I would like to start by reviewing some numbers. 45 to 7, 105 to 7. These are not crazy scores from the NFL, but numbers showing the reduction in parts and pieces of our new small packaged air conditioner. This reminds me of the adage that "less is really more."
When we moved from our 50SS packaged air conditioner to our new product, the 50ZP, we reduced the number of pieces in several key assemblies by 93 percent. We also improved both the quality of the product, and the production process.
Meanwhile, we made the same types of advances with the 48/50EJ.
The key to this improvement is Carrier's Integrated Development System, IDS. Our revolutionary new approach to product development depends on teamwork among several disciplines, and it has brought the product development cycle into the twenty-first century. This Integrated Development System uses input from four distinct elements:
The first is marketing. I put this first, because we need marketing input well in advance of the start of product development. Marketing involves determining the customer's product requirements, and, more importantly, obtaining customer ownership. We want their "buy-in".
Traditionally, we depended on input from "marketing." a marketing manager or group determined what should be produced. Engineering designed it. And the factory built it. We call that a linear approach each operation uses inputs from another organization.
Now, with our Integrated Development Systems approach, professionals across all disciplines (including customers and suppliers), form a creative team to gather and evaluate market data.
People from manufacturing, marketing, engineering, purchasing, and other areas gather information as a team and jointly interpret it according to their expertise. The result: a more creative product development process. We call the second element "customer voice." with customer voice we ask, "what do you want? What do you need?" believe me, our customers
Tell us and we listen. the customer is really the voice.
The IDS team process creates a synergy where the whole truly is greater than the sum of its parts.
Engineering is the third element. Our design and manufacturing engineers have the handle on new technology. They know its state of readiness. They evaluate what new technology is appropriate and insert it into the design and manufacturing process.
The aim of the engineering input is to improve quality, reduce costs, improve the process and compress the time required for production. Engineering is also involved in containing our risk. We exercise prudent risk management by evaluating our risks, and managing them so they don't get out of hand.
Finally, but perhaps most important, we have the manufacturing element. We focus on process improvement, burden reduction, time compression and machinery investment. These efforts generate both direct and indirect cost savings.
The result is a new, improved, highly innovative product that responds precisely to our customers' needs.
Let's first look at our new large rooftop unit and see how IDS plays a role. This EJ is smaller than competitive models we took out weight and size through parts reduction.
We simplified the EJ and made several design improvements at the same time. We eliminated electro-mechanical guide vane systems and incorporated variable speed drive technology to control the large horse-power motors. This improved motor performance and reduced fan power requirements up to 50 percent in part load applications at no additional cost!
An added bonus: by using variable-speed drives, we made the EJ much easier to install, maintain and service a big step in improving customer satisfaction.
We also improved the EJ's environmental performance by using cleanable insulation, which incorporates an anti-microbial agent to resist growth of bacteria and fungi. The result is better indoor air quality and reduced risk of IAQ-related health problems.
Controls also have a role in the EJ's ability to deliver healthful air. Cable-ready, the EJ's microprocessor-based control plugs into the Carrier Comfort Network, our communicating controls system.
This enables the unit to accept and process information like carbon dioxide and V-O-C data from remote sensors to improve HVAC system IAQ performance. It also flushes an office building with fresh air before occupants arrive in the morning, and even plays a crucial role in firefighting.
When we were re-designing the EJ, product and manufacturing simplification were the main drivers. As a result, we cut our part count by 20 percent and reduced the size, giving us a sturdier, more reliable and cost-effective air conditioner.
There are two parts which make up the wrapper cabinet. By contrast, the old 50SS had a 14-part cabinet composed of 32 individual pieces, each produced separately. This is an another example of process simplification which leads to an improved product.
Another example is the base for the 50ZP. This highly integrated part, made of a composite plastic material, replaces 18 parts made up of 45 individual pieces, each produced separately. The design of this part reflects creative, integrated thinking based on listening and working with our customers.
Our customers told us the features they wanted in a new design. In fact, George Saunders, one of our Carleton-Stuart hosts today, participated in this activity.
Our customers told us they wanted round supply and return ducts, located exactly where they needed to be, so we located the ducts there.
They told us they wanted a unit which could be serviced easily and quickly, so we provided a two-piece removable top for fast access.
They told us they wanted a top-cover design that would not leak or need a sealant, so we gave them a unique rain trough.
They told us they did not want sharp edges, so we rolled the top edges under to prevent injury.
And we gave them all this in a simple, elegant design that is easier to produce.
Finally, we have addressed an industry problem of water drainage and indoor air quality that has been around for decades. We developed a product with a rust-proof, corrosion-proof base that also drains all condensate and water.
This baby will never rust!
And it's recyclable.
The base pan also embodies another aspect of our process. This part could only result from coordinating the four disciplines in our integrated design process with a network of supplier partners. Carrier worked with the developer of the composite material and with the company which molds the part for us.
And when you add the toolmaker who supplied the molds and other second-tier suppliers, you end up with a dynamic network of expert companies, a "global" web much like the internet all of them partners in developing and producing the product.
In summary, at Carrier we have created a "paradigm shift" for our industry from the old paradigm of commodity-based thinking to a new one which uses a high-powered, technology-based, rapid deployment teamwork approach. The result is a new line of customer-focused products featuring the latest technology at competitive prices.
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