BAM 158 Operations Management

Student Activity Sheet Module #6

Name: Class number:

Section: Schedule: Date:

Lesson Title: Exploring Product and Materials:

Service Design SAS
Lesson Objectives:
At the end of this module, I should be able to: References:
1. Identify some reasons for design or redesign Operations Management with Total
2. List some of the main sources of design ideas Quality Management, 2019 edition
by Stevenson and Defeo (textbook)

Productivity Tip: Be observant. Most of the time, the answers to your questions could be found in
your surroundings and your own experiences.

A. LESSON PREVIEW/REVIEW
1) Introduction (1 min)
Hola! Como estas? (Hello. How are you?) How was your quiz? I hope you did well.

We’re done with the introduction to operations management. Now, we will start talking about
product and service design. Are you ready for today?

2) Activity 1: What I Know Chart, Part 1 (3 mins)

First, let us test what you already know about the topic. Try answering the questions below by
writing your ideas under the column ―What I Know‖. Writing keywords or phrases that you think are
related to the questions will do. You may start.

What I Know Questions: What I Learned (Activity 4)

Can you name one reason of
design ideas?

Can you name one source of

design ideas?

What is a research?

B. MAIN LESSON
1) Activity 2: Content Notes (17 mins)
LO1: Identify some reasons for design or redesign
Think of an electronic device you are familiar with. What feature does it have that made you say ―wow‖?
The essence of a business organization is the products and services it offers, and every aspect of
the organization and its supply chain are structured around those products and services.
Organizations that offer products or services with excellent features, unique characteristics, and
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 BAM 158 Operations Management
Student Activity Sheet Module #6

Name: Class number:

Section: Schedule: Date:

designs that are well-thought out are more likely to realize their goals. Hence, organizations have
a strategic interest in product and service design.

Key Questions
From a buyer’s standpoint, most purchasing decisions entail two fundamental considerations: cost
and quality/performance. From the organization’s standpoint, the key questions are:

1. Is there a demand for it? (market size, demand profile)

2. Can we do it? (manufacturability, serviceability)
3. What level of quality is appropriate? (customer expectations, competitor quality, fit with current
offering)
4. Does it make sense from an economic standpoint? (Liability issues, ethical considerations,
sustainability issues, costs and profits
.
Reasons for Product and Service Design or Redesign
Product and service design has typically had strategic implications for the success and prosperity
of an organization. Furthermore, it has an impact on future activities. Consequently, decisions in
this area are some of the most fundamental that managers must make.

Organizations become involved in product and service design or redesign for a variety of reasons.
The main forces that initiate design or redesign are market opportunities and threats. The
factors that give rise to these can be one or more changes in:

 Economic – low demand, excessive warranty claims, the need to reduce costs
 Social and Demographic – aging baby boomers, population shifts
 Political, liability, or legal – government changes, safety issues, new regulations
 Competitive – new or changed products or services, new advertising/promotions
 Cost or availability – raw materials, components, labor, water, energy
 Technological – in product components, processes

These factors may seem obvious but reflecting a bit on technological changes can also create a
need for product or service design changes in several different ways. An obvious way is new
technology that can be used directly in a product or service.

To put it simply, organizations design or redesign their products and services for a variety of
reasons such as customer dissatisfaction, government regulation, competition, liability claims,
technological innovation (products and methods), and changes in costs and availability of such
inputs as materials, labor, and energy.

Let’s consider iPhone as an example. We all know how this company has made such a name in the
consumer electronics industry. We have witnessed how they were able to take their products into the
next level by solving users’ problems, adding new features, and refreshing its design. And they do not
fail to impress their customers by redesigning their products to make it extraordinary.

What do you think was their driving force to keep on improving their products?

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 BAM 158 Operations Management
Student Activity Sheet Module #6

Name: Class number:

Section: Schedule: Date:

LO2: List some of the main sources of design ideas

Main Sources of Design Ideas (Idea Generation)
Ideas for new or redesigned products or services may come from a variety of sources. It is
classified into three categories:

1. Supply chain-based - ideas can come from anywhere in the supply chain such as:
 customers (surveys, focus groups, complaints, unsolicited suggestions)
 suppliers, distributors, employees, maintenance and repair personnel (interviews,
direct or indirect suggestions, complaints)

2. Competitor-Based - by studying how a competitor operates and its products and

services, many useful ideas can be generated.

Reverse engineering – dismantling and inspecting a competitor’s product to discover

product improvements.

Do you think this is unethical? It is ethical to look but not to copy, in most cases.

3. Research-Based - organized efforts to increase scientific knowledge or product

innovation.

 Basic research - has the objective of advancing the state of knowledge about a
subject without any near-term expectation of commercial applications.
 Applied research - has the objective of achieving commercial applications.
 Development - converts the results of applied research into useful commercial
applications.

R & D efforts can play a significant role in product and process innovations and the
benefits of its success can be tremendous, although, these sometimes so costly that only
large company can afford to underwrite them.

In designing a product, one of the trade-offs that a business organization should consider is the
marketability of the product versus its manufacturability. In many cases, the more options and
interesting features that is added to the product, the less ability to manufacture the product at a
reasonable cost. In other words, to include these ―hot‖ features a company may have to pay a
significant price.

2) Activity 3: Skill-building Activities (20 mins)

Let’s have a drill!

Exercise 1: Examine and compare one of the following product sets. Base your comparison on
such factors as features, costs, convenience, ease of use, and value. Don’t worry. I’ve done an
example for you.

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 BAM 158 Operations Management
Student Activity Sheet Module #6

Name: Class number:

Section: Schedule: Date:

GPS (Global Positioning System) Maps

offers voice commands, more current, offers may show both the origin and the destination
more detailed directions many more locations, vs simultaneously, an inexpensive city map might
costs more and is easier to use (no folding is provide high value if travelling is within the city
required), higher value in the detail offered by
GPS if travelling cross-country

Cell phones Landline

vs

Online shopping “Bricks and Mortar” shopping

vs

Online Booking Booking from a Travel Agency

(using company websites)
vs

Online Course Classroom

vs

Grab Taxi Hailing a Taxi

(using the application)
vs

3) Activity 4: What I Know Chart, Part 2 (2 mins)

It’s time to answer the questions in the ―What I Know Chart‖ in Activity 1. Log in your answers in
the ―What I Learned‖ column. Let’s go!

4) Activity 5: Check for Understanding (5 mins)

Let’s check how well you understood the lesson. Choose the best answer. Write the CAPITAL
LETTER of your answer on the blank space provided.

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 BAM 158 Operations Management
Student Activity Sheet Module #6

Name: Class number:

Section: Schedule: Date:

1.Which of the following is not a reason for redesigning a product or service?

A. to reduce labor or material cost
B. to increase the level of employee satisfaction
C. to increase the level of customer satisfaction
D. to attract and increase customer demand
E. to increase quality
2. Which one of the following is not a factor of successful product and service design?
A. Be aware of what the competitors are doing.
B. Be aware of what customers want.
C. Know what government regulations are.
D. Use computerized design techniques.
E. Know what new technologies are available.
3. The process of dismantling and inspecting a competitor's new or revised product for
the purpose of gleaning design ideas is called:
A. design by imitation.
B. product analysis.
C. reverse engineering.
D. benchmarking.
4. Statement I: Applied research has the objective of achieving commercial applications
for new ideas
Statement II: Research and development (R&D) refers to organized efforts that are directed
toward increasing scientific knowledge and product (or process) innovation.
A. Both statements are true.
B. Both statements are false.
C. Only statement I is true.
D. Only statement II is false.
5.Which of the following makes products that are friendlier to the environment?
A. using less material
B. more recycled materials
C. using less energy
D. using less harmful ingredients
E. all of the above

C. LESSON WRAP-UP
5) Activity 6: Thinking about Learning (5 mins)
Wow, congratulations! You are done with this session. Shade the module number you just
completed.

Did you have challenges learning the concepts in this module? If none, which parts of the module
helped you learn the concepts?

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 BAM 158 Operations Management
Student Activity Sheet Module #6

Name: Class number:

Section: Schedule: Date:

The question/s I want to ask my teacher about this module is/are:

FAQs

1. Contrast applied research and basic research.

Applied research is research with a specific ―commercial‖ application goal; basic research is
intended to increase knowledge about a subject or area.

2. Who needs to be involved in the design of products and services?

In designing products and services, we need input from the marketing group because they generally
have the closest relationship with the customers and the best understanding of the marketdemand
for various products. We need a design engineer (especially in manufacturing) to provide adetailed
design of the product. We also need to include the manufacturing people in this process because
they have the best understanding of the company’s manufacturing capabilities and quality issues.
We also may need input from the finance department—especially if the product or service design
requires capital expenditures. Of course, last but certainly not least, we need a representative from
upper management to ensure that the product in question fits with the overall mission and objectives
of this firm.

KEY TO CORRECTIONS

Answers to Skill-Building Exercises:

Exercise:
GPS (Global Positioning System) Maps
offers voice commands, more current, offers may show both the origin and the destination
more detailed directions many more locations, vs simultaneously, an inexpensive city map might
costs more and is easier to use (no folding is provide high value if travelling is within the city
required), higher value in the detail offered by
GPS if travelling cross-country

Cell phones Landline

mobile and can be used at any location offer service at a single location, (they are
within a network, need to be plugged in continuously charged), tend to have fewer
vs
after their batteries run low, more dropped calls, for a homebound person who
convenient given that users can take cell rarely travels, landlines may offer high
phones with them, cost more than landlines value
Online shopping “Bricks and Mortar” shopping
requires that a customer have online access, requires that a customer place orders at the
allows a customer to place orders from any bricks and mortar location,
location, normally does not allow easy
vs
access to a salesperson, cheaper due to no
sales taxes, offers a wider variety of
products, more convenient given that a
customer can be at any location to place an
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 BAM 158 Operations Management
Student Activity Sheet Module #6

order, Customers may find higher value

inthe online experience given the
convenience, the wider product
selection, and lower (or equal) prices.

Online Booking: Flights Booking Flights from a Travel

(using company websites) Agency
offer greaterchoices, a customer can Customers can ask any question they may
vs
compare rates and schedules, manage have about the products, services,
his/her own booking, and view reviews; schedules, and prices; customers are
it could also be done anytime, dependent on the information provided or
anywhere, provided you have internet recommendations given by the travel
connection agent; prices may be higher as compared to
online booking
Online Course Classroom
require access to a computer, enable a classroom requires that the student travel to
student to take a course from any location, the university,
more convenient and they may cost less
vs
because students do not have to travel to
the classroom, online courses may cost
more if the universities are charging a
premium for the convenience
Grab Taxi Hailing a Taxi
(using the application) Customers need to compete with other
Convenient, easy, and fast; rates are commuters in hailing a taxi; rates are not
vs displayed beforehand; calling the
displayed together with the driver’s
information; customers can track the company may incur charges
driver’s location while waiting; there’s a
chance to leave a review after the ride

Answers to Check for Understanding:

1. B - A product or service redesign does not necessarily involve improving employee satisfaction.
2. D - Computerized design techniques don't necessarily lead to successful product and
servicedesign.
3. C - Reverse engineering can be a good source of ideas for product design.
4. A
5. E

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