A Decision-Based Design Approach to Product Family Design

In this chapter, we present an extension of the DBD approach to product family design. Products that share a common platform but have specific features and functionality required by different sets of customers form a product family. In product family design, achieving the commonality of the platform for minimizing producer’s cost is a competing objective with meeting the variability of consumer preference. The Decision-Based Design approach is employed here for complex decision makings in product family design. First, we introduce the market segmentation grid to help understand the different product variants needed, and then introduce the nested logit model to estimate demand considering product segmentation. We next create a product family formulation of DBD for making complex decisions in optimal product line positioning optimal “commonality” decisions, and optimal levels of engineering design attributes. We demonstrate the method using a case study for the design of a family of universal electric motors.

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