Product/Service OrientationThomas J. Howardthow@mek.dtu.dkMain Contributions from: Tim C. McAloone, Niki Bey & Krestine Mougaard

Unless otherwise stated, this material is under a Creative Commons 3.0 Attribution–Share-Alike licence and can be freely modified, used and redistributed but only under the same licence and if including the following statement:

“Original material created for the PROTEUS project and adapted for course 42629, Innovation and Product Development Department of Mechanical Engineering, DTU”

2012Material provided by Tim C. McAloone and adapted for course 42629, Innovation and Product Development Department of Mechanical Engineering, DTU

2

In your teams discuss the following scenario:

“You have been developing and selling microwave ovens for many years and

have seen profits steadily falling due to increase competition. How could you add a service dimension to your business and what market segment would you target?

2012Material provided by Tim C. McAloone and adapted for course 42629, Innovation and Product Development Department of Mechanical Engineering, DTU

3

Based on Tukker & Tischner 2006

SERVICE ORIENTATION

PRODUCT ORIENTATION

PRODUCT• Product related

service

• Product related consultancy

USE• Product lease

• Product renting

• Pay per service unit

RESULT• Activity management

• Functional unit

Product/Service Orientation

2012Material provided by Tim C. McAloone and adapted for course 42629, Innovation and Product Development Department of Mechanical Engineering, DTU

4

Product/Service Orientation

2012Material provided by Tim C. McAloone and adapted for course 42629, Innovation and Product Development Department of Mechanical Engineering, DTU

5

SUPPORT OF CUSTOMER’SACTIVITIES

CUSTOMER’S ACTIVITY

CYCLE

PRODUCT’S LIFE CYCLE

TR

AN

SP

OR

T

RA

W M

AT

ER

IALS

AS

SE

MB

LY

MA

NU

FAC

TU

RE

SA

LES

DIS

PO

SA

L

INS

TALL

AT

ION

MA

INT

EN

AN

CE

US

E

Product Life & User Activity Cycles

Tan, A., McAloone, T.C., Andreasen, M., “What happens to integrated product development Models with product/service-system approaches?”, The 6th Integrated Product Development workshop, 2006

2012Material provided by Tim C. McAloone and adapted for course 42629, Innovation and Product Development Department of Mechanical Engineering, DTU

6

Strategies of Service Design

Product

Product use services• Maintena

nce

• Repair

• Spare parts

• Warranty

Product life services• Supplies

• Installation

• Auxiliary input

• Upgrade

• Disposal

Customer activity services• Training

• Planning

• Designing

• Specifying

• Operating

• Measuring

Business supporting services• Consulting

• Financing

• Managing

• Partnering

• Outsourcing

Design for Serviceability [Dewhurst 1994]

Design for Supportability[Goffin, 2000][Takata et al. 2004]

Design for Service[Harrison, 2006]

2012Material provided by Tim C. McAloone and adapted for course 42629, Innovation and Product Development Department of Mechanical Engineering, DTU

7

Strategies for Service Design

2012Material provided by Tim C. McAloone and adapted for course 42629, Innovation and Product Development Department of Mechanical Engineering, DTU

8

Designing a PSS

We need to adopt new approaches for making substantial changes:– For the end-user:

o New patterns of usage, lifestyle, purchasing and flexibility

– For the producing company:o Maintain contact, supply, maintenance, upgrading, disposal, and

recycling of the producto See utilisation of the product as the delivered serviceo Realise new ownership patterns such as renting, leasing, service-

contracts, etc.o Identify new markets and greater share by re-defining core business

– For society:o Increased product efficiency (due to the producing company having

increased liability for-, insight into- and ownership over the product)o A closer relationship between social needs and the products that

industry supplies (due to the voice of the customer being louder and clearer than before)

2012Material provided by Tim C. McAloone and adapted for course 42629, Innovation and Product Development Department of Mechanical Engineering, DTU

9

PSS can be an effective way to bring suppliers closer to customers while responding more to the customer’s

real needs.

Services should be integrated into the design of products where

valuable.

2012Material provided by Tim C. McAloone and adapted for course 42629, Innovation and Product Development Department of Mechanical Engineering, DTU

10

Questions

?

2012Material provided by Tim C. McAloone and adapted for course 42629, Innovation and Product Development Department of Mechanical Engineering, DTU

11

Exercise

In your project teams, try to synthesise at least 3 PSS business configurations that for you business ideas.

Try to consider what, where, when and how your customers would pay for your offerings.