MGT3303 Michel Leseure Design Activities in Operations Management Learning objectives: –To review...
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Transcript of MGT3303 Michel Leseure Design Activities in Operations Management Learning objectives: –To review...
MGT3303Michel Leseure
Design Activities in Operations Management
• Learning objectives:– To review all key design activities in the
field of operations management– Focus on the design of manufactured
goods– To understand the key challenges of
design tasks• Product design & Innovation• Challenges of design• Best practices in NPD• The importance of time to market
MGT3303Michel Leseure
New Product Development
• The process of converting an idea into a product or service
• The development task may be more or less innovative:– Invention: products or services that are
radically new– Expansion: products or services that are new
to the firm– Revisions of existing products and services
MGT3303Michel Leseure
Information flow in NPD
Needs/Wants
Mkt Function
OutlineSpecification Designers
Customers
Product and/orservice
OperationsFunction
OperationalSpecification
Case of a market-ledNPD
MGT3303Michel Leseure
Product Design ProcessConcept Generation
Screening
Prototyping and Final Design
Evaluation & Improvement
Preliminary Design
Concept Package Process
From Slack et al., 2004
MGT3303Michel Leseure
No
Ideageneration
Finaldesign
Preliminarydesign
Feasibilitystudy
Processplanning
Productfeasible?
Yes
Prototype
Manufacturing
Design & ManufacturingSpecifications
Product Concept
PerformanceSpecifications
Russell & Taylor’sFramework
MGT3303Michel Leseure
Failures in NPD
• NPD can fail because:– The process itself is costly and uncertain –
a technically successful innovation might not be profitable
– The process is hard to manage – innovating firms require special skills
– Reward of success are hard to appropriate – innovations can be copied and bettered by competitors
MGT3303Michel Leseure
NPD & Product Superiority
• History has proved that technological superiority is NOT a sufficient condition for NPD success– VHS vs. Beta– Concorde– Qwerty keyboards, path dependency– Dos and Windows, increasing economies
of scale
MGT3303Michel Leseure
The Challenge of Design: Achieving Integration
Source: Simon & Schuster from Fast Cycle Times: How to Align Purpose, Strategy, and Structure for Speed by Christopher Meyer. Copyright © 1993 by Christopher Meyer.
MGT3303Michel Leseure
Design Changes
Company 2
90% of Totalchangescomplete
Company 1
TimeProduct is
commercialised
Number ofDesign Changes
MGT3303Michel Leseure
Best practices in NPD
MGT3303Michel Leseure
Best Practices in NPD
• Concurrent engineering, supplier involvement, cross-functional teams– Improve communication between parties through:
• Well designed NPD and information exchange processes• The right organisational structure• The right organisational climate
• Process integration– CADCAM, Rapid prototyping
• Idea generation– Brainstorming– Benchmarking– Reverse engineering
MGT3303Michel Leseure
Perceptual MapsGood taste
Bad taste
High nutritionLow nutrition
• Cocoa Puffs
• Rice Krispies • Wheaties
• Cheerios
• Shredded Wheat
MGT3303Michel Leseure
Best Practices in NPD
• Platform and modularity • Design for manufacture, design for
assembly• Failure mode effect analysis• Value analysis• QFD (covered in next class)
MGT3303Michel Leseure
Platform Technology
– The platform concept• “A platform can broadly be defined as a relatively large set
of product components that are physically connected as a stable sub-assembly and are common to different final models” (Meyer and Lehnerd, 1997)
– The modularisation concept• “A module can be described as a large group of
components that is physically coherent as a sub-assembly and which often has standardised interface designs (Muffato, 1999).
MGT3303Michel Leseure
Examples of Platforms
• Swiss army knives • Swatch watches• Xerox copiers • Hewlett-Packard printers • The Boeing 747 family of aircraft• Kodak single use camera• Sony Walkman
– Original designed as a platform in 1979– There are 250+ models– New designs (i.e. innovations) only account for 25% of all
models– This means that 85% of the models were a simple re-
combination of modules
MGT3303Michel Leseure
Evolution of Platforms/Products
MGT3303Michel Leseure
Platforms and Scalability(Rolls Royce Engines)
MGT3303Michel Leseure
Benefits of Platforms
• At the production level– Similar models more easily assembled in
the same production process– Some companies even define platform
from a production rather than product-function standpoint!
• From a multi-product perspective– Ability to target sub-segments within a
product family at a fraction of the cost of independent designs
MGT3303Michel Leseure
Benefits of Modules
• Possibility of producing product variations which have only limited impact on production and assembly processes
• Limited proliferation of parts• Reduction of throughput time because
many pre-assembly operations are eliminated
• Greater productivity and quality from automation
MGT3303Michel Leseure
Design for Manufacture
MGT3303Michel Leseure
Failure Mode and Effects Analysis (FMEA)
• A systematic approach for analyzing causes and effects of failures
• Prioritizes failures• Attempts to eliminate causes• Similar to: Fault Tree Analysis (FTA)
– more visual– studies interrelationship between failures
MGT3303Michel Leseure
FMEAFailure Mode
Causes of Failure
Effects of Failure
Corrective Action
Stale Low moisture content, expired shelf life, poor packaging
Tastes bad, won’t 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
Can’t dip, poor display, injures mouth, choking, perceived as old, lost sales
Change recipe, change process, change packaging
Too Salty Outdated recipe, 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
MGT3303Michel Leseure
MGT3303Michel Leseure
Value Analysis (or value engineering)
• Ratio of value to cost• Assessment of value:
1. Can we do without it?2. Does it do more than is required?3. Does it cost more than it is worth?4. Can something else do a better job5. Can it be made by less costly method, tools,
material?6. Can it be made cheaper, better or faster by
someone else?
MGT3303Michel Leseure
The Timing of NPD
MGT3303Michel Leseure
Product Lifecycle
Introduction
Growth
Maturity
Decline
Time
Sales Volume
Beware of design gaps!
MGT3303Michel Leseure
Time to Market Performance
• Time to market– First mover advantage– Ability to deliver a product on time
• Essential for a product which is « sold in »• A printer brought 6 months to the market within development cost
will lose the organisation 33% of profits• A printer brought on time to the market 30% over-budget will lose
the organisation 2.3% of profits (McKinsey)
– Time-based competition
MGT3303Michel Leseure
Time to Market Performance
MGT3303Michel Leseure
Second Mover Advantage
• Many researchers have questioned the idea of “first-mover advantage”
• First mover advantage only works if the product which is launched is perfectly reliable!
• Otherwise, a second company can imitate the first mover and avoid the mistakes that were made!– Second Mover advantage!– There is an optimal timing for new product
introductions!– Time vs. quality trade-off
MGT3303Michel Leseure
Follower Advantage!
From (Cottrelland Sick, 2002)
MGT3303Michel Leseure
Summary
• Several key issues in managing innovation:– Timing of NPD– Reliability of NPD– Role of process, best practices, and
organisation
MGT3303Michel Leseure
Suggested Homework
• Question 3.1, p. 110• Morocco’s textile sector is an important part of
the Moroccan economy. Write an assessment of this sector’s design capabilities.
• Questions 3.3, 3.4, 3.6 p. 110• There are a number of innovation/invention prizes
in Morocco. What types of new product designs could be a winner?