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Transcript of Malinin PDMA Presentation
www.GEN3.com
The method for transforming a business goal into a set of engineering problems
PDMA Research Forum
Sept. 29, 2007
Len Malinin
© 2007 GEN3 Partners, Inc. Confidential2 2
How can we increase our revenues from
product X or profits by %%? What
product innovations will help me to achieve that?
Initial Situation
© 2007 GEN3 Partners, Inc. Confidential3 3
MPV?An attribute of a
product that represents a critical element of its functionality and that bears heavily on the
customer’s purchasing decision
Main Parameters of Value (MPVs)
© 2007 GEN3 Partners, Inc. Confidential4 4
“You’re telling me that all the Hospital Purchasing Organizations careabout is the Cost Components? And that the MPV set that’s relevant to me, your patient, is not relevant for their purchase decision!? I’m suddenly feeling really nauseous…”
Main Parameters of Value (MPVs)
© 2007 GEN3 Partners, Inc. Confidential5 5
Steps Required to Translate Business Needs into Product Innovation Problems (for industrial products)
1. Identify stakeholders in the value
chain and the primary
stakeholder
5.2. Determine distance
to physical/technological
limits for the Variables
2. Identify MPVs of a product for the primary and other
stakeholders
3. Select a set of MPVs
for improvement
4. Determine underlying physical variables
responsible for selected
MPVs
5.1. Determine Coefficients of
Sensitivity for the Underlying Variables
6. Formulate and prioritize
Key Problems for Underlying Variables
5. Select the underlying
variables that yield
maximum MPV
improvement
8. Back propagate the
solution to estimate
business impact and success
criteria
7. Solve the selected problems
© 2007 GEN3 Partners, Inc. Confidential6 6
The success criteria of an innovation project are often determined by the MPVs of the primary stakeholder (the nearest customer in the value chain), and not by those of the end user. Before determining the MPVs, we need to ask ourselves:
• To whom do we sell the new product?
• What is the value chain for the product?
1. Identify stakeholders in the value
chain and the primary
stakeholder
1. Identify stakeholders in the value chain and the primary stakeholder
© 2007 GEN3 Partners, Inc. Confidential7 7
There are several sets of MPVs, for different stakeholders within the value chain• For instance, with heavy trucks:
─ MPVs of Structural Component Manufacturer
─ OEMs’ MPVs (Mercedes-Benz, Paccar, Volvo, etc.)
─ Fleets’ MPVs (WalMart, UPS, etc.)
─ End users’ MPVs (Owner/Operator, Contractor, or Fleet-employed truck drivers)
Fleet MPV: Fuel Cost
1. Identify stakeholders in the value chain and the primary stakeholder
© 2007 GEN3 Partners, Inc. Confidential8 8
Next, we analyze how the Purchase Decision Making is
affected by the MPVs. We aim to bring the MPVs to the
common denominator, e.g., express them as cost components, because
purchase decision-making is driven by cost structure.
.
2. Identify MPVs of a product for the primary and other stakeholders
© 2007 GEN3 Partners, Inc. Confidential9 9
2. Identify MPVs of a product for the primary and other stakeholders
Driver Retention Cost
Maintenance Cost
Fuel Cost
Repair Cost
Legal Compliance Cost
Fleet MPVs
Engine Losses
Aerodynamic Losses
Rolling Friction Losses
Sub MPVsFleets
OEMs
Metal company
End Users
Stakeholders
Example: Class 8 Truck
MPVs of a truck for a fleet include operation cost components, which are an important factor in the decision making process. To derive the fleets’ set of MPVs, we ignore the manufacturing process, which determines the OEMs’ set of MPVs
© 2007 GEN3 Partners, Inc. Confidential10 10
Fleet MPV: Fuel Cost
3. Select a set of MPVs for improvement...
Driver Retention Cost
Maintenance Cost
Fuel Cost
Repair Cost
Legal Compliance Cost
Fleet MPVs
Engine Losses
Aerodynamic Losses
Rolling Friction Losses
Sub MPVsFleets
OEMs
Metal company
End Users
Stakeholders …based on the client’s core competencies, problem scale, restrictions (can be iterative process).
© 2007 GEN3 Partners, Inc. Confidential11 11
Fleet MPV: Fuel Cost
Driver Retention Cost
Maintenance Cost
Fuel Cost
Repair Cost
Legal Compliance Cost
Fleet MPVs
Engine Losses
Aerodynamic Losses
Rolling Friction Losses
Sub MPVs
Speed
Air viscosity
Surface energy
Yaw angle
Air temperature
Air density
Drag coefficient (Cd)
Physical variables
Fleets
OEMs
Metal company
End Users
Stakeholders
4. Determine underlying physical variables responsible for selected MPVs
Use Functional Model or Cause-Effect Chain Approach
© 2007 GEN3 Partners, Inc. Confidential12 12
For instance: MPV = fuel consumption, Cd=drag coefficient
5. Select the underlying variables for improvement
Three possible methods for determining Coefficients of Sensitivity:
─ 1. Through tested analytical models
─ 2. From known references
─ 3. Through interviews and “fuzzy” references
1. Through tested analytical models
Express the right-hand part via Cd
5.1. Determine Coefficients of Sensitivity of MPVs with respect to the Underlying Variables
© 2007 GEN3 Partners, Inc. Confidential13 13
2. From known references
5. Select the underlying variables for improvement
5.1. Determine Coefficients of Sensitivity of MPVs with respect to the Underlying Variables
© 2007 GEN3 Partners, Inc. Confidential14 14
3. Through interviews and “fuzzy” references
Driver Satisfaction: May increase driver retention and recruiting; reduce noise levels >= 10%
Maintenance Cost: Value of uptime = $500/day/truck in revenueCorrosion reduction could add 1-2 years on 10-year life for private fleet — 40 hrs/year for new truck; 120 hrs/year for 5-year old truck
Residual Value: Less corrosion could increase residualNicer cab and “chrome” can increase residual up to 10% in 5 th year of life
Increased Payload: 1% weight reduction = 1% more cargo for weight-sensitive hauls, yielding 1% less miles that need to be driven (cost = $1.33/mile x 122,000/tractor/yr)
Fuel Economy: >1% increase in fuel economy worth paying for; avg 5.7 MPG
5. Select the underlying variables for improvement
5.1. Determine Coefficients of Sensitivity of MPVs with respect to the Underlying Variables
© 2007 GEN3 Partners, Inc. Confidential15 15
MPV Sub-MPVs 1 Sub-MPVs 2 Physical variables
FuelEconomy
Aerodynamic losses • Drag coefficient (Cd)• Air density• Air viscosity• Speed• Yaw angle• Surface energy• Air temperature
Engine performance • Combustion temperature• Density of air-fuel mixture• Pattern of fuel spray• Air temperature
Rolling friction • Road roughness• Profile of the tire tread • Mechanical (viscous-elastic) parameters of the tire• Coefficient of linear expansion• Area of the tire-road contact• Load per axle • Friction coefficient in the bearings
Cd
0.19
0.6
0.7
0.35
5.2. Determine distance to physical/technological limits for the Variables
5.2. The greater the distance to the physical limit, the greater the parameter improvement that can
be achieved
5.2. The greater the distance to the physical limit, the greater the parameter improvement that can
be achieved
5. Select the underlying variables for improvement
© 2007 GEN3 Partners, Inc. Confidential16 16
Example 1
Baseline: V1 = 60 mph, Cd = 0.6.
For the Cd = 0.6 curve, 10% change in speed 12% change in fuel consumption.
∆V1 = 10% ∆MPV = 12.1%.
Z11 = ∆MPV / ∆V1 = 1.21.
5.1. Determine Coefficients of Sensitivity - Examples
MPV1 = Fuel consumptionV1 = Truck speed
1
111
V
MPVZ
© 2007 GEN3 Partners, Inc. Confidential17 17
Baseline: V1 = 60 mph, Cd = 0.6.
At V1 = 60 mph, 10% change in aerodynamic drag 6% change in fuel consumption.
∆V2 = 10%; ∆MPV = 6%.
Z12 = ∆MPV / ∆V2 = 0.6.
Example 2
MPV1 = Fuel consumptionV2 = Drag coefficient
2
112
V
MPVZ
5.1. Determine Coefficients of Sensitivity - Examples
© 2007 GEN3 Partners, Inc. Confidential18 18
Variation of drag coefficient with gap length between tractor and trailer (wind tunnel model)
∆MPV / ∆V2 = 0.6 (Example 2).
At baseline dimensionless gap = 0.2, ∆V3 = 20% ∆V2 = = 14.8%,
∆V2 / ∆V3 = 0.74,
Z13 = ∆MPV / ∆V3 = 0.6 * 0.74 = 0.42.
MPV1 = Fuel consumptionV2 = Aerodynamic dragV3 = Tractor-trailer gap
32
113
2
V
V
V
MPVZ
Example 3
5.1. Determine Coefficients of Sensitivity - Examples
© 2007 GEN3 Partners, Inc. Confidential19 19
v1 v2 v3 … vm
MPV1 z11 z12 z13 z1m
MPV2 z21 z22 z23 z2m
MPV3 z31 z32 z33 z3m
…
MPVn zn1 zn2 zn3 znm
v3 close to its limits
MPV3 not selected
for improvementzij are low
Selected for Solutions
5. Select the underlying variables that yield maximum MPV improvement
© 2007 GEN3 Partners, Inc. Confidential20 20
• Formulate the set of problems: How to change a physical parameter
vi in a way that improves MPVj
• Prioritize the problems, based on the client’s core competencies, match with the client’s strategic directions, development time, problem scale, restrictions
6. Formulate and prioritize Key Problems for Underlying Variables
© 2007 GEN3 Partners, Inc. Confidential21 21
6. Formulate and prioritize Key Problems for Underlying Variables
• Many aerodynamic devices of a truck are useful at the cruising speed, while during docking or maneuvering they present a hurdle for the driver.
• The devices are needed at the cruising speed and not needed at other times.
• Problem Statement 1: Design dynamic (extendable, folding) devices that can be deployed on demand.
• Problem Statement 2: Use resources of the environment (“the super-system”) to generate the required aerodynamic features only at a high speed.
How to change a physical parameter vi in a way that improves MPVj
Example: How to reduce drag coefficient and reduce fuel cost
© 2007 GEN3 Partners, Inc. Confidential22 22
7. Solve the selected problems
Gap with VGs Baseline
Example. Vortex generators can be interpreted as “virtual cab extenders” which streamline the airflow around the tractor-trailer gap at a high speed.
Problem Statement 2: Use the incoming airflow to generate the required aerodynamic features only at a high speed.
© 2007 GEN3 Partners, Inc. Confidential23 23
8. Back propagate the solution to estimate business impact and success criteria
Changing adhesive properties of the surface repels dust and reduces MPV Maintenance Cost.
Dust repelling by positively charged mirror
Dust repelling by positively charged mirror
Reduced frequency of cleaningReduced frequency of cleaning
Time saved per maintenance cycle Time saved per maintenance cycle
Labor saved per maintenance cycleLabor saved per maintenance cycle
Reduced maintenance cost
Reduced maintenance cost
Back propagating the effect of solution to the initial MPV
© 2007 GEN3 Partners, Inc. Confidential24 24
Steps Required to Translate Business Needs into Product Innovation Problems (for industrial products)
1. Identify stakeholders in the value
chain and the primary
stakeholder
5.2. Determine distance
to physical/technological
limits for the Variables
3. Select a set of MPVs
for improvement
2. Identify MPVs of a product for the primary and other
stakeholders
4. Determine underlying physical variables
responsible for selected
MPVs
5.1. Determine Coefficients of
Sensitivity for the Underlying Variables
6. Formulate and prioritize
Key Problems for Underlying Variables
5. Select the underlying
variables that yield
maximum MPV
improvement
8. Back propagate the
solution to estimate
business impact and success
criteria
7. Solve the selected problems