Chapter 2: Development Processes and Organizations

1. Chapter 1: Introduction Chapter 2: Development Processes and Organizations Chapter 3: Product Planning Product Design and Development Fourth Edition by Karl T. Ulrich and Steven D. Eppinger

3. This represents cross-funtional teams Functions – Could be Design, Manufacturing, Marketing, etc.

6. Most designs are one of these two, with Market pull as the primary. More than one of these may apply.

7. http://en.wikipedia.org/wiki/Technology_push Aging Baby Boomers have created a number of marketing opportunities Aerogel is a technology looking for commercial applications https://www.besttvbuys.com/loudandclear/index.asp?did=978&refcode=lnc4 http://cleantechnica.com/files/2009/02/ls.jpg

8. Customized Products While Pacific Bearing has a large number of stock choices, they also sell unique combinations and modifications of existing designs http://www.pacific-bearing.com/default.aspx

9. Platform Products Dyson Vacuum cleaners are all built around the same “Cyclone” http://www.unplggd.com/uimages/unplggd/james_dyson_sz.jpg

10. Risk Companies face many forms of risk which they need to report in an SEC filing. We will look at the issues raised by Medtronic (a medical device company) in their SEC filing. Name the risks you expect Medtronic to list.

11. From the 2011 SEC 10K filing • Market competition, Price Risk • Supply Chain • Government Regulation • Reimbursement Rates • Quality Issues • Intellectual Property • Product Liability • Obamacare Tax • R&D Pipeline • Customer Relations • Credit Markets • Clinical Trials • Business Acquisitions • Global Business • Tax Law (International)

12. Product Development Process Concept Development System-Level Design Detail Design Testing and Refinement Production Ramp-Up Planning Four Phases of Product Development 3 speed to 4 speed or Continuously variable (GM Tech Center) GM sees Energy Crisis, needs better gas mileage The product planning phase precedes the product development process. For transmissions, more speeds = better mileage e.g. Find clutch area needed for full throttle upshift with current engine. (Division Level)

13. ZF’s 8-Speed Automatic Transmission - Tech Dept. BY K.C. COLWELL December 2009

14. Xerox Lakes Project Example Xerox Document Centre 265

15. The Product Planning Process

16. A Product Plan

17. Market Segmentation • A market segment is a group of actual or potential customers who can be expected to respond in a similar way to a product or service offer. They want the same types of benefits or solutions to problems from a product or service, or they respond in a similar way to a company’s promotional programs. • Successful segmentation: • Heterogeneity of wants and needs. Customers will actively seek and pay a premium for products and services that better meet their wants/needs. • Customers do cluster into specific groups whose members’ needs are more similar to those of other customers in that groups than they are to the needs of customers in other groups. (Tennis shoes) • The costs of serving a customer in a segment must be no more than they are willing to pay. When successful segmentation conditions exist, a firm that does not segment the market presents its competitors with an opportunity to enter the market.

18. Market Segment Map Market Segment

19. Technology S-Curves DigitalTechnology Copier Performance Light-LensTechnology Time

20. Technology Roadmap

21. Segmentation Examples Dell computers http://www.dell.com/ Apple Computers http://store.apple.com/us/browse/home/shop_mac?mco=NzcwNjgzMA Harley Davidson http://en.wikipedia.org/wiki/Harley-Davidson

22. Quiz