Operations

Management
Design of Goods
 Learning Objectives
1. Describe a product development
system
2. Build a house of quality
3. Describe how time-based competition
is implemented
4. Prepare the documents needed for
production
 Regal Marine
 Global market
 3-dimensional CAD system
 Reduced product development time
 Reduced problems with tooling
 Reduced problems in production
 Assembly line production
 JIT
Product-by-Value Analysis
 Lists products in descending
order of their individual dollar
contribution to the firm
 Lists the total annual dollar
contribution of the product
 Helps management evaluate
alternative strategies
Product-by-Value Analysis
Furniture Factory

Individual Total Annual

Contribution ($) Contribution ($)
Sofa Seat $102 $36,720
Arm Chair $87 $51,765
Foot Stool $12 $6,240
Recliner $136 $51,000
 Product Development
System
Ideas

Ability

Customer Requirements

Functional Specifications

Scope of Product Specifications Scope for

product design and
Design Review engineering
development teams
team Test Market

Introduction

Evaluation
The Design Process
 Design Thinking for Product
Design
1. Identifying the requirements
2. Development of the concept
3. Defining the scope
4. Engineering and risk analysis
5. Realizing the prototype
6. Testing, verification, validation, and quality control
7. Making the consumers realize the product’s value
8. Installation and commissioning
9. After-sales-service
10. Obtaining feedback for modification and retrofitment.
 Quality Function
Deployment
 Identify customer wants
 Identify how the good/service will satisfy
customer wants
 Relate customer wants to product hows
 Identify relationships between the firm’s hows
 Develop importance ratings
 Evaluate competing products
 Compare performance to desirable technical
attributes
QFD House of Quality
Interrelationships
Customer
importance
How to satisfy
ratings
customer wants

Competitive
assessment
What the Relationship
customer matrix
wants

Target values Weighted

rating
Technical
evaluation
 House of Quality Case
Solution
The design and development team
team was charged with designing a
new camera for Great Cameras, Inc.
The first action was
to construct a
House of Quality
 Interrelationships

House of Quality Example

How to Satisfy
Customer Wants

Competitors
Analysis of
What the
Relationship
Customer
Matrix
Wants

What the
Technical
Attributes and
Evaluation

customer
wants Customer
importance
rating
(5 = highest)
Lightweight 3
Easy to use 4
Reliable 5
Easy to hold steady 2
Color correction 1
 Interrelationships

House of Quality Example

How to Satisfy
Customer Wants

Competitors
Analysis of
What the
Relationship
Customer
Matrix
Wants

Technical
Low electricity requirements
Attributes and
Evaluation

Aluminum components

Ergonomic design
Auto exposure
How to Satisfy
Customer Wants
Paint pallet
Auto focus
 Interrelationships

House of Quality Example

How to Satisfy
Customer Wants

Competitors
Analysis of
What the
Relationship
Customer
Matrix
Wants

High relationship Technical

Attributes and
Evaluation

Medium relationship
Low relationship

Lightweight 3
Easy to use 4
Reliable 5
Easy to hold steady 2
Color corrections 1

Relationship matrix
 Interrelationships

House of Quality Example

How to Satisfy
Customer Wants

Competitors
Analysis of
What the
Relationship
Customer
Matrix
Wants

Technical
Attributes and
Evaluation

Low electricity requirements

Relationships
between the
things we can do

Aluminum components

Ergonomic design
Auto exposure

Paint pallet
Auto focus
 Interrelationships

House of Quality Example

How to Satisfy
Customer Wants

Competitors
Analysis of
What the
Relationship
Customer
Matrix
Wants

Technical
Attributes and
Evaluation

Lightweight 3
Easy to use 4
Reliable 5
Easy to hold steady 2
Color corrections 1
Our importance ratings 22 9 27 27 32 25

Weighted
rating
 Interrelationships

How to Satisfy
Customer Wants

House of Quality Example

Competitors
Analysis of
What the
Relationship
Customer
Matrix
Wants

Technical
Attributes and

Company A

Company B
Evaluation

How well do
competing products
meet customer wants

Lightweight 3 G P
Easy to use 4 G P
Reliable 5 F G
Easy to hold steady 2 G P
Color corrections 1 P P
Our importance ratings 22 5
 Interrelationships

How to Satisfy
Customer Wants

House of Quality Example

Competitors
Analysis of
What the
Relationship
Customer
Matrix
Wants

Technical
Attributes and
Evaluation

Failure 1 per 10,000

Panel ranking
Target
values

2 circuits
(Technical

2’ to ∞
attributes)

0.5 A

75%
Company A 0.7 60% yes 1 ok G
Technical
evaluation Company B 0.6 50% yes 2 ok F
Us 0.5 75% yes 2 ok G
House of Quality Example

Low electricity requirements

Aluminum components

Ergonomic design
Auto exposure

Company A

Company B
Paint pallet
Auto focus
Completed
House of Lightweight
Easy to use
3
4
G P
G P

Quality Reliable
Easy to hold steady 2
5 F G
G P
Color correction 1 P P
Our importance ratings 22 9 27 27 32 25

Failure 1 per 10,000

Panel ranking
Target values
(Technical
attributes)

2 circuits
2’ to ∞
0.5 A
75%
Company A 0.7 60% yes 1 ok G
Technical
evaluation Company B 0.6 50% yes 2 ok F
Us 0.5 75% yes 2 ok G
 House of Quality Sequence
Deploying resources through the
organization in response to
customer requirements

Quality
plan
Production
process

Production
Specific
House

process
components

components
House 4

Specific
Design
characteristics

characteristics
3
House
Design

2
requirements
Customer

House
1
UPCOMING SLIDES only for
READING

• NOT in END TERM Syllabus

 Organizing for Product
Development
 Historically – distinct departments
 Duties and responsibilities are defined
 Difficult to foster forward thinking
 A Champion
 Product manager drives the product
through the product development
system and related organizations
 Organizing for Product
Development
 Team approach
 Cross functional – representatives
from all disciplines or functions
 Product development teams, design
for manufacturability teams, value
engineering teams
 Japanese “whole organization”
approach
 No organizational divisions
 Manufacturability and
Value Engineering
 Benefits:
1. Reduced complexity of products
2. Additional standardization of products
3. Improved functional aspects of product
4. Improved job design and job safety
5. Improved maintainability (serviceability)
of the product
6. Robust design
Cost Reduction of a Bracket
via Value Engineering
 Time-Based Competition

 Product life cycles are becoming

shorter and the rate of
technological change is
increasing
 Developing new products faster
can result in a competitive
advantage
 Product Development
Continuum
External Development Strategies
Alliances
Joint ventures
Purchase technology or expertise
by acquiring the developer

Internal Development Strategies

Migrations of existing products
Enhancements to existing products
New internally developed products

Internal Cost of product development Shared

Lengthy Speed of product development Rapid and/
or Existing
High Risk of product development Shared
 Acquiring Technology
 By Purchasing a Firm
 Speeds development
 Issues concern the fit between the acquired
organization and product and the host
 Through Joint Ventures
 Both organizations learn
 Risks are shared
 Through Alliances
 Cooperative agreements between
independent organizations
 Defining The Product
 First definition is in terms of
functions
 Rigorous specifications are
developed during the design phase
 Manufactured products will have an
engineering drawing
 Bill of material (BOM) lists the
components of a product
 Product Documents
 Engineering drawing
 Shows dimensions, tolerances, and
materials
 Shows codes for Group Technology
 Bill of Material
 Lists components, quantities and
where used
 Shows product structure
 Monterey Jack Cheese
(a) U.S. grade AA. Monterey cheese shall conform to the
following requirements:
(1) Flavor. Is fine and highly pleasing, free from undesirable
flavors and odors. May possess a very slight acid or feed
flavor.
(2) Body and texture. A plug drawn from the cheese shall be
reasonably firm. It shall have numerous small mechanical
openings evenly distributed throughout the plug. It shall not
possess sweet holes, yeast holes, or other gas holes.
(3) Color. Shall have a natural, uniform, bright and attractive
appearance.
(4) Finish and appearance - bandaged and paraffin-dipped .
The rind shall be sound, firm, and smooth providing a good
protection to the cheese.
Code of Federal Regulation, Parts 53 to 109,
General Service Administration
Engineering Drawings
 Bills of Material
BOM for Panel Weldment
NUMBER DESCRIPTION QTY
A 60-71 PANEL WELDM’T 1
A 60-7 LOWER ROLLER ASSM. 1
R 60-17 ROLLER 1
R 60-428 PIN 1
P 60-2 LOCKNUT 1
A 60-72 GUIDE ASSM. REAR 1
R 60-57-1 SUPPORT ANGLE 1
A 60-4 ROLLER ASSM. 1
02-50-1150 BOLT 1
A 60-73 GUIDE ASSM. FRONT 1
A 60-74 SUPPORT WELDM’T 1
R 60-99 WEAR PLATE 1
02-50-1150 BOLT 1
 Bills of Material
DESCRIPTION QTY
Hard Rock
Bun 1
Cafe’s Hickory Hamburger patty 8 oz.
BBQ Bacon Cheddar cheese 2 slices
Cheeseburger Bacon 2 strips
BBQ onions 1/2 cup
Hickory BBQ sauce 1 oz.
Burger set
Lettuce 1 leaf
Tomato 1 slice
Red onion 4 rings
Pickle 1 slice
French fries 5 oz.
Seasoned salt 1 tsp.
11-inch plate 1
HRC flag 1
 Group Technology
 Parts grouped into families with
similar characteristics
 Coding system describes
processing and physical
characteristics
 Part families can be produced
in dedicated manufacturing cells
Group Technology Scheme
(b) Grouped Cylindrical Parts (families of parts)
(a) Ungrouped Parts
Grooved Slotted Threaded Drilled Machined
Group Technology Benefits
1. Improved design
2. Reduced raw material and purchases
3. Simplified production planning and
control
4. Improved layout, routing, and
machine loading
5. Reduced tooling setup time, work-in-
process, and production time
Documents for Production

 Assembly drawing
 Assembly chart
 Route sheet
 Work order
 Engineering change notices (ECNs)
 Assembly Drawing

 Shows exploded
view of product
 Details relative
locations to
show how to
assemble the
product
 Assembly Chart
R 209 Angle
1
Left
R 207 Angle SA bracket
2 A1
Bolts w/nuts (2)
1 assembly Identifies the point
3 of production
R 209 Angle
4
Right
where components
5
R 207 Angle SA bracket
2 assembly
A2 flow into
6
Bolts w/nuts (2) subassemblies and
Bolt w/nut ultimately into the
7
R 404 Roller final product
8 A3
Lock washer Poka-yoke
9 inspection
Part number tag
10 A4
Box w/packing material
11 A5
 Route Sheet
Lists the operations and times required
to produce a component
Setup Operation
Process Machine Operations Time Time/Unit
1 Auto Insert 2 Insert Component 1.5 .4
Set 56
2 Manual Insert Component .5 2.3
Insert 1 Set 12C
3 Wave Solder Solder all 1.5 4.1
components
to board
4 Test 4 Circuit integrity .25 .5
test 4GY
 Work Order
Instructions to produce a given quantity
of a particular item, usually to a schedule

Work Order
Item Quantity Start Date Due Date
157C 125 5/2/08 5/4/08

Production Delivery
Dept Location
F32 Dept K11
Engineering Change Notice
(ECN)
 A correction or modification to a
product’s definition or
documentation
 Engineering drawings
 Bill of material

Quite common with long product life

cycles, long manufacturing lead times, or
rapidly changing technologies
Configuration Management

 The need to manage ECNs has led

to the development of configuration
management systems
 A product’s planned and changing
components are accurately
identified and control and
accountability for change are
identified and maintained
 Transition to Production
 Know when to move to production
 Product development can be viewed as
evolutionary and never complete
 Product must move from design to
production in a timely manner
 Most products have a trial production
period to insure producibility
 Develop tooling, quality control, training
 Ensures successful production
 Transition to Production
 Responsibility must also transition as the
product moves through its life cycle
 Line management takes over from design
 Three common approaches to managing
transition
 Project managers
 Product development teams
 Integrate product development and
manufacturing organizations