September 3, 2024

What major difference would you expect to find in the management approaches used for breakthrough innovation projects versus those used for derivative or enha

Due Thursday 9/6

What major difference would you expect to find in the management approaches used for breakthrough innovation projects versus those used for derivative or enhancement projects? (125-150 words)

NO Ai, chegg, brainy, course hero, etc.

Use attachment as your source

Swink_MOAS_4e_Ch04_PPT.pdf

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Chapter 4

Product/Process Innovation

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Learning Objectives

4-1 Explain why product/process innovation is an important contributor to a firm’s performance.

4-2 Contrast different types of innovation strategies and projects.

4-3 Describe new product/process design and development objectives and project phases

4-4 Explain why cross-functional integration is needed in product and process design.

4-5 Apply tools and techniques for integrating customer needs and supply chain considerations into product/process design and development.

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Learning Objective 4-1

Product and Process Innovation: Diet Black Cherry Vanilla Coke Anyone?

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Learning Objective 4-1

Design and Development Definitions

• New Product Design and Development: transform market opportunities or new technologies into product design specifications

• New Process Design and Development: transform product specifications or process technology into a new or revised production system

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Learning Objective 4-1

Product Life Cycle Definitions and Stages (1 of 2)

• Launch: introduction into the market; may require SC process innovation

• Growth: increasing demand, flexible SC, more data from customers, increasing standardization

• Maturity: demand and product stabilization, increasing importance of cost, process innovation to increase SC efficiency

• Decline: changing technology or customer needs, declining demand, potential phase-in of a replacement product

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Learning Objective 4-1

Product Life Cycle Definitions and Stages (2 of 2)

Figure 4-1 Innovation Across a Product’s Life Cycle

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Learning Objective 4-1

Innovation Across the Product Life Cycle (1 of 2)

Launch

• Intense design and development

• May need SC process innovation

Growth

• Customer data aids in the refinement of product

• Product changes, but moving toward standardization

• Process innovation postponed

• SC flexibility due to high mix of low-volume orders, increasing capacity

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Learning Objective 4-1

Innovation Across the Product Life Cycle (2 of 2)

Maturity

• Demand stabilizes

• Product stabilizes

• Emphasis on cost

• Process innovation needed to increase SC efficiency

Decline

• Market/technology changes

• Pressure to reduce cost and capacity

• Incremental projects to extend life

• Introduction of next generation products

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How Product/Process Innovation Affects Firm Performance (1 of 2)

• Customers share needs and desires

• Financial managers evaluate potential opportunities

• Marketing managers communicate customer needs and desires, competitive opportunities, and marketing strategies

Learning Objective 4-1

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How Product/Process Innovation Affects Performance (2 of 2)

• Engineers and designers turn customer needs and desires into product and process specifications

• Operations managers across the SC determine how to best source, produce, and deliver products based on operational capabilities

Learning Objective 4-1

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Types of Innovators

• Fast Innovators

– Get to market quickly

– React quickly to competitors’ actions

– More continuous stream of product introductions

• High-Quality Innovators

– Fewer issues launching products and fewer failures

– Effectively satisfy customers for higher brand loyalty

• Efficient Innovators

– Fund more new design and development projects

– Sell at lower prices, or have lower break-even quantities

Learning Objective 4-1

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Student Activity (1 of 2)

Search the web and find companies that have been highly ranked or given awards for innovation. Examine the issues from the past few years. What do most of these innovative companies have in common?

Learning Objective 4-1

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Critical Innovation Operational Competencies (1 of 2)

• Idea and opportunity development

• Innovation portfolio planning and selection

• Innovation project management

• Organizational learning

Learning Objective 4-2

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Critical Innovation Operational Competencies (2 of 2)

Figure 4-2 Competencies for Product/Process Innovation Management

Learning Objective 4-2

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Learning Objective 4-2

Idea and Opportunity Development (1 of 2)

– Hiring the “best and brightest”

– Creating effective rewards

– Providing adequate resources

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Idea and Opportunity Development (2 of 2)

• Open innovation: an organizational effort to capture ideas and resources from sources outside the firm for use in innovation efforts

• Crowdsourcing: the process of obtaining ideas or services by soliciting contributions from a large group of people, especially from an online community

Learning Objective 4-2

• Many firms have taken steps to process ideas from external networks like customers, suppliers, universities, and competitors

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Learning Objective 4-2

Innovation Portfolio Planning (1 of 2)

Figure 4-3 Types of Development Projects Source: S. C. Wheelwright and K. B. Clark, Revolutionizing Product Development (New York: Free Press, 1992).

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Innovation Portfolio Planning (2 of 2)

Types of Developmental Projects:

• Research and advanced: finding new core products or

processes

• Radical breakthrough: develop products or processes that

will employ some entirely new technology

• Next generation or platform: develop new product platforms

using mostly existing technologies

• Enhancements, hybrid, and derivatives: refine and improve

selected features of existing products

Learning Objective 4-2

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Innovation Project Management (1 of 2)

In innovative firms, product/process design and development projects are marked by two key competencies: discipline and flexibility.

A disciplined innovation project has

1) well-defined process steps,

2) consideration and inclusion of all relevant stakeholders and decision makers, and

3) well-thought-out metrics and incentives

Learning Objective 4-2

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Innovation Project Management (2 of 2)

A flexible innovation project includes

1) rigorous risk analysis and contingency plans,

2) planned evaluation and decision points where the project may be killed, redirected, or continued; and

3) extra resources (funds, people, equipment) that can be quickly redeployed.

Learning Objective 4-2

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Learning Objective 4-2

New Product/Process Launch and Learning

• Management of a progression of projects

• Capture lessons learned postlaunch

• Learning applied to next project

• Continual chain of innovation projects adds to overall capabilities

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Learning Objective 4-2

Codevelopment

Benefits:

• Increased sources of, and access to, ideas and opportunities, leading to higher quality

• Leveraging the expertise of others increases the number of successful launches and reduces lead time

• Financial and legal risks are shared

Risks:

• Less control over intellectual property

• Partner dependency may lead to less control over goals and timing

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Learning Objective 4-3

Product/Process Design and Development: Stages

• Concept development

• Product and process planning

• Detailed design and development

• Product and market testing

• Commercialization

• Market introduction

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Learning Objective 4-3

Product/Process Design and Development: Managing Stages

• The Stage-Gate Process: resources allocated on stage-by-stage completion

• Concurrent Engineering: simultaneous (not sequential)

• Design for the Customer: use of multiple customer-focused tools

• Design for Supply Chain Operations: use of multiple supply chain or product techniques

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Learning Objective 4-4

Concurrent Engineering (1 of 2)

Figure 4-4 Overlapped Product Development Activities: Concurrent Engineering

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Learning Objective 4-4

Concurrent Engineering (2 of 2)

Figure 4-5 Comparing Resource Expenditures in Functional and Integrated Product Development Projects

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Learning Objective 4-4

Categories of Overall Resources Spent in New Product Development

• Development costs

– Spent to fund the design, development, and testing activities in the development project

• Sustaining and warranty costs

– Spent to make changes to the product design and production processes needed to solve problems uncovered both in production and in the field

• Production and sales support costs

– Spent to promote, sell, produce, and distribute the product

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Learning Objective 4-5

Design for the Customer

• Voice of the Customer (VOC): gather input on customer’s needs and wants

• Quality Function Deployment (QFD): convert customer’s needs and wants into specifications

• Failure Modes and Effects Analysis (FMEA): identification and correction of potential problems

• Value Engineering/Value Analysis: improvement of benefits and costs through examination of functionality

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Learning Objective 4-5

House of Quality

Figure 4-6 House of Quality for Housekeeping Service

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Learning Objective 4-5

Failure Modes and Effects Analysis (FMEA)

1. Determine what portions of the product or the process are to be analyzed

2. Identify potential failures and causes of failures

3. Prioritize failure modes • Risk Priority Number (RPN) =

= Occurrence rating × Severity Rating × Undetectability Rating

5. Create plans to deal with each critical failure mode

6. Implement plans, measure impact, adjust analysis

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Learning Objective 4-5

Failure Modes and Effects Analysis: An Example

Table 4-2 FMEA for Coffee Heating Element

Name Function Failure Mode

Effect Cause Severity

(S) Occurrence

(O)

Undetecta- bility (U)

RPN= S ×

O × U

Recommen- dation

Heating Element

Keep coffee at constant temperature

Coffee cold

Coffee thrown out

Broken connection

3 6 6 108 Reinforce connection guides for protection

Broken heating element

3 4 3 36 No action

Coffee too hot

Mouth or hands burned

Malfunctioning regulator

8 4 8 256 Swap Current regulator for new, redesigned one provided by supplier

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Learning Objective 4-5

Value Engineering/Value Analysis

• Identify functional purposes of a product or component

• Separate functions into two categories, those that make the product work and those that make it sell

• Estimate the value (benefits and costs) of each function

• Compare the importance versus the cost of each function

• Implement changes to the product design that maximize the value of the product

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Learning Objective 4-5

Design for Supply Chain Operations

• Design for Manufacture (DFM): improvement of product “producibility”

• Design for Assembly: minimizing number of components and easing assembly processes

• Design for Six Sigma: improving process consistency

• Design for Product Serviceability: easing disassembly and component reuse

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Learning Objective 4-5

Design for Manufacture: Processes

• Design for Logistics: minimizing packaging, handling, and shipping costs

• Design for the Environment: minimize negative environmental impacts across product life cycle

• Robust Design: improving the design’s tolerance for variability

• Components Standardization: reuse parts for existing designs

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Learning Objective 4-5

Modular Product Design and Service Platforms

Modular Product Design: using combinations of components with standardized product interfaces to create different product variations

Service Platform: a product designed to deliver a wide range of customizable services

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Learning Objective 4-5

Student Activity (2 of 2)

How many of the items and devices you own are service platforms? Identify a product that is not currently sold as a service platform, but could be. List the types of services (information, support, experience) that a servitized version of this product could provide. How might information generated by the product be used to improve supply chain processes?

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Learning Objective 4-5

Enabling Technologies for Product/Process Innovation

Computer-Aided Design (CAD):

• automating systems for drawings and technical specifications

Computer-Aided Engineering (CAE):

• systems that create 3D models, reducing prototype need

Product life cycle management (PLM):

• capturing and sharing product definition data across the life cycle

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Product/Process Innovation Summary

1. Innovative firms gain competitive advantage.

2. Innovation in the SC involves customers, suppliers, and other partners, resulting in faster and more efficient development.

3. Innovation projects have multiple stages.

4. Innovation project stages can proceed sequentially or concurrently.

5. Innovation projects require the integration of many interrelated product/process design issues.

6. Advancing technologies are enabling new ways to simulate and evaluate alternative design concepts.

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