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4-1 Product and Service Design
CHAPTER
4
Product andService Design
McGraw-Hill/Irwin
Operations Management, Eighth Edition, by William J. StevensonCopyright 2005 by The McGraw-Hill Companies, Inc. All rights reserved.
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4-2 Product and Service Design Design Process
Copyright 2011 John 4-2
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4-3 Product and Service Design
Major factors in design strategy Cost
Quality
Time-to-market Customer satisfaction
Competitive advantage
Product and Service Design
Product and service design or redesign should be
closely tied to an organizations strategy
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4-4 Product and Service Design
Translate customer wants and needs intoproduct and service requirements
Refine existing products and services
Develop new products and services Formulate quality goals
Formulate cost targets
Construct and test prototypes Document specifications
Product or Service Design Activities
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4-5 Product and Service Design Reasons for Product or Service Design
Economic
Social and demographic
Political, liability, or legal
Competitive
Technological
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4-6 Product and Service Design 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
S
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4-7 Product and Service Design
Taking into account the capabilities of theorganization in designing goods and
services
Designing For Operations
4 8 P d d S i D i
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4-8 Product and Service Design
Legal FDA, OSHA, IRS
Product liability
Uniform commercial code Ethical
Releasing products with defects
Environmental
EPA
Legal, Ethical, and Environmental Issues
4 9 P d t d S i D i
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4-9 Product and Service DesignRegulations & Legal Considerations Product Liability - A manufacturer is liable for
any injuries or damages caused by a faulty
product.
Uniform Commercial Code - Products carry animplication of merchantability and fitness.
4 10 P d t d S i D i
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4-10Product and Service DesignDesigners Adhere to Guidelines
Produce designs that are consistent with thegoals of the company
Give customers the value they expect
Make health and safety a primary concern Consider potential harm to the environment
4 11 P d t d S i D i
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4-11 Product and Service DesignOther Issues in Product and Service Design
Product/service life cycles How much standardization
Product/service reliability
Range of operating conditions
4 12 Prod ct and Ser ice Design
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4-12Product and Service DesignProduct Life Cycle
Introduction
Growth
Maturity
Decline
4 13 Product and Service Design
P d t Lif C l
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4-13Product and Service DesignProduct Life CycleIntroduction
Fine tuning
research
product development
process modification and enhancement supplier development
4 14 Product and Service Design
P d t Lif C l
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4-14Product and Service DesignProduct Life CycleGrowth
Product design begins to stabilize
Effective forecasting of capacity becomes
necessary
Adding or enhancing capacity may be necessary
4 15 Product and Service Design
P d t Lif C l
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4-15Product and Service DesignProduct Life CycleMaturity
Competitors now established
High volume, innovative production may be
needed
Improved cost control, reduction in options, paringdown of product line
4 16 Product and Service Design
P d t Lif C l
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4-16Product and Service DesignProduct Life CycleDecline
Unless product makes a special contribution, must
plan to terminate offering
4 17 Product and Service Design
P d t Lif C l S l C t d
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4-17Product and Service DesignProduct Life Cycle, Sales, Cost, andProfit
S
ales,
Cost&Pro
fit
.
Introduction Maturity DeclineGrowth
Cost of
Development
& ManufactureSales Revenue
Time
Cash flow
Loss
Profit
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4-18Product and Service DesignStandardization
Standardization Extent to which there is an absence of variety
in a product, service or process
Standardized products are immediatelyavailable to customers
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4 19Product and Service DesignAdvantages 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
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4 20Product and Service DesignAdvantages of Standardization (Contd)
Orders fillable from inventory Opportunities for long production runs and
automation
Need for fewer parts justifies increasedexpenditures on perfecting designs andimproving quality control procedures.
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4 21Product and Service DesignDisadvantages of Standardization
Designs may be frozen with too manyimperfections remaining.
High cost of design changes increases
resistance to improvements. Decreased variety results in less consumer
appeal.
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4 22Product and Service Design
Mass customization: A strategy of producing standardized goods
or services, but incorporating some degree
degree of customization
Delayed differentiation
Modular design
Mass Customization
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4 23Product and Service Design
Delayed differentiation is a postponementtactic
Producing but not quite completing a product
or service until customer preferences or
specifications are known
Delayed Differentiation
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4 24Product and Service DesignModular Design
Modular design is a form of standardization inwhich component parts are subdivided intomodules that are easily replaced orinterchanged. It allows:
easier diagnosis and remedy of failures
easier repair and replacement
simplification of manufacturing and assembly
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4 25Product and Service DesignReliability
Reliability: The ability of a product, part, or systemto perform its intended function under a prescribed
set of conditions
Failure: Situation in which a product, part, orsystem does not perform as intended
Normal operating conditions: The set of
conditions under which an items reliability isspecified
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6 oduct a d Se ce es gComputing Reliability
Copyright 2011 John 4-26
0.90 0.90 0.90 x 0.90 = 0.81
Components in series
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gComputing Reliability
Copyright 2011 John 4-27
0.95 + 0.90(1-0.95) = 0.995
Components in parallel
0.95
0.90
R2
R1
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gSystem Reliability
Copyright 2011 John 4-28
0.90
0.92+(1-0.92)(0.90)=0.990.98 0.98
0.98 x 0.99 x 0.98 = 0.951
0.92 0.980.98
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gImproving Reliability
Component design Production/assembly techniques
Testing
Redundancy/backup
Preventive maintenance procedures
User education System design
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g
Robust Design: Design that results inproducts or services that can function over
a broad range of conditions
Robust Design
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gDesign 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, etc.)
Copyright 2011 John 4-31
4-32Product and Service Design
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gTaguchi Approach Robust Design
Design a robust product Insensitive to environmental factors either in
manufacturing or in use.
Central feature is Parameter Design.
Determines:
factors that are controllable and those notcontrollable
their optimal levels relative to major productadvances
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Product Development Stages
Idea generation Assessment of firms ability to carry out Customer Requirements
Functional Specification Product Specifications Design Review Test Market Introduction to Market EvaluationSc
opeo
fproductdeve
lopmentteam
Scope of design for
manufacturability and
value engineering teams
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Idea Generation
Ideas Competitor based
Supply chain based
Research based
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Idea Generation Stage
Provides basis for entry into market
Sources of ideas
Market need (60-80%); engineering & operations(20%); technology; competitors; inventions;
employees
Follows from marketing strategy Identifies, defines, & selects best market
opportunities
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Customer Requirements Stage
Identifies & positions key product benefits
Stated in core benefits proposition (CBP)
Example: Long lasting with more power
(Sears Die Hard Battery)
Identifies detailed list of productattributes desired by customer
Focus groups or1-on-1 interviews
House of Quality
Customer
Requirements
Product
Characteristics
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Functional Specification Stage
Defines product in terms of how theproduct would meet desired attributes
Identifies products engineering
characteristics
Example: printer noise (dB)
Prioritizes engineering characteristics
May rate product compared
to competitors
House of Quality
CustomerRequirements
Product
Characteristics
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Determines how product will be made Gives products physical specifications
Example: Dimensions, material etc.
Defined by engineeringdrawing
Done often on computer
Computer-Aided
Design (CAD)
Product Specification Stage
House of Quality
ProductCharacteristics
Component
Specifications
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Reverse EngineeringReverse engineering is the
dismantling and inspecting
of a competitors product to discoverproduct improvements.
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Research & Development (R&D)
Organized efforts to increase scientificknowledge or product innovation & mayinvolve:
Basic Research advances knowledge about a
subject without near-term expectations ofcommercial applications.
Applied Research achieves commercialapplications.
Developmentconverts results of appliedresearch into commercial applications.
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Manufacturability
Manufacturability is the ease of fabricationand/or assembly which is important for:
Cost
Productivity
Quality
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Value Engineering
4-43Product and Service Design D i i f M f t i
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Designing for ManufacturingBeyond the overall objective to achievecustomer satisfaction while making areasonable profit is:
Design for Manufacturing(DFM)The designers consideration of theorganizations manufacturing capabilities when
designing a product.The more general term design for operationsencompasses services as well as manufacturing
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Concurrent Engineering
Concurrent engineering
is the bringing together
of engineering design andmanufacturing personnel
early in the design phase.
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Concurrent Design
Copyright 2011 John 4-45
4-46Product and Service Design H i P d t D i
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PowerPoint presentation toaccompany Heizer/Render -
2004 by Prentice Hall, Inc.,Upper Saddle River, N.J.
5-46
As Engineering
designed it.
1984-1994 T/Maker Co.
As Operations
made it.
1984-1994 T/Maker Co.
As Marketinginterpreted it.
1984-1994 T/Maker Co.
As the customerwanted it.
1984-1994 T/Maker Co.
Humor in Product Design
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Computer-Aided Design
Computer-Aided Design (CAD) is productdesign using computer graphics.
increases productivity of designers, 3 to 10times
creates a database for manufacturinginformation on product specifications
provides possibility of engineering and costanalysis on proposed designs
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Engineering drawing
Shows dimensions,tolerances, & materials
Shows codes for GroupTechnology
Bill of Material
Lists components, quantities& where used
Shows product structure 1984-1994 T/Mak
Product Documents
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1-5/8
13/163/8
13/16
13/16
diameter
13/32
diameter 1/4 R
1
2-1/2
5/16
2-1/4
45
BracketScale: FULL
Drawn: J. Thomas A- 435-038
Engineering Drawing Example
4-50Product and Service Design
Engineering Drawings - Show
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Engineering Drawings ShowDimensions, Tolerances, etc.
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Bill f M t i l E l
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Bill of Material
P/N: 1000 Name: BicycleP/N Desc Qty Units Level
1001 Handle Bars 1 Each 1
1002 Frame Assy 1 Each 1
1003 Wheels 2 Each 21004 Frame 1 Each 2
1995 Corel Corp.
Bill of Material Example
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Bill of Materials Manufacturing Plant
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PowerPoint presentation toaccompany Heizer/Render - 2004 by Prentice Hall, Inc.,Upper Saddle River, N.J.5-52
Bill of Material for a Panel Weldment Hard Rock Cafs Hickory BBQ
Bacon Cheeseburger
Number Description Qt
y
Description Qty
A60-71 Panel Weldmt 1 Bun
Hamburger Patty
Cheddar CheeseBacon
BBQ Onions
Hickory BBQ Sauce
Burger Set
Lettuce
Tomato
Red OnionPickle
French Fries
Seasoned Salt
11-inch Plate
HRC Flag
1
8 oz.
2 slices2 strips
cup
1 oz.
1 leaf
1 slice
4 rings1 slice
5 oz.
1 tsp
1
1
A 60-7R 60-17
R 60-428
P 60-2
Lower Roller AssemblyRoller
Pin
Locknet
11
1
1
60-72
R 60-57-1
A 60-4
02-50-1150
Guide Assem. Rear
Support Angle
Roller Assem.
Bolt
1
1
1
1
A 60-73
A 60-74
R 60-99
02-50-1150
Guide Assm, Front
Support Weldmt
Wear Plate
Bolt
1
1
1
1
Bill of Materials Manufacturing Plant
and Fast-Food Restaurant
4-53Product and Service Design
A bl D i
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Shows exploded view of product
Head Neck
Handle
End
Cap
Assembly Drawing
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Assembly Chart for
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1
2
3
SA1 A1
A2
Tuna Fish
Mayonnaise
Bread
Tuna
Assy
FG
Sandwich
Assembly Chart forA Tuna Sandwich
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Assembly Drawing and Assembly Chart
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Assembly Drawing and Assembly Chart
4-56Product and Service Design
Route Sheet
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Route Sheet
Lists all operationsRoute Sheet for Bracket
Sequence Machine Operation SetupTime
OperationTime/Unit
1 Shear # 3 Shear tolength
5 .030
2 Shear # 3 Shear 45corners
8 .050
3 Drillpress
Drill bothholes
15 3.000
4 Brakepress
Bend 90 10 .025
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Work Order
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Work Order
1984-1994 T/Maker
Co.
Authorizes producing a given item, usually to a schedule
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Engineering Change Notice (ECN)
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Engineering Change Notice (ECN)
A correction or modification of an engineering
drawing or bill of material
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Service Design
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Service Design
Service Something that is done to or for a customer
Service delivery system
The facilities, processes, and skills needed toprovide a service
Product bundle
The combination of goods and services
provided to a customer Service package
The physical resources needed to perform the
service
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Differences Between Product
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Tangibleintangible 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
and Service Design
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Phases in Service Design
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Phases in Service Design
1. Conceptualize2. Identify service package components
3. Determine performance specifications
4. Translate performance specifications intodesign specifications
5. Translate design specifications into delivery
specifications
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Service
Design
Process
Copyright 2011 John
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Service Blueprinting
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Service Blueprinting
Service blueprinting A method used in service design to describe and
analyze a proposed service
A useful tool for conceptualizing a servicedelivery system
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Major Steps in Service Blueprinting
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Major Steps in Service Blueprinting
1. Establish boundaries2. Identify steps involved
3. Prepare a flowchart
4. Identify potential failure points5. Establish a time frame
6. Analyze profitability
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Service Blueprinting
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Service Blueprinting
Copyright 2011 John
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Service Blueprinting
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Service Blueprinting
Copyright 2011 John
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Characteristics of Well Designed
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gService 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
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Challenges of Service Design
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Challenges of Service Design
Variable requirements Difficult to describe
High customer contact
Servicecustomer encounter
4-69Product and Service DesignHigh vs. Low Contact
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gServices
Facilitylocation
Convenient to customer
Design
Decision
High-Contact Service Low-Contact Service
Near labor or
transportation source
Facilitylayout
Must look presentable,
accommodate customer
needs, and facilitate
interaction with customer
Designed for efficiency
Copyright 2011 John
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High vs. Low Contact
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Services
Quality
control
More variable sincecustomer is involved inprocess; customerexpectations and
perceptions of qualitymay differ; customerpresent when defectsoccur
Design
Decision
High-Contact Service Low-Contact
Service
Measured against
established standards;
testing and rework
possible to correctdefects
Capacity Excess capacity required
to handle peaks indemand
Planned for average
demand
Copyright 2011 John
4-71Product and Service Design
High vs Low Contact Services
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High vs. Low Contact Services
Worker skills Must be able to interact
well with customers and
use judgment in decision
making
Design
Decision
High-Contact Service Low-Contact
Service
Technical skills
Scheduling Must accommodate
customer schedule
Customer
concerned only
with completion
date
Copyright 2011 John
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High vs Low Contact Services
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High vs. Low Contact Services
Service process Mostly front-roomactivities; service maychange during delivery inresponse to customer
Design
Decision
High-Contact Service Low-Contact
Service
Mostly back-
room activities;
planned and
executed withminimal
interference
Servicepackage
Varies with customer;
includes environment as
well as actual service
Fixed, less
extensive
Copyright 2011 John
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Quality Function Deployment
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Quality Function Deployment Voice of the customer
House of quality
Quality Function Deployment
QFD: An approach that integrates the voice of the
customer into the product and service development
process.
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The House of Quality
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The House of Quality
Correlation
matrix
Design
requirements
Customer
require-
ments
Competitive
assessment
Relationship
matrix
Specifications
or
target values
Figure 4.4
4-75Product and Service Design
House of Quality Example
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Customer
Requirements
Easy to close
Stays open on a hill
Easy to open
Doesnt leak in rain
No road noise
Importance weighting
Engineering
Characteristics
Energyneeded
toclosedoor
Checkforce
onlevel
ground
Energyneeded
toopendoor
Waterresistance
6363 45 27 6 27
7
5
3
3
2
X
X
X
X
X
Correlation:Strong positivePositive
NegativeStrong negative
X*
Competitive evaluation
X = UsA = Comp. AB = Comp. B(5 is best)
1 2 3 4 5
X AB
X AB
XAB
A X B
X A B
Relationships:
Strong = 9
Medium = 3
Small = 1Target values
Reduceenergy
levelto7.5
ft/lb
Reduceforce
to9lb.
Reduceenergy
to7.5
ft/lb.
Maintain
currentlevel
Technical evaluation
(5 is best)
54321
B
A
X
BA
X B
A
X
B
X
A
BXABA
X
Doorseal
resistance
Accoust.
Trans.
Window
Maintain
currentlevel
Maintain
currentlevel
House of Quality ExampleFigure 4.5
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Operations Strategy
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1. Invest in R & D
2. Shift from short-term to long-term focus
3. Continuous Improvement
4. Increase emphasis on component
commonality5. Package products and services
6. Use multiple-use platforms
7. Consider tactics for mass customization
8. Look for continual improvement
9. Shorten time to market
Operations Strategy
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Shorten Time to Market
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Shorten Time to Market
1. Use standardized components2. Use technology
3. Use concurrent engineering