MANAGEMENT OF MACHINES AND MATERIALS (MS-5) UNIT 2 PRODUCT SELECTION

Roshan Gnyawali

Product and Service Selection

Strategic Decision (Long-term Decision) Other decisions (capacity planning, process planning, location, human resource etc.) depend upon it.

Basis of Competitiveness and Profitability

Involves other areas as marketing, R&D Requires Top Management Support

2-2

Product or Service Design Activities

1. Translate customer wants and needs into product and service requirements 2. Refine existing products and services 3. Develop new products and services 4. Formulate quality goals 5. Formulate cost targets 6. Construct and test prototypes 7. Document specifications

2-3

Reasons for Product or Service Design

Economic
Social and demographic changes Political, liability, or legal Competitiveness Cost or availability Technological advances
Product and service design or redesign should be closely tied to an organizations strategy
2-4

Objectives of Product 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
2-5

Life Cycles of Products or Services

Saturation

Maturity

Demand

Decline Growth

Introduction

Time
2-6

Product Selection Process

Pure Research
Applied Research Marketing Research Screening Idea Generation

Economic Analysis
Product Development Process Development Design and Testing
2-7

Product Selection Process

Pure Research
Applied Research Marketing Research Screening Idea Generation
Research

Economic Analysis
Development

Selection

Product Development Process Development Design and Testing

Design
2-8

Research

Organized efforts to increase scientific knowledge or product innovation

Basic Research: knowledge about a subject Applied Research: commercial focus

Development: convert into commercial application

Market Research: Consumer Survey, Dealer Survey, opinion polls Idea Generation: Brainstorming, panel discussion, scenario building, technology forecasting

2-9

Research
New Idea Mortality curve

2-10

Selection
Qualitative Phase (Screening)
Match Corporate Strategy, Capitalize on Strengths Exploit Familiarity Factor
Familiarity with similar products and services Familiarity with similar transformation process Familiarity with similar market segments Familiarity with similar distribution channels.

Quantitative Phase
Economic Analysis NPV, IRR, B/C Ratio
2-11

Development
Creation, Modification or Extension Product Development Process
Planning Concept Development System-Level Design Detailed Engineering Design

Testing and Refinement

Production Ramp-up
2-12

Development
Key Elements of a Product Design
Function Cost Quality Reliability Maintainability Producibility Timing Accessibility Legal, Ethical, Environmental, Social Factors Appearance Safety

More Important for Service Design

2-13

Product Design
Two Methods
Standard Product (Standardization) Product Variety
Mass Customization
Delayed Differentiation Modularization

Design Simplification Structuring of Options

2-14

Standardization
Standardization: Extent to which there is an absence of variety in a product, service or process

Standardized products are immediately available to customers

2-15

Advantages of Standardization
Ease in Production Low inventory Low Design costs Low training costs More routine procedures Quality consistent Steady Flow Less Set-ups Use of Automation Economies of Scale Order filled by Inventory Less Improvement Costs
2-16

Quantity Discount

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.

2-17

Mass Customization
Mass customization:
A strategy of producing standardized goods or services, but incorporating some degree of customization Delayed differentiation Modular design

2-18

Delayed Differentiation
Delayed differentiation is a postponement tactic
Producing but not quite completing a product or service until customer preferences or specifications are known

2-19

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

2-20

Design Simplification
It attempts to simplify the design.
Combining two or more parts into one. Eliminate some parts.

Lower Production cost Lower Material Cost

2-21

Options
Provide variety to product Increased Attractiveness

Broad Range of Customers

Pricing can be complicated

2-22

Product and Process Innovation

Need Stimulated

Technology Stimulated

Cost Stimulated

Output rate Stimulated Uncoordinated processes Performance maximization

Integrated processes Cost minimization

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

2-24

Quality Function Deployment

Quality Function Deployment
Voice of the customer House of quality

QFD: An approach that integrates the voice of the customer into the product and service development process.

2-25

The House of Quality

Correlation matrix Design requirements

Customer requirements

Relationship matrix

Competitive assessment

Specifications or target values

2-26

House of Quality Example

Correlation:
X X X

Water resistance

Accoust. Trans. Window

Energy needed to close door

Door seal resistance

Engineering Characteristics

Check force on level ground Energy needed to open door

Strong positive Positive Negative Strong negative

X = Us A = Comp. A B = Comp. B (5 is best) 1 2 3 4

Competitive evaluation

Customer Requirements Easy to close

7 5 3 3 2
Reduce energy level to 7.5 ft/lb

X X AB

AB

Stays open on a hill

Easy to open Doesnt leak in rain No road noise Importance weighting Target values

XAB A XB X A B

10

6
Maintain current level

6
Reduce force to 9 lb.

9
Reduce energy to 7.5 ft/lb.

2
Maintain current level

3
Maintain current level

Relationships:
Strong = 9 Medium = 3 Small = 1

Technical evaluation (5 is best)

5 4 3 2 1

B A X

BA X

B A X

B X A

BXA

BA X

2-27

Discussion Questions
Describe the product selection process with the help of an example of a new small car. Give two examples for each of a service and manufacturing firm, of the impact of technology in service and product design. Discuss with suitable examples, the process of launching a new product in the market. Explain with the help of suitable examples. What do you mean by Product Life Cycle? State the different stages of a product life cycle and also the factors affecting the decisions at each stage of product life cycle.

Discussion Questions
What are the factors that cause organizations to redesign their products or services? Describe some of the ways a product designer can use CAD. Some suggest that customer expectation is the key to service success. Give an example from your own experience to support or refute this assertion.

End of Unit 2

UNIT 3: Process Selection