The industry leader is dominant and able to deliver on very aggressive schedules while smaller, leaner competitors dominate on price. Increased competition and market dominance by the largest producer of port equipment mandates the rapid introduction of more product types to grow sales revenue, increase net income, and increase R&D investment. The future income growth rate will be through new products and services with services providing the highest level of ROI. Cost reduction will focus primarily on materials costs. Consequently, the ability to decrease time to market, reduce cost, and enable a lean product development process is critical to increase market share. Product development processes and technology improvements like LIMM help overcome current barriers.
The client receives a request for proposal, product requirements, and regulations as explicit documents and/or links to specific regional or wharf-specific applications. The client is given 21 calendar days to prepare engineering concept drawings, provide a fixed price quote, and schedule for delivery. The process is to select a previous design that closely matches the requirements for the new design, quickly run reports based on the existing design BOM to obtain the required cost data from recent purchases. Two-dimensional drawings are manually edited (text changes only) to characterize the product based on new requirements.
The data is packaged, an executive review is conducted, and the numbers finalized based on shipping, installation, insurance, and profit. Final numbers were reviewed by the company president and head of sales for final refinement. The result of this process caused several strategic issues:
- The price would be too low, and the company would lose money on the project
- The price would be too high, and they would lose the project to a competitor; and/or
- The proposed delivery date was later than the competitors’ and they would lose the project.
The client was looking for a solution that would provide a rapid and efficient product development process that enabled a proposal’s cost to be based on the design. The client asked for quick results and decided on an incremental deployment where each increment was a different product line. The first product line selected is the container crane that is used to load and unload ships. The container crane product line consists of 48 structural configurations and each of these is configured based on other functional requirements and wharf loading limits. The goals of the project included moving the design into 3D, using the geometry to drive engineering analysis, material estimates, and BOM pricing. The objective was to generate a quote based on the design, refine the design, and review cost multiple times during the 21-day window; then delivery is based on the design for which the quotation is submitted.