Product Development

Product Development System

An effective product strategy links product decisions with other business
functions, such as
R&D, engineering, marketing, and finance. A firm requires cash for product
development,
an understanding of the marketplace, and the necessary human talents. The product
development system may well determine not only product success but also the firm’s
future. Figure 5.3
shows the stages of product development. In this system, product options go through
a series
of steps, each having its own screening and evaluation criteria, but providing a
continuing
flow of information to prior steps.

Optimum product development depends not only on support from other parts of the
firm
but also on the successful integration of all 10 of the OM decisions, from product
design to
maintenance. Identifying products that appear likely to capture market share, be
cost-effective,
and be profitable but are, in fact, very difficult to produce may lead to failure
rather than
success.

Quality Function Deployment (QFD)

Quality function deployment (QFD) refers to both (1) determining what will satisfy
the customer
and (2) translating those customer desires into the target design. The idea is to
capture a
rich understanding of customer wants and to identify alternative process solutions.
This
information is then integrated into the evolving product design. QFD is used early
in the
design process to help determine what will satisfy the customer and where to deploy
quality
efforts .

One of the tools of QFD is the house of quality , a graphic technique for defining
the relationship between customer desires and product (or service). Only by
defining this relationship in a
rigorous way can managers design products and processes with features desired by
customers.