QUESTION 4 [20 Marks] You have been appointed as a product development specialist at a fast-moving consumer goods company. Mr. John who is currently the head of the supply chain management department has recently been experiencing continuous issues with one of his products. Your task as a product development specialist is to discuss the product life cycle with a diagram and explain how the value chain proposition can be achieved. 5.5. Product Life Cycles Many new products exhibit a product life cycle. Heizer and Render (2017) contends that there are four stages in product/service life cycles and these are Introduction When an item is first introduced it may be treated as a curiosity. Demand is generally high because potential buyers may not be familiar with the product/service. . Growth As products or services survive the rigours of their introduction to the market, they will begin to be more widely accepted. Increasing numbers of customers accept the value of the product or service and volume starts to grow. . . Maturity After a period of rapid growth, customers may become bored with products or services. Demand starts to level off as many customers have already been supplied Decline Sales start to decline and the product life cycle is at the end. No new capital investments are made in the product The strategies and issues within the product life cycle is depicted in the figure below: OM Strategy/Issues Introduction Product design and development critical Frequent product and process design changes Short production runs High production costs Limited models Attention to quality MANCOSA Growth Forecasting critical Product and process reliability Competitive product improvements and options Increase capacity Shift toward product focus Enhance distribution Operations Management Maturity Standardization Less rapid product changes -more minor changes Optimum capacity Increasing stability of process Long production runs Product Improvement and cost cutting Source: (Heizer and Render 2017) Decline Little product differentiation Cost minimization Overcapacity in the industry Prune line to eliminate items not returning good margin Reduce capecity Product Development Stages Product concepts are developed from a variety of sources, both external and internal to the firm. Concepts that survive the product idea stage progress through various stages, with nearly constant review, feedback and evaluation in a highly participative environment to minimise failure. 75 5.5. Product Life Cycles Many new products exhibit a product life cycle. Heizer and Render (2017) contends that there are four stages in product/service life cycles and these are: Introduction When an item is first introduced it may be treated as a curiosity. Demand is generally high because potential buyers may not be familiar with the product/service. Growth As products or services survive the rigours of their introduction to the market, they will begin to be more widely accepted. Increasing numbers of customers accept the value of the product or service and volume starts to grow. Maturity After a period of rapid growth, customers may become bored with products or services. Demand starts to level off as many customers have already been supplied. Decline Sales start to decline and the product life cycle is at the end. No new capital investments are made in the product. The strategies and issues within the product life cycle is depicted in the figure below: OM Strategy/issues TUSSE Introduction Product design and development critical Frequent product and process design changes Short production runs High production costs Limited models Attention to quality Growth Forecasting critical Product and process reliability Competitiv product improvements and options Increase capacity Shift toward product focus Enhance distribution Operations Management Maturity Standardization Less rapid product changes -more minor changes Optimum capacity Increasing stability of process Long production runs Product improvement and cost cutting Decline Little product differentiation Cost minimization Overcapacity in the industry Prune line to eliminate items not returning good margin Reduce capacity Source: (Heizer and Render 2017) Product Development Stages Product concepts are developed from a variety of sources, both external and internal to the firm. Concepts that survive the product idea stage progress through various stages, with nearly constant review, feedback and evaluation in a highly participative environment to minimise failure