7b Products and Services

Chapter 5
Products and Services

Operations Management
Roberta Russell & Bernard W. Taylor, III
Copyright 2006 John Wiley & Sons, Inc.
Beni Asllani
University of Tennessee at Chattanooga
Lecture Outline
Design Process
Reducing Time-to-Market
Improving Quality of Design
Special Considerations in Service
Design
5-2
Design Process
Effective design can provide a competitive edge
matches product or service characteristics with
customer requirements
ensures that customer requirements are met in the
simplest and least costly manner
reduces time required to design a new product or
service
minimizes revisions necessary to make a design
workable
5-3
Design Process (cont.)

Service design
Product design
defines appearance of
product
sets standards for
performance
specifies which materials are
to be used
determines dimensions and
tolerances
Copyright 2006 John
5-4
specifies what physical

items, sensual benefits, and
psychological benefits
customer is to receive from
service
defines environment in
which service will take place
Design Process (cont.)

Idea
generation
Suppliers
Product or
service concept
Feasibility
study
Performance
specifications
Form design
Customers
R&D
Marketing
Revising and testing

prototypes
Competitors
Production
design
Functional
design
New product or
service launch
Final design
& process plans
Design
specifications
Manufacturing
or delivery
specifications
Pilot run
and final tests
5-5
Idea Generation Sources

Companys own R&D
department
Customer complaints or
suggestions
Marketing research
Suppliers
Copyright 2006 John
5-6
Salespersons in the
field
Factory workers
New technological
developments
Competitors
Idea Generation Sources (cont.)

Perceptual Maps
Visual comparison of
customer perceptions
Benchmarking
Comparing product/service
against best-in-class
Reverse engineering
Dismantling competitors product to improve
your own product
5-7
Perceptual Map of Breakfast

Cereals
GOOD
TASTE
Cocoa Puffs
LOW
NUTRITION
HIGH
NUTRITION
Rice
Rice
Krispies
Krispies
Cheerios
Cheerios
Wheaties
Wheaties
Shredded
Shredded
Wheat
Wheat
BAD
TASTE
5-8
Feasibility Study
Market analysis
Economic analysis
Technical/strategic analysis
Performance specifications
5-9
Rapid Prototyping
Build a prototype
form design
functional design
production design
Test prototype
Revise design
Retest
5-10
Form and Functional Design

Form Design
how product will
look?
Functional Design
reliability
maintainability
usability
Copyright 2006 John
5-11
Computing Reliability
Components in series
0.90
0.90
0.90 x 0.90 = 0.81
5-12
Computing Reliability
Components in parallel
0.90
R2
0.95 + 0.90(1-0.95) = 0.995
0.95
R1
5-13
System Reliability
0.90
0.98
0.98
0.92
0.98
0.92+(1-0.92)(0.90)=0.99
0.98
0.98 x 0.99 x 0.98 = 0.951
5-14
System Availability (SA)

SA =
MTBF
MTBF + MTTR
where:
MTBF = mean time between failures
MTTR = mean time to repair
Copyright 2006 John
5-15
System Availability
(cont.)
PROVIDER
MTBF (HR)
MTTR (HR)
A
B
C
60
36
24
4.0
2.0
1.0
SAA = 60 / (60 + 4) = .9375 or 93.75%

SAB = 36 / (36 + 2) = .9726 or 97.26%
SAC = 24 / (24 + 1) = .9473 or 94.73%
5-16
Usability
Ease of use of a product or service

ease of learning
ease of use
ease of remembering how to use
frequency and severity of errors
user satisfaction with experience
5-17
Production Design
Simplification
reducing number of parts, assemblies, or options in a
product
Standardization
using commonly available and interchangeable parts
Modularity
combining standardized building blocks, or modules, to
create unique finished products
5-18
Design Simplification
(a) Original design
Assembly using
common fasteners
(b) Revised design
(c) Final design
One-piece base &

elimination of
fasteners
Design for
push-and-snap
assembly
5-19
Final Design and Process Plans

Process plans
Final design
detailed drawings
and specifications for
new product or
service
Copyright 2006 John
5-20
workable instructions
necessary equipment
and tooling
component sourcing
recommendations
job descriptions and
procedures
computer programs for
automated machines
Reducing Time-to-Market
Establish multifunctional design teams
Make design decisions concurrently rather
than sequentially
Design for manufacture and assembly
Use technology in the design process
Engage in collaborative design
5-21
Design Team
5-22
Concurrent Design
A new approach to design
that involves simultaneous
design of products and
processes by design teams
Copyright 2006 John
5-23
Improves quality of early

design decisions
Involves suppliers
Incorporates production
process
Uses a price-minus system
Scheduling and
management can be
complex as tasks are done
in parallel
Design for Manufacture and

Assembly (DFMA)
Design for assembly
Design for
manufacture
a set of procedures for:
design a product for

easy and economical
production
Copyright 2006 John
5-24
reducing number of parts in

an assembly
evaluating methods of
assembly
determining an assembly
sequence
DFM Guidelines
Minimize number of parts and subassemblies
Avoid tools, separate fasteners, and adjustments
Use standard parts when possible and repeatable, wellunderstood processes
Design parts for many uses, and modules that can be
combined in different ways
Design for ease of assembly, minimal handling, and proper
presentation
Allow for efficient and adequate testing and replacement of
parts
5-25
Technology in the Design

Process
Computer Aided Design (CAD)
assists in creation, modification, and analysis of
a design
includes
computer-aided engineering (CAE)
tests and analyzes designs on computer screen
computer-aided manufacturing (CAM)

ultimate design-to-manufacture connection
5-26
Collaborative Design
A software system for collaborative design and
development among trading partners
Follows life cycle of the product
Accelerates product development, helps to resolve product
launch issues, and improves quality of the design
Designers can
conduct virtual review sessions

test what if scenarios
assign and track design issues
communicate with multiple tiers of suppliers
create, store, and manage project documents
5-27
Improving Quality of Design
Review designs to prevent failures

and ensure value
Design for environment
Measure design quality
Use quality function deployment
Design for robustness
5-28
Design Review
Failure mode and effects analysis (FMEA)

a systematic method of analyzing product failures
Fault tree analysis (FTA)

a visual method for analyzing interrelationships among
failures
Value analysis (VA)

helps eliminate unnecessary features and functions
5-29
FMEA for Potato Chips

Failure
Mode
Cause of
Failure
Effect of
Failure
Corrective
Action
Stale
low moisture content

expired shelf life
poor packaging
tastes bad
wont crunch
thrown out
lost sales
add moisture
cure longer
better package seal
shorter shelf life
Broken
too thin
too brittle
rough handling
rough use
poor packaging
cant dip
poor display
injures mouth
chocking
perceived as old
lost sales
change recipe
change process
change packaging
Too Salty
outdated receipt
process not in control
uneven distribution of salt
eat less
drink more
health hazard
lost sales
experiment with recipe

experiment with process
introduce low salt version
5-30
Fault tree analysis (FTA)
5-31
Value analysis (VA)
Can we do without it?

Does it do more than is required?
Does it cost more than it is worth?
Can something else do a better job?
Can it be made
by a less costly method?
with less costly tooling?
with less costly material?
Can it be made cheaper, better, or faster by

someone else?
5-32
Design for Environment

Design for environment
designing a product from material that can be recycled

design from recycled material
design for ease of repair
minimize packaging
minimize material and energy used during manufacture,
consumption and disposal
Extended producer responsibility

holds companies responsible for their product even after its useful
life
5-33
Design for Environment (cont.)
5-34
Measure Design Quality

% of revenue from new
products or services
% of products capturing 50%
or more of market
% of process initiatives
yielding a 50% or more
improvement in
effectiveness
% of suppliers engaged in
collaborative design
Copyright 2006 John
5-35
% of parts that can be

recycled
% of parts used in multiple
products
% of parts with no
engineering change orders
Average number of
components per product
Things gone wrong (TGW)
Quality Function
Deployment (QFD)
Translates voice of customer into technical design
requirements
Displays requirements in matrix diagrams
first matrix called house of quality
series of connected houses
5-36
Importance
House of Quality
5
Trade-off matrix
3
Design
characteristics
1
Customer
requirements
Relationship
matrix
2
Competitive
assessment
Target values
5-37
Competitive Assessment of
Customer Requirements
Competitive Assessment
Easy and
safe to use
Irons
well
B A
Presses quickly
Removes wrinkles
AB
Doesnt stick to fabric
BA
Provides enough steam
AB
Doesnt spot fabric
X AB
Doesnt scorch fabric
A XB
Heats quickly
Automatic shut-off
Quick cool-down
Doesnt break when dropped
AB
Doesnt burn when touched
AB X
Not too heavy
A
ABX
5-38
A B
X
Irons
well
Removes wrinkles
Doesnt stick to fabric
Provides enough steam
+
-
+ +
+ - +
Automatic shut-off
Quick cool-down
Doesnt break when dropped
- +
+ + +
Doesnt burn when touched

Not too heavy
Automatic shutoff
Protective cover for soleplate
+ +
+ + +
+ -
Time to go from 450 to 100
+ + +
Heats quickly
Time required to reach 450 F
Doesnt scorch fabric
Flow of water from holes
Size of holes
Number of holes
- + + +
Doesnt spot fabric
Easy and
safe to use
Material used in soleplate
Thickness of soleplate
Weight of iron
Presses quickly
Size of soleplate
Energy needed to press
From Customer
Requirements
to Design
Characteristics
+
+ -
+ + +
- +
5-39

5-40
Automatic shutoff
Time required to reach 450
Size of holes
Number of holes
Size of soleplate
Weight of iron
Tradeoff Matrix
Number of holes
in.
cm
ty
ea
1.4
8x4
SS
27
15
0.5
45
500
1.2
8x4
MG
27
15
0.3
35
350
1.7
9x5
35
15
0.7
50
600
1.2
8x5
SS
30
30
500
Automatic shutoff
Size of soleplate
lb
Weight of iron
ft-lb
Size of holes

Objective
measures
Units of measure
Iron A
Iron B
Our Iron (X)
Estimated impact
Estimated cost
Targets
Design changes
Time required to reach 450
Targeted Changes
in Design
mm oz/s sec sec Y/N Y/N
5-41
Completed
House of Quality
SS = Silverstone
MG = Mirorrglide
T = Titanium
5-42
A Series of Connected QFD

Houses
Part
characteristics
Process
characteristics
A-2
Parts
deployment
Operations
A-3
Process
characteristics
House
of
quality
Part
characteristics
A-1
Product
characteristics
Customer
requirements
Product
characteristics
Process
planning
A-4
Operating
requirements
5-43
Benefits of QFD
Promotes better understanding of customer
demands
Promotes better understanding of design
interactions
Involves manufacturing in design process
Breaks down barriers between functions and
departments
Provides documentation of design process
5-44
Design for Robustness

Robust product
designed to withstand variations in environmental and
operating conditions
Robust design
yields a product or service designed to withstand
variations
Controllable factors
design parameters such as material used, dimensions,
and form of processing
Uncontrollable factors
users control (length of use, maintenance, settings
5-45
Tolerance and Consistency

Tolerance
allowable ranges of variation in the dimension of a part
Consistency
consistent errors are easier to correct than random
errors
parts within tolerances may yield assemblies that are
not within limits
consumers prefer product characteristics near their ideal
values
5-46
Quantifies customer
preferences toward quality
Emphasizes that customer
preferences are strongly
oriented toward
consistently
Design for Six Sigma (DFSS)
Quality Loss
Taguchis Quality Loss Function
Lower
tolerance
limit
Target
Upper
tolerance
limit
5-47
Special Considerations in Service Design
Services are intangible

Service output is
variable
Service have higher
customer contact
Services are perishable
Copyright 2006 John
5-48
Service inseparable from

delivery
Services tend to be
decentralized and
dispersed
Services are consumed
more often than products
Services can be easily
emulated
Desired service
experience
Service Concept
Service Package
Targeted
customer
Physical
items
Sensual
benefits
Psychological
benefits
Performance Specifications
Customer
requirements
Service
Provider
Design Specifications
Customer
Activities
Service
Design
Process
Customer
expectations
Facility
Provider
skills
Cost and time

estimates
Delivery Specifications
Schedule
Deliverables
Location
Service
5-49
Service Design Process

(cont.)
Service concept
purpose of a service; it defines target
market and customer experience
Service package
mixture of physical items, sensual benefits,
and psychological benefits
Service specifications
performance specifications
design specifications
delivery specifications
5-50
High v. Low Contact

Services
Design
Decision
High-Contact Service
Facility Convenient to customer

location
Facility
layout
Low-Contact Service
Near labor or
transportation source
Must look presentable, Designed for

accommodate
efficiency
customer needs, and
facilitate interaction
with customer
Source: Adapted from R. Chase, N. Aquilano, and R. Jacobs, Operations Management for Competitive
Advantage (New York:McGraw-Hill, 2001), p. 210
Copyright 2006 John
5-51
High v. Low Contact

Services (cont.)
Design
Decision
Low-Contact Service
Quality
control
More variable since

customer is involved in
process; customer
expectations and
perceptions of quality
may differ; customer
present when defects
occur
Measured against
established
standards; testing
and rework possible
to correct defects
Capacity
Excess capacity
required to handle
peaks in demand
Planned for average

demand
Copyright 2006 John
5-52
High v. Low Contact

Services (cont.)
Design Decision
Low-Contact Service
Worker skills
Must be able to interact Technical skills

well with customers and
use judgment in decision
making
Scheduling
Must accommodate
customer schedule
Customer
concerned only
with completion
date
Copyright 2006 John
5-53
High v. Low Contact

Services (cont.)
Design Decision
Low-Contact Service
Service process Mostly front-room

Mostly backactivities; service may
room activities;
change during delivery in
planned and
response to customer
executed with
minimal
interference
Service
package
Varies with customer;

includes environment
as well as actual
service
Fixed, less
extensive
Copyright 2006 John
5-54

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Chapter 5

Products and Services

Roberta Russell & Bernard W. Taylor, III

Copyright 2006 John Wiley & Sons, Inc.

Copyright 2006 John Wiley & Sons, Inc.

Copyright 2006 John Wiley & Sons, Inc.

Design Process (cont.)

Copyright 2006 John

specifies what physical

Design Process (cont.)

Revising and testing

Copyright 2006 John Wiley & Sons, Inc.

Idea Generation Sources

Copyright 2006 John

Idea Generation Sources (cont.)

Copyright 2006 John Wiley & Sons, Inc.

Perceptual Map of Breakfast

Copyright 2006 John Wiley & Sons, Inc.

Copyright 2006 John Wiley & Sons, Inc.

Copyright 2006 John Wiley & Sons, Inc.

Form and Functional Design

Copyright 2006 John

Copyright 2006 John Wiley & Sons, Inc.

0.90 x 0.90 = 0.81

Copyright 2006 John Wiley & Sons, Inc.

0.98 x 0.99 x 0.98 = 0.951

Copyright 2006 John Wiley & Sons, Inc.

System Availability (SA)

Copyright 2006 John

SAA = 60 / (60 + 4) = .9375 or 93.75%

Copyright 2006 John Wiley & Sons, Inc.

Ease of use of a product or service

Copyright 2006 John Wiley & Sons, Inc.

Copyright 2006 John Wiley & Sons, Inc.

(b) Revised design

(c) Final design

One-piece base &

Copyright 2006 John Wiley & Sons, Inc.

Final Design and Process Plans

Copyright 2006 John

Copyright 2006 John Wiley & Sons, Inc.

Copyright 2006 John Wiley & Sons, Inc.

Copyright 2006 John

Improves quality of early

Design for Manufacture and

a set of procedures for:

design a product for

Copyright 2006 John

reducing number of parts in

Copyright 2006 John Wiley & Sons, Inc.

Technology in the Design

computer-aided manufacturing (CAM)

Copyright 2006 John Wiley & Sons, Inc.

conduct virtual review sessions

Copyright 2006 John Wiley & Sons, Inc.

Improving Quality of Design

Review designs to prevent failures

Copyright 2006 John Wiley & Sons, Inc.

Failure mode and effects analysis (FMEA)

Fault tree analysis (FTA)

Value analysis (VA)

Copyright 2006 John Wiley & Sons, Inc.

FMEA for Potato Chips

low moisture content