Product Design and Development

Karl T. Ulrich and Steven D. Eppinger

5th edition, Irwin McGraw-Hill, 2012.

Chapter Table of Contents: 9. Concept Testing

1. Introduction 10. Product Architecture
2. Development Processes 11. Industrial Design
and Organizations
12. Design for Environment
3. Opportunity Identification
13. Design for Manufacturing
4. Product 14. Prototyping
Planning 15. Robust Design
5. Identifying Customer 16. Patents and Intellectual
Needs Property
6. Product Specifications 17. Product Development
7. Concept Generation Economics

8. Concept Selection 18. Managing Projects

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

 Ensures product development projects support the broader

business strategy of the company.
Addresses:
 What product development projects will be undertaken?
 What mix of fundamentally new products, platforms and
derivative products should be pursued?
 How do the various projects relate to each other as a portfolio?
 What will be the timing and sequence of projects?
 The product plan identifies the portfolio of
products to be developed by the
The organization and the timing of their
Product introduction to the market through
proper allocation of resources.
Planning
Process The planning process considers:
 Product dev. Opportunities identified
from various sources
 Suggestions from marketing, research,
customers, current product development
teams
 Benchmarking of competitors
 Some inefficiencies in organizations that do not
Inefficiencies 
engage in product planning:
Inadequate coverage of target markets with
competitive products.
 Poor timing of market introductions of products.
 Mismatches between aggregate development
capacity and the number of projects pursued.
 Poor distribution of resources, with some
projects overstaffed and others understaffed.
 Initiation and subsequent cancellation of ill-
conceived projects.
 Frequent changes in the directions of the
projects.
 The product plans developed by keeping
in mind:
The  Company’s goals

Product  Capabilities
 Constraints
Plan  Competitive environment

The product plan is regularly updated

to reflect changes in:
 Competitive environment
 Technology
 Info on successes of existing products
 Xerox Lakes Project Example
Xerox’s Competitive
Strategy  Exploit
technological innovation
in a rapidly changing
market

DIGITAL COPIER
PLATFORM
(AS OPPOSED TO
EXISTING LIGHT
LENS )

Xerox Document Centre 265

 Exh 3-2: The product plan identifies the portfolio of
projects to be pursued by the development organization.
This plan divides projects into four categories.

The
Product
Plan
The Product Planning Process

1. Identify opportunities.
2. Evaluate and prioritize projects.
3. Allocate resources and plan timing.
4. Complete pre-project planning.
5. Reflect on the results and the processes.
Note: Selecting a promising project is iterative in nature
 Sources of product development opportunities:
 Marketing/Sales
 Research/Technology Development (Xerox PARC)
 PD Teams
Manufacturing
Step 1:


 Customers

Identify 


Third party: Suppliers, Inventors, and business partners
Other business groups (Xerox Supplies Division)

opportunities Some proactive approaches:

 Document frustrations and complaints
 Study Competitors’ products (Competitive
benchmarking)
 Track the status of emerging technologies
 More…see text
 Some opportunity statements proposed at Xerox:
Create a document distribution system in which a
Xerox

networked printing, device resides on each office
worker’s desk and automatically drives mail and other
documents.
 Create document delivery software that allows the
digital delivery and storage of most intra-organizational
documents via a worker’s personal computer.
Opportunity statement: Lakes Project
 Develop a new black & white (B&W), digital,
networkable, document center platform for the office
market, including scanning, storage, fax, distribution,
and printing capabilities
 Competitive strategies
 Technology leadership

Step 2: 


Cost leadership
Customer focus
Evaluate and  Imitative
Market Segmentation
Prioritize Technology Trajectories
Projects Product Platform Planning
Evaluating Fundamentally New Product Opportunities
Balancing the portfolio
Competitive  Technology leadership  Basic R & D
 Cost leadership  Superior
Strategies manufacturing methods; Design for
manufacturing to reduce costs
 Customer focus  Rapid
development of derivatives through
carefully designed product platforms
 Imitative  Fast development process
Market Segmentation: Market Segment Map

Exh 3.4: Product segment map showing Xerox B&W digital products and the competition in three
markets (Segmentation based on number of users sharing office equipment) . Key performance
dimensions  pages per minute & networking capability
 Technology Trajectories
Exh 3.5: This technology S-curve
illustrates that Xerox believed digital
copier technologies were just emerging
and will improve product performance
in coming years. Xerox believed that it
could develop a full-featured digital
copier in the near future with
performance exceeding that of light-
lens copiers.

Q: How near or far is the ultimate performance limit?

 Product Platform Planning: Platforms vs.
Derivatives
Platform  Set of assets shared across a set of products (e.g. components & sub assys)
Derivatives  For different segments

Ex 3.6: A platform development project creates the architecture of a family of products.

Derivative products may be included in the initial platform development effort (Platform
A) or derivative products may follow thereafter (Platform B)
Product Platform Planning: Technology Roadmap
Ex 3.7: This technology
roadmap shows the life cycles
of several digital
photocopying technologies &
identifies which technologies
would be used in each
product. For Lakes
platform Higher speeds
and color capabilities
required of its derivatives.

Note: decisions about

product platforms are
closely related to the
technology development
efforts of the firm
  Market size (units/year * average price)
 Market growth rate (percent per year)
Evaluating  Competitive intensity (#competitors & their strengths)
Fundamentally  Depth of the firm’s existing knowledge of the markets

New Product  Depth of the firm’s existing knowledge of technology

 Fit with the firm’s other products
Opportunities  Fit with the firm’s capabilities
 Potential for patents or other barriers to competition
 Existence of a product champion within the firm
  Ex 3.8: The product-process change matrix

Balancing  The extent to which the project involves changes in the

product line and/or the production processes

the portfolio  Helps identify projects  breakthrough opportunities as well

as incremental improvements
 Firms typically benefit from a diverse set of projects
 Firm’s choice of competitive strategy influences product
development portfolio:

 (FIRM STRATEGY) (PORTFOLIO)

LOW COST STRATEGY  MORE OF PRODUCTION PROCESS
 IMPROVEMENT PROJECTS
HIGH PRODUCT VARIETY  DERIVATIVE PRODUCTS UPON
 EXISTING PLATFORMS
TECHNOLOGICAL SUPERIORITY  TECH DEV. &
 BREAKTHROUGH PROJECTS
 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
 Resource Allocation
 Careful use of the limited development resources
 Avoid starting too many projects. May result in:
 Skilled engineers and managers stretching their capabilities

Step 3: 
 Affects productivity, time-to-market, quality, and profitability
Aggregate Product Planning (Ex 3.9):

Allocate
 makes efficient use of resources within budgeted resources
Project Timing

Resources &
 Timing of product introductions
 Technology readiness
Market readiness

Plan Timing


 Competition
The Product Plan (Exhibit: 3.2)
 Set of projects approved by the planning process and sequenced in time.
 Mix of: Fundamentally new product, platform and derivative projects.
 Updated periodically as a part of the strategic planning activity.
Ex 3.9: Aggregate
Resource Planning
 Product Plan
The Product Plan (Exhibit: 3.2)
•Set of projects approved by the planning process and sequenced in time.
•Mix of: Fundamentally new product, platform and derivative projects.
•Updated periodically as a part of the strategic planning activity.

Exh 3-2: The product plan identifies the portfolio of projects to be pursued by the
development organization. This plan divides projects into four categories.
 Product Vision Statement
Develop a networked, mid-range digital platform for
imaging, marking, and finishing
Mission Statements
 Brief (one sentence) description of the product
Step 4:  Key business goals
 Target market(s) for the product
Complete  Assumptions and constraints that guide the development
effort
Pre-Project  Stakeholders
Assumptions and constraints
Planning  Manufacturing
 Service
 Environment
Staffing and other pre-project planning activities
Lakes Project Product Description
 Networkable, digital machine with copy, print, fax, and scan functions
Mission Key Business Goals
Statement  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 Centre Ware 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
 Assumptions & Constraints
Some may ask:
 Why manufacturing, Service and Environmental
strategies should be part of the mission statement
for a new product?
Some may even hold:
 Decisions about these issues should arise from
customer needs for new products and should not
be determined in advance.
Why then do we have Xerox mentioning these
in the project mission statement?
Assumptions & Constraints (contd..)

 For complex projects (as in this Xerox example), the design of

the manufacturing systems are equally complex.
 Thus manufacturing facilities involved in the product need
to be identified very early in the process.
Some product requirements cannot be derived strictly from customer
needs.

 Environmentally responsible design (as a Corporate

Responsibility of Xerox)

Mission statements must reflect such corporate

objectives and constraints.
 Assumptions & Constraints (contd..)
For Lakes Project of Xerox
Manufacturing
 Capabilities, capacities, and constraints of existing manufacturing processes
 Which internal production facility to be used?
 What key suppliers to be involved and when?
 For Xerox: Input devises at Canada, Output devices in Brazil etc.
Service
 Note: Customer service and service revenue important in this business
 Strategic goals for improving service quality
 Designing components requiring few parts
 Designing for ease of serviceability (quick service)
Environment
 Design for environment
 Developing new products with environmental sustainability
 Xerox’s  “Zero to landfill” policy with an energy efficiency goal “most efficient machine in
its class”
 Remanufacture or recycle [no part should be disposed by the customer to end up in a
landfill]
 Some suggested questions:
 Is the opportunity funnel collecting an exciting and diverse set of
product opportunities?
 Does the product plan support the competitive strategy of the
firm?

Step 5:  Does the product plan address the most important current
opportunities facing the firm?

Reflect on the  Are the resources allocated product development adequate to

pursue the firm’s competitive strategy?

Results & the

 Have creative ways of leveraging finite resources been
considered…?
 Does the core team accept the challenges of the resulting mission
Process 
statement
Are the elements of the mission statement consistent?
 Are assumptions listed in the mission statement really necessary
or is the project over-constrained? Will the development team
have the freedom to develop the best possible design?
 How can the product planning process be improved?