Please give full answer for these 4 qustions.

1

What are IKEA's competitive priorities?

2

Describe IKEA's process for developing a new product.

3

What are additional features of the IKEA concept

(beyond its design process) that contribute to creat-

ing exceptional value for the customer?

4

What would be important criteria for selecting a site

for an IKEA store?

68 section 1 SA, Pocon, CPC & Perot's eagles have determined that spending $10 million more on development will allow them to add even more advanced features. Having a more advanced chip will allow them to price the chip $so higher in both years (5870 for year I and $700 for year 2). Is it worth the additional investment? If sales are only 200,000 the first year and 100,000 the second year, would Perot still do the project? 12. Pick a product and list issues that need to be considered in its design and manufacture The product can be something like a nero, telephone, desk, or kitchen appliance. Con sider the functional and shetic spects of design as well as the important concerts for manufacturing 13. The che below is a partial house of quality for a golf country club. Provide an importance weighting from your propective for that of a polting friend) in the unshaded areas. If you can, using the QFD approach, compare it to a club where you or your friends play TAN HAPA Camarined in data Landicap Crowd Courses Teeplacement in place Cowe Top sulity food Service in myaled on valy | WHAT So R Median Rai Week RA To Activities Caday Bandages Excitie door portas ang Y ypes of sity dam malapit Manicure Calauge Service Tech Rest Good food Good Gand layout Plush leder Hal services There is Good Farm Pations Case: Ikea: Design and Pricing The Swedish retailer dominates markets in 32 countries, rise over time, IKEA says it has reduced its retail prices and now it's poised to conquer North America. Its buite by a total of about 20 percent during the past four years. plan: Koop making its offerings less expensive, without At IKEA the process of driving down costs starts the mancing them cheap. moment a new item is conceived and continues relent Above all else, one factor accounts for IKEA'S T- lessly throughout its production ran. The price of a cess: good quality at a low price. IKEA selle boase hasic Plung chair, for example, has fallen from $149 hold items that are cheap but not cheape, at prices that in 2000 to $99 in 2001 to $79 today. IKEA expects the typically run 30 to 50 percent below the competition's. most recent price cut to increase Pang sales by 30 to While the price of other companies' products tends to 50 percent Des Precion Services chapter 3 IKEA's corporate mantra is "Low price with meaning." developed in close cooperation with suppliers. In the The goal is to make things less expensive without ever mak case of Trofe, for example, the new size has rational ing customers feel cheap. Striking that halance demands ined production by making better use of the space in the special kind of design, manufacturing, and distribution kiln during the firing process. That's cost-effective and expertise. But IKEA pulls it off in its own distinctive way: saves time. tastefully, methodically, even cheerfully, and yet some IKEA has introdaced a code of conduct governing how differently than any other company anywhere. Here's working conditions and environmental awareness among a step-by-step guide to how IKEA designs, builds, and suppliers. This deals with matters such as health and distributes the items that the entire world wants to buy safety in the workplace and forbidis the use of child labor The Trof magis one of the most popular IKEA prod. The practical work of implementing this code of conduct ucts. The story of the meg is an example of how IKEA is carried out by co-workers in IKEA Trading Service works, from a co-worker's bright idea through to prodoc Offices worldwide. Many suppliers already meet the de tion and sales. It is also a story about all the demands that mands; others are working together with IKEA 10 CETY customers place on IKEA. A low price tag is the obvi out the necessary improvements. IKEA also works closely ous one, but other requirements include function, modern with external quality control and audit companies that design, environmental considerations, and making sure check that IKRA and its suppliers live up to the require products have been manufactured under acceptable work ments of the code of conduct ing conditions. Both customers and co-workers must be The low price tag is crucial to the vision IKEA has of able to rely on IKEA creating a better everyday life for many people. That is why IKEA works nonstop to redoce cost. Bet it's also Step 1. Pick a Price a question of saving raw materials and ultimately, the Product Development sketch for a new product? Yes, environment. The low-cost mug is one example of how but it's also a calculation of what that product will cost environmental considerations can influence the develop The low price begins at the drawing board. ment of products. For example, the new mug is lighter in The team behind each product consists of designers, color-move that cuts costs and is more environmentally product developers, and purchasers who get together to friendly. The loss pigment that is used the better. The mos discuss design, materials, and suitable suppliers. Every is also lead and cadmium free one contributes with their specialist knowledge. Pur chasers, for example, use their contacts with suppliers all Step 3. Design the Product over the world via IKEA Trading Service Offices. Who With a price point and a manufacturer in place, IKEA can make this at the best quality for the right price at the once again uses internal competition to find a designer right time? and select a design for production. The designer begins When product developer Pia Eldin Lindaten was given the design process by writing a brief that explains the the task of creating a new mug over five years ago, she was product's price, its function, the materials to be used, and also told how much it should cost in the stores. In the case the fabricator's capabilities. The designer the sends the of Trofe, the price had to be incredibly low tive Swedish brief to IKEA's stall designers and freelancers, and refines kronor! This tog hand to have a real knock-out price promising designs untilsettling on the one to product. The To produce the right mag at the right price, Pia and her designer wants products to be like Swiss Army knives-- colleagues had to take into account materials, colors, and get maximum functionality at minimum cont. design. For example, the meg is made in green, blue, yel- low, or white as these pigments cost less than other shades, Step 4. Shipit such as red. Distribution and logistics are the lifchlood of IKEA and important pieces of the puzzle on the road to a low price. Step 2. Choose a Manufacturer IKEA strives to deliver the right number of goods to the Suppliers and Purchasing The task of developing pood right stores at the right time. It calculates the goods to ucts never ends. Working with suppliers, the mug was quirements and makes sure that deliveries are efficient shortened and the handle changed so it stacks more eff- Fach pallet holds 2,024 megs, which are transported ciently, saving space for transport, warehousing and store from Romania by mil, road, and scato IKEA distribution display and, not least, in the customen cupboards at centers around the world. Transportation does, of course, bome. IKEA is always keen to banish asmach air as por have an effect on the environment, but IKEA is working sible from its packaging Packages should preferably be toward rodacing environmental impact. flat for efficient transport and storage Many of IKEA's products are bulky, for example, to One supplier, a factory in Romania, has worked with bles and chairs. IKEA plovered the concept of flat. The IKEA for 15 years. Long-term relationships help both company's eureka moment occurred in 1956, when ose of parties to build up a huge fond of knowledge about de IKEA's first designers watched a customer trying to fita mands and expectations. That is why products are often table into his car. There was only one way to do it: Remove 70 rection Sunset, Precoct, AND CAPACITY the logs. From that day forward, most IKEA products have and comfort, then offer plenty of easy credit. But to keep been designed to ship disassembled, flat enough to be prices low, IKEA needs to sell furniture and other prod slipped into the cargo hatch of a station wagon or safely acts such as the mug without salespeople or conspicuous tied down on an oto's roof rack price reductions. The company ass customers to em In IKEA's innitely frugal corporate culture, where waste ble their furniture themselves. And IKEA doesn't want to has been declared a deadly in the flat package is also an ship it to you either. Hy any conventional mure, there colleat way to lower shipping costs by maximizing the formidable burdles to overcome. Yet they also explain use of space inside shipping containers. The company or why IKEA has worked so hard to create a separate world timates transport volume would be at times greater if its inside its stores a kind of theme park masquerading as items were shipped assembled. From the design studio to a furniture outlet where normal rules and expectations the warehouse floor, IKEA employees' mantra is always don't apply the same: "We don't want to pay to ship air." The Trof mugs arrive at IKEA sors packed on Making things flat is an IKEA hission. How many pullets. Any transportation packaging is collected for times can you redesign a simple fired-clay coffee map?rocycling. Price tags have already been placed on the IKEA's mug was redesigned three times simply to maxi mugs at the suppliers In-store display is important. It's mize the number of them that could be stored on a pallet. not just a question of displaying mugs and other prod- Originally, only 864 mugs would fit. A redesign added a rim ucts. It's also about providing inspiration for smart in such as you'd find on a flowerpot, so that each pallet could terior solutions Customers contribute to the low prices hold 1,280 mugs. Yet another redesign created a shorter at IKEA by selecting and collecting the products from mug with a new handle, allowing 2,124 to squeeze onto the self-serve aroa, taking them home, and using the pallet. While the mag's sales price has remained at 50 cents, instructions enclosed to assemble them. Many will have shipping costs have been reduced by 60 percent, which is a already chosen the products from the IKEA catalog, of significant savings, given that IKEA sells about 25 million which 110 million coples are printed in 34 different of the mugs each year. Hven better, the cost of prodoction at guage versions IKEA's Romanian factory also has fallen because the more When you walk through the door of an IKEA store compact mugs require a space in the kiln. you citera meticulously constructed virtual Sweden When you ship 25 million cubic meters of goods The first thing you encounter is a company-sponsored all over the globe, flat-pack frugality adds up. IKEA child-care facility. Hungry? Have some of thote Swedish now uses a 65 percent average fill-rate target for all meatballs and lingonberries. The layout of an IKEA store the continens it ship, and it hopes to increase that to guides shoppers in a prodetermined path past several re 75 percent. Meeting that goal will require further de alistic model homes, which convey an eerily lived-in im sign changes and sometimes even sucking the air out of pression but are open for customers to sit in Information items (like IKEA's shrink-wrapped pillows, which look kilos provide advice on home decor Color-coordinated like giant crackers on store shelves). And, of course, flatcards offer plenty of suggestions on offbeat uses for packing shifts the cost of product assembly to the cus products tome, saving even more But the emphasis is always on price. Low priced prod As IKEA has shifted more of its buying from Europe scts that IKEA calls BTs (reathtaking items") are often to the Far East, shipping time and costs love become an perched on rises, framed by a huge yellow price tag. even more critical concer. Last year China tied Swe Nearby shoppers will find other products-price, den atop IBA's list of supplier countries. The company design-oriented a substitute for the BTL has responded by creating a global network of distribe The model homes suggest cheerful young people tion centers, most of which are near container ports and throwing dinner parties in hallways, wing mismatched major truck and railroutes. There are 18 IKEA distribe office chairs and narrow side tables. These aren't the tion centers worldwide which handle about 70 percent pirational images you'll find at Pottery Barn or Crate of IKEA's total product line and 4 more are under con Barrel. These are people who are living well in modest struction. The other 30 percent of IKEA's products travel circumstances frugal folks who know the value of a directly from supplier to store comfortable place to sit Sometimes, however, product components actually IKEA says its biggest selling point is the price tag. come together for the first time in the stock. In the case of but it can't hurt that getting through one of IKEA's hage the Pang chair, the cushion comes from Poland and the stores takes a lot of time. The layout is blatantly manipu- frame from China. The two pieces are united only when lativo-though in a friendly, knowing way, not unlike the customer pulls each one off the shell Disneyland but when customers finally arrive at the checkout counter, they've had plenty of time to fully con Step 5. Sellit sider their purchases IKEA sells a lot of expensive furniture, and in a tradi- IKEA products broadcast an ethos for living in the tional store this is relatively easy: Put a place in a lash modern world: Don't buy an ugly pitcher if you can get a etting, let the customer fall prey to visions of wealth stylish one for the same price. If you arganize your plastic Decor Protein Sevices chapter 71 bags, you'll feel more in control of your life. It's lett Questions brain logic applied to the right-brain art of living well. 1 What are IKEA's competitive priorities? And if happiness involves dragging a combersome flat 2 Describe IKEA's process for developing a new product package off the shelf, standing in fine at the checkout 3 What are additional features of the IKEA concept hauling the box home, and spending hours assembling a (beyond its design process that contribute to creat- kitchen cabinet, well, 260 million customers a year are ing exceptional valoe for the customer willing to make that trade-off. 4 What would be important criteria for selecting a site And, of course, next year it will be even cheapet. for an IKEA store? Secree Inmation about the Troco mug was ostaned from www.com Case: Posten AB In January 2009, Posten AB decided to involve its custom- the transportation services, resulting in incrcased cost-of- ers in an effort to find out the reasons why it was losing busi- ficiency, less traffic hazards, and less environmental arm. ness. After long discussions, project members and that users were having more urgent concerns than just transport Questions services. That is, they were not interested in the services 1 Which of the three new service requirements would per se, but rather in the consequences of modes of deliver Porten AB least likely pe service experience fit, ing those services due to traffic congestion and an increased operational flor financial impact? laborate rate of pollution and entailing hazards for children. 2 What are some of the main areas of complexity and As a result Posten AB decided to streamline the activi- divergence in this kind of operation? ties of the various parties to be carried out jointly by one deliverer. To achieve this, the company had to develop an Sou Lundit. And A. (2000). Where is now service designer como Maglie Owl information system service, able to schedule and integrate to 2, pp. 2007 Practice Exam 1. An oganization capable of manufacturing or purchas- S. An approach that uses interfunctional teams to get ing all the components needed to produce a finished input from the customer in design specification product or device 6 A matrix of information that helps a team tralate com 2. The one thing that a company can do better than its tomer requirements into operating or engineering goals. competitors. 7. The greatest improvements from this arise from simplifica 3. The six phases of the product development process, tion of the product by reducing the number of separate parts 4. A useful tool for the economic analysis of a product de & The incorporation of environmental comiderations into velopment project the design and development of products or service hapoua pe Tupac kopbudopatapogundua dn dan orpoal upp og SMO 1 Selected Bibliography Tooteoto: Destunt mod W. Krighe. Pod Desige for Womerture and A Indee Marcel 2010 Merg. Medy. Like The Death relerome WewYok: 2006 Kulud . Per Design and De New Vide Mew, 2011 We New Arrie Lam Neting, MA, 2011 Footnotes Adapted from the wheeting Now the west Beer, 2012 2 Adapted from Kel. Cihad ee .. Modern Dew York: M., 2018. 12-23 The city is actually amistodia of the word for qualities, bet a widely used in the of qualit Bleed from hoy. 1. Deshme at W. Kabeh. Probeer Delon Aur Minder and Amber Vak 2016)5-10 Syed www. Betaped ratom Sock Services Printing og Strawwele Mwing Cry 7. Adapted from the doping. 10-12