DESIGN

COLLABORATION

By:
Arun K S
Ist sem M.tech
SJCET PALAI

ksarun1987@gmail.com
 OUTLINE
Key sourcing related processes are:
 Supplier scoring and assessment
 Supplier selection and contract negotiation
 DESIGN COLLABORATION
 Procurement
 Sourcing planning & Analysis
 DESIGN COLLABORATION

• Integrating supplier in to design phase of Product

development.

• Eg: Gold corp Inc.

– They collaborated with Two Australian companies for 3-
dimensional depiction of their mines.

– This led to increase in their production rate from 53000

ounces @ $360 an ounce in 1996 to 504000 ounces @ $ 59
per ton in 2001.
Design collaboration
Factors to be considered while Design
sourcing
• 80% of cost of product is determined during
design stage. So active participation of supplier is
needed in this stage.
• 50 – 70% of spending at manufacturer is for
procurement process (during delivery of
outsourced parts). So this has to be lowered.
• Coordination is necessary if dealing with a
number of suppliers.
• Mutual understanding with customers.
• Manufacturer should act as a design coordinator.
 Mutual Understandings
1. Design for Logistics
2. Design for Manufacturability
 1. DESIGN FOR LOGISTICS
• Attempts to reduce Transportation, Handling
and Inventory costs during distribution by taking
appropriate actions during Design.

• To reduce Transportation and Handling cost

manufacturer should convey information's about:
– Expected order sizes
– Packaging details (to be compact & Easiness for
stacking).
 1. DESIGN FOR LOGISTICS contd……

• To reduce Inventory cost Primary approach is

to postponement or mass customization:
– Postponement: Aim is to design a production and
production process so that features that
differentiate the end product are late in
manufacturing Phase.
Eg: Dell designs it’s PC’s after customer order
comes. This helps them to lower inventories by
aggregating them as components.
• Mass Customization: similar approach as that
of postponement. Here design is so that
inventory can be carried in a form that
aggregates across multiple end products.
• Customization occurs along following 3 stages:
– a. Module customization: Product is designed as
modules. Eg: PC assembly at dell.
-b. Adjustable customization: All inventory is
maintained in a single product. Eg: Washing
m/c designed by Matsushita.
-c. Dimensional customization: Eg: National
bicycle which cuts frame tubing to fit
according to size of customer.
 2. Design for Manufacturability
• Attempts to design product for ease of
manufacturing.
• Key principles used while designing
manufacturability are:
– Part commonality
– Designing symmetrical parts
– Combining parts
– Using catalogue part rather than designing new one
– Design parts to provide access for other parts and tools.
Advantages of design collaboration
• Design collaboration can:
– Lower material purchase cost
– Lower logistic cost
– Lower manufacturing cost.
– Design collaboration is also helpful for a company
which tries to produce a lot of variety and
customization.
– Increases product development time significantly.
– Cost decreases by 20%, Quality improves by 30%,
Time to market decreases by 50 %.
 Conclusion
• Design collaboration helps a firm to reduce
cost, Improve quality and decrease time to
market.
• Ensuring of design for logistics and design for
manufacturability by manufacturer.
• To be successful, manufacturers should
become effective design coordinators in
supply chain.
THANK YOU