OPERATIONS MANAGEMENT STRATEGY 1. PRODUCT CHOICE 2. PROCESS CHOICE 3. FACILITIES CHOICE 4. QUALITY CHOICE

 Product choice is an important strategic decision  The organisation must be able to produce a product of quality and at a cost that allows it to be marketed at a competitive price

 There are five stages to new product development once the opportunity of need has been identified 1. EXPLORING AND GENERATING IDEAS 2. ROUGH SCREENING 3. BUSINESS ANALYSIS 4. PROTOTYPE DEVELOPMENT 5. TESTING

 The exploring and generating stage is where new ideas are generated  Tasks in this stage include formal research into:  Suggestions (coming from consumers, suppliers, wholesalers and retailers)  Analysis of competitors’ products  Investigating suggestions from shop floor employees

 New ideas need to be screened to see if they fit with the organisation’s overall strategy plan  Questions need to be asked such as:  How long will the development take?  Are resources (human & material) available already or would they need to be introduced?

 At the business analysis or thorough screening stage, the idea is costed and initial financial projections are made.  Questions asked should include the following:  How much investment will be required?  What are the expected sales?  What impact will it have on other products?  What is the expected break-even point?  What sort of return on the investment is estimated?

 A prototype is a model or sample of the proposed new item, produced for the purposes of further development of the following:  The idea  The total product concept  A marketing strategy Sometimes the sample will be tested on employees or staff for feedback. Proposed new products often don’t get past this stage

 New products may be tested on a representative sample of the market, but that is not always a good idea  Can be better to wait until the company can launch the new product (without competitors seeing what it is like)

FLOWCHART Label and describe each stage of product development (We just looked at these 5 stages)

Read the article “Fruity Inventors” and answer the questions - (a – e)

Selection and documentation of all the features of a good and service to be produced and all the inputs needed for its production  SIZE  SHAPE  COLOUR  FUNCTIONS

 Requirements for the manufacture of the products a) Machinery b) Processes c) Completed product or assembly

Think of a product you have bought recently 1. Draw the product 2. Define the product with specifications