ATI 4614 Lecture Notes

Introduction to Products

• Definition: Products include both tangible goods and services.
• Examples: Insurance policies and mortgages are also considered products.

Module Overview

• Focus on product design and development.
• Development process starts with gathering customer/user requirements.
• Design specifications are created using various tools, techniques, and methods.
• Product lifecycle phases and their relation to operations management decisions will be discussed.

Case Study: Regal Marine

• Company located in Orlando, specializing in boating products.
• Utilizes global market and just-in-time strategies in production.
• Employs 3D CAD systems to:
  • Reduce product development time
  • Minimize tooling problems
  • Mitigate production issues
• Production based on a simple line approach.

Product Design Strategy

• Successful product design links product decisions with investment, market share, and product lifecycle.
• Objective: Develop and implement product strategies that meet market demand with a competitive advantage.

Key Product Strategies

1. Differentiation: Offer unique goods/services compared to competitors.
2. Cost Leadership: Compete by being the lowest cost provider.
3. Speed: Respond to customer needs faster than competitors.

• Note: Companies can mix strategies to achieve competitive advantage.

Product Lifecycle Phases

1. Introduction:

   • Product in design and development phase.
   • Higher costs than sales revenue at this stage.
   • Focus on research and testing.

2. Growth:

   • Product design is finalized.
   • Long production runs reduce costs and increase sales.
   • Revenue starts exceeding costs.

3. Maturity:

   • Little or no changes made; focus on marketing.

4. Decline:

   • Sales revenue decreases; demand fades.
   • Need to replace with new products.

Research and Development in New Products

• Importance of understanding customer needs and market conditions.
• Continuous development is key due to limited product life cycles.
• New product ideas often stem from users or lead users.

Factors Influencing Customer Needs

• Economic, sociological, demographic, technical, and political changes affect product demand.

Product Development Process

• Starts from idea generation to evaluation.
• Quality Function Deployment used to translate customer wants into design specifications.
  • Incorporates the House of Quality method to identify relationships between customer wants and product specifications.

Example: Camera Design for Great Cameras Incorporated

• Construct a House of Quality to summarize customer wants and design specifications.
• Importance ratings assigned to various features (e.g., lightweight, reliability).
• Identify and evaluate competitor products using technical attributes.

Team Approach to Product Development

• Shift from isolated departmental designs to cross-functional team approaches.
• Teams include representatives from various disciplines to improve efficiency.

Value Engineering and Design Improvement

• Focus on manufacturability and improving design specifications at early stages.
• Benefits include:
  • Reduced complexity and environmental impact.
  • Standardization of components.
  • Improved functionality, job design, and maintainability.

Case Study on Value Engineering

• Example of cost reduction in product design by changing materials and methods.
  • Initial cost: $3.50; reduced to $0.80 through new design choices.

Conclusion

• Importance of team collaboration in product development.
• Encourage questions or concerns through provided channels.