4

Product and
Service Design

McGraw-Hill/Irwin Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
 Product and Service Design

 Major factors in design strategy

 Cost
 Quality
 Time-to-market
 Customer satisfaction
 Competitive advantage

Product and service design – or redesign – should be

closely tied to an organization’s strategy

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 Product or Service Design Activities
1. Translate customer wants and needs
into product and service requirements
2. Refine existing products and services
3. Develop new products and services
4. Formulate quality goals
5. Formulate cost targets
6. Construct and test prototypes
7. Document specifications

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 Reasons for Product or Service
Design

 Economic
 Social and demographic
 Political, liability, or legal
 Competitive
 Cost or availability
 Technological

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 Objectives of Product and
Service Design
 Main focus
 Customer satisfaction
 Understand what the customer wants
 Secondary focus
 Function of product/service
 Cost/profit
 Quality
 Appearance
 Ease of production/assembly
 Ease of maintenance/service

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 Designing For Operations
 Taking into account the capabilities of
the organization in designing goods
and services.
 Failure to take this into account can:
 Reduce productivity
 Reduce quality
 Increase costs

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 Legal, Ethical, and Environmental
Issues
 Legal
 FDA, OSHA, IRS
 Product liability
 Uniform commercial code
 Ethical
 Releasing products with defects
 Environmental
 EPA

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Regulations & Legal Considerations
 Product Liability - A manufacturer is liable
for any injuries or damages caused by a
faulty product.
 Uniform Commercial Code - Products carry
an implication of merchantability and fitness.

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Designers Adhere to Guidelines
 Produce designs that are consistant with
the goals of the company
 Give customers the value they expect
 Make health and safety a primary
concern
 Consider potential harm to the
environment

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 Other Issues in Product and
Service Design
 Product/service life cycles
 How much standardization
 Mass customization
 Product/service reliability
 Robust design
 Degree of newness
 Cultural differences

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 Life Cycles of Products or Services
Figure 4.1

Saturation

Maturity
Deman

Decline
Growth
d

Introduction

Time

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 Standardization
 Standardization
 Extent to which there is an absence of
variety in a product, service or process
 Standardized products are immediately
available to customers

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 Advantages of Standardization
 Fewer parts to deal with in inventory &
manufacturing
 Design costs are generally lower
 Reduced training costs and time
 More routine purchasing, handling, and
inspection procedures
 Quality is more consistent

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 Advantages of Standardization
(Cont’d)

 Orders fillable from inventory

 Opportunities for long production runs
and automation
 Need for fewer parts justifies increased
expenditures on perfecting designs and
improving quality control procedures.

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 Disadvantages of Standardization

 Designs may be frozen with too many

imperfections remaining.
 High cost of design changes increases
resistance to improvements.
 Decreased variety results in less
consumer appeal.

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 Mass Customization

• Mass customization:
 A strategy of producing standardized
goods or services, but incorporating some
degree degree of customization
 Delayed differentiation
 Modular design

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 Delayed Differentiation

• Delayed differentiation is a
postponement tactic
 Producing but not quite completing a
product or service until customer
preferences or specifications are known

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 Modular Design

Modular design is a form of standardization

in which component parts are subdivided
into modules that are easily replaced or
interchanged. It allows:
 easier diagnosis and remedy of failures
 easier repair and replacement
 simplification of manufacturing and assembly

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 Product Design

 Product Life Cycles

 Robust Design
 Concurrent Engineering
 Computer-Aided Design
 Modular Design

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 Robust Design

Robust Design: Design that results in

products or services that can function
over a broad range of conditions

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 Taguchi Approach Robust Design
 Design a robust product
 Insensitive to environmental factors either in
manufacturing or in use.
 Central feature is Parameter Design.
 Determines:
 factors that are controllable and those not
controllable
 their optimal levels relative to major product
advances

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 Cultural Differences
 Multinational companies must take into
account cultural differences related to the
product design.
 Notable failures:
 McDonalds' in India
 Coffee in UK

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 Global Product Design
 Virtual teams
 Uses combined efforts of a team of designers
working in different countries
 Provides a range of comparative advantages
over traditional teams such as:
 Engaging the best human resources around the world
 Possibly operating on a 24-hr basis
 Global customer needs assessment
 Global design can increase marketability

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 Phases in Product Development
Process
1. Idea generation
2. Feasibility analysis
3. Product specifications
4. Process specifications
5. Prototype development
6. Design review
7. Market test
8. Product introduction
9. Follow-up evaluation

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 Idea Generation

Supply chain based

Ideas Competitor based

Research based

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 Reverse Engineering

Reverse engineering is the

dismantling and inspecting
of a competitor’s product to
discover product improvements.

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Research & Development (R&D)
 Organized efforts to increase scientific
knowledge or product innovation & may
involve:
 Basic Research advances knowledge about
a subject without near-term expectations of
commercial applications.
 Applied Research achieves commercial
applications.
 Development converts results of applied
research into commercial applications.

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 Manufacturability

 Manufacturability is the ease of

fabrication and/or assembly which is
important for:
 Cost
 Productivity
 Quality

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 Concurrent Engineering

Concurrent engineering
is the bringing together
of engineering design and
manufacturing personnel
early in the design phase.

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 Computer-Aided Design

 Computer-Aided Design (CAD) is

product design using computer graphics.
 increases productivity of designers, 3 to 10
times
 creates a database for manufacturing
information on product specifications
 provides possibility of engineering and cost
analysis on proposed designs

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 Recycling

 Recycling: recovering materials for future

use
 Recycling reasons
 Cost savings
 Environment concerns
 Environment regulations

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 4S

Reliability

McGraw-Hill/Irwin Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
 Learning Objectives
 Define reliability
 Perform reliability computations
 Explain the purpose of redundancy in a
system

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 Reliability
 Reliability: The ability of a product, part,
or system to perform its intended
function under a prescribed set of
conditions
 Failure: Situation in which a product,
part, or system does not perform as
intended
 Normal operating conditions: The set
of conditions under which an item’s
reliability is specified
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 Reliability is a Probability
 Probability that the product or system
will:
 Function when activated
 Function for a given length of time
 Independent events
 Events whose occurrence or
nonoccurrence do not influence each other
 Redundancy
 The use of backup components to increase
reliability

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 Rule 1

Lamp 1 Lamp 2

.90 .80 .90 x .80 = .72

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 Rule 2

.80 Lamp 2 (backup)

.90 .90 + (1-.90)*.80 = .98

Lamp 1

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 Rule 3

.70
Lamp 3 (backup for Lamp 2)

.80
Lamp 2 (backup for Lamp1)

1 – P(all fail)
.90 1-[(1-.90)*(1-.80)*(1-.70)] = .994
Lamp 1

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 Example S-1 Reliability
Determine the reliability of the system shown

.90 .92

.98 .90 .95

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 Example S-1 Solution
The system can be reduced to a series of three
components

.98 .90+.90(1-.90) .95+.92(1-.95)

.98 x .99 x .996 = .966

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 Failure Rate
Figure 4S.1
Failure Rate

Infant Failures due

Few (random) failures
mortality to wear-out
Time, T

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 Exponential Distribution
Figure 4S.2

Reliability = e -T/MTBF

1- e -T/MTBF

T Time

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 Normal Distribution
Figure 4S.3

Reliability

0 z

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 Availability

 The fraction of time a piece of equipment

is expected to be available for operation
MTBF
Availability 
MTBF  MTR

MTBF = mean time between failures

MTR = mean time to repair

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 Improving Reliability
 Component design
 Production/assembly techniques
 Testing
 Redundancy/backups
 Preventive maintenance procedures
 User education
 System design

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