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Basic Development and Decision Processes: An Introduction African Technology Forum USAGhana.

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Presentation on theme: "Basic Development and Decision Processes: An Introduction African Technology Forum USAGhana."— Presentation transcript:

1 Basic Development and Decision Processes: An Introduction African Technology Forum USAGhana

2 Objectives of Introduction: I.Review common challenges of developing goods and services. II.Show how to analyze the problems. III.Introduce development and decision methods that let you address these challenges effectively.

3 This is an introduction to analytical processes used in the development of modern products, production systems and processes, and services. These tools help you capture the needs of your customers, end users, and citizens. They enable decision-making based on both technical and financial criteria, simultaneously. They are not capital intensive and are as easy to apply in developing nations as in fully industrialized nations.

4 I. Some common challenges when developing goods and services: "No Input, No Feedback" problems "Over the Wall" problems Understanding the real nature of the problems facing you Internal and External causes and effects

5 "No Input, No Feedback" problems: –"Eureka, we've solved it - all by ourselves!" –"Solved? Says who? We didn't want these!" Developers and users often don't ensure they are working with the same assumptions. Developers fail to get preparatory input or preliminary feedback from users. The outcome: the answer in the developer's mind doesn't serve the users in the users' own terms.

6 You must take the needs and wants of the people you are trying to serve and listen to them in those people's own terms. If you deliver a perfect "X", but it should have been "Y", nobody will remember it's a perfect "X". Even if what they asked for sounded like "X"!

7 "Over the Wall" problems: –"Hey, factory, go make this." –"This couldn't be made even if we wanted to!" –"They want us to add how much cost?" Left hand did not know what the right hand was doing. "Solution" was only one-way, as if simply "thrown over the wall". No concurrent development of product, process, or service with all related parties.

8 Internal and External causes and effects of problems: –"You can't think of everything, but you should have thought about that." –"We broke it. You go solve it." –"Someone else broke it. You go solve it." Preventing all "reasonably" possible internal and external causes of problems, and their subsequent effects, can help a good project be seen as a great one over time.

9 II. How to better analyze the problems? Performance Matrices: Cause and Effect Diagrams/Function Trees –Also called Fishbone, Fault Tree, or Ishikawa Diagrams. –May be top-down or bottom-up analysis. Histograms and Pareto Charts –How much of each thing do we have? –What are the most important or common?

10 Cause and Effect Diagrams/Function Trees –One functional outcome, or effect, may have many inputs or causes. –One fault, or cause, may have many effects. –"How many things must go right for this to function? How many things could go wrong?" Available upgrades Standard tooling Variable speed lines Multiple power sources Customer satisfaction Healthy, sustainable profit Good revenue Adjustable costs Wide distribution Flexible labor schedule Flexible plant machinery High quality Steady billing Product example: Operational example:

11 Histograms and Pareto Charts –A histogram counts the occurrences of each cause or effect, and displays them graphically. –A Pareto chart is simply a histogram sorted from highest to lowest frequency of occurrence. –Helps prioritize the issues - what to fix first. In this example on milk spoiling, the causes are sorted from highest to lowest, as a percent of total occurrences of spoilage. Here, sealing is shown as the most frequent cause. Thus, it is likely best that sealing be addressed first. Shipping time should be addressed next.

12 III. What are effective ways to develop a solution? Decision Matrices: Simple matrices - Positives and Negatives ("Pros vs. Cons") Pugh Concept Selection Charts More detailed matrices - Analytical Hierarchy Process House of Quality Method

13 Positives and Negatives ("Pros vs. Cons") –Simple and usually done to some degree. –Lay the info in front of everyone, and visually compare all the issues. –"Why'd we do that?" "I don't know." –"Did anyone consider the risks?" "I don't know." –Often issues which are assumed to be the simplest end up causing the most problems.

14 Positives and Negatives ("Pros vs. Cons") –Ex.: "pros" vs. "cons" for a machinery purchase Machine A`Positives, or "pros"Negatives, or "cons" Cost Purchase costLow financing charges and flexible credit Moderately high purchase price Operating costLow power consumptionHighly skilled operators required Speed & time Cycle timeFast and consistent Start-up timeSlow start-up time due to low power rating Mean time between failureVery durable, high reported time between failures Mean time to repairAuthorized personnel can repair quickly. Manufacturer certified technicians required by warranty contract

15 Pugh Concept Selection Charts –Compares all options using list of criteria. –The method can also take into account how important each criteria is. Ranking is weighted. Ex. 1 - Pugh Chart with no weights in ranking: CriteriaPresentMachine AMachine BMachine C CostCompare new options to present situation, or simply to each other. Purchase cost++same Operating cost-++ Speed & time Cycle time+same Start-up time++- Mean time between failuresame++ Mean time to repairsame++ # of pluses0353 # of minuses0101 Best overall option:best

16 Ex. 2 - Pugh Chart with weighting and ranking: CriteriaImportance weightings PresentMachine AMachine BMachine C Purchase cost10Compare new options to present situation, or simply to each other. 880 Cycle time7300 Mean time between failure 7085 Operating cost5-246 Mean time to repair2044 Start-up time174-3 Weighted scores and best overall option: best 70 –Teams and leaders with preconceptions are sometimes surprised by what option actually "wins". However, this helps objectively show what was really important and why. –With or without weights, scoring should be collaborative with all related parties. Everyone need not agree on values, but at least see up front what big differences might indicate.

17 Analytical Hierarchy Process (AHP) –Relies more on quantitative scoring. –Less subjective than qualitative Pugh scores. –Most appropriate for complex decision making, where multiple variables come into play. House of Quality Method (HoQ) –Comprehensive methodology which ties together function trees and Pugh charts. –Converts "customer" inputs into more specific, targeted requirements you can design to. –Helps analyze and manage trade-offs.

18 For more details on, and examples of, the AHP and HoQ methodologies, please see or Also, the economic aspects of your decisions must be kept in mind...

19 Basic Economic Analyses Time Value of Money Minimum Attractive Rate of Return and Payback Period Economic Figures of Merit –Present Worth (Net Present Value) –Future Worth and Annual Worth (Annual Cost) –Internal Rate of Return –Cost to Benefit Ratio These are also important decision criteria. Please see for details of their analyses.

20 For more information, please see Basic Development and Decision Processes: Technical and Economic Analyses Michael Tekletsion Berhan African Technology Forum

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