Product Development

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PRODUCT DEVELOPMENT
Product development is define the creation of products with new or different characteristics that offer new or additional benefits to the customer. Product development may involve modification of an existing product or its presentation, or formulation of an entirely new product that satisfies a newly defined customer want or market niche. (BusinessDictionery.com) Product Development System

An effective product strategy links product decision with cash flow, market dynamics, product life cycle, and the organization’s capabilities. A firm must have the cash for product development, understand the changes constantly taking place in the marketplaces and have the necessary talents and resources available. The product development system may well determine not only product success but also the firm’s future. In this system, product options go through a series of steps, each having its own screening and evaluation criteria, but providing a continuing flow of information to prior steps.

The screening process extends to the operation function. Optimum product development depends not only on support from other parts of the firm but also on the successful integration of all 10 of the OM decision, from product design to maintenance. Identifying products that appear likely to capture market share, be cost effective and profitable but are in fact difficult to produce, may lead to failure rather than success.

Here are the 13 Management Principles of Toyota's Product Development System (Jul. 13, 2006 By James M. Morgan and Jeffrey K. Liker): Excerpts from "The Toyota Product Development System: Integrating People, Process and Technology," (2006, Productivity Press)

1. Establish customer-defined value to separate value-added activity from waste. 2. Front-load the product development process while there is maximum design space to explore alternate solutions thoroughly. 3. Create a leveled product development process flow.

4. Utilize rigorous standardization to reduce variation, and create flexibility and predictable outcomes. 5. Develop a chief engineer system to integrate development from start to finish. 6. Organize to balance functional expertise and cross-functional integration. 7. Develop towering technical competence in all engineers. 8. Fully integrate suppliers into the product development system. 9. Build in learning and continuous improvement.

10. Build a culture to support excellence and relentless improvement. 11. Adapt technology to fit your people and process.
12. Align your organization through simple, visual communication. 13. Use powerful tools for standardization and organizational learning.

Quality Function Deployment (QFD)

Quality Function Deployment (QFD) refers to both determining what will satisfy the customer and translating those customers’ desires into the target design. The idea is to capture a rich understanding of the customer wants and to identify alternative process solution. This information is then integrated into the evolving product design. QFD is used early in the design process to help determine what will satisfy the customers and where to deploy quality effect. One of tools of QFD is the house of quality.

House of Quality

House of Quality appeared in 1972 in the design of an oil tanker by Mitsubishi Heavy Industries. Akao has reiterated numerous times that a House of Quality is not QFD; it is just an example of one tool. A Flash tutorial exists showing the build process of the traditional QFD "House of Quality" (HOQ). (Although this example may violate QFD principles, the basic sequences of HOQ building are illustrative.) There are also free QFD templates available that walk users through the process of creating a House of Quality. Other tools extend the analysis beyond quality to cost, technology, reliability, function, parts, technology, manufacturing, and service deployments. In...
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