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MISS IONS & TOOLS

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CONTENTS

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Arolys Overview Vocation, Missions and Expertise

Competitive Design and Innovation Potentials, Tools and Principles

Rational Diversity Potentials, Principles and Effective levers

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AROLYS OVERVIEW

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THE KEY OF YOUR COMPETITIVENESS

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Competitive Design Adequacy between product and needs Product cost reduction

Rationalized ranges Simplified ranges of products Indirect costs reduction

Innovation Customer value Innovative simplicity

Let’s reinvent your product competitiveness ! thanks to simple, direct and fast methods for high, concrete and sustainable savings.

Product competitiveness is the key of companies future

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AROLYS MISSIONS

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INNOVATION Customer Value, Design to Value, Innovative simplicity Innovation and customer value are at the heart of current and future competitiveness.

COMPETITIVE DESIGN Design to Cost, Redesign, Value Analysis Cost reduction and adequacy to needs are key points for the product competitiveness.

RATIONAL DIVERSITY Diversity costs, Ranges simplification, Standardization Rationalized product ranges are source of enhanced profitability and better answer to the needs.

Our quick diagnosis detect the main potentials of competitiveness. Our concepts researches materialize innovative solutions and radical savings.

FUNCTIONAL ANALYSIS

BENCHMARKING

VALUE ANALYSIS

CREATIVITY

CONCEPTS EVALUATION

RISK ANALYSIS

DIVERSITY COSTS SCALE

PRODUCTS’ REAL PROFITABILITIES

RATIONALIZATION OF COMMERCIAL AND

TECHNICAL DIVERSITIES

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AROLYS EXPERTISE

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An expertise and major industrial references in various sectors :

Aeronautics and Space Cost reduction of A380 modules (Hispano-Suiza), cost optimization on composites new technologies for civil aeronautics (Snecma Propulsion Solide), …

Agricultural Equipment Design to Value and diversity costs on a complete tractors range, combines, planter ... (AGCO - Massey Ferguson - Valtra), …

Military Vehicles and radar systems optimization, Design of antijamming systems (Thales), …

Railway Redesign of AGC systems (Bombardier Transport), fittings optimization of a new locomotive (Alstom), …

Automotive Design to Cost of the 307 (PSA), redesign of functions in a manufacturer-supplier partnership (Sogedac), …

Nuclear technology Optimization of an Uranium purifying installation (Areva), …

All sectors Design and Redesign to cost of several products and electronic, electromechanical, mechanical, hydraulic equipments, …

In addition, Arolys have a strong international experience with several missions leaded in Germany (Itron), in United States (AGCO) and in Finland (Valtra).

The simplicity and pragmatism of our missions get support of participants to stimulate a sustainable change in the company.

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COMPETITIVE DESIGN AND

INNOVATION

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POTENTIALS ABOUT DIRECT COSTS

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Costs of products are often penalized by specification choices and solutions that do not fit the just need. Simple methods help to highlight really sooner those potentials to drive efficiently the competitive design.

According to the drawing of Mr Yves Dubreil, Director of Renault innovation and Project manager of the Twingo.

*

* Beautiful, sophisticated technique

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FUNCTIONAL ANALYSIS

FUNCTIONS PERFORMANCE CRITERIA

Functions are those expected from the various customers and environments. Performance criteria summarize the essential requirements :

Value, Origin, Flexibility, Quantity.

The Functional Analysis draws up a synthetic table of the diversity of key needs and the possible weaknesses of current products (internal or competition).

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F1

F2 F4

F3

1 2 3 4 5

F1xxx xxx xxx xxx 1 X XXX

xxx xxx xxx 2 XXX

xxx xxx xxx 0 X XXX

xxx xxx xxx 1 X XXX

xxx xxx xxx 2 XX

xxx xxx xxx 0 XXX

F2xxx xxx xxx xxx 0 X XXX

xxx xxx xxx 1 XXX

xxx xxx xxx 0 X XXX

F3xxx xxx xxx xxx 0 X XXX

xxx xxx xxx 2 X XXX

xxx xxx xxx 0 XXX

Response to need of

current productFunction Value Flexibility QuantityOriginCriteria

The Functional Analysis defines the just need by forgetting habits of conception and existing solutions :

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VALUE ANALYSIS

The Value Analysis identifies costs that do not provide any service in order to reduce costs without altering the response to needs.

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Just Necessary costs by functions

Excessive cost regarding the

services rendered

Detection of priority areas of improvement

Value Analysis : correlation of costs and functions

CostsCosts

The Value Analysis distinguishes «Just Necessary» costs from «Not Required» cost potentials :

Sub-assemblies Cost F1 F2 ... F10 Not Required

...

TOTAL ...

3

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Just NecessaryNot Required

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Sub-assembliesFunctions

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CREATIVITY

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The Creativity opens efficiently the way to innovation using all the technological opportunities thanks to a segmented and targeted research.

Check the adequacy with need

Focus the research properly

Look for all possible solutions

(Brainstorming, ...)

Select the best solutions

The Creativity explores the range of possible solutions relying effectively on the diagnosis that precedes it : unsatisfied needs, potential optimizations...

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CONCEPTS EVALUATION

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The Concepts Evaluation spots strengths, weaknesses and major unknowns in order to select the best compromises.

The Concepts Evaluation characterizes rapidly the solutions in front of a list of criteria synthesizing the requirements :

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!A multidisciplinary team

from the conception !!!!!

!!

Validation of the need Choice of the concept to develop : Balance between costs and risks

PRINCIPAL OF A COMPETITIVE DESIGN

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The competitive design must «get to the heart of the matter» to operate the best choices with full knowledge of the needs, costs and risks.

CONCEPTION

DEVELOPMENT

INDUSTRIALIZATION

PRODUCTION

DISTRIBUTION

!!!!!!Project control !!!Risks Management Simple performance indicators and targeted project reviews

Development of the project

R&D

Industrialization

Marketing Purchasing

Production

The competitive design approach brings together a multidisciplinary team early in the project thanks to rapid and simple tools :

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Innovation, at the crossroad of a triple requirement :

Identification of the real customer value.

The innovative simplicity of products and ranges.

The exploration of all economical and technological opportunities.

Beyond creativity methods and usual exploration of new technologies, it’s the association of those three levers that promote efficiently innovation within the company.

INNOVATION

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INNOVATIONRadical

SimplificationTechnological Opportunities

Customer Value

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THE iPOD EXAMPLE

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Radical innovation often springs from the comprehension of the real customer value.

iPOD APPLE Content : 1 000 songs Download : 1 entire CD in 5 to 10 seconds Reduced size Innovative design High ease of use 10h of autonomy

Nowadays, the iPod still holds 70% of the digital music player world market and opens to Apple the doors of music industry.

FIRST DIGITAL MUSIC PLAYERS : with Flash Memory Content : 12 songs with Hard Drive Content : Thousands of songs

Extremely low speed download

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THE TWO PERIODS OF INNOVATION

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Two phases are favorable to innovating projects :

The exploratory phase is favorable to strong and breakthrough innovations.

The application phase intend to concretize innovation.

Rather than through pharaonic projects, it is thanks to successful breakthrough projects that innovation take shape in company culture.

Technological exploration

Expérimentation

Prototyping

Reflection on fondamental

needs

EXPLORATORY PHASE APPLICATION PHASE

LAUNCH DECISION

!OF AN APPLICATION

PROJET

SpecificationsConcepts

and solutions Evaluations

Commercialization

OwnershipFeedback

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INNOVATION APPROACH AND TOOLS

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!

!

The diagnosis enlighten the inadequacies of the current offer and the need of customer value.

The creativity relies efficiently on the relevant diagnosis.

Structured approaches and simple tools are strong innovation vehicles within the company.

INNOVATION

Functional Analysis

Benchmarking

Value Analysis

Concepts evaluation

Risk Analysis

Simplification Radicale

Opportunités Technologiques

Valeur Client

New ConceptCreativity

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RATIONAL DIVERSITY

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0

50

100

POTENTIALS ABOUT INDIRECT COSTS

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Turnover pareto of a family of industrial productsC

umul

ativ

e %

of t

he tu

rnov

er

98% of the turnover

50% of the turnover

MAJOR FLOWS

2% of the turnover

10% of the

variants

50% of the variants

MINOR FLOWS

50% of the variants

Variants

Ranges profitability is generally weakened by a lot of variants sold at very low volumes :

Resources of the company are used up to conceive and produce products in reality unprofitable.

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DIVERSITY : SOURCE OF TENSION

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Within the company, diversity is source of antagonisms, between visions that are market oriented and those close to industrial reality. Without assessment of these diversity costs, no rational approach is possible.

Unstandardization Standardization

Diversity choice

MARKETING !Pressure to references

proliferation

TECHNIQUE !Pressure to references

elimination

CUSTOMER ASPIRATIONS

INDUSTRIAL CONSTRAINTS

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a b c d - - - t u v w x -

Diversity overcosts

Standardization overcosts

MAJOR FLOWS & MINOR FLOWS

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Two kinds of wastes may be observed about diversity : Excess of standardization on expensive and recurring products Excess of diversity on a lot of products at low volumes.

Major flows !

Don’t we cover too many levels of needs with a single product ?

!=> UNSTANDARDIZATION of some high volumes references

Minor flows !

Don’t we produce too many items at low volumes ?

!=> STANDARDIZATION

of numerous references at low volumes

Variants

Cumulative turnover

0

50

100

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IDENTIFICATION OF DIVERSITY HIDDEN COSTS

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A scale synthesizes the costs generated by the diversity of references in different sectors of the company :

A simple scale allows to quantify the hidden costs of diversity, in creation as in current life.

Initial costs :

Current life costs : Manufacture

Current life costs : Related services

Design and Development, Methods & Industrialization, Purchasing, Marketing & Sales, Investments, ...

Batch changes, Wastes & Losses, Decreased yields, Purchasing, transport and logistic overcosts ...

Scheduling, Launching, Planning, Missing parts control, Delays, ...

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REAL PROFITABILITY OF REFERENCES

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Real profitabilities are recalculated taking into account the diversity hidden costs :

The scale of diversity costs reveals the products real profitability.

References References

Visible profitabilities

Margins according to usual calculation of spread indirect costs

Real profitabilities

Real margins including the scale of diversity costs

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TECHNICAL DIVERSITYCOMMERCIAL DIVERSITY

DIVERSITY EFFECTIVE LEVERS

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Products diversity : better tiering of ranges, flows massification, minor flows products grouping, incentive rating…

Components diversity : modular design, standardization trade-off thanks to the scale of diversity costs.

Process diversity : dedicated means of production, delayed differentiation, specific treatment of flows.

Customer needs diversity must be answered thanks to a rationalized commercial and technical diversity.

Diversity of Customer needs

Diversity of

Finished productsDiversity of

ComponentsDiversity of

Process

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CONCRETE EXAMPLE N°1 : STEVE JOBS BACK AT APPLE IN 1997

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Simplifying Apple’s product line ultimately helped to resuscitate the company, leading to one of the most successful financial decades of any company in U.S. business history.

«When we got to the company one year ago, there were fifteen product platforms and a zillion variants of each one.

How are we going to recommend these products to others when we don’t know what products to recommend to our friends ?»

One year after he came back, Steve Jobs had cut Apple’s total product offerings from 350 to 10.

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CONCRETE EXAMPLE N°2 : NOKIA & APPLE

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At the beginning of 2011, the Nokia phones range sold in France included 140

references

The Apple phones range for its part included 3 very similar models but very innovative

(more than 200 patents)

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CONCRETE EXAMPLE N°2 : NOKIA & APPLE

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Percentage of profit for the first 8 mobile phones manufacturers

Source : asymco.com

With an extremely simple but exceptionally innovative range, Apple has revolutionized the mobile phone market.

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OUR REFERENCES

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View our clients testimonials on www.arolys.com !