21 July 2010

Jan Larsson at Siemens PLM Software explores the many facets of product development and delivery.

It used to be fairly straightforward to conceptualise a new innovative product idea, do some market research and verification of the concept before getting into the design phase and some real life testing before manufacturing and distributing the product in question.

In the early automotive days, the Model T offered its customers very little in the way of options or customisation. In fact, Henry Ford used to say: “You can paint it (your car) any colour… as long as it’s black.”

However today, nearly all manufacturing companies deal with not only a global audience for their products but also with a dispersed design and manufacturing chain, creating a very complex environment that needs to be managed and controlled to successfully launch a product.

Managing complexity has to be done while meeting the demanding requirements for:
Speed – rapidly take an idea and deliver it to the market
Globalisation – develop innovations in the context of the global market being served
Sustainability – deliver product innovations that are environmentally friendly today and will not have harmful effects on the environment in the future
Optimisation – take full advantage of the resources available today through greater productivity and more efficient processes, all while optimising the cost and quality of the products.

In order for companies to meet these requirements, deal with the increase in complexity and, more importantly, understand the large amount of information necessary to take the right decision at any point in time, they require the correct infrastructure and tools along with a very good understanding of the overall requirements and processes.

As an example, let’s look at the complexity of today’s vehicles, which far exceeds that of the first Model T. The spectrum of customisation available to today’s automotive customers adds a tremendous amount of complexity that must be dealt with by the automotive manufacturers.

Looking at a typical car line gives trillions of possible combinations when you consider any colour, any features, anytime, anywhere.

In order to compete and to meet the varying needs of a diverse, global customer base, the automotive industry has been evolving over the years to a strategy of common platforms. This approach has resulted in a tremendous amount of both product and process complexity. When considering the number of options and the production of these options on a single global platform, we see a highly complex product brought to market through a set of complex processes.

This complexity is required to meet the increased requirements of consumers for greater personalisation in their products and is fundamental to the competitiveness of automotive manufacturers as well as manufacturers across all vertical industries.

So what is the answer?
Companies must be able to simultaneously execute the activities required to offer the right product and build it in the best way possible. By establishing an environment where they can simultaneously deal with these issues, they ultimately will transform their process of innovation.

Coming up with the right product means defining the specific aspects that will meet or exceed the needs of today’s customers. In particular these customer requirements fall into the categories of timing, function, performance, style and price. That means the product is available when the customer wants it, it provides needed value, regarding functionality it is either better than other products on the market or performs exactly as the customer requires, it looks and feels exciting, and it is available to the customer at a price that is competitive and meets their threshold.

Of course, these requirements then all have a direct effect on how the product should be built. For example, the manufacturer needs to be able to manage the overall production costs while ensuring quality. This means the company can make a tidy profit and the customer gets a product that meets or exceeds their expectations and will last as long as it is expected to. Manufacturers also need to bear in mind availability – ensuring that their products can be delivered on time to customers no matter where they are in the world – and sustainability; something that has become so important today, both on an environmental and a regulatory compliance level.

So to summarise, in order for manufacturers to be able to simultaneously build the right product in the correct manner, they must develop a rich platform of product and process knowledge to underpin and support continuous innovation across the multiple disciplines and phases that encompass the product’s lifecycle.

This article first appeared in the Summer 2010 edition of Prime.

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