Chapter 42

1. Chapter 42 Special Design Tools

2. Objectives • Describe Porter’s 5 forces analysis used in strategic design and planning. • Describe the theory of inventive problem solving (TRIZ).

3. Strategic Planning • Strategic plans look at 3 to 5 year horizon: • 1. Study the current state • 2. Envision the ideal future state • 3. Plan the path • Senior management must be actively engaged in the process.

4. Porter’s Five Forces • Porter’s 5 forces that affect the success of an enterprise: • 1. The bargaining power of customers – to drive prices down. • 2. The bargaining power of suppliers – to drive prices up. • 3. The threat of new entrants – competitors can enter the market and drive prices down. • 4. The threat of substitute products – products and services that can be substituted for your own • 5. The intensity of competitive rivalry – strength of competition in your industry.

5. Portfolio Architecting • Portfolio architecting is the process of determining which products to produce. • The strategic advantage is that a product family will have common modules that will decrease costs. • Form a matrix of products (fig 42.1, page 426) • Study which products to build.

6. Hoshin Planning • Steps: • 1. Statement of organizational goals. • 2. Strategies that support those goals. • 3. Tactics that support strategy. • 4. Metrics that measure progress towards strategy. • 5. Assignment of accountability for strategies and tactics. • 6. Regular reviews to assess actual performance. • 7. Recovery plan or adjustment of strategy and tactics as necessary.

7. Tactical Planning • Tactical Planning covers 1 to 3 years. • They are designed to support strategic plans.

8. TRIZ • TRIZ is an acronym for a Russian word meaning theory of inventive problem solving. • 1. Contradiction – Solving the problem consists of resolving the contradiction – example: better product is more expensive. • 2. Resources – analysis of items, information, energy, or material properties to determine what can be useful in resolving the contradiction. • 3. Ideality – The ideal solution is defined. • 4. Patterns of Evolution – Integrating a device or idea with others to form a new device or idea. • 5. Inventive Principles – Review of worldwide patents.

9. Axiomatic Design • 1. Customer Domain – list the features customers want (concept designers). • 2. Functional Domain – list the way a product must work to meet the customer domain requirements (product designers). • 3. Physical Domain – List design that satisfies functional domain (process designers). • 4. Process Domain – list the processes that satisfy the physical domian.

10. Pugh Analysis • Pugh Analysis is a decision matrix when a single option must be selected from several options (fig 42.2, page 429). Used in design of products and processes. • Assign each criterion a weight (fig 42.3). • Multiply criteria weights by each cell value and calculate common totals (fig 42.5, page 430). • This will generate discussion and debate regarding which option is most appropriate.

11. Summary • Strategic plans look at 3 to 5 year horizon. • Porter’s 5 forces that affect the success of an enterprise. • Portfolio architecting is the process of determining which products to produce. • Tactical Planning covers 1 to 3 years. • TRIZ is an acronym for a Russian word meaning theory of inventive problem solving. • Pugh Analysis is a decision matrix when a single option must be selected from several options .Used in design of products and processes.

12. Home Work • 1. How long are strategic plans and what are the 3 steps of strategic planning? • 2. What are Porter’s 5 forces that affect the success of an enterprise? • 3. How long are tactical plans and why are they necessary? • 4. What is a Pugh analysis and where is it used?