Biddy's Bakery

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Product Design and Process Selection
Before studying this chapter you should know or, if necessary, review 1. 2. 3. Differences between manufacturing and service organizations, Chapter 1, pp. 5 – 7. Differences between strategic and tactical decisions, Chapter 1, pp. 00 – 00. Competitive priorities, Chapter 2, pp. 36 – 39.


LEARNING OBJECTIVES After completing this chapter you should be able to 1 2 3 4 5 6 7 8

Define product design and explain its strategic impact on the organization. Describe the steps used to develop a product design. Use break-even analysis as a tool in deciding between alternative products. Identify different types of processes and explain their characteristics. Understand how to use a process flowchart. Understand how to use process performance metrics. Understand current technological advancements and how they impact process and product design. Understand issues of designing service operations.


Product Design 55 The Product Design Process 56 Links to Practice: IBM Corporation 57 Factors Impacting Product Design 61 Process Selection 64 Designing Processes 68 Process Performance Metrics 71 Linking Product Design and Process Selection Links to Practice: The Babcock & Wilcox Company 75


Technology Decisions 78 Links to Practice: Using GPS Technology in Product Advertising 79 Links to Practice: Performing Robotic Surgery 81 Designing Services 83 OM Across the Organization 88 Inside OM 88 Case: Biddy’s Bakery (BB) 94 Case: Creature Care Animal Clinic (B) 94

000 53

54 • CHAPTER 3


ave you ever been with a group of friends and decided to order pizzas? One person wants pizza from Pizza Hut because he likes the taste of stuffed-crust pizza made with cheese in the crust. Someone else wants Donatos pizza because she likes the unique crispy-thin crust. A third wants pizza from Spagio’s because of the woodgrilled oven taste. Even a simple product like a...
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