OS - NEW PRODUCT OR SERVICE DESIGN AND DEVELOPMENT Flashcards
NEW PRODUCT OR SERVICE DESIGN AND DEVELOPMENT
o New product or service design and development involves the planning and production of an original output by a business
o In other words, if you want to achieve a competitive advantage, make or do something differently to your competition
Successful businesses do not want to compete with their rivals, they want to differentiate from them
APPROACHES TO NPSDD
o Businesses design and development new products/services in two ways:
Customer focused
Product focused
CUSTOMER CENTRIC DESIGN
o Customer focused design centres on finding out what people need/want and then developing products to satisfy these needs/wants
PRODUCT CENTRIC DESIGN
o Product focused design centres on the use of advancement in technologies to come up with new and appealing products or services
STEPS IN DESIGN AND DEVELOPMENT
- Market research and specification development. (what do people want? What do we want the new product to do?)
- Design product prototype (how do we actually make this?)
- Test product prototype (will this work like we hoped?)
- Product and production process refinement (What changes need to be made? How do we do this on a larger scale?)
- Full commercial production and distribution (How do we make this available to all of our customers?)
WHAT IS THE RESULT OF EFFECTIVE NSPDD?
o The effective design and development of a new product or service will allow a business to differentiate from its competitors.
o Businesses will achieve performance objectives of quality and customisation.
o This differentiation should drive increased sales revenue and in turn increased profitability
NPSDD AT IKEA
o Ikea has consistently embraced an evolution of all their products and services
o Within IKEA there is an overall product range of 9,500, with approximately 2 500 new product items added each year
HOW CAN WE EVALUATE THE EFFECTIVENESS OF THIS STRATEGY
o NPSDD as an operations strategy can be measured and evaluated by ‘if’ and ‘how’ new products will be added to operations activities.
o Approximately 2500 new products items are added each year at IKEA
step 1 = life at home report and home visits
step 2 + 3 = IKEA test lab at their birthplace and headquarters in Almhult, Sweden
step 4 = Designers work with a diverse team of technicians, manufacturers and specialists – often right on the factory floor.
Step 5= 20,000 co-workers produce wood-based furniture and boards at 36 sites in 11 countries
IKEAS DEMOCRATIC DESIGN
o “making great design available to everyone”
o “a tool we use when we develop and evaluate the product we put into our range. It has five dimensions, which are function, form, quality, sustainability and low price”
EFFECTIVNESS
o 41.3 billion euros made in retail sales
o 6.5% growth rate from 2016-2019
