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Product and Service Design Processes

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Introduction

Product and Service Design Processes

Successful production of the new product by an enterprise as well as decision to deliver new service to its customers largely depends on the effective design of both product and service as well as design of the processes, which produce these products and services (Hammer & Stanton 1999). In general, decisions, which have been made in the course of the process of product and service design, have considerable impact on the conclusions, which are undertaken during design of processes that produce products and services. In order to design product and service successfully, managers at the enterprises need to follow basic guidelines. First, both products and services should be designed in such a way that could be further produced effectively. Next, design of products and services affects process design. Moreover, processes should be designed in such a way that they would be able to produce products and services which the operation at the enterprise would be likely to introduce (Heizer & Render 1999). Product and service design processes include certain steps that should be undertaken in order to secure successful products’ and services’ positioning on the market.

Starting from the motivation of the new product and service, managers need to generate ideas about new product and service or develop ideas for improvement of the current product and service. Based on the organizational capabilities, preliminary design of the new product and service stage is followed by the step that includes evaluation and improvement of the product and service. On the final stage of the design process, new product and service are prototyped and their production is forecasted (Johnston et al. 2003; Johnston & Clark 2005). Clearly, in the course of the product and service design processes, research and development play considerable role. Due to the impact that a new product and service design can exhibit on an enterprise, the design process is suggested to be closely related to the major strategy of the enterprise and take into account its central considerations (Keen 1997).

In the course of the product and service design processes in the organization, managers need to be aware of certain external threats and opportunities that have significantly affected success of the new product and service in the market (Slack & Lewis 2005). Both product and service design processes are considered to be processes in themselves. Fully specified products and services at the enterprise come as output of the design process which transforms inputs with the help of design and technical staff, test and design equipment (Figure 2) (Slack et al. 2012).

Environmental and Social Gaps in the Product Design Processes

Process of the product design or industrial design at the enterprise has been practiced and improved by organizations for a long period of time. Stages, opportunities and threats of the product design process have been addressed in the previous section. However, what deserves special attention is magnificent incorporation of the environmental as well as social aspects (that ensure sustainability of the product) into the regular stages of the product development and product design processes at the enterprise. Integration of the environmental and social aspects into the process of the product design has been intensively studied by researchers for the past few decades. Based on the numerous ecodesign studies that have been carried out in different countries of the world as well as based on the ISO technical report on “Integrating environmental aspects into product development and design”, the information about finest practices in the field of product design process management has been made available to the public (Charter & Tischner 2001).

However, still there are certain gaps in the product design process’ management that should be addressed. First, currently there are several complications related to the integration of social aspects into the product design process. There is a general lack of practical tools and indicators that would cover ethical and social aspects of the product design process, as well as lack of tools for covering strategies of integration into the product design and product development processes. Next, there is a need for dissemination to both small firms and medium sized enterprises. Most tools and methods of the ecodesign are developed for large companies since most of the market activities are undertaken by large enterprises. Therefore, it is essential to convert the ecodesign tools and methods and further adapt them to the particular needs of small and medium sized enterprises, which constitute approximately 90% of businesses. Finally, there is a need to take into account soft factors ecodesign, including product semantics, aesthetics, consumer preferences and behaviour, and cultural aspects etc (Charter & Tischner 2001).

Environmental and Social Gaps in the Service Design Processes

One of the central sources of the service design process is considered to be conventional service marketing. The two fundamental properties of services are their client intensity and intangibility. Therefore, major drivers and obstacles in the service design process are associated with these major characteristics of services. Due to the fact that a service is intangible, customers are not able to either see or touch it before they make a purchase, hence, complicating the goal of the sales representative to advertise quality of the service. Intangibility of the service implies that customers have no tangible or specific product that they can evaluate before purchase. Thus, they are forced to believe producers and providers of services that the service they are purchasing has high quality. Moreover, customers frequently undervalue the service in cases when they have little information about the process of service’s provision and costs associated with it. Hence, image of the brand that is providing a service, quality and reputation are exceptionally important in the process of selling a service or developing and designing new services in addition to introducing them in the market (Charter & Tischner 2001).

A service should be designed in such a way that it would meet needs and wishes of customers even more compared to the product. At the same time, a service has larger variance in its implementation than a product does in its production. Hence, if it is easier to justify a product’s failure to perform worse than expected, it is substantially harder to reason non-responsiveness of the service provider.

However, even if intangibility of the service complicates the distribution process, this property of the service improves the process of new services’ introduction to the market through a simple change of the nature of the service, an alteration in the routine of the service production and retraining provider of the service. New services comprise a critical factor in the market competition of the enterprises. In particular, it is widely established that delivery of poor quality services by one company affects consumers’ decision to switch their preferences to another company. Due to the fact that conformance of a service is predominantly hard to manage compared to the conformance of the product’s manufacturing, it is important for enterprises to pay additional attention to the skills and knowledge of the staff in the service oriented sectors (Charter & Tischner 2001).

There are numerous specific approaches and methods to the service design process’ management at the enterprise. Overall, following stages are undertaken in the course of effective and successful service design process: continuous generation of ideas, concretion, assessment, decision, and realisation. Among the tools that are used in the course of the service design process, following are found to be the most effective: blueprinting that is targeted at the conceptualising of the desired service, gap-analyses that detects potential problems, quality function deployment, which is focused on the minimisation of these problems. However, the major gap in the service design process of the majority of enterprises is the lack of integration of social and environmental aspects in both research and practice of the service design at the enterprises (Charter & Tischner 2001).

Combination of Product and Service Design Processes

Majority of business that enterprises run are connected with both tangible products (for example, production and sale of cars) and intangible services (for example, automotive repair). In both situations, products as well as services are associated with offering a certain value to the customer. For instance, the mechanic in the enterprise needs products, such as screw driver, in order to repair the car. On the other hand, producer of the car needs services, for example, transportation, in order to manufacture the car. Recently, in the majority of the developed economies, share of service processes at the enterprises has increased while the number and importance of the product processes has decreased (Verkuijl & Tischner 2004). As a result, this shift has been positively perceived by the environmental scientists who consider that this change to services from products has considerable positive impact on the environment. According to them, energy efficiency improvement and a demanded material is hard to achieve with the help of only implementing modifications to the existing products. The major idea in the framework of the shift from product to service oriented production is optimisation and integration of the product functions or replacement of the product with a corresponding service. For instance, certain share of the population is using mobile phones on the contract basis, due to which they make payments only for the services provided and not for the phone itself. An increasing number of enterprises have positioned themselves on the market as service providers; for example, Electrolux (industrial cleaning), Interface (carpets), Wilkhahn (furniture), IBM (computers), and Rank Xerox (photocopiers). As a result, modern trend to offer mixed services and products to customers has been most distinguished in the business-to-business offers (Charter & Tischner 2001).

There is a growing public interest in the environmentally friendly product and service policies and potential of the market to address necessary transformations. Moreover, the debate on the implementation of the product-service mix with the purpose of achieving increased environmental benefits has considerably advanced over the last decade. Nevertheless, difficulty to identify environmental benefits, as well as other benefits associated with the product and service provision to the customers, largely explains reasons why product-service mix has not been taken seriously and widely established (Manzini, Vezzoli & Clark 2001). In 1998, the market for “products sold as services” in the European Union was estimated at the level of 758 billion euros, which constituted about 10% of GDP (Stahel 2000). Within this market segment, the function selling of products constitutes for about 60% (or 6% of the GDP) when remanufacturing the services comprised only 40% (or 4% of the GDP) (Stahel 2000).

Noteworthy, not all cases of implementing product-service mixes at the enterprises are associated with increased environmental benefits, as well as increased social advantages. There are certain conditions of the product-service mix’ design process that should be kept. For instance, in cases when products are borrowed and then returned the costs associated with additional transportation incur as a result of the use of fuel along with increased emissions.

Moreover, even in cases when the product-service mix processes are well-designed, their implementation is sometimes associated with generation of the undesirable side effects that are commonly known as rebound effects. Latter is referred to the counterproductive negative effects that exceed anticipated positive impacts, either through inefficient use of resources or customers’ behaviour. Society is often perceived as a set of multifaceted and inter-related systems that are not visibly clear. Therefore, sometimes the implementation of the environmentally friendly product and service design processes at the enterprises may turn into increase in the global consumption of natural resources and increased environmental pollution. For instance, outsourcing, instead of the products’ ownership, can be associated with consumers’ behaviour that is less environmentally responsible (Charter & Tischner 2001).

However, the implementation of the product-service mix processes at the enterprises definitely presents a strong potential for generating positive solutions, which would endorse social and environmental benefits.

Defining Sustainability Guidelines as a Tool for Product and Service Design Processes

Following sustainability guidelines is considered to be one of the most effective tools of the product-service mix design processes, since it helps to adopt ideas and solutions that are moving the enterprise towards improved sustainability. Sustainability guidelines are formulated on two levels. First level guidelines are developed for the idea generation stages of the product-service mix design process. Second level of the guidelines includes more thorough recommendations for further stages of the design process. All of the sustainability guidelines are organised in six criteria per each of the three sustainability’s dimensions. These criteria are pertinent for achieving sustainability of the product-service mix process

process design can be achieved through brainstorming workshop, conducted with a group of experts or employees. In general, it is useful to discuss every of the six criteria of each of three dimensions for sustainability. Yet, not all of the criteria have identical importance for every product-service mix design process. Therefore, depending on the context of the product-service mix design process, a reasonable first step would be setting up priorities and carrying out weighing of the criteria for sustainability dimensions. Using the checklist, one can identify importance of every criterion and determine whether it is of high, medium or low importance or if it has no priority at all.

Data Analysis

Methodological approach that is used for collecting data is based on the case studies. Using information from case studies provides an opportunity to get an insight of the product-service mix processes’ design and their benefits for the environment and society, since adopting this qualitative approach is beneficial in the framework of this research. Overall, analysis is based on the case study of the company that has adopted product-service mix design processes.

The case study is based on the MEWA Company, which is located in Germany. In short, this enterprise hires out cleaning cloths, which was made of recycled cotton to printing plants, engineering companies, railway companies, and automobile repair garages.

The rags are transported to consumers and, once they get dirty, they throw them back into the delivery containers that are later collected by MEWA again. Further, these cloths are washed in large washing machines and then they are hired out again. Every item of cloths is used up to fifty times in this cycle (Tischner, Brezet & Grablowitz 2001).

Adoption of this product-service mix design process has enabled increase of the below discussed environmental benefits. First, it is worth noting that plant of this enterprise that is located in Vienna does not need supply of any external energy, owing to its process of energy recovery. Next, wastewater in the plant after washes is treated without any problems as sufficiently clean to be accepted as standard municipal wastewater of the treatment plants. Moreover, unlike a one-way system of cleaning cloths, system of cleaning cloths that was adopted by MEWA substantially eliminates hazardous waste. Among other social and economic benefits of adoption of the product-service mix design process are lower costs of cleaning cloths that are heavily soiled with hazardous waste. Jointly, all these factors have contributed to MEWA, becoming a leader on the market of cleaning cloths in Germany (Tischner, Brezet & Grablowitz 2001).

Discussion and Recommendations

Products’ design processes together with the service design process encompass an essential part of the processes that take place at the enterprise. They play a vital role in the development of the product/service and its positioning on the market. In the long run, successful management of the product and service design products determine profitability and performance of the enterprise. However, given the increased trend in the global production and consumption, a growing public attention is focused on the arisen environmental and social problems associated with overconsumption/overproduction. As a result, in order to maintain functioning on the market as well as improve its position, a number of enterprises are determined to adopt novel approaches in the management of their product and service design process that would be socially and environmentally friendly. One of them is implementation of the product-service mix design process at the enterprises that generate a number of social and environmental benefits. The underlying idea of the product-service mix design process is to introduce modernization to the existing processes or develop new ones which would reduce usage of natural resources, as well as generate fewer waste products.

Therefore, in order to improve implementation of the product-service mix design process at the enterprises, it can be recommended to thoroughly analyse their product design and service design processes according to the sustainability guidelines. This will help to determine potential opportunities for introduction of the environmentally and socially friendly operations at the enterprise.

Conclusion

Effective and successful production of the new product or service by an enterprise and its delivery to the customers largely depends on the effective design. In order to comply with customers’ needs and wishes, producers of goods and services need to design them in the most appropriate manner. Therefore, product and service design processes comprise substantial determining factors of the enterprise’s success on the market. Recently, there has been an increase of the share of service design processes that take place at the enterprises, compared to the number of the product design processes. This is partially explained by the fact that a lot of enterprises are attempting to cover the gap in the social and environmental problems that are associated with global production and consumption. As a result, product-service mix has been developed as an effective way of dealing with environmental and social problems, related to consumption. Implementation of the product-service mix design processes at the enterprises requires compliance to certain sustainability guidelines in order to avoid rebound effects. This approach has proven to be effective, based on the empirical evidence and case studies that are available in the literature.

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