CHAPTER 3

PRODUCT AND
SERVICE DESIGN
 WHAT DOES PRODUCT AND
SERVICE DESIGN DO?
1. TRANSLATE CUSTOMER WANTS AND NEEDS INTO
PRODUCT AND SERVICE REQUIREMENTS (MARKETING
OPERATIONS).
2. REFINE EXISTING PRODUCTS AND SERVICES
(MARKETING).
3. DEVELOP NEW PRODUCTS AND/OR SERVICES
(MARKETING, OPERATIONS).
4. FORMULATE QUALITY GOALS (MARKETING, OPERATIONS)
5. FORMULATE COST TARGETS (ACCOUNTING, FINANCE,
OPERATIONS).
 WHAT DOES PRODUCT AND
SERVICE DESIGN DO?

1. CONSTRUCT AND TEST PROTOTYPES

(OPERATIONS, MARKETING, ENGINEERING).
2. DOCUMENT SPECIFICATIONS
3. TRANSLATE PRODUCT AND SERVICE
SPECIFICATIONS INTO PROCESS
SPECIFICATIONS (ENGINEERING, OPERATIONS).
4. INVOLVE INTER-FUNCTIONAL COLLABORATION.
 KEY QUESTIONS
1. IS THERE DEMAND FOR IT?
2. CAN WE DO IT?
3. WHAT LEVEL OF QUALITY IS APPROPRIATE? WHAT DO
CUSTOMERS EXPECT? WHAT LEVEL OF QUALITY DO
COMPETITORS PROVIDE FOR SIMILAR ITEMS? HOW
WOULD IT FIT WITH OUR CURRENT OFFERINGS?
4. DOES IT MAKE SENSE FROM AN ECONOMIC
STANDPOINT? WHAT ARE THE POTENTIAL LIABILITY
ISSUES, ETHICAL CONSIDERATIONS, SUSTAINABILITY
ISSUES, COSTS, AND PROFITS? FOR NON-PROFITS, IS
THE COST WITHIN BUDGET?
 LEGAL
AND
ETHICAL
CONSIDERATIONS
 ORGANIZATIONS GENERALLY WANT
DESIGNERS TO ADHERE TO GUIDELINES SUCH
AS FOLLOWING:

 PRODUCE DESIGNS THAT ARE CONSISTENT

WITH THE GOALS OF THE ORIENTATION.
 GIVE CUSTOMERS THE VALUE THEY EXPECT.
 MAKE HEALTH AND SAFETY A PRIMARY
CONCERN.
 HUMAN FACTORS
• HUMAN FACTOR ISSUES OFTEN
ARISE IN THE DESIGN OF CONSUMER
PRODUCTS. SAFETY AND LIABILITY
ARE TWO CRITICAL ISSUES IN MANY
INSTANCES, AND THEY MUST BE
CAREFULLY CONSIDERED.
 CULTURAL FACTORS
• PRODUCT DESIGNERS IN COMPANIES THAT
OPERATE GLOBALLY ALSO MUST TAKE INTO
ACCOUNT ANY CULTURAL DIFFERENCES OF
DIFFERENT COUNTRIES OR REGIONS
RELATED TO THE PRODUCT. THIS CAN
RESULT IN DIFFERENT DESIGNS FOR
DIFFERENT COUNTRIES OR REGIONS.
 7 CULTURAL FACTORS YOU NEED TO
CONSIDER WHEN CHOOSING YOUR
NEXT EXPORT MARKET
MATERIAL CULTURE
•THIS INCLUDES THE TECHNOLOGICAL GOODS USED BY THE
MAJORITY OF THE POPULATION, PERSONAL TRANSPORT
(INCLUDING CAR OWNERSHIP) AND THE AVAILABILITY OF
RESOURCES SUCH AS ELECTRICITY, NATURAL GAS,
TELEPHONE, INTERNET AND WIRELESS COMMUNICATION.
CULTURAL PREFERENCES
•EACH INTERNATIONAL MARKET WILL HAVE VARYING
PREFERENCES FOR PRODUCTS, FOODS, PRODUCT/FOOD
QUALITY LEVELS, AND EVEN BRANDS. THE MEANING OF
SHAPES, COLORS AND ICONIC FEATURES CAN ALSO HAVE
DIFFERENT CULTURAL SIGNIFICANCE.
 7 CULTURAL FACTORS YOU NEED TO
CONSIDER WHEN CHOOSING YOUR
NEXT EXPORT MARKET
LANGUAGES
•THE LANGUAGES SPOKEN AND USED IN A COUNTRY HAVE AN
IMPACT ON MARKETING, BRAND NAMES, THE COLLECTION OF
INFORMATION THROUGH SURVEYS AND INTERVIEWS,
ADVERTISING AND THE CONDUCT OF BUSINESS RELATIONSHIPS.
LANGUAGES MIGHT VARY BETWEEN REGIONS OF A COUNTRY,
AND SOME COUNTRIES HAVE MORE THAN ONE OFFICIAL
LANGUAGE.

EDUCATION
•THE TYPICAL LEVEL OF COMPLETED EDUCATION IN A REGION
CAN INDICATE THE QUALITY OF A POTENTIAL WORK FORCE AND
THE STATUS OF CONSUMERS.
 7 CULTURAL FACTORS YOU NEED TO
CONSIDER WHEN CHOOSING YOUR
NEXT EXPORT MARKET
RELIGION
•RELIGION IS A MAJOR CULTURAL INFLUENCER THAT CAN
AFFECT MANY ASPECTS OF LIFE, INCLUDING THE ROLE OF
WOMEN IN SOCIETY, RULES ABOUT FOOD AND BEVERAGE
CONSUMPTION, CLOTHING HABITS AND HOLIDAY ACTIVITIES.
ETHICS AND VALUES
•THESE CAN HAVE AN IMPACT ON INTERNATIONAL BUSINESS,
ESPECIALLY WHEN CONDUCTED FROM WITHIN ANOTHER
COUNTRY. HOWEVER, IT IS IMPORTANT FOR RESEARCHERS
TO REMEMBER THAT THE SAME ETHICS AND VALUES ARE
NOT HELD BY EVERYONE IN A TARGET MARKET. THEY ARE
ALWAYS DEPENDENT ON STATUS, REGION, ETHNICITY AND
RELIGION.
 7 CULTURAL FACTORS YOU NEED TO
CONSIDER WHEN CHOOSING YOUR
NEXT EXPORT MARKET
SOCIAL ORGANIZATION
•THE COMPOSITION OF FAMILY GROUPS, THE
PREVALENCE OF SPECIAL-INTEREST GROUPS
AND ATTITUDES TOWARD THEM, RACIAL
DIVERSITY AND RECREATIONAL LIFESTYLES
ARE ALL IMPORTANT TO CONSIDER WHEN A
COUNTRY IS BEING INVESTIGATED AS A
POTENTIAL EXPORT MARKET.
 ENVIRONMENTAL FACTORS
• PRODUCT DESIGNERS IN COMPANIES THAT
OPERATE GLOBALLY ALSO MUST TAKE INTO
ACCOUNT ANY CULTURAL DIFFERENCES OF
DIFFERENT COUNTRIES OR REGIONS
RELATED TO THE PRODUCT. THIS CAN
RESULT IN DIFFERENT DESIGNS FOR
DIFFERENT COUNTRIES OR REGIONS.
 KEY ASPECTS
1. CRADLE-TO-GRAVE ASSESSMENT – ALSO KNOWN AS LIFE CYCLE
ANALYSIS, IS THE ASSESSMENT OF THE ENVIRONMENTAL IMPACT
OF A PRODUCT OR SERVICE THROUGHOUT ITS USEFUL LIFE,
FOCUSING ON SUCH FACTORS AS GLOBAL WARMING, SMOG
FORMATION, OXYGEN DEPLETION, AND SOLID WASTE GENERATION.
2. END-OF-LIFE PROGRAMS – DEAL WITH PRODUCTS THAT HAVE
REACHED THE END OF THEIR USEFUL LIVES. THE PRODUCTS
INCLUDE BOTH CONSUMER PRODUCTS AND BUSINESS EQUIPMENT.
THE PURPOSE OF THESE PROGRAMS IS TO REDUCE THE DUMPING
OF PRODUCTS, PARTICULARLY ELECTRONIC EQUIPMENT, IN
LANDFILLS OR THIRD-WORLD COUNTRIES, AS HAS BEEN THE
COMMON PRACTICE, OR INCINERATION, WHICH CONVERTS
MATERIALS INTO HAZARDOUS AIR AND WATER EMISSIONS AND
GENERATES TOXIC ASH.
 KEY ASPECTS
1. THE THREE R’S: REDUCE, REUSE, AND RECYCLE – DESIGNERS
OFTEN REFLECT ON THREE PARTICULAR ASPECTS OF POTENTIAL
COST SAVING AND REDUCING ENVIRONMENTAL IMPACT: REDUCING
THE USE OF MATERIAL THROUGH VALUE ANALYSIS; REFURBISHING
AND THEN RESELLING RETURNED GOODS THAT ARE DEEMED TO
HAVE ADDITIONAL USEFUL LIFE, WHICH IS REFERRED TO AS
REMANUFACTURING; AND RECLAIMING PARTS OF UNUSABLE
PRODUCTS OF RECYCLING.
2. REDUCE: VALUE ANALYSIS – IS REFERS TO AN EXAMINATION OF
THE FUNCTION OF PARTS AND MATERIALS IN AN EFFORT TO
REDUCE THE COST AND/OR IMPROVE THE PERFORMANCE OF A
PRODUCT.
 PRODUCT LIFE CYCLE

INTRODUCTION STAGE – THIS STAGE OF THE CYCLE

COULD BE THE MOST EXPENSIVE FOR A COMPANY
LAUNCHING A NEW PRODUCT. THE SIZE OF THE MARKET
FOR THE PRODUCT IS SMALL, WHICH MEANS SALES ARE
LOW, ALTHOUGH THEY WILL BE INCREASING. ON THE
OTHER HAND, THE COST OF THINGS LIKE RESEARCH
AND DEVELOPMENT, CONSUMER TESTING, AND THE
MARKETING NEEDED TO LAUNCH THE PRODUCT CAN BE
VERY HIGH, ESPECIALLY IF IT’S A COMPETITIVE SECTOR.
 PRODUCT LIFE CYCLE

GROWTH STAGE – THE GROWTH STAGE IS TYPICALLY

CHARACTERIZED BY A STRONG GROWTH IN SALES AND
PROFITS, AND BECAUSE THE COMPANY CAN START TO
BENEFIT FROM ECONOMIES OF SCALE IN PRODUCTION,
THE PROFIT MARGINS, AS WELL AS THE OVERALL
AMOUNT OF PROFIT, WILL INCREASE. THIS MAKES IT
POSSIBLE FOR BUSINESSES TO INVEST MORE MONEY IN
THE PROMOTIONAL ACTIVITY TO MAXIMIZE THE
POTENTIAL OF THIS GROWTH STAGE.
 PRODUCT LIFE CYCLE

MATURITY STAGE – DURING THE MATURITY STAGE, THE

PRODUCT IS ESTABLISHED AND THE AIM FOR THE
MANUFACTURER IS NOW TO MAINTAIN THE MARKET
SHARE THEY HAVE BUILT UP. THIS IS PROBABLY THE
MOST COMPETITIVE TIME FOR MOST PRODUCTS AND
BUSINESSES NEED TO INVEST WISELY IN ANY
MARKETING THEY UNDERTAKE. THEY ALSO NEED TO
CONSIDER ANY PRODUCT MODIFICATIONS OR
IMPROVEMENTS TO THE PRODUCTION PROCESS WHICH
MIGHT GIVE THEM A COMPETITIVE ADVANTAGE.
 PRODUCT LIFE CYCLE

•DECLINE STAGE – EVENTUALLY, THE MARKET FOR A

PRODUCT WILL START TO SHRINK, AND THIS IS WHAT’S
KNOWN AS THE DECLINE STAGE. THIS SHRINKAGE
COULD BE DUE TO THE MARKET BECOMING SATURATED
(I.E. ALL THE CUSTOMERS WHO WILL BUY THE PRODUCT
HAVE ALREADY PURCHASED IT), OR BECAUSE THE
CONSUMERS ARE SWITCHING TO A DIFFERENT TYPE OF
 PRODUCT LIFECYCLE MANAGEMENT

• PRODUCT LIFECYCLE MANAGEMENT (PLM) REFERS TO

THE HANDLING OF A GOOD AS IT MOVES THROUGH
THE TYPICAL STAGES OF ITS PRODUCT LIFE:
DEVELOPMENT AND INTRODUCTION, GROWTH,
MATURITY/STABILITY, AND DECLINE. THIS HANDLING
INVOLVES BOTH THE MANUFACTURING OF THE GOOD
AND THE MARKETING OF IT. THE CONCEPT OF
PRODUCT LIFE CYCLE HELPS INFORM BUSINESS
DECISION-MAKING, FROM PRICING AND PROMOTION
TO EXPANSION OR COST-CUTTING.
 THREE PHASES OF PRODUCT LIFE CYCLE
APPLICATION

1. BEGINNING OF LIFE – WHICH INVOLVES DESIGN

AND DEVELOPMENT.
2. MIDDLE OF LIFE – WHICH INVOLVES WORKING WITH
SUPPLIERS, MANAGING PRODUCT INFORMATION
AND WARRANTIES.
3. END OF LIFE- WHICH INVOLVES STRATEGIES FOR
PRODUCT DISCONTINUANCE, DISPOSAL, OR
RECYCLING.
 STANDARDIZATION

• STANDARDIZATION IS A PROCESS WHEREIN

SPECIFIC GUIDELINE ARE GENERATED FOR AN
OPERATION. GUIDELINES ARE DEVELOPED FOR
IMPLEMENTING THE PROCESS AND GUIDELINES
ARE GENERATED FOR MEASURING THE EFFICIENCY
OF THE OPERATION.
DEGREE OF STANDARDIZATION

 THE DEGREE OF STANDARDIZATION, TO BE USED

IN THE COMPANY’S PRACTICES, IS IDENTIFIED,
AND SUITABLE CHANGES ARE BROUGHT ABOUT
AFTER THOROUGH INVESTIGATION
 DESIGNING FOR MASS CUSTOMIZATION

• COMPANIES LIKE STANDARDIZATION BECAUSE IT

ENABLES THEM TO PRODUCE HIGH VOLUMES OF
RELATIVELY LOW-COST PRODUCTS. CUSTOMERS, ON
THE OTHER HAND, TYPICALLY PREFER MORE
VARIETY, ALTHOUGH THEY LIKE THE LOW COST. THE
QUESTION FOR PRODUCERS IS HOW TO RESOLVE
THESE ISSUES WITHOUT (1) LOSING THE BENEFITS
OF STANDARDIZATION, AND (2) INCURRING A HOST
OF PROBLEMS THAT ARE OFTEN LINKED TO VARIETY.
 MASS CUSTOMIZATION

• IS THE PROCESS OF DELIVERING MARKET GOODS

AND SERVICES THAT ARE MODIFIED TO SATISFY A
SPECIFIC CUSTOMER'S NEEDS. MASS
CUSTOMIZATION IS A MARKETING AND
MANUFACTURING TECHNIQUE THAT COMBINES THE
FLEXIBILITY AND PERSONALIZATION OF CUSTOM-
MADE PRODUCTS WITH THE LOW UNIT COSTS
ASSOCIATED WITH MASS PRODUCTION. OTHER
NAMES FOR MASS CUSTOMIZATION INCLUDE MADE-
TO-ORDER OR BUILT-TO-ORDER.
 RELIABILITY
•THE IMPORTANCE OF RELIABILITY IS UNDERSCORED BY ITS USE
BY PROSPECTIVE BUYERS IN COMPARING ALTERNATIVES AND
BY SELLERS AS ONE DETERMINANT OF PRICE.
•RELIABILITY ALSO CAN HAVE AN IMPACT ON REPEAT SALES,
REFLECT ON THE PRODUCTS’ IMAGE, AND, IF IT IS TOO LOW,
CREATE LEGAL IMPLICATIONS. RELIABILITY IS ALSO A
CONSIDERATION FOR SUSTAINABILITY; THE HIGHER THE
RELIABILITY OF A PRODUCT, THE FEWER THE RESOURCES THAT
WILL BE NEEDED TO MAINTAIN IT, AND THE LESS FREQUENTLY IT
WILL INVOLVE THE THREE R’S.
 ROBUST DESIGN
•ROBUST MEANS THAT SOMETHING IS STURDY OR
ABLE TO HOLD UP. THIS IS AN IMPORTANT QUALITY TO
HAVE WHEN IT COMES TO PRODUCTS, BECAUSE
CUSTOMERS WANT A PRODUCT THEY CAN TRUST AND
DEPEND ON
• ROBUST DESIGN METHOD, ALSO CALLED THE
TAGUCHI METHOD
 DEGREE OF NEWNESS

PRODUCT OR SERVICE DESIGN CHANGE CAN RANGE

FROM THE MODIFICATION OF AN EXISTING PRODUCT OR
SERVICE TO AN ENTIRELY NEW PRODUCT OR SERVICE:

MODIFICATION OF AN EXISTING PRODUCT OR SERVICE

EXPANSION OF AN EXISTING PRODUCT LINE OR SERVICE
OFFERING
CLONE OF A COMPETITOR’S PRODUCT OR SERVICE
NEW PRODUCT OR SERVICE
 QUALITY FUNCTION DEPLOYMENT

•QUALITY FUNCTION DEPLOYMENT (QFD) IS A

STRUCTURED APPROACH FOR INTEGRATING THE
“VOICE OF THE CUSTOMER” INTO BOTH THE
PRODUCT AND SERVICE DEVELOPMENT
PROCESS. THE PURPOSE IS TO ENSURE THAT
CUSTOMER REQUIREMENTS ARE FACTORED
INTO EVERY ASPECT OF THE PROCESS.

 THE KANO MODEL

•NORIAKI KANO, A JAPANESE RESEARCHER AND

CONSULTANT, PUBLISHED A PAPER IN 19841 WITH A SET
OF IDEAS AND TECHNIQUES THAT HELP US DETERMINE
OUR CUSTOMERS’ (AND PROSPECTS’) SATISFACTION WITH
PRODUCT FEATURES. THESE IDEAS ARE COMMONLY
CALLED THE KANO MODEL AND ARE BASED UPON THE
FOLLOWING PREMISES:
•CUSTOMERS’ SATISFACTION WITH OUR PRODUCT’S
FEATURES DEPENDS ON THE LEVEL OF FUNCTIONALITY
THAT IS PROVIDED (HOW MUCH OR HOW WELL THEY’RE
IMPLEMENTED);
THE KANO MODEL
 THE FOUR CATEGORIES OF FEATURES

PERFORMANCE
•SOME PRODUCT FEATURES BEHAVE AS WHAT WE MIGHT
INTUITIVELY THINK THAT SATISFACTION WORKS: THE
MORE WE PROVIDE, THE MORE SATISFIED OUR
CUSTOMERS BECOME. BECAUSE OF THIS PROPORTIONAL
RELATION BETWEEN FUNCTIONALITY AND SATISFACTION,
THESE FEATURES ARE USUALLY
CALLED LINEAR, PERFORMANCE OR ONE-
DIMENSIONAL ATTRIBUTES IN THE KANO LITERATURE (I
PREFER THE PERFORMANCE).
•
 THE FOUR CATEGORIES OF FEATURES

PERFORMANCE
•SOME PRODUCT FEATURES BEHAVE AS WHAT WE MIGHT
INTUITIVELY THINK THAT SATISFACTION WORKS: THE
MORE WE PROVIDE, THE MORE SATISFIED OUR
CUSTOMERS BECOME. BECAUSE OF THIS PROPORTIONAL
RELATION BETWEEN FUNCTIONALITY AND SATISFACTION,
THESE FEATURES ARE USUALLY
CALLED LINEAR, PERFORMANCE OR ONE-
DIMENSIONAL ATTRIBUTES IN THE KANO LITERATURE (I
PREFER THE PERFORMANCE).
•
 THE FOUR CATEGORIES OF FEATURES

•MUST-BE
•OTHER PRODUCT FEATURES ARE
SIMPLY EXPECTED BY CUSTOMERS. IF
THE PRODUCT DOESN’T HAVE THEM, IT WILL BE
CONSIDERED TO BE INCOMPLETE OR JUST PLAIN
BAD. THIS TYPE OF FEATURES IS USUALLY
CALLED MUST-BE OR BASIC EXPECTATIONS.
•
 THE FOUR CATEGORIES OF FEATURES

PERFORMANCE
•SOME PRODUCT FEATURES BEHAVE AS WHAT WE MIGHT
INTUITIVELY THINK THAT SATISFACTION WORKS: THE
MORE WE PROVIDE, THE MORE SATISFIED OUR
CUSTOMERS BECOME. BECAUSE OF THIS PROPORTIONAL
RELATION BETWEEN FUNCTIONALITY AND SATISFACTION,
THESE FEATURES ARE USUALLY
CALLED LINEAR, PERFORMANCE OR ONE-
DIMENSIONAL ATTRIBUTES IN THE KANO LITERATURE (I
PREFER THE PERFORMANCE).
•
 THE FOUR CATEGORIES OF FEATURES

•ATTRACTIVE
•THERE ARE UNEXPECTED FEATURES WHICH, WHEN
PRESENTED, CAUSE A POSITIVE REACTION. THESE ARE
USUALLY
CALLED ATTRACTIVE, EXCITERS OR DELIGHTERS. I TEND
TO PREFER THE TERM ATTRACTIVE, BECAUSE IT
CONVEYS THE NOTION THAT WE’RE TALKING ABOUT A
SCALE. WE CAN HAVE REACTIONS RANGING FROM MILD
ATTRACTIVENESS TO ABSOLUTE DELIGHT, AND STILL
HAVE EVERYTHING FIT UNDER THE “ATTRACTIVE” NAME.
 THE FOUR CATEGORIES OF FEATURES

PERFORMANCE
•SOME PRODUCT FEATURES BEHAVE AS WHAT WE MIGHT
INTUITIVELY THINK THAT SATISFACTION WORKS: THE
MORE WE PROVIDE, THE MORE SATISFIED OUR
CUSTOMERS BECOME. BECAUSE OF THIS PROPORTIONAL
RELATION BETWEEN FUNCTIONALITY AND SATISFACTION,
THESE FEATURES ARE USUALLY
CALLED LINEAR, PERFORMANCE OR ONE-
DIMENSIONAL ATTRIBUTES IN THE KANO LITERATURE (I
PREFER THE PERFORMANCE).
•
 THE FOUR CATEGORIES OF FEATURES

•INDIFFERENT
•NATURALLY, THERE ARE ALSO FEATURES
TOWARDS WHICH WE FEEL INDIFFERENT. THOSE
WHICH THEIR PRESENCE (OR ABSENCE) DOESN’T
MAKE A REAL DIFFERENCE IN OUR REACTION TO
THE PRODUCT.
 THE FOUR CATEGORIES OF FEATURES

PERFORMANCE
•SOME PRODUCT FEATURES BEHAVE AS WHAT WE MIGHT
INTUITIVELY THINK THAT SATISFACTION WORKS: THE
MORE WE PROVIDE, THE MORE SATISFIED OUR
CUSTOMERS BECOME. BECAUSE OF THIS PROPORTIONAL
RELATION BETWEEN FUNCTIONALITY AND SATISFACTION,
THESE FEATURES ARE USUALLY
CALLED LINEAR, PERFORMANCE OR ONE-
DIMENSIONAL ATTRIBUTES IN THE KANO LITERATURE (I
PREFER THE PERFORMANCE).
•
PHASES IN PRODUCT
DESIGN AND
DEVELOPMENT
 PHASES OF PRODUCT DESIGN
AND DEVELOPMENT
FEASIBILITY ANALYSIS – ENTAILS MARKET ANALYSIS
(DEMAND), ECONOMIC ANALYSIS (DEVELOPMENT COST
AND PRODUCTION COST, PROFIT POTENTIAL), AND
TECHNICAL ANALYSIS (CAPACITY REQUIREMENTS AND
AVAILABILITY, AND THE SKILLS NEEDED).
PRODUCT SPECIFICATIONS – THIS INVOLVES DETAIL
DESCRIPTIONS OF WHAT IS NEEDED TO MEET (OR
EXCEED) CUSTOMER WANTS, AND REQUIRES
COLLABORATION BETWEEN LEGAL, MARKETING, AND
OPERATIONS.
 PHASES OF PRODUCT DESIGN
AND DEVELOPMENT
PROCESS SPECIFICATIONS – ONCE PRODUCT
SPECIFICATIONS HAVE BEEN SET, ATTENTION TURNS TO
SPECIFICATION FOR THE PROCESS THAT WILL BE
NEEDED TO PRODUCE PRODUCT. ALTERNATIVES MUST
BE WEIGHED IN TERMS OF COST, AVAILABILITY OF
RESOURCES, PROFIT POTENTIAL, AND QUALITY. THIS
INVOLVES COLLABORATION BETWEEN ACCOUNTING AND
OPERATIONS.
PROTOTYPE DEVELOPMENT – WITH PRODUCT AND
PROCESS SPECIFICATIONS COMPLETE, ONE (OR FEW)
UNITS ARE MADE TO SEE IF THERE ARE ANY PROBLEM
WITH THE PRODUCT OR PROCESS SPECIFICATIONS.
 PHASES OF PRODUCT DESIGN
AND DEVELOPMENT
DESIGN REVIEW – AT THIS STAGE, ANY NECESSARY
CHANGES ARE MADE OR THE PROJECT IS ABANDONED.
MARKETING, FINANCE, ENGINEERING, DESIGN, AND
OPERATIONS COLLABORATE TO DETERMINE WHETHER
TO PROCEED OR ABANDON.
MARKET TEST – IS USED TO DETERMINE THE EXTENT OF
CONSUMER ACCEPTANCE. IF UNSUCCESSFUL, THE
PRODUCT RETURNS TO THE DESIGN REVIEW PHASE. THIS
PHASE IS HANDLED BY MARKETING.
 PHASES OF PRODUCT DESIGN
AND DEVELOPMENT
PRODUCT INTRODUCTION – THE NEW PRODUCT IS
PROMOTED. THIS PHASE IS HANDLED BY MARKETING.
FOLLOW-UP EVALUATION – BASED ON USER FEEDBACK,
CHANGES MAY BE MADE OR FORECASTS REFINED. THIS
PHASE IS HANDLED BY MARKETING.
•
 SERVICE DESIGN

•SERVICE DESIGN IS CONCERNED WITH THE DESIGN OF

SERVICES AND MAKING THEM BETTER SUIT THE NEEDS
OF THE SERVICE’S USERS AND CUSTOMERS. IT
EXAMINES ALL ACTIVITIES, INFRASTRUCTURE,
COMMUNICATION, PEOPLE, AND MATERIAL COMPONENTS
INVOLVED IN THE SERVICE TO IMPROVE BOTH QUALITY
OF SERVICE AND INTERACTIONS BETWEEN THE
PROVIDER OF THE SERVICE AND ITS CUSTOMERS.
 SERVICE DESIGN FIVE KEY
PRINCIPLES
•USER-CENTERED – USE QUALITATIVE RESEARCH TO DESIGN
FOCUSING ON ALL USERS.
•CO-CREATIVE – INCLUDE ALL RELEVANT STAKEHOLDERS IN THE
DESIGN PROCESS.
•SEQUENCING – BREAK A COMPLEX SERVICE INTO SEPARATE
PROCESSES AND USER JOURNEY SECTIONS.
•EVIDENCING – ENVISION SERVICE EXPERIENCES TO MAKE THEM
TANGIBLE FOR USERS TO UNDERSTAND AND TRUST BRANDS.
•HOLISTIC – DESIGN FOR ALL TOUCHPOINTS THROUGHOUT
EXPERIENCES, ACROSS NETWORKS OF USERS AND INTERACTIONS.
 GUIDELINES FOR SUCCESSFUL
SERVICE DESIGN
DEFINE THE SERVICE PACKAGE – A SERVICE
BLUEPRINT MAY BE HELPFUL FOR THIS.
FOCUS ON CUSTOMER’S PERSPECTIVE – CONSIDER
HOW CUSTOMER EXPECTATIONS AND PERCEPTIONS ARE
MANAGED DURING AND AFTER THE SERVICE.
CONSIDER IMAGE OF THE SERVICE PACKAGE – WILL
PRESENT BOTH TO CUSTOMERS AND TO PROSPECTIVE
CUSTOMERS.
 GUIDELINES FOR SUCCESSFUL
SERVICE DESIGN
RECOGNIZE THAT DESIGNER’S PERSPECTIVE IS
DIFFERENT FROM THE CUSTOMER’S PERSPECTIVE
MAKE SURE THAT MANAGERS ARE INVOLVED – AND
WILL SUPPORT THE DESIGN ONCE IT IS IMPLEMENTED.
DEFINE QUALITY FOR TANGIBLE AND INTANGIBLES –
INTANGIBLE STANDARDS ARE MORE DIFFICULT TO
DEFINE, BUT THEY MUST BE ADDRESSED.
 GUIDELINES FOR SUCCESSFUL
SERVICE DESIGN

 MAKE SURE THAT RECRUITMENT, TRAINING

AND REWARDS ARE CONSISTENT WITH
SERVICE EXPECTATIONS
 ESTABLISH PROCEDURES TO HANDLE
EXCEPTIONS
 ESTABLISH SYSTEMS TO MONITOR SERVICE,
MAINTAIN AND IMPROVE SERVICE.