Operations Management

and
Total Quality Management (TQM)
Module 3

Product and Service Design

 Topic Outline:
Idea Generation
Legal and Ethical Considerations
Human Factors & Cultural Factors
Global Product and Service Design
Environmental Factors
Other Design Considerations
Phases in Product Design and Development
Designing for Production
Service Design
Operations Strategy
 Learning Objectives

By the end of the lesson, the participants should be able to:

Explain the strategic importance of product and service design.

Describe what product and service design does.

Discuss the importance of legal, ethical, and sustainability

considerations in product and service design.

Identify some reasons for design or redesign.

Briefly describe the phases in product design and development.

List the characteristics of well-designed service systems.

Words Ponder
INTRODUCTION
 What Does Product and Service Design Do?
The various activities and responsibilities of product and service
design include the following:
Translate customer wants and Formulate cost targets.
needs into product and service Construct and test
requirements. prototypes.
Refine existing products and Document specifications.
services.
Translate product and
Develop new products and/or service specifications into
services. process specifications.
Formulate quality goals.
 Product and Service Design
Key questions of product and service design
From a buyer’s standpoint, most purchasing decisions
entail two fundamental considerations; one is cost and the
other is quality or performance.
From the organization’s standpoint, the key questions are:
Is there demand for it?
Can we do it?
What level of quality is appropriate?
Does it make sense from an economic standpoint?
 IDEA GENERATION

One of the strongest motivators for new and improved

products or services is competitors.
Research is another source of ideas for new or improved
products or services (Research and development (R&D).
Customer input can come from surveys, focus groups,
complaints, and unsolicited suggestions for
improvement.
Input from suppliers, distributors, and employees can be
obtained from interviews, direct or indirect suggestions,
and complaints.
 Product and Service Design

Major factors in design strategy

Cost
Quality
Time-to-market
Customer satisfaction
Competitive advantage
 Reasons for Product or Service Design

 Economic  Competitive
(e.g., low demand, excessive (e.g., new or changed
warranty claims, the need to products or services, new
reduce costs). advertising/promotions).
 Social and demographic  Cost or availability
(e.g., aging baby boomers, (e.g., of raw materials,
population shifts). components, labor, water,
energy).
 Political, liability, or legal
 Technological
(e.g., government changes,
safety issues, new regulations). (e.g., in product components,
processes).
 Objectives of Product and Service Design

Main focus
Customer satisfaction
Secondary focus
Function of product/service
Cost/profit
Quality
Appearance
Ease of production/assembly
Ease of maintenance/service
 Legal, Ethical, and Environmental Issues

Legal
FDA, OSHA, IRS
Product liability
Uniform commercial code
Ethical
Releasing products with defects
Environmental
EPA
Legal, Ethical, and Environmental Issues (continued)

Product liability - is the responsibility of a

manufacturer for any injuries or damages
caused by a faulty product because of
poor workmanship or design.

Uniform Commercial Code - A product

must be suitable for its intended purpose.
 HUMAN FACTORS

Human factor issues often arise in the design of

consumer products.
Safety and liability are two critical issues in many
instances.
For example, the crashworthiness of vehicles is of much interest to
consumers, insurance companies, automobile producers, and the
government.
Companies in certain businesses may seek a competitive edge by
adding new features. Although this can have obvious benefits, it
can sometimes be “too much of a good thing,” and be a source of
customer dissatisfaction.
 CULTURAL FACTORS

Product designers in companies that operate

globally also must take into account any cultural
differences of different countries or regions related
to the product. This can result in different designs
for different countries or regions.
Example:
Mc Donald’s fast-food presence globally, offer
variety of food to cater the customers preference.
 GLOBAL PRODUCT AND SERVICE DESIGN

Global product design can provide design outcomes that

increase the marketability and utility of a product.
The diversity of an international team may yield different
points of view and ideas and information to enrich the
design process.
Advances in information technology have played a key
role in the viability of global product design teams by
enabling team members to maintain continual contact
with each other and to instantaneously share designs and
progress, and to transmit engineering changes and other
necessary information.
 ENVIRONMENTAL FACTORS: SUSTAINABILITY

Product and service design is a focal point in the

quest for sustainability.
Key aspects include:
Cradle-to-grave assessment,
End-of-life programs,
Reduction of costs and materials used,
Reuse of parts of returned products, and
Recycling.
 Cradle-to-grave assessment

Cradle-to-grave assessment - The assessment of the

environmental impact of a product or service throughout its
useful life.
also known as life cycle analysis, is the assessment of the
environmental impact of a product or service throughout its
useful life, focusing on such factors as global warming (the
amount of carbon dioxide released into the atmosphere), smog
formation, oxygen depletion, and solid waste generation.
The goal of cradle-to-grave assessment is to choose products
and services that have the least environmental impact while still
taking into account economic considerations.
 End-of-Life Programs

End-of-life (EOL) programs deal with products

that have reached the end of their useful lives.
The purpose of these programs is to reduce the
dumping of products, particularly electronic
equipment, in landfills or third-world countries, as
has been the common practice, or incineration,
which converts materials into hazardous air and
water emissions and generates toxic ash.
 The Three Rs: Reduce, Reuse, and Recycle

Reduce: Value Analysis

Value analysis - examination of the function of parts and materials in an
effort to reduce cost and/or improve product performance.

Reuse: Remanufacturing
Remanufacturing - Refurbishing used products by replacing worn-out or
defective components.
Design for disassembly (DFD) - Design so that used products can be easily
taken apart.

Recycle
Design for recycling (DFR) - Design that facilitates the recovery of materials
and components in used products for reuse.
 Designers Adhere to Guidelines

Produce designs that are consistent 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
Other Issues in Product and Service Design

Product/service life cycles

How much standardization
Product/service reliability
Range of operating conditions
Life Cycles of Products or Services

 a
 Standardization

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

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

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

• Component design
• Production/assembly techniques
• Testing
• Redundancy/backup
• Preventive maintenance procedures
• User education
• System design
 Product Design

Product Life Cycles

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

Robust Design: Design that results in

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

1.Modification of an existing product/service

2.Expansion of an existing product/service
3.Clone of a competitor’s product/service
4.New product/service
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
 Idea Generation

Supply chain based

Ideas Competitor based

Research based
 Reverse Engineering

Reverse engineering
It is the Dismantling and inspecting
of a competitor’s product to discover product
improvements.
 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.
 Manufacturability

Manufacturability is the ease of

fabrication and/or assembly which
is important for:
Cost

Productivity

Quality
 Concurrent Engineering

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

Recycling: recovering materials for future use

Recycling reasons
Cost savings
Environment concerns
Environment regulations
 Service Design

Service is an act
Service delivery system
Facilities
Processes
Skills
Many services are bundled with products
 Service Design

Service design involves

The physical resources needed
The goods that are purchased or consumed
by the customer
Explicit services
Implicit services
 Service Design

Service
Something that is done to or for a customer
Service delivery system
The facilities, processes, and skills needed to provide a
service
Product bundle
The combination of goods and services provided to a
customer
Service package
The physical resources needed to perform the service
 Differences Between Product
and Service Design

Tangible – intangible
Services created and delivered at the same
time
Services cannot be inventoried
Services highly visible to customers
Services have low barrier to entry
Location important to service
 Phases in Service Design

1.Conceptualize
2.Identify service package components
3.Determine performance specifications
4.Translate performance specifications into
design specifications
5.Translate design specifications into
delivery specifications
 Service Blueprinting

Service blueprinting
A method used in service design to describe
and analyze a proposed service
A useful tool for conceptualizing a service
delivery system
Major Steps in Service Blueprinting

1. Establish boundaries
2. Identify steps involved
3. Prepare a flowchart
4. Identify potential failure points
5. Establish a time frame
6. Analyze profitability
 Characteristics of Well Designed
Service Systems
1. Consistent with the organization mission
2. User friendly
3. Robust
4. Easy to sustain
5. Cost effective
6. Value to customers
7. Effective linkages between back operations
8. Single unifying theme
9. Ensure reliability and high quality
 Challenges of Service Design

Variable requirements
Difficult to describe
High customer contact
Service – customer encounter
 Quality Function Deployment

Quality Function Deployment

Voice of the customer
House of quality

QFD: An approach that integrates the “voice of the customer”

into the product and service development process.
 The House of Quality
Correlation:
X Strong positive
 a Positive
X X
X Negative
X X
* Strong negative

Water resistance
Accoust. Trans.
Energy needed

Energy needed
Engineering Characteristics

to close door

to open door
Competitive evaluation

Check force
resistance
Door seal
X = Us

Window
on level
ground
A = Comp. A
B = Comp. B
Customer (5 is best)
Requirements 1 2 3 4 5

X AB
Easy to close 7
Stays open on a hill 5 X AB

Easy to open 3 XAB

A XB
Doesn’t leak in rain 3
No road noise 2 X A B

Importance weighting 10 6 6 9 2 3 Relationships:

Strong = 9
level to 7.5 ft/lb
Reduce energy

Reduce energy
Reduce force
current level

current level
current level
Medium = 3

to 7.5 ft/lb.
Target values

Maintain

Maintain
Maintain
Small = 1

to 9 lb.
5 BA BA
B B BXA
4 X B X
Technical evaluation A A X
3
(5 is best) 2 X A
X
1
 Operations Strategy

1. Increase emphasis on component commonality

2. Package products and services
3. Use multiple-use platforms
4. Consider tactics for mass customization
5. Look for continual improvement
6. Shorten time to market
 Shorten Time to Market

1.Use standardized components

2.Use technology
3.Use concurrent engineering
End of Presentation
 ACTIVITY / DISCUSSION AND REVIEW QUESTIONS

1. What are some of the factors that cause organizations to

redesign their products or services?

2. Name some of the main advantages and disadvantages of

standardization.

3. What is reverse engineering? Do you feel this is unethical?

4. What is life cycle assessment, and what is its overall goal?

5. Explain the term “three Rs” and how the three Rs relate to
sustainability.
 References
 Stevenson, W. (2011). Operation Management 12th Ed.. New York: Mc Graw-Hill / Irwin

 Sharma, S. (2018). Total Quality Management Concepts, strategy and Implementation for Operational
Excellence. New Delhi: Sage Publication Inc.

 Swink, M., Melnyk, S.A., and Hartley, L.H. (2020). Managing Operation Across the Supply Chain. New
York: Mc Graw Hill

 https://www.winwithteamwork.com/what-we-do/product-and-service-design

 https://www.sofigate.com/insight/3-reasons-why-you-need-service-design/

 https://opentextbc.ca/businessopenstax/chapter/the-product-life-cycle/

 https://www.mindtools.com/pages/article/newCT_97.htm