A bilevel-optimization approach to determine product specifications during the early phases of product development: Increase customer value and reduce design risks

Abstract It is crucial to define product specifications (a series of engineering characteristics and their corresponding values) reasonably and scientifically in the early phases of product development. The product specifications should consider multiple decision-making factors (external situations, internal situations, laws and regulations, and other product lifecycle requirements), which requires several cycles of iterations, tradeoffs, and modifications. During this decision-making process, two key challenges must be overcome. The first is how to organize all of the related factors in a manner that adequately assists, clarifies, and expresses the iterative decision-making process. The second is how to abstract this decision-making problem with iterations and tradeoffs into an approximate optimization model. To overcome these two challenges, a bilevel-optimization approach to determine product specifications during the product planning and concept design phases is proposed. First, an iterative decision-making process, which includes customer value-driven product planning based on quality function deployment, design risk-reducing concept design using cost-based concept failure mode effects analysis, and the interactions between the product planning and concept design phases, is constructed to solve the first challenge. Second, a bilevel-optimization model is proposed to determine the best product specifications and product concepts, which clarifies how the tradeoffs between these two phases are reached, solving the second challenge. Subsequently, a case study of developing an integrated washer and dryer machine is used to explain and prove the validity of the proposed bilevel-optimization approach.