Om Mid Term Syllabus: Analysis Design

OM Mid Term SYLLABUS
1. Introduction to OM
2. Operations Strategy & Competitiveness
3. Manufacturing Process Selection & Analysis
4. Service Process Selection & Design
5. Product Design 6/7 Nov
6. Project Mgt 13/14 Nov

7. Facility Location 20/21 Nov
8. Facility Layout
QUIZ on 27/28 Nov

New Product Design
Designing Products for Mfr,Assy & Logistics

AGENDA
• DESIGNING FOR CUSTOMER…NPD
• QFD
• VALUE ANALYSIS & VALUE ENGINEERING
• DESIGNING PRODUCTS FOR MFR, ASSY & LOGISTICS.

INNOVATION
Implementation of a new or significantly

improved product or a process,
a new marketing method,
or a new organizational method in
business practices, workplace organization or
external relation.
Minimum requirement for an Innovation…..
Product or process MUST be NEW or a
MUST be a SIGNIFICANT improvement

PRODUCT DEVELOPMENT
Product development is a strategy

that seeks increased sales by
improving or modifying present
products or services.
Innovation Journey: idealized
Energy, enthusiasm,
results Big rewards
Ownership
& go ahead
Team unity
Glimpses of
brilliance
Vision
emerges
Excitement:
people jump in
Realize the
need for
innovation
Encouraging Innovation
The following questions offer a practical starting point for many
executives and boards:
• Are we encouraging employees to pursue new ideas and

opportunities?
• What are the best approaches—from corporate venture capital to

accelerators—to propel our innovation strategy?
• Do we employ enough approaches to constitute a diverse

portfolio? Are those approaches aligned with clear objectives?
• Are we enabling and supporting failure in our organization?
• Who are our EPIC leaders?

Causes of New Product Failures
1..Overestimation of Market Size
2..Product Design Problems
3..Product Incorrectly Positioned, Priced or Advertised
4..Costs of Product Development
5..Competitive Actions
To create successful new products, the company must:

………..understand it’s customers, markets and competitors
…………develop products that deliver superior value to customers.
NPD
Marketing Legal
C
U
S
T R&D
O
M
E Operations
R SCM
S
Enterprise
To satisfy
customers
A Few NPD Processes………
• CONVENTIONAL NPD PROCESS
• JAPANESE UMEZAWA PROCESS
• PROF RAM CHARAN SOCIAL INNOV PROCESS
• McKinsey FLEXIBLE INNOV PROCESS
• Monitor Deloitte DOBLIN PROCESS
• NPD based on MASLOW’s NEED HIERARCHY (BAIN)

CONVENTIONAL NPD PROCESS
7 Step New Product Development
Process
• Idea Generation and Screening

• Concept Development and Testing
• Marketing Strategy
• Business Analysis
• Product Development
• Test Marketing
• Commercialization
New
New Product
Product Development
Development Process
Process
Step
Step 1a.
1a. Idea
Idea Generation
Generation
• Systematic Search for New Product

Ideas
• Internal sources
• Customers
• Competitors
• Distributors
• Suppliers
New Product Development Process
Step 1b. Idea Screening
Process to spot good ideas and drop poor ones
Criteria
Market Size
Product Price
Development Time & Costs
Manufacturing Costs
Rate of Return
3.
3. Choose
Choosethe
theBest
BestOne
One
2.
2. Concept
ConceptTesting
Testing--Test
Testthe
the
Product
ProductConcepts
Conceptswith
withGroups
Groups
of
ofTarget
TargetCustomers
Customers
1.
1. Develop
DevelopProduct
ProductIdeas
Ideasinto
into
Alternative
Alternative
Product
ProductConcepts
Concepts
Step 2.
Step Concept Development
2. Concept Testing
& Testing
Development &
Product Development
New Product
New Process
Development Process
New
New Product
Product Development
Development Process
Process
Step
Step 3.
3. Marketing
Marketing Strategy
Strategy Development
Development
Marketing Strategy Statement Formulation
Part
Part One
One -- Overall:
Overall:
Target
Target Market
Market
Planned
Planned Product
Product Positioning
Positioning
Sales
Sales &
& Profit
Profit Goals
Goals
Market
Market Share
Share
Part
Part Two
Two -- Short-Term:
Short-Term:
Product’s
Product’s Planned
Planned Price
Price
Distribution
Distribution
Marketing
Marketing Budget
Budget
Part
Part Three
Three -- Long-Term:
Long-Term:
Sales
Sales &
& Profit
Profit Goals
Goals
Marketing
Marketing Mix
Mix Strategy
Strategy
IfIfYes,
Yes,Move
Moveto
to
Product
ProductDevelopment
Development
IfIfNo,
No,Eliminate
Eliminate
Product
ProductConcept
Concept
Business
BusinessAnalysis
Analysis
Review
ReviewofofProduct
ProductSales,
Sales,Costs,
Costs,
and
andProfits
ProfitsProjections
Projectionsto
toSee
Seeifif
They
TheyMeet
MeetCompany
CompanyObjectives
Objectives
5. Product
Step 5.
Step Development
Product Development
4. Business
Step 4.
Step Analysis
Business Analysis
Product Development
New Product
New Process
Development Process
New
New Product
Product Development
Development Process
Process
Step
Step 6.
6. Test
Test Marketing
Marketing
Standard
Standard Controlled
Test Controlled
Test Market
Market Test
Test Market
Market
Full
Fullmarketing
marketingcampaign AAfew
in
campaign fewstores
storesthat
thathave
have
in a small numberof
a small number of agreed
agreedto
tocarry
carrynew
new
representative cities. products
representative cities. productsfor
foraafee.
fee.
Simulated
Simulated
Test
Test Market
Market
Test
Testin
inaasimulated
simulated
shopping
shoppingenvironment
environment
to
toaasample
sampleofof
consumers.
consumers.
Step 7. Commercialisation
Japanese…Umezawa Process
( Unmet need..Concept test..Product test…CP test )
Group formed for ideating on unmet need around certain product category eg shampoo
(Brainstorming Japanese way & short listing ideas)
Shortlisted idea eg cooling shampoo
Develop concept card C
Test C
If > 80% top 2 boxes on likeability………..develop product prototype P
Test P
Test C+P…..If top 2 boxes > 80%....go ahead, else change
Also used for improving and existing poor performing product.

Process
• Idea Generation and Screening E D
N E
ET
NM
U
• Test Marketing
INNOVATION
Prof. Ram Charan

Context
We need to do following things simultaneously for world leadership:
1. Focus on both- Users and Customers
2. Innovation is must- Innovate/Die

a) Improve your competitive advantage
b) Can create new need/segment
c) Gives you price power
4. Make money for yourself. Market share and revenue
5. Ability to make acquisition – Probably innovation acquisition
We must have Disciplined manner of innovation.
Social process of innovation continue with singles and

doubles and do not wait for homeruns
Central elements of social process
Selecting right leader for team
Selection of diverse team- Include outside expert
How they conduct dialogue, listening, look for options, not
giving up on goal
Full time and co-location. Break-thru comes from
total immersion
Simultaneous dialogue, not sequential for speed and
creativity
Senior team needs to interact with Innovation team at more
frequency. Ask two questions:
1. What hurdles team is facing

2. What help team needs
Social pattern of Innovation
Step-1 Step-2 Step-3 Step-4
Idea generation Small team(3/4). May Selection of team Top team interaction
has to be one pager include outsider and team leader. with
right frequency of interaction
1.Who is 1.What are
impossible / near
Outside expertise
user/customer can be team No-Go decision, if required.
impossible
2.What help or pain
member.
hurdles the idea
points the idea will face Proof of concept
will need to Everyone is full
address 2.This team will not timer. Finalization of person who is
solve the problems. accountable for “GO TO MKT”
3.What change the Only enlist
user/customer will
Total immersion is
have to make the principal for this -Budget
3.Timeline- 3-4 -Capital Investment
weeks not months.
team.
-Testing with BOSS
4.Price/ cost points
(User/customers)
4.Team will be -Look for negatives
5.Differentiation in changed later
market
RAM CHARAN
Process
d e
• Idea Generation and Screening t si
O u
e r t s
l v
o xp e
Inv E
• Test Marketing
Flexible Information based approach for Innovation
(McKinsey)
Radical Change in Approach
Product Development facing a fundamental challenge.
Most companies under pressure to bring new products/services

to market more quickly.
Unfortunately, at the very moment when companies need to make

better products more efficiently, previous performance innovations
in product development have hit a plateau……std NPD process with
disciplined timelines, strict design reviews, “gates” to decision making,
and cross functional development teams.
Need of the hour….A way of raising product development to a new level.

Some companies have done exactly that…reduced time to launch new products
while dramatically raising sales of new products and their market share.
They have turned a linear sequential process into a flexible one that reacts to
information continually rather than at intervals and in batches,
They keep their product options open longer than most of their rivals and ca
act on new information about customers, suppliers, and production capabilities
later in the development process.
The teams solve problems and synthesize new information continually

instead of merely collecting bits of info from various functions and compiling the results
just before gate meetings.
Decisions are made when all options have been understood fully, not at rigidly
scheduled meetings that open the gate to the next stage.
Companies adopting the new approach appoint senior managers from Marketing
R&D and Operations to lead cross functional teams in hopes of getting the
three key disciplines to work together from the start.
Typically, one of them is first among equals and ultimately leads the project.
Such Companies set their performance targets and conduct management review
meetings, much as they do in a conventional process. The difference is that they
reach decision gates when criteria are met, not when a given amount of time has
Passed.
Flexible information-based approach
Continuous synthesis of findings Design iteration Management review
Internet-based Features prior- Marketing Alternatives ex- Business forecast

survey conduct- tized with repeated insights com- plored,expanded from customer Features, cost/ Market data used
ed to confirm web based conjoint -municated to by Marketing,R&D evaluations of quality trade-offs to set quality &
unmet needs analysis subteams & Operations e-prototypes considered daily reliability targets
Concept
Feasibility
Customer needs/ confirmed
design features
work flow
Cost work flow

c
Reliability
work flow
Target feature Cost of features Targets for cost & Feasibility of Options for Manufactur- Risk of not
set established extrapolated from quality commu- alternatives features vs cost -ability evaluated meeting targets
historical data nicated to subteams quantified by shared with by Suppliers, quantified
life cycle cost customers Operations
Process
• Idea Generation and Screening

fo
• Business Analysis in
ew
• Product Development n
e ly
i z
s us
• Test Marketing e
h uo
t
n n
y
• Commercialization S onti
c
Monitor Delloite …DOBLIN
Defining Innovation
Which is different To our market

than invention or the world
Innovation is the creation of a new,

viable business offering.
Creating value for Ideally going beyond products to

our customers and platforms, business models, and
for our enterprise customer experiences
How leaders can bring discipline to their
innovation challenges
1. Think holistically
Go beyond product to integrate multiple types of innovation
2. Focus on fewer, bolder ideas

Foster the courage to set a high ambition level
3. Be genuinely curious about customers

Understand the context of customers’ lives, beliefs, attitudes, and values
4. Look beyond your industry for ideas

Learn from precursors and borrow strategically
How leaders can bring discipline to their
innovation challenges
5. Challenge conventional wisdom

Make orthodoxies explicit so that they can be selectively over-turned
6. Resist premature problem solving

The answer is rarely “out there” to be discovered, it must be developed
7. Build to learn
Commit to protoyping and piloting to get the offering right
Design a vase
You have one minute to put your idea to paper

Exercise: Context and framing
Design a vase for people to

enjoy flowers in the home
Again, you have one minute………
TEN TYPES OF INNOVATION
(DOBLIN)
How you use How you create How you deliver

How you connect with superior complementary your offering to How you foster
others to create value methods products/services your customers distinctive interactions
Profit Network Structure Process Product Product Service Channel Brand Customer
Model Perf. System Engagement
CONFIGURATION OFFERING EXPERIENCE
How you How you align How you use How you support How you represent
make money your talent/assets distinct & enhance value of your offering
features your offering
Process
• Idea Generation and Screening K LY
IN AL
TH TIC
L IS
HO
• Test Marketing
Maslow’s Hierarchy of Needs
NEED
SELF-
ACTUALIZATION
ESTEEM NEEDS
LOVE, AFFECTION, AND

BELONGINGNESS NEEDS
SAFETY NEEDS
PHYSIOLOGICAL OR SURVIVAL NEEDS

How do customers evaluate a product?
They weigh its perceived value against the price
SOCIAL IMPACT
Self
transcendence
LIFE CHANGING Provides Self
hope actualisation
Motivation Heirloom Affiliation/
belonging
EMOTIONAL
Reduces Rewards Nostalgia Design/ Badge
Anxiety me aesthetics value
Wellness Therapeutic Fun/ Attractiveness Provides

Value entertainment access
FUNCTIONAL
Saves Simplifies Makes Reduces Organises Integrates Connects
time money risk
Reduces Avoids Reduces Quality Variety Sensory Informs

effort hassles cost appeal
In general, the more elements provided, the greater customers’

loyalty and higher the company’s sustained growth
I Phone
SOCIAL IMPACT
Self
transcendence
hope actualisation
Motivation Heirloom Affiliation/
belonging
EMOTIONAL Design/
Reduces Rewards Nostalgia Badge
Anxiety me aesthetics Value
Wellness Therapeutic Value Fun/ Attractiveness Provides

entertainment access
FUNCTIONAL
Saves Simplifies Makes Reduces Organises Integrates Connects
time money risk


SOURCE @2015 Bain & Co Inc
FROM “The Elements of Value”, Sept 2016
SOCIAL IMPACT
Self
transcendence
?
hope actualisation
b er
Motivation Heirloom
8
Affiliation/
num
# s he
belonging
e
K
S ct u
l et
A a
EMOTIONAL P T du d v
e as
Reduces
O p ro eive iDesign/
Rewards U Nostalgia
ncr Badge
Anxiety R t c
G es er t to aesthetics value
me
s b f p uc
Wellness Therapeutic
’
o nt oFun/od Attractiveness Provides
C
r entertainment
e r
Value u
o tm in p access
y fi s
le ct a ge
o n
FUNCTIONAL Se d d cha
An hMakes
Saves Simplifies at Reduces Organises Itegrates Connects
time W money risk


SOURCE @2015 Bain & Co Inc
FROM “The Elements of Value”, Sept 2016
Process a l s
e r d
ev ee
• Idea Generation and Screening s
s ca l n
s
e hi
r
d rc
d
A era
hi
• Test Marketing
NPD…for Customer
• Seven step stage Gate Process
• Japanese Umezawa………Unmet Need

• Ram Charan………………….Social Process
• McKinsey………………………Flexible Approach
• Doblin…………………………..Holistic Approach
• Maslow………………………..Address several
hierarchical needs
NPD following any of the described
processes will be multi-functional….
Corp.Affairs External experts
Marketing Legal
C
U
S
T R&D
O
M
E Operations
R SCM
S Consultants Finance
Enterprise
To satisfy
customers
CROSS INDUSTRY INNOVATIONS
Restaurant meets airport
This ‘take what you want’ Shushi bar uses the baggage carousel system from airports.

Mc Donald’s meets Formula 1
The Drive Thru concept is based on the principles of a fast Formula 1 pit stop.

Eggs meets wine
Molded pulp is a great and cheap way to protect a product. It can be applied to
protect many other breakable products. Wine for instance.
Transport meets nature
The kingfisher’s beak became the model for the nose cone of Japan’s 500 Series
Shinkansen bullet train (more aerodynamic – less noise).
DISRUPTIVE TECHNOLOGIES
• Transportation……..From no cars in 1900 to only cars in 1913 in NYC
• Communication………From only to only
………From to
• Hospitality…………...From hotels to Airbnb
• Transportation……..From kali/peeli to Uber/Ola
……..From to
…….From ICE vehicles to Electric vehicles (18K moving parts to just 18)
….…. From car ownership to car sharing

Car-as-a Service
• Mobility on Demand/ Car-as-a service
• Self-Driving Cars tech with

• Car/Ride sharing biz model
Asset Utilisation
4% 80-90%
Car-as-a Service

• Cars go from parking ~90% of time to driving ~90+% of time.
• Cost/mile – 10X cheaper than car ownership
Asset Utilisation
4% 80-90%
Car-as-a Service: The End of Car Ownership

• Cars go from parking ~90% of time to driving ~90+% of time. (Parking obsolete)
• Cost/mile – 10X cheaper than car ownership
• We’ll need ~80% fewer cars and ~80+% fewer parking spots
Asset Utilisation
4% 80-90%
( End of car ownership in developed countries by 2030)

AGENDA
 DESIGNING FOR CUSTOMER…NPD
• QFD

Quality
Function Deployment
(QFD)
Outline
• Introduction
• QFD Team
• Benefits Of QFD
• Voice Of The Customer
• House Of Quality
• Building A House Of Quality
• QFD Process
• Summary
Introduction
• Dr. Mizuno, Prof. Emeritus
• Mitsubishi Heavy Industries
– Kobe Shipyards, 1972
• Toyota Minivans (1977 Base)
– 1979 - 20% Reduction In Start-Up Costs
– 1982 - 38%
– 1984 - 61%
• Dr. Clausing, Xerox, 1984
• Any Manufacturing Or Service Industry
QFD Team
• Significant Amount Of Time
– Communication
• Two Types Of Teams
– New Product
– Improve Existing Product
• Marketing, Design, Quality, Finance,
Production, etc.
Benefits Of QFD
• Customer Driven
• Reduces Implementation Time
• Promotes Teamwork
• Provides Documentation
Customer Driven
• Creates Focus On Customer Requirements

• Uses Competitive Information Effectively
• Prioritizes Resources
• Identifies Items That Can Be Acted On
• Structures Resident Experience/Information
Customer Driven
Reduces Impl time
Promotes teamwork
Provides documentation
Reduces Implementation Time
• Decreases Midstream Design Change
• Limits Post Introduction Problems
• Avoids Future Development Redundancies
• Identifies Future Application Opportunities
• Surfaces Missing Assumptions
Customer Driven
Reduces Impl time
Promotes teamwork
Promotes Teamwork
• Based On Consensus
• Creates Communication At Interfaces
• Identifies Actions At Interfaces
• Creates Global View-Out Of Details
Customer Driven
Reduces Impl time
Promotes teamwork
Provides Documentation
• Documents Rationale For Design

• Is Easy To Assimilate
• Adds Structure To The Information
• Adapts To Changes (Living Document)
• Provides Framework For Sensitivity Analysis
Customer Driven
Reduces Impl time
Promotes teamwork
VOC
• Driving Force Behind QFD
– Customer Dictates Attributes Of Product
• Customer Satisfaction
– Meeting Or Exceeding Customer Expectations
– Customer Expectations Can Be Vague & General In
Nature
– Customer Expectations Must Be Taken Literally, Not
Translated Into What The Organization Desires
Collecting Customer
Information
• What Does Customer Really Want ?

• What Are Customer’s Expectations ?
• Are Customer’s Expectations Used To Drive
Design Process ?
• What Can Design Team Do To Achieve
Customer Satisfaction?
Types Of Customer Information
• Solicited, Measurable, Routine
– Cus. & Market Surveys, Trade Trials
• Unsolicited, Measurable, Routine
– Customer Complaints, Lawsuits
• Solicited, Subjective, Routine
– Focus Groups
• Solicited, Subjective, Haphazard
– Trade & Cus. Visits, Indep. Consultants
• Unsolicited, Subjective, Haphazard
– Conventions, Vendors, Suppliers
House of Quality Sequence
Deploying resources through the
organization in response to customer
requirements
Quality
plan
Production
process
Production
Specific
House 4
process
components
components
House 3
Specific
Design
characteristics
characteristics
House 2
Design
requirements
Customer
House 1
SEVEN STEP
Quality Function Deployment

1. Identify customer wants (WHAT)
2. Identify HOW the good/service will satisfy customer
wants
3. Relate customer wants to product how’s
4. Identify relationships between the product how’s
(Least used room in the House of Quality; however, this room is a big help to the design
engineers in the next phase of a comprehensive QFD project. Team members must
examine how each of the technical descriptors impact each other. The team should
document strong negative relationships between technical descriptors and work to
eliminate physical contradictions.)
SEVEN STEP
Quality Function Deployment

1. Identify customer wants
2. Identify how the good/service will satisfy
customer wants
3. Relate customer wants to product how’s
4. Identify relationships between the product how’s
5. Develop importance ratings
6. Evaluate competing products
7. Compare performance to desirable technical
attributes
QFD House of Quality
Interrelationship of how’s:
Strong Positive
Med. Poditive
Strong negative
Med. Negative
Tec Competitive
Imp h. p Evaluation
orta ara How to satisfy X=Us
nce me
to c ters
usto customer wants A=Comp 1
B=Comp2
Customer Reqts mer 1 2 3 4 5
Relationship
matrix
Importance Weighting
Importance scale:
Target values Strong =3
Medium =2
Small =1
Technical
A
evaluation B
X
House of Quality Example
Your team has been charged with designing

a new camera for Great Cameras, Inc.
The first action is
to construct a
House of Quality
Strong Positive
Med. Poditive
Step 1..Identify WHAT customer wants Strong negative
Med. Negative
Tec Competitive
Imp h. p Evaluation
orta ara How to satisfy X=Us
nce me
to c ters
usto customer wants A=Comp 1
B=Comp2
Light Weight 3
Easy to Use 4 Relationship
Reliable 5 matrix
Color Correction 1
Importance scale:
Target values Strong =3
Medium =2
Small =1
Technical
A
evaluation B
X
Strong Positive
Med. Positive
Step 2..How to satisfy customer wants Strong Negative
Med. Negative
Competitive
Alum Comp
Ergo Design
Tec
Paint Pallet
Auto Focus
Imp h. p Evaluation
orta ara X=Us
nce me
to c ters A=Comp 1
usto
B=Comp2
Light Weight 3
Reliable 5 matrix
Color Correction 1
Importance scale:
Target values High =3
Medium =2
Low =1
Technical
A
evaluation B
X
Strong Positive
Step 3..Relate customer wants Med. Positive
Strong Negative
to Product How’s Med. Negative
Competitive
Alum Comp
Ergo Design
Tec
Paint Pallet
Auto Focus
Imp h. p Evaluation
orta ara X=Us
nce me
to c ters A=Comp 1
usto
B=Comp2
Light Weight 3 H
Easy to Use 4 L H Relationship
H
Reliable 5 M matrix
Color Correction 1 H
Importance scale:
Medium =2
Low =1
Technical
A
evaluation B
X
Strong Positive
Med. Positive
Step 4..Identify relationship between
Strong Negative
product how’s SP Med. Negative
Competitive
Alum Comp
Ergo Design
Tec
Paint Pallet
Auto Focus
Imp h. p Evaluation
orta ara X=Us
nce me
to c ters A=Comp 1
usto
B=Comp2
Light Weight 3
Reliable 5 matrix
Color Correction 1
Importance scale:
Medium =2
Low =1
Technical
A
evaluation B
X
Identify relationship between
product how’s
4. Identify relationships
between the product
how’s
(Least used room in the House of Quality;
however, this room is a big help to the
design engineers in the next phase of a
comprehensive QFD project. Team
members must examine how each of the
technical descriptors impact each other.
The team should document strong
negative relationships between technical
descriptors and work to eliminate
physical contradictions.)
Interrelationship:
Strong Positive
Med. Positive
Step 5..Develop importance ratings Strong Negative
Med. Negative
Competitive
Alum Comp
Ergo Design
Tec
Paint Pallet
Auto Focus
Imp h. p Evaluation
orta ara X=Us
nce me
to c ters A=Comp 1
usto
B=Comp2
Light Weight 3 H
H
Reliable 5 M matrix
Importance Weighting 13 22 3 12
Importance scale:
Medium =2
Low =1
Technical
A
evaluation B
X
Interrelationship:
Strong Positive
Med. Positive
Step 5..Develop importance ratings Strong Negative
and target values Med. Negative
Competitive
Alum Comp
Ergo Design
Tec
Paint Pallet
Auto Focus
Imp h. p Evaluation
orta ara X=Us
nce me
to c ters A=Comp 1
usto
B=Comp2
Light Weight 3 H
H
Reliable 5 M matrix
Importance Weighting 13 22 3
Fail 1/10K
12
Panel Rat
2’ to Inf.
Importance scale:
75% Al

Medium =2
Low =1
Technical A
evaluation B
X
Interrelationship:
Strong Positive
Med. Positive
Step 6..Evaluate competing products Strong Negative
Med. Negative
Competitive
Alum Comp
Ergo Design
Tec
Paint Pallet
Auto Focus
Imp h. p Evaluation
orta ara X=Us
nce me
to c ters A=Comp 1
usto
B=Comp2
Light Weight 3 H
H
Reliable 5 M matrix
Fail 1/10K
12
Panel Rat
2’ to Inf.
Importance scale:
75% Al

Medium =2
Low =1
Technical A
evaluation B
X
Evaluate competing products
Interrelationship:
Strong Positive
Med. Positive
Step 7.. .Compare performance to Strong Negative
desirable technical attributes Med. Negative
Competitive
Ergo Design
Tec
One touch click
Paint Pallet
Auto Focus
Imp h. p Evaluation
orta ara X=Us
nce me
to c ters A=Comp 1
usto
B=Comp2
Customer Reqts mer 1 2 3 4
5
Product Availability 3 H
Delivery Time 4 L H Relationship
H
Reverse Pick-up 5 M matrix
Delivery Distance 1 H
Fail 1/10K
12
Panel Rat
2’ to Inf.
Importance scale:
75% Al

Medium =2
Low =1
Technical A
evaluation B
X
Compare performance to
desirable technical attributes
# 8 Interrelationship:
T Strong Positive
S
RK Y AS E
Med. Positive
N L E U R
Strong Negative
O PA AT ATMed. Negative
W M H FE Competitive
Imp
orta
Tec
U Ph. p
ara CO T
How Ito satisfy CT
Evaluation
O
nce
to c me
U R
ters W wants
customer U X=Us
R usto
O T Y O D A=Comp 1
Customer Reqts mer
G Y L I R
B=Comp2
1 2 3 4
O F A P 5
T Q U 4
C F N D
D U O Relationship
A matrix
O S E R S
P R U TE
A H O E
CK E A M
PI TH
R
A
I LDTarget valuesY P Importance scale:
BU L IT Strong =3
Medium =2
U A A Small =1
Q
Technical
4 evaluation B
X
AGENDA
 QFD

Value Analysis and Value Engg.
Value Engineering
Value Engineering (VE) is concerned with new products & applied during product development.
The focus is on reducing costs, improving function or both, based product evaluation and analysis
This takes place before any capital is invested in tooling, plant or equipment.
This is very significant, because according to many reports, up to 80% of a product’s costs
(throughout the rest of its life-cycle), are locked in at the design development stage.
Therefore value engineering should be considered a crucial activity late on in the product
development process and is certainly a wise commercial investment.
It is strongly recommended you build value engineering into your new product development
process, to make it more robust and for sound commercial reasons.
Value Analysis and Value Engg.
Value Analysis
Value Analysis (VA) is concerned with existing products.
It involves a current product being analysed and evaluated to reduce costs,

improve product function or both.
Value Analysis exercises use a plan which step-by-step, methodically evaluates the
product in a range of areas. These include costs, function, alternative components and design
aspects such as ease of manufacture and assembly.
A significant part of VA is a technique called Functional Analysis, where the product is broken
down and reviewed as a number of assemblies. Here, the function is identified and defined for
each product assembly. Costs are also assigned to each one. This is assisted by designing and
viewing products as assemblies (or modules). As with VE, VA is a group activity that involves
brainstorming improvements and alternatives to improve the value of the product, particular
to the customer.

Many refer to Value Management or VAVE as an umbrella term, which encompasses
value engineering and value analysis.
Reasons for Value Analysing Existing
Products
The majority of our learning so far was geared towards New Product
Development and New Product Introduction. In contrast to this, VA is
based upon products you already sell.
On the face of it, the reasons for value analysing existing products may
seem obvious.
1)VA reduces costs (in all areas such as materials, parts and production),
as well as improving product function. Therefore, the value of the
product is increased to the customer.
2)Reducing the cost of products increases revenue and profit per

product. Therefore, giving your company the option of reducing price
to sell more or investing in R&D.
Reasons for Value Analysing Existing Products
3)VA enables improvements to be made to the product in a variety of areas,

such as design and engineering, material selection, testing, manufacturing,
assembly, shipping, installation, use by the customer, service, maintenance and recyclin
4)For many manufacturing businesses their product range has evolved over time,
as a collection of solutions to meet new customer needs, rather than being the result
of strategic planning.
This leaves lots of scope for component rationalisation across the range.
In-turn this opens the door to cost reduction negotiations based on ordering greater
quantities and economies of scale. A value analysis exercise can deliver this.
5)A VA project enables your business to take commercial advantage of the constantly
falling price of some technologies, as well as source alternative components and mtls
Reasons for Value Analysing Existing Products
The above factors all increase perceived value of the product by all those who interact with it,
throughout its product life (including of course, the customer).
The prestige value of the product increases, therefore making ownership more desirable,
which should help product sales (and indeed the process of marketing and selling it).
A customer who perceives the value of the product as being more prestigious is more willing to
pay a premium for it or choose it over rival products if it is priced the same.
An all-round better quality product is easier and less costly to produce, assemble, ship, install,
use, service and recycle. The result is to reduce all associated costs throughout the product
lifecycle (importantly, including ownership costs for the customer).
VA, in conjunction with other world class manufacturing techniques, can help realise substantial
company-wide improvements, thereby delivering significant competitive advantage.
What Value Engineering Is Not!
• Cost Cutting
• Design Review
• Project Elimination
• Scope Reduction
• Quality Reduction
• Detailed Cost
Estimating
• Redesign
What Value Engineering Is …….
What Value Engineering Is!
An organized study of
FUNCTIONS to satisfy the
USER’S NEEDS with a
QUALITY PRODUCT at the
LOWEST LIFE CYCLE COST
through APPLIED CREATIVITY
Definition of Value Engineering
• The value of a function is defined as the

relationship of cost to performance
Performancemax
Valuemax =
Costmin
Definition of Value Engineering
• “Good” Value is the lowest cost to reliably provide the
required function with essential performance.
• Value is always increased by decreasing costs while

maintaining essential performance.
• Value may also be increased if the customer needs, wants,

and is willing to pay for greater performance.
Range of Application
• VE applies to everything because every
project or process has a function
• VE can be applied at any point of the design
or process
• VE is a problem solving technique
• VE can be used as a technique for developing
design criteria
Reasons for Poor Value…
• Lack of and/or poor  Not enough time for
coordination among project formulation
designers
and/or design
 Failure to utilize latest

• Failure to network with
customer – poor technologies
definition of needs and
wants
 Negative attitudes
• Design based on
habitual thinking or
mistaken beliefs
More Reasons for Poor Value…
• Poor communication in developing project
scope
• Lack of consensus among project
stakeholders with regard to project scope
• Outdated or inappropriate design standards
• Incorrect assumptions based on poor
information
• Fixation with previous design concepts
• Honest wrong beliefs
Common Misconceptions
• “VE is something we do all the time.”
– No it isn’t. VE requires the application of a
specialized body of knowledge at the right time with
the right people.
• “VE degrades project performance.”
– If applied properly, its should maintain or improve
project performance.
• “VE is just another management fad.”
– VE was developed in 1943. It is required by federal
and many state laws. It has a professional society
and maintains professional standards and
accreditation.
• “VE is really just cost cutting.”
– Really?
VE vs. Cost Cutting/Reduction
• VE seeks to maintain or • Cost reduction seeks to cut
improve performance e INITIAL costs, often at the
while reducing TOTAL costs. expense of project quality
• VE is a pre-planned
allocation of time and e • Cost reduction is usually a
effort. reaction to budget
overruns.
• VE is a highly structured
process using a formal • Cost reduction is an
methodology. e
informal process.
• VE utilizes an objective,
multi-disciplined team and • Cost reduction generally
e involves only a few
a trained facilitator.
• VE provides an organized management personnel.
follow-up, implementation
and reporting program.
Value Engineering Quality
Value Engineering is a tool/method to
enhance QUALITY
Timing the VE Effort
Potential Value Engineering Cost Savings
Potential
Savings
$
Cost to
Change
Design Final Design /

Planning Construction
Development Bid Documents
Project Life Cycle

Some VE Study Objectives
• Performance Improvement
• Significant Cost Savings/Avoidance
• Optimization of Resources (Time & Money)
• Review (Technical, QA) – Optional Objective
• Coordination (In- House & Users)
• Transfer Innovative Technologies
• Have Fun!
Value Engineering Is:
Step 1 – Preparation/Organization
Step 2 - Information
Step 3 – Function Analysis
Step 4 – Speculation/Creativity
Step 5 – Evaluation
Step 6 - Development
Step 7 – Presentation/Report
Step 8 – Implementation & Audit

VE STEP 3…..FUNCTIONAL ANALYSIS
Why is Functional Analysis Important?

• You can’t always get what you want!
• BUT – if you try, somehow you just might ,
from time to time, get what you need!
• Function Analysis defines user’s needs
through verb-noun pairings
Function – The
• Specific purposes or intended use of an item
(What is this? What is it supposed to do?
What else can it do?)
– Function is that which makes a product, process or
project work or sell.
– All cost is for function.
– Primary functions posses value and are required to
make a product work or sell.
– Secondary functions have no value and are present
due to the current design of the product.
• That characteristic that makes a product or
service have value
• Determine by considering the user’s actual
needs
Every Design has Basic and
Secondary Functions
Basic Function:
• Principal reason for the product’s existence
• Has value to the Customer
• Loss of Basic Function results in total loss of market value
for the design
• May be Performance and / or Esteem based
Secondary Function:
• Assist in, or necessary for, the realization of a Basic Function
• Targets for modification and/or elimination to:
– Reduce cost
– Reduce design complexity
– Achieve Breakthrough in design
Basic and Secondary Functions Of A Pencil
Pencil Description Function
Components Basic or Secondary
Eraser Remove Marks Secondary

Band Secure Eraser Secondary
Improve Appearance Secondary
Body Support Lead Secondary
Transmit Force Secondary

Accommodate Grip Secondary
Paint Protect Wood Secondary
Improve Appearance Secondary
Display Information Secondary
Deliver Message Secondary
Lead Produce Marks Basic
Why someone
buys a pencil
VE STEP 4….Speculation/Creativity Phase
PURPOSE
• To generate a large number of
alternatives that provide the item’s basic
function(s)….with the aim of
---reducing cost/improving value
To generate alternatives/drop items that

provide the item’s secondary functions,
again with the aim of
-----reducing cost/improving value
AGENDA
 QFD
 VALUE ANALYSIS & VALUE ENGINEERING

Design For X (DFX)
• A successful design must consider all relevant considerations
throughout the life cycle of a product by analyzing the causes
and effects of the product.
• A common set of design guidelines for X includes:
– Assembly
– Environment
– Manufacturing
– Quality
– Reliability
– Safety
– Serviceability
………………………………WHAT/HOW/WHY/WHEN/WHO
DFMA
WHAT…..Definitions
• Design for Manufacturing (DFM)
– Concerned with reducing overall/part
production cost
• Minimize complexity of manufacturing
• Design for Assembly (DFA)

– Concerned with reducing product assembly
cost
• Minimize number and complexity of assembly
operations
• Individual parts may be more complex in design
WHAT….cont’d
 IT PROVIDES A NON-THREATENING WAY TO GET PEOPLE TALKING
ABOUT A DESIGN WITHOUT FEELING LIKE OTHERS ARE ENCROACHING
ON THEIR TERRITORY
 EINSTEIN SAID “ THE BEST DESIGN IS THE SIMPLEST ONE THAT WORKS
“. DFMA PROVIDES THE CHEAPEST WAY TO THAT GOAL
 DFMA IS AN EXACTING DESIGN REVIEW METHOD
 IT IDENTIFIES:
• -OPTIMAL PART DESIGN
-MATERIAL CHOICE
-ASSEMBLY AND FABRICATION OPERATIONS TO PRODUCE AN EFFICIENT
AND COST EFFECTIVE PRODUCT
 IT REVEALS THAT INITIAL IDEAS MAY NOT BE THE MOST EFFECTIVE
HOW…Principles of DFM
(DFM Guidelines)
• Simplify and reduce the number of
manufacturing operations
• Standardize materials and use common parts
• Design for efficient joining
• Open tolerance as much as possible
• Avoid special tooling and frequent tool
changes
• Select materials for best manufacturability
• Specify ‘acceptable’ surface finish for
functionality
HOW…Principles of DFA
(DFA Guidelines)
• Minimize part count

• Design parts with self-locating features
• Design parts with self-fastening features
• Minimize reorientation of parts during
assembly
• Emphasize ‘top-down’ assemblies
• Standardize parts
• Encourage modular design
DFMA TECHNIQUE
DESIGN CONCEPT
SUGGESTIONS FOR
DESIGN FOR ASSEMBLY SIMPLIFICATION FOR
( DFA ) PRODUCT STRUCTURE
SELECTION OF
SUGGESTIONS FOR
MATERIALS AND
MORE ECONOMIC
PROCESSES AND EARLY
MATERIALS AND
COST ESTIMATES
PROCESSES
BEST DESIGN CONCEPT
DETAIL DESIGN FOR

DESIGN FOR MANUFACTURE MINIMUM MANUFACTURING
( DFM ) COST
PROTOTYPE PRODUCTION
DFM TOOLS DFM ACTIVITY
OPTIMIZE SIMPLIFY ENSURE PROCESS OPTIMIZE

CONFORMANCE PRODUCT
CONCEPT
DFM TOOLS FUNCTION
DESIGN AXIOMS
DFM GUIDELINES
DESIGN FOR ASSY. METHOD
TAGUCHI METHOD
MFG. PROCESS DESIGN RULES
DESIGNERS TOOLKIT
COMPUTER AIDED DFM
GROUP TECHNOLOGY
FMEA
VALUE ANALYSIS
Symmetry
Illustration of principle: Which part can be ‘aligned’ with minimum rotation?

How many axes of symmetry?
Self-locating parts
Handling
Handling Time Handling difficulty
• How many hands required? • Size
• Any grasping assistance needed? • Thickness
• Effect of part symmetry on • Weight
assembly • Fragility
• Is part easy to align/position? • Flexibility
• Slipperiness
Insertion time • Stickiness
• Is part self-securing? • Necessity for using:
• Need to hold down? – Both hands
• What fastening process? – Optical magnification
• Easy to align/position? – Mechanical assistance
WHY…BENEFITS OF DFMA
THERE IS A MUCH BETTEER OPPORTUNITY TO MEET PREDICTED COST
SCHEDULE AND QUALITY TARGETS WHEN THE MANUFACURING PROCESS
DATA IS CAPTURED EARLY
REDUCED
-PRODUCTION COSTS
-DEFECTS
-REWORK
Shorter developmental schedules and reduced cycle

times.
Better first article quality
Development of robust product designs
Easier transition of designs to production
Better supplier product integration
More effective risk management
BENEFITS OF DFMA
( CONTD.)
TOMOHAWK CRUISE MISSILE

STRATEGIC TACTICAL
PARTS 11500 7500
FASTENERS 2500 800
CIRCUIT CARDS 45 22
CONNECTORS 160 45
ASSEMBLY/ TEST
HOURS 610 195
UNIT PRODUCTION
COST $1000,000 $500,000
PILOT’S INSTRUMENT PANEL
ORIGINAL PANEL NEW PANEL

( OPTION 1 )
PARTS COUNT 74 9
FABRICATION TIME HRS. 305 20
ASSY./INSTALLATION TIME HRS. 149/153 8/153
TOTAL TIME HRS. 697 181
WEIGHT KG. 3.0 2.74
COST $ 56000 15000
When to apply DFMA
 WHEN CONCEPTUAL LAYOUTS ARE BEING MADE. THEN

DESIGNER ENVISIONS AN ASSEMBLY EASY TO INSTALL
THAT
REQUIRES MINIMUM NUMBER OF PARTS TO PERFORM
THE REQUIREMENTS PREVIOUSLY ESTABLISHED
 WHEN ASSEMBLY LAYOUTS ARE BEING MADE. DESIGNER
IMPLEMENTS OPTIMISATION TO EASE OF
MANUFACTURING , RELIABILITY AND
MAINTAINABILITY
Who are using DFMA
 Over 400 companies and institutions
 Aerospace companies
- Allied signal
- Hughes Aircraft
- McDonnell Douglas Corpn.
Have implemented DFMA philosophy throughout
their product line
- Automotive industries
- Medical electronic equipment
- PC – industry and others
DFMA Team
Multidisciplinary teams
 Design engineers
 Manufacturing engineers
 Shop floor mechanics
 Suppliers reps
 Specialist in product support
 Maintainability
 Reliability
CONCLUSION
THE NEED FOR DFMA DURING EARLY STAGES
OF PRODUCT DEVELOPMENT IS SEEN
TWO METHODS Viz. BDI AND FMECA
APPROACHES APPEAR TO BE YIELDING
EXCELLENT RESULTS.
A COMBINATION OF THE TWO IS LIKELY TO
SERVE THE PURPOSE BOTH IN MECHANICAL AND
ELECTRONIC PRODUCTS
 Design for Mfr (DFM)
Design for Assy (DFA)
Design for Logistics (DFL)

• Strategy in SCM which involves product design to
reduce logistics cost.
• In 1957 Soda Can mfrs. switched from cone top soda
can to flat top soda can
• 3 Components:
– Product design should facilitate easy to ship & shelf
– Concurrent and parallel processing…..to save lead time
and lower inv.cost
– Standardization of parts …common parts for many
different products
• Therefore design for logistics is a crucial
component in supply chain management.
• It is not just a mechanism to save costs but is

being consistently used as a strategic weapon
to gain competitive advantage.
AGENDA
 QFD
 VALUE ANALYSIS & VALUE ENGINEERING
 DESIGNING PRODUCTS FOR MFR, ASSY & LOGISTICS.

THANK YOU

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OM Mid Term SYLLABUS

6. Project Mgt 13/14 Nov

QUIZ on 27/28 Nov

Designing Products for Mfr,Assy & Logistics

• VALUE ANALYSIS & VALUE ENGINEERING

• DESIGNING PRODUCTS FOR MFR, ASSY & LOGISTICS.

Implementation of a new or significantly

Product or process MUST be NEW or a

MUST be a SIGNIFICANT improvement

Product development is a strategy

• Are we encouraging employees to pursue new ideas and

• What are the best approaches—from corporate venture capital to

• Do we employ enough approaches to constitute a diverse

• Are we enabling and supporting failure in our organization?

• Who are our EPIC leaders?

2..Product Design Problems

3..Product Incorrectly Positioned, Priced or Advertised

4..Costs of Product Development

To create successful new products, the company must:

• JAPANESE UMEZAWA PROCESS

• PROF RAM CHARAN SOCIAL INNOV PROCESS

• McKinsey FLEXIBLE INNOV PROCESS

• Monitor Deloitte DOBLIN PROCESS

• NPD based on MASLOW’s NEED HIERARCHY (BAIN)

• Idea Generation and Screening

• Systematic Search for New Product

Process to spot good ideas and drop poor ones

Development Time & Costs

Shortlisted idea eg cooling shampoo

Develop concept card C

If > 80% top 2 boxes on likeability………..develop product prototype P

Test C+P…..If top 2 boxes > 80%....go ahead, else change

Also used for improving and existing poor performing product.

Prof. Ram Charan

1. Focus on both- Users and Customers

2. Innovation is must- Innovate/Die

4. Make money for yourself. Market share and revenue

5. Ability to make acquisition – Probably innovation acquisition

We must have Disciplined manner of innovation.

Social process of innovation continue with singles and

1. What hurdles team is facing

Product Development facing a fundamental challenge.

Most companies under pressure to bring new products/services

Unfortunately, at the very moment when companies need to make

Need of the hour….A way of raising product development to a new level.

The teams solve problems and synthesize new information continually

Internet-based Features prior- Marketing Alternatives ex- Business forecast

Cost work flow

• Idea Generation and Screening

Which is different To our market

Innovation is the creation of a new,

Creating value for Ideally going beyond products to

2. Focus on fewer, bolder ideas

3. Be genuinely curious about customers

4. Look beyond your industry for ideas

5. Challenge conventional wisdom

6. Resist premature problem solving

You have one minute to put your idea to paper

Design a vase for people to