Final Review

Product Design & Development

 Testing in the Concept Development Process
Mission Plan Development
Establish Set
Statement Identify Generate Select Test Downstrea Plan
Target Final
Customer Product Product Product m
Specificati Specificati
Needs Concepts Concept(s) Concept(s) Developme
ons ons
nt

Benchmarking confirms Concept testing confirms

the specifications the concept selection
Interpreting the Results:
Forecasting Sales
Q=NxAxP
• Q = sales (annual)
• N = number of (annual) purchases
• A= awareness x availability (fractions)
• P = probability of purchase (surveyed)
= Cdef x Fdef + Cprob x Fprob

EX: brand sales at rate of 100,000 hats per year; only 15% of students aware of their
products. Result from concept testing process indicates that a definitely-would-buy fraction
of 0.35 and probably-would-buy fraction of 0.15. If we use value Cdef = 0.4 and Cprob=0.2.
How many hats expected to be sold per year?
 Sources of Forecast Error
• Word-of-Mouth Effects
• Quality of Concept Description
• Pricing
• Level of Promotion
• Competition
Give example?
Industrial Design
User Experience Needs: usability, ease of maintenance, user interactions, safety issue

Aesthetic Needs: visual product differentiation, pride of ownership, image, and style,
aesthetically appealing product to motivate team

Technology-driven products: its core benefit is based on its technology, or its ability to
accomplish a specific technical task.

User-driven products: The core benefit is derived from the functionality of its interface
and/or its aesthetic appeal. The user interfaces: safe, easy to use, and easy to maintain
Three Design Challenges

People Business
“desirable” “viable”

Technical
“feasible”

Source: IDEO
With this in mind, a convenient means for assessing the
importance of ID to a particular product is to
characterize importance along two dimensions: user
experience and aesthetics. User experience
encompasses how comprehensively a product meets all
of a user’s needs, including emotional as well as
functional, and relates to its usability, user interface,
human factors, and ergonomics as well as subjective
qualities (“Does the product make the user happy when
she turns it on?”).
=> Try assessing any product you like
Design for
Environment -
DFE
• Effective DFE practice maintains
or improves product quality and
cost while reducing
environmental impacts.
Design for Manufacturing
and Supply Chain
• Economic of scale
Prototyping
Product Development Economics
• Net Present Value
NPV Review

Discount
Compute the NPV of the Cash Flows
Coffee Machines Only

Why not
-1.25, but
-1.23? How to calculate Period Present Value?
How to calculate Net Present Value?