STRATEGIC PRODUCT DESIGN DECISIONS FOR UNCERTAIN, CONVERGING AND SERVICE ORIENTED MARKETS

Abstract

Market driven product design decisions are receiving increasing attention in the engineering design research literature. Econometric models and marketing research techniques are being integrated into engineering design in order to assist with profit maximizing product design decisions. This stream of research is referred to as "Design for Market Systems" (DMS). The existing DMS approaches fall short when the market environment is complex. The complexity can be incurred by the uncertain action-reactions of market players which impose unexpected market responses to a new design. The complexity can originate from the emergence of a niche product which creates a new product market by integrating the features of two or more existing products categories. The complexity can also arise when the designer is challenged to handle the couplings of outsourced subsystems from suppliers and explore the integration of the product with service providers. The objective of the thesis is to overcome such limitations and facilitate design decisions by modeling and interpreting the complex market environment.

The research objective is achieved by three research thrusts. Thrust 1 examines the impact of action-reactions of market players on the long and short term design decisions for single category products using an agent based simulation approach. Thrust 2 concerns the design decisions for "convergence products". A convergence product physically integrates two or more existing product categories into a common product form. Convergence products make the consumer choice behavior and profit implications of design alternatives differ significantly from the situation where only a single product market is involved. Thrust 3 explores product design decisions while considering the connection to the upstream suppliers and downstream service providers. The connection is achieved by a quantitative understanding of interoperability of physical product modules as well as between a physical product and a service provider.