Value balancing method for product development – A Case study at Volvo Car Corporation

The study aims to develop a method that provides Concept Engineering Unit at Volvo Car Corporation (VCC) with reflection on how cost, technical characteristic, and customer requirements effects the end-product. The purpose of this thesis is to develop a method that supports value balancing of customer requirements and costs in the concept phase of the product development process at VCC. The study has been performed as a case study at VCC in Gothenburg. It was done at the Concept Engineering Unit, which is responsible for managing the different development units at VCC during the concept phase in order to achieve several requirements. The theoretical background covered: value based decision making, communication and collaboration within companies, the impact and efficiency of decision support tools, customer satisfaction theory, cost consideration and implications of product platforms on the product development process. The explorative study covered the product development process, cost calculation systems, platform usage, cost of change and attribute classification at VCC. The study resulted in a proposed Value Balancing Method that contains the following parts: Main QFD matrix, Value Index chart, Critical Attributes and Systems and a Modularity Matrix. The information from the Value Balance Method can be used to study which technical systems that need to be functionally improved and which systems that need cost reduction effort in order to achieve value balanced products. Moreover, the Value Balance Method provides valuable information of which systems that should be platform systems and which that ought…

Contents

1. INTRODUCTION
1.1. PROBLEM BACKGROUND AND MOTIVATION OF STUDY
1.2. PROBLEM DEFINITION
1.3. RESEARCH QUESTION
1.4. OBJECTIVE
1.5. PURPOSE
1.6. LIMITATIONS
1.7. POTENTIAL CONTRIBUTIONS AND INTERESTED PARTIES
1.8. THESIS OUTLINE
2. RESEARCH METHODOLOGY
2.1. METHODOLOGY OVERVIEW
2.2. CHOICE OF METHODOLOGY
2.3. THE CASE STUDY
2.3.1. Volvo Car Corporation
2.3.2. The Concept Engineering Unit at Volvo Car Corporation
2.3.3. Previous research at Volvo Car Corporation
2.3.4. Why Volvo Car Corporation?
2.4. RESEARCH PROCESS
2.5. EMPIRICAL DATA COLLECTION FOR THE MAIN STUDY
2.6. VALIDITY AND RELIABILITY
3. THEORETICAL BACKGROUND
3.1. VALUE BASED DECISION MAKING
3.2. COMMUNICATION AND COLLABORATION
3.3. DECISION SUPPORT TOOLS
3.3.1. Quality Function Deployment (QFD)
3.3.2. Value index
3.3.3. Conjoint analysis
3.4. CUSTOMER SATISFACTION
3.5. COST CONSIDERATIONS IN PRODUCT DEVELOPMENT
3.6. PRODUCT DEVELOPMENT WITH PRODUCT PLATFORMS
3.6.1. Component sharing implications on product development
3.6.2. Product platforms influence on cost considerations
3.6.3. Deviations from value optimised decisions
4. BUILDING THE THEORETICAL FRAMEWORK OF THE METHOD
5. PRESENTATION AND DISCUSSION OF THE MAIN STUDY
5.1. PRESENTATION OF THE RESULTS FROM THE EXPLORATIVE STUDY
5.1.1. The product development process at VCC
5.1.2. Product Cost Calculations at VCC (ProCost)
5.1.3. Product Cost Calculations at VCC (PreCost)
5.2. PLATFORM USAGE AT VCC
5.3. PRESENTATION OF THE INTERVIEWS TO FIND A PROXY FOR COST OF CHANGE AT VCC
5.4. PRESENTATION OF THE RESULTS FROM THE INTERVIEWS FOR ATTRIBUTE CLASSIFICATION
6. ANALYSIS
6.1. CUSTOMER REQUIREMENTS
6.1.1. Attributes
6.1.2. Ranking of attributes
6.2. TECHNICAL SYSTEMS
6.2.1. System costs
6.2.2. Cost of Change
6.3. SUMMARY OF ANALYSIS
7. PROPOSED METHOD
7.1. MAIN QFD MATRIX
7.1.1. Part 1- Customer Importance
7.1.2. Part 2 – Allocation Method
7.1.3. Part 3 – Data for technical systems
7.2. VALUE INDEX CHART
7.3. CRITICAL ATTRIBUTES AND SYSTEMS
7.4. MODULARITY MATRIX
8. CONCLUSIONS AND RECOMMENDATIONS FOR FURTHER WORK
BIBLIOGRAPHY
APPENDIX I – INTERVIEW QUESTIONS
APPENDIX II – DATABASES AND SEARCH WORDS
APPENDIX III – PEOPLE INTERVIEWED FOR THE EXPLORATIVE STUDY
APPENDIX IV – DEFINITION OF ATTRIBUTES AT EB-LEVEL
APPENDIX V – PRODUCT STRUCTURE SYSTEMS
APPENDIX VI – REPORTS FROM PROCOST
APPENDIX VII – PEOPLE INTERVIEWED
APPENDIX VIII – ALLOCATION METHOD
APPENDIX IX – MAIN MATRIX

Author: Svensson, Johan,Stenbeck, Carl

Source: Goteborg University

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