Chapter - 3

Design of Goods & Services

1. Introduction
 Effective design can provide a competitive edge by:
 matching product or service characteristics with customer

requirements
 ensuring that customer requirements are met in the
simplest and least costly manner
 reducing time required to design a new product or
service
 minimizing revisions necessary to make a design
workable
 So, managers should work hard to improve their
operations design
 PRODUCT DESIGN
 Product design means the process of deciding on the
unique characteristics and features of the company’s
product.
 Product design is the structuring of component parts
or activities so that as a unit they can provide a
specified value.
 Typically on engineering function, design entails
preparing detailed drawing or specifications that give
dimensions, weights colors, and other physical
characteristics.

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 4) Objectives of design

The objectives of design may vary from situations to situations

and from organization to organization. An obvious reason
includes:
 To bring new or revised products to the market as quickly as

possible
 To reduce cost and/or increase profit.

 To ensure ease of production/assembly

 To ensure ease of maintenance/service

 To increase quality and level of customer satisfaction

 5. Philosophies towards product design
Strategies for New-Product Introduction
 Market-pull philosophy – its logo is: “one should make what can be
sold”.
 Technology – push strategy – its logo is: “one should sell what can be
made”.
 Inter – functional philosophy – its logo is: “Product design and
development is neither market pull nor technology push.
Rather it is inter-functional and interactive process of customers,
marketing, finance, personnel, engineering, procurement, suppliers and
other related functional areas.”
6. Issues for product design
a) Legal, Ethical, and Environmental issues:
Designers must be careful to take into account a wide array of
legal and ethical considerations.
Moreover, if there is a potential to harm the environment, then
those issues also become important
 Cont’d

b) Design for manufacturability (DFM):

 Manufacturability refers to the ease with which the product can
be manufactured. Three concepts are closely related to
designing for easy of production. These are:
 Simplifications: is a design or redesign strategy that improves
the manufacturability, serviceability, or reliability of a product or
service by reducing the complexity of its design
 Specifications: is a detail description of material, parts, or
products including physical dimensions. These specifications
profiled production department with precise information about
the characteristics of products to be produced
 Cont’d

 Standardization: the process of reducing variety among a group of products or parts

through design.
 This helps to simplify production and reduce costs.
 Standardized products are made in large quantities of identical items.
 standardized products mean interchangeable parts, which greatly lower the cost of
production while increasing productivity and making replacement or repair relatively
easy compared with that of customized parts. Design costs are generally lower
 Standardization also has disadvantages. A major one relates to the reduction in
variety. This can limit the range of customers to whom a product or service appeals.
 Example: Using the same size and type of screws across different products to simplify
assembly
 One example of a company that uses this form of standardization is Coca-Cola
 c) Mass Customization

 A strategy of producing standardized/uniform goods or services, but incorporating some degree of

customization/to suit individual requirement. A strategy to provide products in lot sizes of one in high
volume.
 Is applicable to products characterized by short life cycles, rapidly advancing technology, or

changing customer requirements

 Forms of Mass Customization
• 1.Delayed differentiation: it is a postponement tactic-Producing but not quite completing a product or
service until customer preferences or specifications are known
• 2.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
 Mass Customization ---cont’d
Modular design: Multiple products using common parts, processes
and modules.
The products should be composed of detachable components
so that whenever any part fails, that part is replaced by a
new one.
Thus the advantages of modular design can be:-
 Diversity can be offered to the customer.
 Inventories can be substantially reduced.
 Repair is cheap because only a few standard tools are
needed.
 Modular Design ---cont’d

 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 & costs associated with large number of

product variations

 Easy to subcontract production of modules.

 d) Concurrent Design than sequential design

In its narrowest sense, concurrent engineering means bringing design and

manufacturing engineering people together early in the design
phase to simultaneously develop the product and the processes for
creating the product
-It is an approach to product/service design in which the concerns of more
than one function are considered simultaneously such as design for
manufacturability; design for procurement, design for
environment; and design for disassembly
- The objective of this technique is to achieve a smoother transition from
product design to production ,and to decrease product development time
.
 .
 C. Robust Design

Robust Design: Design that results in products or

services that can function over a broad range of
conditions.
Example: Free size T shirt/Water resistant mobile phone

 Consider a pair of fine leather boots obviously not

made for trekking through mud and snow.
 eg. Now consider a pair of heavy rubber boots just
the thing for mud of snow.
 The rubber boots have a design that is more robust
than that of the fine leather boots.
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 f) Value analysis and Value engineering

the term VE and VA are used almost interchangeably but they are not
identical.
Value engineering focuses on pre- production design improvement while
VA (even though is a related techniques) takes place during the production
process when it is clear that a new product is a success.
The basic objective of VE &VA is to achieve equivalent or better performance
at a lower cost while maintaining all functions and quality requirements.
It does this largely by identifying and eliminating hidden, invisible, and
unnecessary cost.
Simplifying the design of a product to reduce the number of unique
parts required, which can help to streamline production and
reduce costs.
g) Ergonomics (human factor engineering)

is the study of how to design products and systems that are

comfortable, safe, and efficient for human use
The objectives of ergonomics (human factor engineering) are
 to improve human performance by increasing speed, accuracy, and safety;
 to reduce energy requirement and fatigue;
 to reduce the amount and cost training and special skills;

 to reduce accidents due to human error, and to improve the comfort and

acceptance by the user

Examples: Developing smartphones with larger screens and buttons that are
easier to see and use for people with visual impairments.
impairments
2. Designing office chairs with adjustable height and lumbar support to reduce
back pain and improve posture.
posture
 h) Use Technology in the Design Process
 Computer Aided Design (CAD)
 assists in creation, modification, and analysis of a design
 CAD includes:
 computer-aided engineering (CAE)
 tests and analyzes designs on computer screen
 computer-aided manufacturing (CAM)
 ultimate design-to-manufacture connection
 product life cycle management (PLM)
 managing entire lifecycle of a product
 Integrates decisions of those involved in product development,
manufacturing, sales, customer service, recycling, and disposal
 i. Quality Function Deployment (QFD)

 An approach which integrates

“voice of customers” into
product development process
 Purpose:

 To ensure the customer

requirements are factored into
every aspect of the development
process
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Product design Process
 Step 1 - Idea Development
- what someone thinks of a need for a product/service design to satisfy it
e.g. customers, marketing, engineering, competitors,
benchmarking
 Step 2 - Product Screening
- Every business needs a formal/structured evaluation process
e.g. fit with facility and labor skills, size of market, contribution margin,
break-even analysis, return on sales
 Step 3 – Preliminary Design and Testing
- Technical specifications are developed, prototypes built, testing starts
 Step 4 – Final Design
- Final design based on test results, facility, equipment, material, & labor
skills defined, suppliers identified
These Product Design Processes will be discussed as follows:
.
 .
i. Idea Generation Sources
 Ideas for new and improved products or services can come from a wide range
of sources, both from within the organization and from outside it.
 Internal source:
 Employees-including those who make products or deliver services to customers,
salespeople, maintenance and repair personnel and purchasing agents, can be
a rich source of ideas, if they are motivated to offer suggestions.
 Marketing people are often sources of ideas based on their studies of markets,
buying patterns, and familiarity with demographics.
 Research based: Organized efforts to increase scientific knowledge or product
innovation. It can be basic research, applied research of the R & D unit of the
org.
Cont’d

External source:
 External sources of ideas include customers, competitors,

and suppliers.
 Customers: may submit suggestions for improvements or

new products, or they may be queried through the use of

surveys or focus groups. One such approach is quality
function deployment, which seeks to incorporate the "voice
of the customer" into product and service design.
 Customer complaints can provide valuable insight into areas
that need improvement
 Cont’d

 Competitor based: Strongest motives for new or improved

product is competitors’ product. New idea can be generated
through:
 Reverse engineering :Dismantling and inspecting of a competitor’s product to
discover product improvements. Dismantling competitor’s product to improve your own
product.
 By studying a competitor's products or services and how the
competitor operates (pricing policies, return policies, warranties,
location strategies, etc.), an organization can glean many ideas
 Benchmarking: Comparing product/service against best-in-class
 ii. Idea screening
Not all new ideas should be developed in to new products and hence the
second step is screening. The purpose of screening is to eliminate ideas
that do not appear to have a high potential for success and there for avoid
expensive development costs.
Feasibility Study
 Market analysis (demand)

 Economic analysis: Cost-benefit analysis (cost, Cash flows, NPV)

 Technical analysis (capabilities)

 Performance specifications
 how well the design is: in terms of Speed, Capacity, Power, Accuracy, etc.
 iii. Preliminary design and testing

 Build a prototype
 Form design = how the product will look?
 Functional design =
1.reliability
2.maintainability
3.usability

 Production design
 Test prototype
 Revise design
 Retest
iv. Final Design and Process Plans
 Final design
 detailed drawings and specifications for new product
or service
 Process plans
 workable instructions
 necessary equipment and tooling
 component sourcing recommendations
 job descriptions and procedures
 computer programs for automated machines
B. Service Design Process

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 The service Design Process
• The steps in the service design process are explained below:
1. The service concept
– It defines the target customer and the desired customer experience.
– It also defines how the service is different from others.
2. Service package
– The service package consists of a mixture of physical items, sensual benefits, and psychological
benefits.
-physical items, ….. food, drinks, tableware, napkins
-sensual benefits, and …….. taste and aroma of the food and the sights and sounds of the people
-psychological benefits……. rest and relaxation, comfort, status, and a sense of well-being
 Cont’d

c. Delivery specifications: outline the steps required in the work process.

• It includes
1. the work schedule,
2. deliverables, and
3. the locations at which the work is to be performed.

4. Service Delivery

– Rendering the service to the customer in the specified premise.

 End of Ch 03

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