By: Gerline Mae Ocampo Pableo

TOPIC: Product and Service Design

Part 1: Introduction

Having a life-cycle perspective on products and services in the business strategy of

product and service design is increasingly important as the strategy emerges and

more and more companies see the benefits of controlling a larger share of the

product value chain. The business approach of product and service design puts

new requirements on products in comparison to traditional selling. Since the

volumes of products being sold through product and service design are

increasing, these design issues need to be considered on a larger scale.

Part 2: Summary of the topics/Topics Digest

Product and service design is a strategic decision. Firms develop new products and

services for reasons of: competitive advantage, market share gain, higher

profitability, enhancement of brand, faster competitive response and for improved

operating cost and resource utilization. Another reasons are because of economic

changes, such as low demand or the need to reduce costs, second are factors of

social and demographic changes where there are population shifts and also the

political, liability and legal factors where there is a need due to government changes,

safety issues and new regulations. Among the product tradeoffs that must be

considered by the company are on development cost, development speed, product

or service cost and product or service performance. Activities in product and service

design are: to translate customer wants and needs into product and service

requirements, to refine existing products and services, to develop new products and

services to formulate quality goals, to formulate cost targets, to construct and test

prototypes and to document specifications. The main focus in product and service

design is on customer satisfaction. The secondary focus of the product and service
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design are: function of the product/service; cost/profit; quality; appearance; ease of

production/assembly and ease of maintenance/service. The legal issues

encountered are because of compliance to government agencies, for example, the

food and drug administration, product liability includes the responsibility of a

manufacturer for any injuries or damages caused by a faulty product or in

compliance to uniform commercial code when products carry an implication of

merchantability and fitness. Ethical issues are regarding the issues of releasing

products with defects. The environmental issues are in compliance with

environmental agencies such as the Environmental protection agency. Other issues

are because of the product and service life cycles, the level of standardization,

product and service reliability and the range of operating decisions. The first phase is

on idea generation, the goal should be to generate many worthy ideas that can form

the foundation for the New Product Development strategy. The 2nd phase on the

idea screening. This stage revolves around choosing the one idea that has the

highest potential for success. Put all the ideas available on the table for internal

review. That is, turn to people with industry knowledge and experience in the field for

idea screening. For a new product development idea, having a proof of concept

(POC) should hold precedence as it helps check the feasibility of the idea. There is

no point in zeroing in on an idea that is not technically feasible to build. SWOT

( Strengths, Weaknesses, Opportunities, and Threats) analysis can be another good

practice to consider when shortlisting New Product Development ideas. The 3rd

phase is on concept development and testing. Before starting with the New Product

Development process, building a detailed version of the idea and the user stories

should be given priority. This value proposition evaluation is the first step towards

concept development and testing. At the very least, it ensures that problems in the
By: Gerline Mae Ocampo Pableo

approach are discovered sooner and the team can course-correct earlier. That helps

to ensure that technical debts will not accumulate. The 4th phase is on market

strategy/business analysis. Marketing strategy is all about drafting a way to reach out

to the targeted audience. Perhaps the best and most straightforward method is to

follow McCarthy’s 4Ps of marketing for a New Product Development project. This

business analysis will help to determine whether the New Product Development

efforts are worth the financial investment or not (i.e., will it create a continuous

stream of value)?. When the New Product Development idea is in place, the market

strategy is documented, and the business analysis is completed, it is time to move

on with the product development cycle. The New Product Development starts with

developing the prototype followed by the minimum viable product. The 6th step is

market testing. This step in New Product Development aims to reduce the

uncertainty revolving around the success of the product. In other words, this step

revolves around checking the viability of the new product or its marketing campaign.

The 7th step is market entry/commercialization. Commercialization is an umbrella

term that entails varied strategies to ensure the success of the new product. The rule

of thumb for New Product Development is to focus on innovating while delivering

value. Some of the techniques in designing for the production of products and

services are: concurrent engineering, computer assisted design, designing for

assembly and disassembly, and the use of components for similar products. In its

simplest terms, concurrent engineering means bringing design and manufacturing

engineering people together early in the design phase to simultaneously develop the

product and the processes for creating the product. More recently, this concept has

been enlarged to include manufacturing personnel (e.g., materials specialists) and

marketing and purchasing personnel in loosely integrated, cross-functional teams. In

By: Gerline Mae Ocampo Pableo

addition, the views of suppliers and customers are frequently sought. The purpose,

of course, is to achieve product designs that reflect customer wants as well as

manufacturing capabilities. Computer-aided design (CAD) uses computer graphics

for product design. The designer can obtain a printed version of the completed

design and file it electronically, making it accessible to people in the firm who need

this information (e.g., marketing, operations). A growing number of products are

being designed in this way, including transformers, automobile parts, aircraft parts,

integrated circuits, and electric motors. A major benefit of CAD is the increased

productivity of designers. No longer is it necessary to laboriously prepare mechanical

drawings of products or parts and revise them repeatedly to correct errors or

incorporate revisions. A concept in manufacturing is design for assembly (DFA) . A

good design must take into account not only how a product will be fabricated, but

also how it will be assembled. Design for assembly focuses on reducing the number

of parts in an assembly, as well as on the assembly methods and sequence that

will be employed. Another, more general term, manufacturability , is sometimes used

when referring to the ease with which products can be fabricated and/or assembled.

In the production using the components of similar products, for example, car

manufacturers employ this tactic by using internal components such as water

pumps, engines, and transmissions on several automobile nameplates. In addition to

the savings in design time, companies reap benefits through standard training for

assembly and installation, increased opportunities for savings by buying in bulk from

suppliers, and commonality of parts for repair, which reduces the inventory dealers

and auto parts stores must carry. Similar benefits accrue in services. For example, in

automobile repair, component commonality means less training is needed because

the variety of jobs is reduced. Quality function deployment (QFD) is a structured

By: Gerline Mae Ocampo Pableo

approach for integrating the “voice of the customer” into both the product and service

development process. The purpose is to ensure that customer requirements are

factored into every aspect of the process. Listening to and understanding the

customer is the central feature of QFD. Requirements often take the form of a

general statement such as, “It should be easy to adjust the cutting height of the lawn

mower.” Once the requirements are known, they must be translated into technical

terms related to the product or service. For manufacturing purposes, these must be

related to the materials, dimensions, and equipment used for processing. The

structure of QFD is based on a set of matrices. The main matrix relates customer

requirements (what) and their corresponding technical requirements (how).

Part 3: Recommendations

Companies should change the way they design products especially to meet

environmental challenges. The idea behind eco-design aims to make the

manufacturing process more environmentally-friendly by factoring in the life-cycle of

products from the very outset. It thus assesses every stage of its development, from

the initial idea to the end of its life, including its production, logistics, distribution and

use. It also factors in its consumption of raw materials and possible negative impact

on the environment (atmospheric pollution, discharges into natural environments,

harmful effects on biodiversity, etc.). The approach also applies to product

packaging. The aim is to achieve « optimum packaging »: neither too much nor too

little, so that it can play its role in storage, hygiene and protection against

contamination (with food products) while minimizing the resources used and the

waste generated. In the vehicle industry, it is worthy to mention Renault’s way of

design in production. Renault implements the circular economy throughout the

various stages of the group’s products life cycle, to transform end-to-life parts and
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vehicles into a resource for the production and maintenance of vehicles, with a view

to reducing its consumption of raw materials. Renault uses circular economy

principles to reduce the use of raw materials, since it provides an economic model

that reconciles prosperity and the preservation of finite natural resources. Renault

makes a priority of replacing raw materials, based on natural resources, by

“secondary” materials, made from recycling. Renault leads the way on the use of

recycled plastics on its vehicles. The use of recycled plastics is increasing from

generation to generation, due to greater availability and the constant search for new

applications. Renault’s eco-design policy is also at creating repairable vehicles that

are easy to dismantle and contain recyclable or recoverable materials. The company

reuses parts coming from its ELVs (End-of-life vehicles), sales network, plants or

suppliers in a specific, particularly affordable after-sales offer.The company also

reconditions or remanufactures used parts, which are collected in the sales network,

sorted and refurbished. This activity adheres to a strict industrial process: involving

complete dismantling, cleaning, sorting, refurbishment and replacement of faulty or

worn parts, reassembly and inspection. Because using secondary materials into the

car manufacturing process is subject to their availability and quality, Renault works to

create “short recycling loops” that brings recycled materials into conformity with the

specifications of the automotive industry. I think using this type of approach gradually

to other industries or applying this concept to other industries not just in the

automotive industry will be the innovation of the future.

Part 4: Conclusions

Whilst service design is focused on the organisation and planning of people and

communication in order to create optimal service quality, product design is primarily

concerned with solving real problems through functionality , not just what a product
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looks and feels like. This is thanks to the intangibility of services, versus the physical

nature of products. However, at the heart of both product and service design is the

desire to create the best possible user experience. They are each user-centred and

keep customers at the heart of their decision making. 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.