Advances in Production Engineering & Management Volume 12 | Number 1 | March 2017 | pp 17-28 https://doi.Org/10.14743/apem2017.1.236 ISSN 1854-6250 Journal home: apem-journal.org Original scientific paper Performance modelling based on value analysis for improving product development process architecture Yin, F.P.ab, Gao, Q.a b *, Ji, X.ab aSchool of Mechanical Engineering, Shandong University, Jinan, China bKey Laboratory of High Efficiency and Clean Mechanical Manufacture, Shandong University, Ministry of Education, Jinan, China A B S T R A C T A R T I C L E I N F O Improving the architecture of product development process (PDP) is an effective approach to improve PDP performance. However, performance is difficult to model because the criterion of performance such as development cost, time and product quality are usually contradictory. The objective of this paper is to use process value as the evaluation indicator of PDP performance. The process value of PDP, as well as the ratio of process function and process cost, is discussed and its quantitative method is proposed. The process function is defined as the process effectiveness which considers the importance of each activity of PDP, and its evaluation methods based on rework theory and quality function deployment (QFD) are given. The simulation method is used to illustrate the proposed model and analyze the relation between architecture and process value of PDP, and an optimization model for PDP architecture is provided. With the model, we can get a suitable PDP architecture to balance the cost and product function during product development. © 2017 PEI, University of Maribor. All rights reserved. Keywords: Product development process Process performance Process architecture Value analysis Effectiveness Modelling *Corresponding author: gaoqi@sdu.edu.cn (Gao, Q.) Article history: Received 20 October 2016 Revised 15 February 2017 Accepted 18 February 2017 1. Introduction Product development process (PDP) refers to the entire set of activities to convert customers' needs into a technical and commercial solution [1, 2]. The activities and their relationships are described by the process architecture (or network). Analyzing and optimizing the architecture is helpful to build a PDP with high performance, which implies low development cost, short lead time and high product quality [3, 4]. However, these criterions are usually contradictory. For example, higher product quality may mean that the development time is longer or cost is higher. In addition, high performance is an elusive notion [5]. There have been relevant studies on performance measurement in PDP. Huang and Fu [6] proposed a quantitative model based on signal flow graphs (SFG), assessing process from the aspects of time, cost, quality and robustness. Pun et al. [7] proposed a self-assessment model of new product development performance (NPD) using analytical hierarchy process (AHP). Syamil et al. [8] researched the relationships between product development process and process performance, and provided a model of process performance at project level. The cost estimating [9], development quality [10], product performance [11], feasibility [12] and uncertainty [13] etc. have also been studied by some other researchers, which can reflect or affect the performance of PDP. So many measures and evaluation methods for PDP performance lead to an ambiguous 17 Yin, Gao, Ji definition of performance in above literatures. In addition most works focused on performance at project or program level. O'Donnell and Duffy [14] considered that the overall performance in design is determined both by performance of the design solution (related to the product design parameters or product quality), and the performance of the process (related to the duration or cost). In their model, efficiency and effectiveness are as fundamental elements of performance. Efficiency is seen as the relationship between the knowledge that an activity gained and the used resources; while effectiveness is related to the degree how the outputs of knowledge meet the goals of activities. The model provides an improved perception of performance measurement, but the relationship between efficiency and effectiveness is not direct, because their focuses (efficiency focuses on process, and effectiveness focuses on solution or product) are different. Accordingly in some cases it is difficult to achieve combination of the two variables. With successful application and good effects in manufacturing process, lean thinking has been gradually extended to development field in enterprises. Many works have been reported recently [15-17]. Value is the core concept in lean product development (LPD). The essential of value is to guide improvement processes [18]. Some scholars have tried to improve the performance of PDP through the value analysis method [19] or value stream method [20, 21]. Browning [22] pointed out that value is a function of both the product recipe and the process that produces it. That is to say both the effectiveness of the product and the efficiency of the process affect value. However, there are two types of value in product development, product value and process value according to Chase [23]. Unfortunately, most of researches in this field have ignored the difference between them, and mainly focused on product value. Different from the product value which is defined as a capability provided to a customer at the right time at an appropriate price, process value is defined as the ability to perform with maximum quality at minimum cost. The quality is related to effectiveness, while the cost is related to efficiency, and waste in PDP can be understood as inefficiency and ineffectiveness [18], so the process value provides a new way to evaluate and improve the performance of PDP. This paper is concerned with performance modelling by building the evaluation method of process value. The proposed model that describes the process value of PDP integrates the performance parameters, such as development time, process cost and product quality or function. It involves the factors such as process structure, rework constraints, customer requirements and so on. In the model, we extend O'Donnell and Duffy's [14] concept of effectiveness. In our work, the process effectiveness of one activity is evaluated by its rework. The rework evaluation method based on Design Structure Matrix (DSM) and the creation goal evaluation method based on Quality Function Deployment (QFD) are introduced to the model. Through the optimization of the process value, PDP can be improved from different aspects, such as resource allocation, process architecture improvement, requirement optimization, etc. In this study we focus on improving PDP from the aspect of process architecture improvement. The remainder of this paper is organized as follows. Section 2 discusses the process value and its quantitative method. In section 3 the relationship between architecture and performance of PDP is verified by simulation based on a sample, and a new optimization model for PDP architecture is proposed. An example and some discussions are given in section 4. Finally, the conclusions and some extended research are presented in section 5. 2. Performance modelling based on value analysis 2.1 Process value The importance of one activity in PDP describes the role that the activity plays during developing product, which can be considered as the process creation goal of the activity divided from the overall process creation goal of PDP. We use g to denote the creation goal of an activity and G to denote the overall process creation goal of PDP. The relationship between them can be expressed as Eq. 1. 18 Advances in Production Engineering & Management 12(1) 2017 Performance modelling based on value analysis for improving product development process architecture n G = YJ9i [1) i=l Here n indicates the number of activities. Whether an activity is able to achieve its goals or play its role in PDP depends on the effectiveness of the activity. In our method, the process effectiveness refers to the degree of the relevance between the creation and the goal of the process or activity. The effectiveness of the activity is denoted by e, while the effectiveness of the PDP is denoted by E. The process function can be considered as the actual creation of activity or PDP. The process function of an activity denoted by f and the process function of PDP denoted by F can be calculated as Eq. 2 and Eq. 3. f = g^e (2) F = G • E (3) In addition, /and F have the following relationship: it -I* í = l (4) In our model the process value is defined as the capability to achieve the process creation goal under appropriate cost. The process value of an activity represented by the letter v, and the process value of the PDP represented by the symbol vproc, are formulated as Eq. 5 and Eq. 6. v = yproc _ 9_e_ c G a1 •C + a2 •T (5) (6) The cost of PDP includes both resource consumption C and time consumption T. In Eq. 6, a1 and a2 respectively represent the weight of the cost and development time. The performance model of PDP with effectiveness and process value is expressed in Fig. 1. F=Output-Input Input Product Development Process (PDP) C5> i inputi C¿>...... jgi /i = output\-inpitt\\ OUpUt\ Activity 1 I :: j inputj -f— Activity i ouput\ Output C+T Fig. 1 Effectiveness and process value Advances in Production Engineering & Management 12(1) 2017 19 Yin, Gao, Ji The first part-reflects the different development modes and development methods. The second part E reflects the uncertainties in a PDP, such as the different architectures, reworks and so on. So we can select suitable product development type and improve the architecture of PDP according to Eq. 6. This paper only studies the improvement of architecture under a fixed product development type. The parameters G and C can be considered as the static information, which can be obtained through prediction. Non-dimensional treatment for them is produced in analysis process. The cost C is the accumulation of the cost of all activities in PDP in normal executing case. It is the expected cost, rather than the actual cost of execution, and can be calculated according to Eq. 7. n c i = 1 It = (7) Here ct is the expected cost of unit time of activity i, and di is the expected working time of activity i. Generally, coefficient of C is 1. The development time T is affected by the development process architecture. Assume that the development time on critical path of a PDP is Tmin, the coefficient of T can be calculated by Eq. 8. T = (8) * expected. Here Texpected is the expected time of the product development project, and can be considered as a constant. In Fig. 1 input and output of activity or PDP are indeterminate and difficult to evaluate, so in the next section we will explore the decomposition of G and evaluate E. 2.2 Decomposing of process creation goal G of PDP is the performance or function of product that must be created. As a broad concept, it reflects the extent of how much the product to meet the customer requirements, including technical parameters, quality and other attributes. So that is to say, it is based on the customer requirements and will not be changed during development. In other words, it can be seen as a constant. However, g of an activity is decomposed from G of PDP based on its importance during the development, and difficult to quantify. The coefficient of activity (COA) is used to express the importance of an activity during development. Customer requirement is the start to evaluate process. On referring to Quality Function Deployment (QFD) method, which considers that meeting customer requirement is the ultimate goal of product development, this paper establishes the mapping matrix from customer requirement to product function, and the mapping matrix from product function to activities. Through these matrices the COA can be evaluated. Because the QFD has been quite mature, it is assumed that the customer requirements and all of the mapping matrices are able to be estimated or set by experienced engineers. The customer requirements can be expressed by CR = [CR1,CR2,...,CRi], where I is the total number of customer requirements, and £fc=i CRk = 1. The mapping matrix from product requirements to product function is rfll rflm RF = rfn - rflr¡ where rfks indicates the importance coefficient of product function s to realize the customer requirement k. The sum of every row in RF is 1. The weight of product functions W is expressed by [W1,W2,..., Wm]. So the evaluation coefficient of product functions (COF) expressed by vector [COF1,COF2,...,COFm] can be calculated with Eq. 9. 20 Advances in Production Engineering & Management 12(1) 2017 Performance modelling based on value analysis for improving product development process architecture COF = (CR •RF)xW (9) Similarly, the matrix FA = fan -fan i falr fanr with sum of every column being 1, expresses the mapping matrix from product function to development process, and fais indicates the importance coefficient of activity i to realize the product function s. So the evaluation coefficient of product function target of activities (COA) expressed by vector [COA1,COA2,...,COAn] , can be calculated with Eq. 10. COA = COF • FAt (10) Then the decomposing formula of G is given as Eq. 11. gt = Gx COA, (11) 2.3 Effectiveness evaluating based on R-DSM The effectiveness reflects the degree of completing the process creation goal. If the creation goal cannot be fully completed by the PDP or the activity, the part that has not been completed can be considered as ineffective, which should be retrieved by rework process. So we can evaluate the effectiveness of activity through its rework. We suppose that the completion degree of the process function of the activity is related to the cost and time the activity consumed. As shown in Fig. 2, if the consumed time and cost is c and the process creation goal is g, it will get the process function f = g • e. In other words, there will be g — f process function left to be reworked, which is expressed as rg. Similarly, in order to get the process creation goal g — f function which can be the process creation goal of the rework, the consumed time and cost (rc) will be iS-Hl which is the rework effort. So the rework rate of 3 an activity can be calculated as r = 9 9 e = 1 — e. Therefore the activity effectiveness can be represented and calculated simply by the rework rate of activity as Eq. 12.