In Chapter 4 - Managing Product and Service Innovation Identifies The Following Key Questions

Key operations questions
In Chapter 4 – Managing Product and Service Innovation

identifies the following key questions…….
• What is product and service innovation?

• What is the strategic role of product and service
innovation?
• What are the stages in product and service innovation?
• How should product and service innovation be
resourced?
The Henderson-Clark model
My Notes watch the videos https://www.youtube.com/watch?v=Pne2YdZuAtA

https://www.coursera.org/lecture/innovation-management/1-4-architectural-and-modular-innovations-FHCGL
• Incremental innovation introduces quality improvements in core components. The

word renovation would more precisely describe this type of innovation. (example regular change in
iPhone that have been launched.
 Modular innovation may result in the complete redesign of core components, while leaving
linkages between the components unchanged. (Car with bigger wheels and better ground
clearance. A better scanner with pdf and word format)
 Architectural innovation changes the nature of interactions between core components, while
reinforcing the core design concepts. ( Car with central dashboard. A laptop with better battery
backup may require the entire layout be changed.)
 Radical innovation introduces a new meaning, potentially a paradigm shift. (Example Electric
Car. Example printer + Scanner + fax combined)
The design of products/services and processes are
interrelated and should be treated together
Designing the Designing

product or the process
service
Products and services

should be designed in Product / service design Processes should be designed
such a way that they can has an impact on the so they can create all products
process design and and services which the
be created effectively
vice versa operation is likely to introduce
Why is design so important?
UK Design Council Survey…..
Design helps businesses connect strongly with their customers

90% of businesses growing rapidly say design is significant to
them, only 26% of static companies say the same.
Design reduces costs by making processes more efficient. It can
also reduce the time to market for new products and services.
Almost 70 per cent of companies seeing design as integral have
developed new products and services in the last three years,
compared to only a third of businesses overall.
Companies who were ‘effective users of design’ had financial

performances 200% better than average.
What is designed in a product or service?
A concept the understanding of the nature, use and

value of the service or product;
The group of ‘component’ products and

A package services that provide those benefits defined
in the concept;
the way in which the component products

A process and services will be created and delivered.
The stages of product / service design
Evaluation Prototyping
Concept Concept Preliminary
and and final
generation screening design
improvement design
Concept generation……
Ideas from customers formally through Marketing

activities
Listening to customers - on a day-to-day basis.
Ideas from competitor activity – For example reverse

engineering
Ideas from staff – Especially those who meet

customers every day.
Ideas from research and development
Concept screening……
Broad categories of evaluation criteria for assessing concepts
Feasibility - What investment

How difficult is both managerial and
financial will be
it? needed?
The What return Overall

criteria for Acceptability - in terms of benefits evaluation
screening How worthwhile is to the operation will of the
concepts it? it give?
concept
Vulnerability - What risks

What could go do we run if things
wrong? go wrong?
Design involves progressively reducing the number of
possibilities until the final design is reached
Large number of
design options
CONCEPT
Choice and
evaluation
"Screens"
Uncertainty
regarding the
final design
Certainty
regarding the
One design final design
FINAL DESIGN
SPECIFICATON
Preliminary design……
The component structure for remote mouse
et
Design evaluation and improvement……
There are various ways of

evaluating preliminary designs
These include:
- quality function deployment;

- value engineering;
- Taguchi methods.
A delays in the ‘Time to Market’ disproportionally delays
the financial breakeven point
Cash Sales Revenue
Cash flow
Delayed Sales Revenue
Delayed Cash Flow
Development costs Time

Development costs of
delayed project
Delay in Delay in
Time to financial
Market breakeven
Sequential and simultaneous arrangement of the stages
in the design activity… Simultaneous engineering
First Stage in the Sequential arrangement
Design Activity of stages
Second Stage in the
Design Activity
First Stage in the Third Stage in the

Design Activity Design Activity
Second Stage in the etc.

Design Activity
Third Stage in the

Design Activity Communication between
stages
Simultaneous arrangement
of stages etc.
Where should the management attention be?
KNOWLEDGE CONCEPT BASIC INITIAL PILOT MANUFACTURING
LAUNCH
AQUISITION INVESTIGATION DESIGN TESTS PRODUCTION RAMP-UP
Ability to
influence the
final design
ent
ofile
TIME
Sorting out problems early saves greater disruption later
Slow Time to Market

Low
Fast Time to
Market
High
Early stages of the Later stages of the
total design activity total design activity
Organization structures for the design activity
F.M. F.M. F.M. F.M.
P.M.
F.M. F.M. F.M. F.M.
P.M. F.M. F.M. F.M. F.M.
P.M. P.M.
P.M.
P.M.
PURE FUNCTIONAL
ORGANISATION
INCREASING PROJECT
ORIENTATION F.M. F.M. F.M. F.M.
PURE PROJECT P.M.
ORGANISATION P.M.
P.M.
P.M.
F.M. F.M. F.M. F.M.
P.M.
P.M.
P.M. F.M. = Functional manager
P.M.
P.M.
P.M. = Project manager
Organization structures for the design activity
My Notes
Key operations questions
To summarise the answers to the key question..
• What is product and service innovation?

• What is the strategic role of product and service
innovation?
• What are the stages in product and service innovation?
• How should product and service innovation be
resourced?

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Key operations questions

In Chapter 4 – Managing Product and Service Innovation

• What is product and service innovation?

My Notes watch the videos https://www.youtube.com/watch?v=Pne2YdZuAtA

• Incremental innovation introduces quality improvements in core components. The

Designing the Designing

Products and services

UK Design Council Survey…..

Design helps businesses connect strongly with their customers

Companies who were ‘effective users of design’ had financial

A concept the understanding of the nature, use and

The group of ‘component’ products and

the way in which the component products

Ideas from customers formally through Marketing

Listening to customers - on a day-to-day basis.

Ideas from competitor activity – For example reverse

Ideas from staff – Especially those who meet

Broad categories of evaluation criteria for assessing concepts

Feasibility - What investment

The What return Overall

Vulnerability - What risks

The component structure for remote mouse

There are various ways of

- quality function deployment;

Delayed Sales Revenue

Delayed Cash Flow

Development costs Time

First Stage in the Third Stage in the

Second Stage in the etc.

Third Stage in the

Slow Time to Market

F.M. F.M. F.M. F.M.

PURE PROJECT P.M.

To summarise the answers to the key question..

• What is product and service innovation?

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