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Chapter 4

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Global Management Studies
GMS 401
Kirk Bailey

GMS 401 Chapter Four Notes Product Design Product design – determining the form and function of the product, products are redesigned to rejuvenate demand and to take advantage of new technology There are four elements that successful organizations include when creating new goods and services and delivering them to the consumers. They are the product approval committee, core teams, phase reviews and structured development process. Product approval committee – consists of top management and oversees and directs the design/developmental activities. It is also responsible for authorizing new products, reviewing their progress at certain stages of production, allocating resources across different projects, and ensuring consistency between company strategy and design/development projects. Core teams – cross functional teams empowered to plan and lead the design/developmental projects from idea to commercialization. This involves resoling issues and conflicts, making trade-off decisions, and directing other support staff. Core teams usually consist of a product manager, product designer and a manufacturing/operations representative. The team is expanded during each phase of design. Phase reviews – (sometimes referred to as stage gates) this is where the core teams decides to approve, cancel or redirect the project. Reviews help top management acquire a better understanding of the project and force closures on any problem that may arise in the future. Phase reviews result in recognizing the problems and making necessary changes earlier, reducing the cost of changes and time to market. The structured development process – the use of project management techniques. It involves breaking each phase into steps and each step into activities, determining their precedence relationships, scheduling and execution and control. The steps are critical and are planned and managed by the core team. PHASES OF PRODECT DESIGN 1. Idea generation and preliminary assessment Ideas come from customers’ feedback, research and development staff, suppliers and competitors. Preliminary assessment involves market, technical and financial evaluation. 2. Building a business case This involves learning about what customers want, determining the nature of the product and assessing its technical feasibility. You must also establish product goals and objectives, plan the nature of the production process and perform a complete financial analysis. 3. Development of product and process Translate the customer needs into THEIR physical product specifications such as product size, features and so on. Choose one concept and complete the design. Build product prototypes, test and revise the design if necessary. Design the production/service delivery process. Determine the machines and equipment you will need, the plant layout and possible work centre designs. 1 4. Testing and validation Perform external testing, finalize the product and process specifications and buy the machines and equipment and start trial runs. 5. Launch Introduce the final product Concurrent engineering – a team based approach of simultaneously designing the product and process Silo mentality – when each functional area performed its part of the design and “threw the work over the wall” to the next department in design. This often translated into late launches and costly design revisions. Ideas for new or improved goods and services can come from a wide range of sources, both within the organization and from outside it: front-line employees, the suppliers and purchasing function, customers and sales/marketing functions, competitors (through reverse engineering), and the research and development function. Reverse engineering – when a company purchases and takes apart a competitor’s product to discover what it is composed of and how the components work, with the attempt to improve their own product Research and development function – lab scientists and engineers involved in creative work on a systematic basis to increase knowledge directed toward product and process innovation Key Issues In Product Design 1. The Product Life Cycle Stage 1: Incubation – when the item is introduced, it may be treated as curiosity. Demand is low, still kinks in the product Stage 2: Growth – Design improvements usually create a more reliable and less costly product. Demand grows and awareness of product increases Stage 3: Maturity – there are few, if any, design changes and demand levels off Stage 4: Saturation – Saturation leads to a decline in demand Stage 5: Decline – companies attempt to prolong the useful life o
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