Name: Cindy rose C.

Bonete Subject/Course: Operations Management

Professor: Alma Lyn Miase

PRODUCT AND SERVICE DESIGN

LEARNING OBJECTIVES:

 Explain the strategic importance of product and service design.

 Name the key questions of product and service design.
 Describe what product and service design does.

Products and services fuel your business with the revenue they generate. The core of a
business is the products and services it offers to customers. Because they are at the heart of your
business operations, it’s important to take a calculated, strategic approach to designing
your products and services.

PRODUCT- A product is a tangible item that is put on the market for acquisition, attention, or
consumption

SERVICE- is an intangible item, which arises from the output of one or more individuals.

Product
A product is tangible, it is physical and can be held,
seen and movable
Product value is derived by the customer
Customer care of the product is limited
A product can be stored for future use
A product can be owned
The quality of a product depends its nature
A product can be returned to the seller
The billing process of a service is a once off
transaction
It is easy to compare quality of products
Products can be quantified numerically
Service
A service is intangible, can only be felt and not
touched
Value of service is offered by the service provider
Customer care forms critical component of
marketing a service
A service is perishable and cannot be stored for later
use or sale
A service cannot be owned by the consumer once
payment
has been made
Quality of a service depends on the service provider
who shapes it
A service cannot be returned to the seller
Billing process can be continuous in the form
of subscriptions for services rendered
It is difficult to compare the quality of services
offered
Services cannot be quantified in terms of numbers
 PRODUCT DESIGN the combination of manufacturing capabilities with product and business
knowledge to convert ideas into physical and usable objects. It is the process of identifying a market
opportunity, clearly defining the problem, developing a proper solution for that problem and validating
the solution with real users.

SERVICE DESIGN the coordination and combination of people, communication, and material
components to create quality service. The activity of planning and organising people, infrastructure,
communication and material components of a service in order to improve its quality and the interaction
between service provider and customers.

STRATEGIC PRODUCT AND SERVICE DESIGN

The essence of an organization is the goods and services it offers. For every aspect of an
organization it is structured around the goods and services that it offers.

Product and service design – or redesign – should be closely coupled to an organization’s strategy.
Product and service design should be closely tied to whatever the organization strategy is in order for
that organization to be successful.

Through focusing on the processes of product design and of service design, businesses are able to
effectively generate more sales, a larger amount of customer loyalty and customer growth more widely.

KEY QUESTIONS

 Is there a demand for it?

The product that I plan to make as a manufacturer, are people really going to buy the
product? And even if they are going to buy it, what is the potential size of the market?
Or how many people do I expect to patronize my product and/or service.
 Can we do it?
We say that we are going to give product that is dust proof that cannot break, etc but
do we have the capacity to put our words into actions? Can we materialize this
according to the skills, equipment, materials and our capacity?

Manufacturability- the capability of an organization to produce an item at an acceptable profit

Serviceability - the quality of being able to provide good service at an acceptable profit

 What level of quality is appropriate?

You as a manufacturer must understand that these are the things the customers or the
market want, you should prioritize what your customers want.
 Does it make sense from an economic standpoint?
As operation managers, we would want to maximize our profit and minimize our cost.
Now what is the point of manufacturing something that will cost at a loss, or that would
cost too much.
 Product liability- which is the responsibility of the manufacturer for any injuries or damages
caused by a faulty product because of poor workmanship or design.

Sustainability - producing a good or service that is not harmful to the environment.

SO WHAT DOES PRODUCT AND SERVICE DESIGN DO?

1) Translate customer wants and needs into product and service requirements (marketing) –
now this is done using a very commonly used tool. For doing this is QFD.

2) Refine existing products and services (marketing)

3) Develop new products and services (marketing, operations

4) Formulate quality goals (quality assurance, operations)

5) Construct and test prototypes (marketing, operations)

6) Formulate cost targets (accounting)

7) Document Specifications (engineering, operations)

8) Translate product and service specifications into process

9) Involve inter-functional collaboration

Why is good product and service design important?

Good design makes good business sense because it translates customer needs into the shape and
form of the product or service and so enhances profitability. Design includes formalizing three
particularly important issues: the concept, package and process implied by the design. Design is a
process that itself must be designed according to the process design principles.
REFERENCES:

 https://www.winwithteamwork.com/what-we-do/product-and-service-design

 https://corporatefinanceinstitute.com/resources/knowledge/other/products-and-services/

 https://medium.com/snapout/what-are-the-differences-between-service-design-and-product-
design-769f930bc361

 http://site.iugaza.edu.ps/aschokry/files/2010/09/OM-Fourth-W-1.pdf

 https://managementhelp.org/operationsmanagement/# service

 http://www.markedbyteachers.com/international-baccalaureate/business-studies/why-is-good-
product-and-service-design-important-good-design-makes-good-business-sense-because-it-
translates-customer-needs-into-the-shape-and-form-of-the-product-or-service-and-so-
enhances-profitability.html