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Session 3 Product selection and Design

Product selection

← Product Mix – Selection of products we desire to produce - Factors to beconsidered –

← Sales reports, forecasts

← Design Specifications

← Product characteristics

← Relation to other products/models

←  Type of labour force available

← Financial resources

← Space limitations

← Availability of Raw materials

← Availability of processes

Product selection Process - Continuous activity

← - Search, screen, develop, commercialize

← - New products, modify existing lines, phase out the marginal orunprofitable lines.

Idea Generation – sources

 –  Organized – consumer, laboratories, work place (in the field) –scientists and technologists

 – 

Unorganized – from any where – competitors, salesmen, distributors,consultants, bankers, administrators et

Idea Generation Special techniques –

 –  Attribute listing

 –  Morphological analysis

 –  Brain-storming session

 –  Delphi method

 –  Problem inventory analysis

Product selection process

← Screening – critical evaluation of ideas

 –  Feasible ? Suitable ? Viable ?

 –  Satisfy consumer needs ?

 –  Generate sales volume ?

 –  Profitability ?

 –  Objectives of the company?

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← Methods of screening

 –  Check-list

 –  Rating method

← Detailed business analysis

 –  Break-even analysis

 –  Discounted cash flow

 –  Risk analysis

← Product development

 –  Prototype development

 –  Drawings and designs

 –   Testing

 –  Pilot production

 –  Field trials

 –   Test marketing

 –  commercialization

Product Development and Design

← Customer requirements – ranked in order of importance

←  Technical specifications evolved

← Involve customer into design specifications - Quality Function Deployment

Product design Process

← Design and Manufacturing outsourced – Companies specialize in productdesign

← Core competency characteristics

 –  Provides potential access to wide variety of markets

 –  It increases perceived customer benefits

 –  It is hard for competitors to imitate.

Typical Phases of Product Development

← Planning

← Concept Development

← System-Level design

← Design Detail

← Testing and Refinement

← Production Ramp-up

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No

Phase Input Output

0 Planning Corporate strategy,technology development,

Market objectives

Project mission – target market, businessgoal, key assumptions, constraints

1 Conceptdevelopment

Market needs, alternativeconcepts, evaluation, selectand short list for furtherdevelopment and testing

Product concepts with each giving form,function, features of product, set of specifications, analysis of competitiveproducts, economic justification

2 System Leveldesign

Define product architecture, sub-systems, components, final assemblyscheme. Provide geometric layout, functional specification of eachsubsystem and preliminary process flow diagram for final assembly.

No

Phase Input Output

3 Designdetails

Unique parts - Completegeometric specification,materials and tolerances.Identify all standard parts.Process plan and tooling foreach part to be manufacturedin-house

Drawing of each part and toolings formanufacture, specification of purchasedparts and process plans for fabrication anassembly of product.

4 Testing andRefinement

construction and evaluation of multiple preproduction / prototypeversions - manufactured to the same size and material specifications bunot with the same production process to be employed. Prototypes testedto see whether the product will work as designed and will satisfycustomer needs.

5 ProductionRamp-up

Product is made using intended production system to train the workersand work out remaining problems in the production process. Productssometimes supplied to preferred customers to evaluate and identifyremaining flaws. Gradual transition from ramp-up to regular production.At some point the product launched and available for widespreaddistribution.

Variants of Generic Development Process

← technology push products,

← platform products,

← process intensive products,

← customized products,

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← high-risk products,

← quick build products and

← complex systems.

ProcessIntensive

Characteristicsconstrained byproduction process.Produced at highvolume

Existing process specifiedor both product andprocess to be developedfrom start

Breakfast cereal, noodles,designer paper

Customized Products

Slight variations of existingconfigurations

Streamlined and highlystructured process

Motors, switches, batteries,containers

High riskproducts

 Technical or marketuncertainties withhigh risk of failure

Risks identified andtracked duringdevelopment. Earlyanalysis and testing

Pharmaceuticals, spacesystems

Quick buildproducts

Rapid modeling /prototyping manydesign – build – testcycles

Detail design and testingphases repeated tillbudget runs out

Software, cellular phones

Complex

systems

Decomposed into

several subsystemsand components

Subsystems built by

many teams in parallelfollowed by integrationand validation

Airplanes, jet-engines,

automobiles

Economic Analysis of Project Development Costs

← Using measurable factors to help determine:

 –  Operational design and development decisions

 –  Go/no-go milestones

← Building a Base-Case Financial Model

 – 

A financial model consisting of major cash flows –  Sensitivity Analysis for “what if” questions

Designing for the Customer: Quality Function Deployment

← Interfunctional teams from marketing, design engineering, andmanufacturing

← Voice of the customer

← House of Quality

ProcessType

Description Distinct features Examples

Market pull(Generic)

Begin with marketopportunity. Selectappropriatetechnology to meetcustomer needs

Process includes allphases

Sporting goods, furniture, tools

 Technology

push

New proprietary

technology – findsappropriate market

Planning involves

matching technology andmarket. Conceptdevelopment assumesproven technology.

 Teflon sheet – insulation for

cables, artificial veins, fabricfor outer wear, dental flossPVC - foot ware, tiles,coatings, bags

PlatformProducts

Built aroundpreexistingtechnologicalsubsystem

Similar to Technologypush. But platform hasalready demonstrated itsusefulness to customers. –simpler to develop.

Polaroid film, Apple operatingsystem, transport mechanismof walkman,

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Designing for the Customer: The House of Quality

Customer requirements information forms the basis for this matrix, used totranslate them into operating or engineering goals.

Designing for the Customer: Value Analysis/Value Engineering

← Achieve equivalent or better performance at a lower cost whilemaintaining all functional requirements defined by the customer

 –  Does the item have any design features that are not necessary?

 –  Can two or more parts be combined into one?

 –  How can we cut down the weight?

 –  Are there nonstandard parts that can be eliminated?

Design for Manufacturability

←  Traditional Approach

← “We design it, you build it” or “Over the wall”Concurrent Engineering

 –  “Let’s work together simultaneously”

Design for Manufacturing and Assembly

Greatest improvements related to DFMA arise from simplification of theproduct by reducing the number of separate parts:

1. During the operation of the product, does the part move relative to allother parts already assembled?

2. Must the part be of a different material or be isolated from other partsalready assembled?

3. Must the part be separate from all other parts to allow the disassemblyof the product for adjustment or maintenance?

Measuring Product Development Performance

Performance

Dimension

Measures

 Time-to-market • Freq. Of new products introduced•  Time to market introduction• Number started and number

completed• Actual versus plan• Percentage of sales from new products

Productivity • Engineering hours per project

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• Cost of materials and tooling perproject

• Actual versus planQuality • Conformance-reliability in use

• Design-performance and customer

satisfaction•  Yield-factory and field

 Typical Costs of New Product Development

← Development cost ( design, testing and refinement cost up toproduction ramp-up)

← Ramp-up cost

← Marketing and support cost

← Production cost

← Sales revenue

Analysis of development Costs

← Estimate time and magnitude of future cash flows and then compute

NPV (Net Present Value).

← Inputs - Project schedule, Project Budget, Sales volume forecast andestimated production costs

Sensitivity analysis to understand trade-offs

← What If questions to consider changes in factors considered.