Product Development and Strategy

Preplanning & Product Development

• Preplanning is a crucial stage in production planning & control.
• Product development focuses on creating products that meet market demands with a competitive edge.
• An organization's success hinges on its ability to provide valuable products/services.
• Great products drive success.

Product Strategy Options

• Differentiation: Shouldice Hospital. A focus on unique value and specialty.
• Low cost: Taco Bell. A focus on affordability and mass appeal.
• Rapid response: Toyota. A focus on speed and agility.

Product Life Cycles

• Product life cycles are characterized by distinct stages (Introduction -> Growth -> Maturity -> Decline).
• Initial development and production costs are high in the introductory phase.
• A "profit" phase for the product is found in maturity.
• The introduction stage often entails significant research and product development expenses to refine the product, upgrade procedures, and improve supplier relationships.
• The growth phase sees product design stabilization, making precise capacity forecasting (and possible expansions/improvements) a critical task.

Generating New Products

• Understanding the customer is central to new product development.
• Economic factors (increased purchasing power) spur design innovation.
• Societal shifts (e.g., increased working mothers) create demand for new goods and services.
• Technological advancement drives improvement in quality of life.
• Political changes impact standards, regulations, and incentives.

Product Development Stages

• Products begin with concepts from multiple sources.
• Feasibility is assessed - is the company capable of executing the idea?
• Customer requirements are critical for order-winning criteria.
• Key functions are defined to clarify intended use.
• Specifications are reviewed for design and manufacture.
• Testing determines if products meet client expectations.
• Market entrance and assessment of success follows.

Quality Function Deployment

• Quality function deployment is a systematic strategy to meet customer needs.
• Steps include: identifying customer wants, connecting those wants to product characteristics, analyzing relationships between product elements, establishing customer prioritization, and evaluating competitive products.
• The 'House of Quality' model diagrammatically illustrates these connections.

Issues for Product Design

• Robust design aims to create products less sensitive to minor variations in production.
• Modular designs enhance production flexibility.
• Computer-aided design (CAD) provides tools for more effective creation.
• Computer-aided manufacturing (CAM) leverages CAD design for efficient production.
• Virtual reality design allows realistic simulations before physical models.
• Value analysis focuses on design improvements for enhanced quality and lower cost.
• Sustainable design aligns with environmental concerns.

Robust Design

• Robust design reduces negative impacts from production variability.
• Lower costs and higher quality often result.

Modular Design

• Products are broken down into separate components for design and production efficiency.
• This modular approach offers design and production flexibility.
• Satisfying customer needs is facilitated by using fewer modules.

Computer-Aided Design (CAD)

• Using computers and engineering documentation for product designs.
• Shorter design cycles enhance accuracy and reduce costs.
• Designs can be globally utilized, streamlining workflows.

Computer-Aided Manufacturing (CAM)

• Specialized computers control equipment and production processes.
• The CAM system is usually driven by CAD specifications.
• Key benefits are product quality improvements, faster design times, and reduced production expenses.

Virtual Reality Technology

• Computer simulations help visualize products before physical creation.
• The interactive 3D model provides insights.
• Useful for large-scale designs, like plant layouts.

Value Analysis

• Improving production design during the production process, leading to higher quality or more cost-effective, environmentally-conscious products.
• Encompasses improvements to manufacturing.

Cost Reduction of a Bracket via Value Engineering

• A visual representation demonstrating the impact of design tweaks on costs.

Sustainability and Life Cycle Assessment (LCA)

• Sustainability focuses on generating resources for the present and future.
• LCA formally assesses a product’s environmental impact.

Defining a Product

• Engineering drawings specify product dimensions, materials, and finishes.
• Bill of materials details components, quantities, and product structure.

Engineering Drawings

• Diagrams with all relevant elements and dimensions.

Engineering Drawing for Bicycle

• Diagram to illustrate design parameters of a bicycle.

Bills of Materials

• Lists of materials, descriptions, and quantities needed for product production.

Group Technology

• Grouping parts with similar characteristics, enabling more effective production.
• A code system describes physical and processing characteristics.
• Factories can use dedicated cells for families of parts.

Group Technology Scheme

• A display demonstrating grouping of similar parts.

Process Choices

• Process strategy defines an organization's approach to transforming resources.
• The method must meet customer specs, and stay within budget.

Introduction

• An organization's strategy is to turn resources into products/services.
• A goal is to build a production method that meets demands while adhering to constraints such as financial limits or timeframes.
• This selection will have an impact on the efficiency, flexibility, costs, and final quality of the product.

Four types of process strategies

• Process focus.
• Repetitive focus.
• Product focus.
• Mass customization.

Process, Volume, and Variety

• A chart illustrating the relationship between process types, volume, and variety.
• Process focus is useful for low volume, high variety products.
• Repetitive focus works well for products made in assembly lines which have a modular design.
• Product focused methods are used when large volumes of similar products are being produced.
• Mass customization requires high performance and highly adaptable strategies.

Process focus strategy/Intermittent

• Job shops are facilities set up based on process procedures.
• Typical of low volume/high variety products.
• Departments are organized around unique tasks.
• Requires versatile equipment and skilled employees.
• Low fixed costs but high variables.

Process Focus

• A diagram representing high variety, low volume, intermittent processes.

Repetitive focus strategy

• A strategy that aligns between process and products, using modules usually in continuous processes.
• Commonly employed in automobile/appliance production.
• More structured and less flexible than other methods.

Repetitive Focus

• A diagram representing modular assembly lines, including raw materials and output options.

Product focus strategy

• Designed for high volume, low variety products.
• Relies on continuous processes.
• High investment/costly specialized equipment/low variable costs, due to high facility utilization.
• Generally uses less skilled labor.

Product Focus

• Diagram representing a product-focused facility, with feed inputs and diverse final outputs.

Mass customization focus

• The process uses different combinations of low volume/high variety and low cost/high flexibility for rapid, low-cost services that meet unique customer orders.

Mass Customization

• A diagram highlighting the input components and a range of diverse outputs.

Comparison of Processes

• A detailed table comparing process types (process focus, repetitive, product focus, mass customization) based on volume, variety, equipment, inventory, scheduling, and finished goods.

Improving Service Productivity

• Techniques (e.g., separation, self-service, postponement, focus, modules, automation, scheduling, training) for improving service productivity.

Crossover Chart Example

• A method to evaluate the cost advantages of different accounting software across varying reporting volumes.
• The goal is to determine crossover points.

Crossover Chart Example

• Finding crossover points for varying report volumes from the perspective of variable and fixed costs.

Process Technology

• Machine technology, Automated identification systems (AISs), Process control, Vision system, Robot, Automated storage and retrieval systems (ASRSs), Automated guided vehicles (AGVs), Flexible manufacturing systems (FMSs), Computer-integrated manufacturing (CIM).

Machine Technology

• Enhanced precision, productivity, and flexibility for machines.
• Reduced changeover/power requirements are part of the improvements.

Automatic Identification Systems (AISs)

• Improves data acquisition.
• Reduces data errors.
• Speeds up processes/enhances automation.
• Examples of barcodes/RFID fall into this category.

Process Control

• Real-time monitoring/control of processes.
• Sensors gather and transmit data to computers for decision making.

Vision Systems

• A technology for inspection that can take place consistently while being less expensive and more accurate than human inspection.

Robots

• Handling monotonous/dangerous tasks for greater consistency and accuracy in manufacturing.

Automated Storage and Retrieval Systems (ASRSs)

• Automated placement/withdrawal of parts/products, reducing labor/errors in inventory and test areas for manufacturing companies.

Automated Guided Vehicle (AGVs)

• Transport carts with automatic guidance for materials and people.

Flexible Manufacturing Systems (FMSs)

• Computer controls workstations/material handling in FMSs.
• Enhances flexibility while reducing waste, and allowing for high-quality production.
• Stringent communication between components is a key requirement in FMS.

Computer-Integrated Manufacturing (CIM)

• Extends flexible manufacturing and includes other areas such as engineering, warehousing, and customer service.
• Reduce differences in low/high volume and variety production methods.

Technology in Services

• Examples of technology (debit cards, internet banking, etc.) used in various service sectors.

END OF SLIDES

This quiz explores the fundamental concepts of preplanning and product development, essential for ensuring an organization's success. You'll examine different product strategy options, including differentiation and cost leadership, as well as the stages of product life cycles. Test your knowledge on how effective product management can drive company success.