What is Product and Service Design

 The essence of a business organization is the products and services it offers

1. Refine existing products and services. (marketing)
2. Develop new products and/or services. (marketing, operations)
3. Formulate quality goals. (marketing, operations)
4. Formulate cost targets. (accounting, finance, operations)
5. Construct and test prototypes. (operations, marketing, engineering)
6. Document specifications.
7. Translate product and service specifications into process specifications. (engineering,
operations)

The main forces that initiate design or redesign are market opportunities and threats. The
factors that give rise to market opportunities and threats can be one or more changes

 Economic (e.g. , low demand, excessive warranty claims, the need to reduce costs).
 Social and demographic (e.g. , aging baby boomers, population shifts).
 Political, liability, or legal (e.g. , government changes, safety issues, new regulations).
 Competitive (e.g. , new or changed products or services, new advertising/promotions).
 Cost or availability (e.g. , of raw Organizations that have well-designed products or
services are more likely to realize the company’s goals and mission.

WHAT DOES PRODUCT AND SERVICE DESIGN DO?

 The various activities and responsibilities of product and service design include the
following (functional interactions are shown in parentheses):
8. Translate customer wants and needs into product and service requirements. (marketing,
operations)
 materials, components, labor, water, energy).
 Technological (e.g. , in product components, processes).

GENERATING IDEAS

 Sources of Ideas
 Customers
 come from surveys, focus groups, complaints, and unsolicited suggestions for
improvement
 Supply Chain and Employees
 obtained from interviews, direct or indirect suggestions, and complaints
 Competitors
  Some companies purchase a competitor’s product then carefully dismantle and inspect
it, searching for ways to improve their own product. This is called reverse engineering.
 REVERSE ENGINEERING - The Ford Motor Company used this tactic in developing its
highly successful Taurus model: It examined competitors’ automobiles, searching for
best-in-class components (e.g. , best hood release, best dashboard display, best door
handle).

RESEARCH AND DEVELOPMENT

 Research and development (R&D) refers to organized efforts that are directed toward
increasing scientific knowledge and product or process innovation. Most of the advances
in semiconductors, medicine, communications, and space technology can be attributed
to R&D efforts at colleges and universities, research foundations, government agencies,
and private enterprises.
 Basic Research
 Has the objective of advancing knowledge about a subject, without any near-term
expectation of commercial applications.
 Applied Research
 Has the objective of achieving commercial applications
 Development
 Converts the results of applied research into useful commercial applications.

LEGAL AND ETHICAL CONSIDERATIONS

 PRODUCT LIABILITY
 The responsibility of a manufacturer for any injuries or damages caused by a faulty
product because of poor workmanship or design. Many business firms have faced
lawsuits related to their products, including Firestone Tire & Rubber, Ford Motor
Company, General Motors, tobacco companies, and toy manufacturers.

 ETHICAL CONSIDERATION
 Ethical issues often arise in the design of products and services; it is important for
managers to be aware of these issues and for designers to adhere to ethical standards.
Designers are often under pressure to speed up the design process and to cut costs.
 Organizations generally want designers to adhere to guidelines such as
 the following:
 Produce designs that are consistent with the goals of the organization.
 Give customers the value they expect.
 Make health and safety a primary concern.
 Examples of legal but unethical products include cigarette , alcohol , marijuana.
HUMAN FACTORS

 Human factor issues often arise in the design of consumer products. Safety and liability
are two critical issues in many instances, and they must be carefully considered.
 For example, the crashworthiness of vehicles is of much interest to consumers,
insurance companies, automobile producers, and the government.
 Another issue for designers to take into account is adding new features to their products
or services.
 This “creeping featurism” is particularly evident in electronic products such as handheld
devices that continue to offer new features, and more complexity, even while they are
shrinking in size. This may result in low consumer ratings in terms of “ease of use.”

CULTURAL FACTORS

 Product designers in companies that operate globally also must take into account any
cultural differences of different countries or regions related to the product. This can result
in different designs for different countries or regions.

7 REASONS WHY WE NEED TO CONSIDER CULTURAL FACTORS IN PRODUCT AND

SERVICE DESIGN.

1. User Acceptance
2. Market Reach
3. Functionality and Usability
4. Aesthetic Appeal
5. Communication
6. Innovation and Creativity
7. Social Responsibility

ENVIRONMENTAL FACTORS

 CRADLE-TO-GRAVE ASSESSMENT
 Also known as life cycle analysis, is the assessment of the environmental impact of a
product or service throughout its useful life.
 Focusing on such factors as global warming (the amount of carbon dioxide released into
the atmosphere), smog formation, oxygen depletion, and solid waste generation.
 5 STAGES OF CRADLE-TO-GRAVE ASSESSMENT
1. Resource Extraction
 2. Manufacturing
3. Transportation
4. Use
5. Disposal

END-OF-LIFE (EOL) PROGRAMS

 Deal with products that have reached the end of their useful lives.
 The products include both consumer products and business equipment.
 The purpose of these programs is to reduce the dumping of products.
 particularly electronic equipment, in landfills or third-world countries, as has been the
common practice, or incineration.

THE THREE R’S

 REDUCE : VALUE ANALYSIS

 Value analysis refers to an examination of the function of parts and materials in an effort
to reduce the cost and/or improve the performance of a product.
 Typical questions that would be asked as part of the analysis include: Could a cheaper
part or material be used? Is the function necessary? Can a part be simplified? Could
product specifications be relaxed, and would this result in a lower price? Could standard
parts be substituted for nonstandard parts?

 REUSE : REMANUFACTURING
 Remanufacturing refers to refurbishing used products by replacing worn-out or defective
components, and reselling the products.
 Among the products that have remanufactured components are automobiles, printers,
copiers, cameras, computers, and telephone
 Designing products so that they can be more easily taken apart has given rise to yet
another design consideration: Design for disassembly (DFD).

 RECYCLE
 Recycling is sometimes an important consideration for designers. Recycling means
recovering materials for future use
 Companies recycle for a variety of reasons, including
1. Cost savings.
2. Environment concerns.
3. Environmental regulations.
SERVICE DESIGN

 Service refers to an act, something that is done to or for a customer (client, patient, etc.).
 It is provided by a service delivery system , which includes the facilities, processes, and
skills needed to provide the service.
 Many services are not pure services, but part of a product bundle —the combination of
goods and services provided to a customer.

SERVICE PACKAGE
System design involves development or refinement of the overall service package
1. The physical resources needed.
2. The accompanying goods that are purchased or consumed by the customer, or provided with
the service.
3. Explicit services (the essential/core features of a service, such as tax preparation).
4. Implicit services (ancillary/extra features, such as friendliness, courtesy).

DIFFERENCE BETWEEN SERVICE & PRODUCT DESIGN

1.Products are generally tangible; services are generally intangible.
2.In many instances services are created and delivered at the same time
3.Services cannot be inventoried
4.Services are highly visible to consumers & must be designed with that in mind
5.Some services have low barriers to entry and exit
6.Location is often important to service design
7.Service systems range from those with little or no customer contact to those that have a very
high degree of customer contact
8.Demand variability alternately creates waiting lines or idle service resources.
ISSUES IN SERVICE DESIGN

 Two key issues in service design are the degree of variation in service requirements and
the degree of customer contact and customer involvement in the delivery system.
 These have an impact on the degree to which service can be standardized or must be
customized.
 The lower the degree of customer contact and service requirement variability, the more
standardized the service can be.

SERVICE BLUEPRINT

 A useful tool for conceptualizing a service delivery system is the service blueprint , which
is a method for describing and analyzing a service process.
  A service blueprint is much like an architectural drawing, but instead of showing building
dimensions and other construction features, a service blueprint shows the basic
customer and service actions involved in a service operation.

CHARACTERISTICS OF WELL- DESIGNED SERVICE SYSTEMS

1. Being consistent with the organization’s mission.
2. Being user-friendly.
3. Being robust if variability is a factor.
4. Being easy to sustain.
5. Being cost-effective.
6. Having value that is obvious to customers.
7. Having effective linkages between back-of-the-house operations (i.e. , no contact with the
customer) and front-of-the-house operations (i.e. , direct contact with customers). Front
operations should focus on customer service, while back operations should focus on speed and
efficiency.
8. Having a single, unifying theme, such as convenience or speed.
9. Having design features and checks that will ensure service that is reliable and of high quality.

GUIDELINES FOR SUCCESSFUL SERVICE DESIGN

1. Define the service package in detail. A service blueprint may be helpful for this.
2. Focus on the operation from the customer’s perspective. Consider how customer
expectations and perceptions are managed during and after the service.
3. Consider the image that the service package will present both to customers and to
customers.
4. Recognize that designers’ familiarity with the system may give them a quite different
perspective than that of the customer, and take steps to overcome this.
5. Make sure that managers are involved and will support the design once it is implemented.
6. Define quality for both tangibles and intangibles. Intangible standards are more difficult to
define, but they must be addressed.
7. Make sure that recruitment, training, and reward policies are consistent with service
expectations.
8. Establish procedures to handle both predictable and unpredictable events.
9. Establish systems to monitor, maintain, and improve service.