2. Chapter 3, Product Design INTRODUCTION to Operations Management 5e, Schroeder Copyright © 2011 by The McGraw-Hill Companies, Inc. All rights reserved. McGraw-Hill/Irwin

3. Outline DESIGN PROCESS –Strategies for New-Product Introduction –New-Product Development Process –Cross-Functional Product Design –Supply Chain Collaboration DESIGN TOOLS –Quality Function Deployment –Design for Manufacturing Value Analysis Modular Design 3-2

4. Product Design: Why Does Operations Care? In the old days, “over the wall” Now: –must be able to make it (process) technology availability of resources –must have the capacity –must deliver a quality product or service –must decide inventory policies 3-3

5. Strategies for New-Product Introduction Market Pull (“We Make What We Can Sell”) –food industry Technology Push (“We Sell What We Can Make”) –electronics Interfunctional View –personal computers 3-4

6. 3-5

7. New Product Development Process Concept Development –Idea generation and evaluation of alternative ideas Product Design –Design of the physical product –Design of the production process Pilot Production/Testing –Testing production prototypes –Finalize the ‘information package’ 3-6

8. New Product Design Process (Figure 3.2) Pilot production/testingFinal process design Preliminary process design Concept development Product design 3-7

9. Cross Functional Product Design Traditionally, individual functional areas (engineering, operations, marketing) operate without consulting each other. This is the sequential or ‘over the wall’ approach. Often results in misalignment. Concurrent approach requires the various functional areas to cooperate and work together in the same time frame. 3-8

10. Cross Functional Product Design (Figure 3.3) 3-9

11. Why Don’t Different Functional Areas Cooperate? They don’t speak the same language. They have different performance measures. They tend to have different personality types, i.e., they don’t think alike. They are defensive about their own turfs. They are in different physical locations. They “don’t have time.” 3-10

12. Supply Chain Collaboration Working across functional areas AND collaborating with customers and suppliers Working across functional areas AND collaborating with customers and suppliers 3-11

13. Supply Chain Collaboration Customers Ask the right questions Ask the right questions Provide incentives Provide incentives Create collaborative technology platform Create collaborative technology platform Include customers as advisors to design team Include customers as advisors to design team 3-12

14. Supply Chain Collaboration Suppliers should have: Technical expertise Technical expertise Capability Capability Capacity Capacity Low risk Low risk 3-13

15. Quality Function Deployment (QFD) Also known as “House of Quality” Developed in Japan in 1972 Tool for concurrent design of products Customer Attributes (“Voice of the Customer”) Engineering Characteristics (“Voice of the Engineer”) Tradeoffs Competitors’ Comparison 3-14

16. HOUSE OF QUALITY (QFD) 3-15

17. HOUSE OF QUALITY (QFD) 3-16

18. HOUSE OF QUALITY (QFD) 3-17

19. Design for Manufacturing (DFM) Value Analysis (or engineering) –Simplification of products and processes Modular Design –Multiple products using common parts, processes, and modules 3-18

20. Value Analysis Terms in Value Analysis: –Objective: primary purpose of the product –Basic Function: Makes the objective possible –Secondary Function: How to perform the basic function Value analysis seeks to improve the secondary function, e.g., how to open a can or make a tool box. 3-19

21. Objectives of Value Analysis Enhance the design of a good or service to provide higher quality at the same price, or the same quality at a lower price. Modify the design of production process to lower the cost of a product or service while maintaining or improving quality. In other words, improve the ratio of usefulness (quality) to cost. 3-20

22. DFM: An Example (c) Final design Design for push-and-snap assembly (b) Revised design One-piece base & elimination of fasteners (a) The original design Assembly using common fasteners 3-21

23. DFM: An Example (continued) a.Original Design 24 different parts to assemble 7 unique parts to manage in inventory b.Revised Design 4 different parts to assemble 3 unique parts to manage in inventory c.Final Design 2 parts to assemble and manage Question: How easy would it be to detect an assembly error with each of the designs? 3-22

24. Value Analysis at Toyota GM has 26 different seat frames. Toyota has 2. Toyota’s advantage: $500 million Source: Business Week, 31 July 2006, p. 57. 3-23

25. Value Analysis at GM Bo Andersson (VP Global Purchasing) discovered that door hinges on large SUVs and trucks could be made from 3 parts instead of 5. Savings: $21 per truck or $100 million total. It still took him three months to convince the engineers to change. Source: Business Week, 31 July 2006, p. 57. 3-24

26. Modular Design Allows greater variety through ‘mixing and matching’ of modules Develops a series of basic product components (modules) for later assembly into multiple products Reduces complexity and costs associated with large number of product variations Easy to subcontract production of modules 3-25

27. Modular Design Volvo P1 Platform –S40 sedan –V50 station wagon –C70 convertible –C30 compact Chrysler LX Platform –Dodge Charger –Chrysler 300 –Chrysler 300C Hemi –Dodge Magnum wagon –Dodge Challenger Source: Boston Globe, 19 February 2006, p. K1. 3-26

28. Dana’s “Rolling Chassis” 3-27

29. Summary DESIGN PROCESS –Strategies for New-Product Introduction –New-Product Development Process –Cross-Functional Product Design –Supply Chain Collaboration DESIGN TOOLS –Quality Function Deployment –Design for Manufacturing Value Analysis Modular Design 3-28

30. End of Chapter Three 3-29