanism)
 The arrangement and capacity of service facility
 Series arrangement

 Parallel arrangement

 Mixed arrangement

 The distribution of service times

e. Departure pattern
 These components can be summarized in following
figure.
 Cont..
Service System
Waiting
Customer
Arrival Queuing
Input Process Queuing Discipline Service Departure
Source process Process

Balk Renege Jockey

 6.2 Types of Waiting Line System
According to the arrangement of service facility,
queuing system can be classified in to following five
types:
a. Single channel system
b. Multi channel system
c. Single queue with many service counter system
d. Many queue with single service counter system
e. Multistep system
6.3 Various Calculations in Single Channel
System.
a. The probability that the system being busy/utilization factor/traffic intensity
(p) =
b. The probability that the system being idle (p 0) =
c. The probability that there is ‘n’ units in the system (p n) =
d. The probability that the queue size is greater than or equal to k.
P(n ≥ k) =
e. The probability that the customer spent more than the average time in system
P(waiting time ≥ t) =
f. Expected or mean number of customer in the system (Ls) =
g. Expected or mean number of customer in queue (Lq) =
h. Average length of non-empty system (Lns) =
i. Average length of non-empty queue (Lnq) =
j. Mean or expected waiting time in system (Ws.) =
k. Mean or expected waiting time in queue (Wq) =