OPEQUAL - MOD3

• Organizational success


  Attributed to having products and services that are well-designed and well-thought of
• Customers would buy products and services that provides them value over those that are poorly designed
• An excellent product and service design provides a significant competitive advantage to organizations
• Faulty product design is one of the major reasons why businesses fail. Worse, this may even lead to lawsuits, injuries, deaths, and tarnished business reputation
• Before making a purchase, consumers consider

  • Cost
  • Quality
• Organizations have to consider when designing a product

  1. Demand in the potential market

  2. Capability and capacity to manufacture it
• Manufacturability


  Ability of the organization to produce the output at an acceptable profit
• Serviceability

  Ability to perform the service at an acceptable cost or profit
• Organizations have to consider quality since customers specifically evaluate it before they make a purchase. The quality that they have to offer should be remarkably ahead from that of the competition
• Economic feasibility


  Organizations have to consider the drawbacks such as the possible issues of liabilities, ethics, costs, and profits. They have to assess if they have enough budget to pursue the design and if the company could earn from the investments that they would make
• Companies should redesign their products or services so that they could get ahead of the competition
• If they had the same design for so long, chances are competitors would have already learned how to improve theirs -- They can make better designs which would be more appealing to your customers
• Product redesign is necessary to maintain a strong competitive position in the market
• Indicators that a product needs redesign

  • Low demand
  • Excessive warranty claims
  • Increasing production costs
• Social and demographic aspects of a market constantly change, thus, organizations have to assess if their current design still suit their customers
• If their products have not changed their design for so long that they already lose their appeal to their customers, thus, the decrease in their demand
• Design may change also due to certain legal regulations or safety issues imposed by the government (this is the case for organizations now switching to eco-friendly designs and packaging)
• Technological improvements may also enhance product and service designs
• Product life cycle


  Products are made and go through a process before they are set aside in favor of a better one
• Understanding a product life cycle


  • Knowing which phase the product or service is at enables the firm to prepare and redesign them in order to remain competitive
  • Demand typically varies depending on which stage the products are at, different strategies should be carefully planned and implemented
• Phases of a product life cycle

  • Introduction
  • Growth
  • Maturity
  • Decline
• Operations manager's responsibilities


  1. Assessing how to introduce new products successfully

  2. Prepare capacity to accommodate increasing growth

  3. Devise strategies to extend the product life cycle during maturity

  4. Revive declining product sales
• Product Life Cycle Management (PLM)


  The firm can systematically manage the changes a product goes through
• Introduction stage


  1. Buyers may think that the product is yet to be perfected by the company and may just wait until they feel that it is safe to buy. They may also wait until the prices drop

  2. Organizations should strategically decide on the right timing on introducing the product. They have to weigh if it is better to wait and get all the probable product issues sorted out. However, there is a possibility of the competition getting the first mover advantage
• Growth stage


  1. Companies now enjoy higher reliability, increasing demand and lower manufacturing costs

  2. The challenge is for the organization to make accurate forecasts of demand growth to prepare their manufacturing capacity
• Maturity stage


  1. Demand levels off

  2. There is few needs for design changes

  3. The organization has reached high productivity and much lower costs, compared to when they were at the growth stage

  4. To extend the life cycle, the company comes up with new uses for the product
• Decline stage


  1. Decision whether to discontinue a product or service, replace them or abandon the market

  2. The company tries very hard to find new uses and new users if they decide to extend the product's life

  3. Extending the product life cycle can also be beneficial because they already have trained workforce, same equipment, a steady supply chain and reliable distribution channels
• Organizations must carefully consider different factors in their product and service design
• Legal and ethical aspect


  They have to comply to different government policies that regulate their operations
• Before the design is introduced to the market, the company has to consider its impact to the consumer


  Ensure that the product and its materials would not harm them or put them at risk
• Product liability


  • Responsibility of the manufacturer should the faulty product cause injury or harm to the consumers
  • Such instances damage the reputation of the firm and incur them significant losses
• Faulty products lead to costly recalls and settlement with the concerned parties
• Companies make sure that they provide warnings on the packaging or on their advertisements should there be possible risks on the use of the product
• Companies now also ensure that their products do not harm not only humans, but also animals during their testing, or the environment, in general
• Manufacturers also have to consider ethical standards in the design of their products and services
• If an organization really intends to sustain their business for a long period of time, they have to make meaningful trade-offs. They have to ensure that they provide high quality products that could satisfy their customers
• A product's impact to the environment is seen to affect market acceptance
• Cradle-to-grave assessment or life cycle assessment


  • Involves examining the environmental impact of a product or service throughout its useful life
  • Analyzes the impact in all phase of the product's life cycle -- from raw materials, its transformation processes, its distribution, consumption and its disposal
• Because of this, manufacturers are designing environmental friendly products and choosing designs that contribute less to damaging the environment
• End-of-life (EOL) programs


  • To solve disposal problems once the products reached the end of their useful lives
  • This also includes both the product and the equipment they use to produce them