Product Planning

Teaching materials to accompany:

Product Design and Development
Chapter 4
Karl T. Ulrich and Steven D. Eppinger
5th Edition, Irwin McGraw-Hill, 2012.

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 Product Development Process
Concept System-Level Detail Testing and Production
Planning Development Design Design Refinement Ramp-Up

Four Phases of Product Development

The product planning phase precedes the product development process.

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The Product Planning Process

• Which opportunities should be developed?

• What is the ideal mix of projects, and how
are they related?
• What is the schedule?
• What resources are required?

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 Types of projects
• New product platforms
• Derivatives of existing product platforms
• Incremental improvements
• Fundamentally new products

(Revolutionary vs. Evolutionary Products)

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Xerox Lakes Project Example

Xerox Document Centre 265

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A Product Plan

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 Market Segment Map
Market Segment

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 Technology S-Curves
Copier Performance

Digital
Technology

Light-Lens
Technology

Time
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Technology Roadmap

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Platforms vs. Derivatives

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 Product-Process Change Matrix
Extent of Production Process Changes
Research and New Next Single Tuning and No
Technology Core Generation Department Incremental Process
Development Process Process Upgrade Changes Change
New Breakthrough
Core Development
Product Projects
Extent of Product Changes

Platform
Next Development
Generation Projects
Product
Lakes
Project
Addition
to Product
Family Derivative
Product
Minor Development
Product
Enhancement

Current
No
Product Product/Process
Change Support

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Aggregate Resource Planning

Plan for progression from R&D to applications

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 Lakes Project Mission Statement
Product Description
• Networkable, digital machine with copy, print, fax, and scan functions
Key Business Goals
• Support Xerox strategy of leadership in digital office equipment
• Serve as platform for all future B&W digital products and solutions
• Capture 50% of digital product sales in primary market
• Environmentally friendly
• First product introduction 4thQ 1997
Primary Market
• Office departments, mid-volume (40-65 ppm, above 42,000 avg. copies/mo.)
Secondary Markets
• Quick-print market
• Small ‘satellite’ operations
Assumptions and Constraints
• New product platform
• Digital imaging technology
• Compatible with CentreWare software
• Input devices manufactured in Canada
• Output devices manufactured in Brazil
• Image processing engine manufactured in both USA and Europe
Stakeholders
• Purchasers and Users
• Manufacturing Operations
• Service Operations
• Distributors and Resellers

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 Apple versus Samsung
smartphones (2014)
Apple Samsung
Number of models 3 ~100
Market share 12% 25%
Profit share 55% 55%
Profit margin 30-40% 15-20%

• Apple and Samsung are the only companies

making a profit on smartphones. All others are
losing money.
• Apple covers every market segment with only 3
models.
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Apple Revenue Breakdown

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Apple’s Profit

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 Apple products
Successes Failures
• Mac computers • Apple Lisa (1983)
• iPod • Newton tablet (1993)
• iPhone • Pippin game console
• iPad (1995)
• Apple Watch (?) • Apple TV (?)

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iPhone 7 has no headphone
jack!
Pros ? Cons ?

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