life cycle – The OM Blog by Heizer, Render, & Munson

OM in the News: The Short Life Cycle of Amazon Go

It doesn’t seem that long ago that we posted the news that Amazon was opening 57 Amazon Go cashierless bricks and mortar store grocery sores.

We even highlighted this exciting digital-driven advancement in an OM in Action box in Chapter 5 (see page 175). But as we also point out in in our discussion of product life cycles in that chapter (Design of Goods and Services): “Products are born. They live and they die.”

The e-commerce giant just announced that “its branded stores failed to deliver a distinctive customer experience with an economic model that could be scaled up successfully.” This marks the latest pivot in Amazon’s more than decadelong effort to break into physical retail, reports The Wall Street Journal (Jan. 28, 2026).

Amazon Go’s convenience stores, which let customers check out electronically without waiting in line, also never resonated with shoppers on a large scale, and the company has trimmed its fleet by more than half since 2023. The company does, however, license its Just Walk Out technology to retailers at more than 360 locations in five countries, including colleges and universities, sports arenas, hospitals and airports.

Amazon plans to continue experimenting with bricks-and-mortar retail. The company just won approval to open its largest-ever store in Orland Park, Ill., where it will sell groceries, general merchandise and prepared foods. The megastore, which at 230,000 square feet will be big enough to fit nearly two Target stores, will incorporate in-person and digital shopping.

Product life cycle can span a few days (a concert t-shirt), months (seasonal fashions) years (NFL Madden football), or decades (Boeing 737). Amazon Go lasted eight years.

Classroom discussion questions:

Why did Amazon Go fail?
Name a few other products that also exhibited short life cycles.

OM in the News: The Electric F-150’s Short Life Cycle

The first Boeing 737 jet rolled off the assembly line 58 years ago, on April 9, 1967. That is a long life cycle, given it has still not reached the “decline” phase in Figure 2.5 in your text. But the life cycle certainly looks a lot shorter for electric pickup trucks.

Ford is planning to scrap the electric version of its F-150 pickup, according to The Wall Street Journal (Nov. 7, 2025) which would make the money-losing truck America’s first major EV casualty. “The demand is just not there” for the F-150 Lightning and other electric trucks, said one dealer. Stellantis earlier this year called off plans to make an electric version of its Ram pickup. GM plans to discontinue some electric trucks and sales of Tesla’s Cybertruck tanked this year. The trucks seemed a good bet amid booming EV demand and clean-air mandates that required automakers to sell fewer gas-guzzlers.

Ford halts production of the F-150 Lightning

The Lightning fell far short of expectations as American truck buyers skipped the electric version of the top-selling truck. Overall EV sales are plummeting in the absence of government subsidies. Ford dealers sold 66,000 gas-powered F-Series pickups, and just 1,500 Lightnings, the fewest of any model. (Ford has racked up $13 billion in EV losses since 2023).

When Ford launched the Lightning 5 years ago it promised a pickup as fast as a sports car and as affordable as a conventional truck. It would drive hundreds of miles on a single charge, and carry enough voltage to power a home for days. “It’s like a smartphone that can tow 10,000 pounds,” said the CEO at the launch.

But truck buyers worried the pickups would run out of juice in the middle of a job or a long haul as their range is dramatically reduced when towing big loads or operating in cold weather.

GM has also lost billions on electric trucks after rolling out a string of them, including an electric version of the popular Chevrolet Silverado. GM has three electric pickups, and it sold about 1,800 of them last month.

Ford built up the capacity to make as many as 150,000 Lightnings a year. But the EVs cost billions to develop and manufacture, and are only profitable if they sell in large enough volumes, which they did not.

Classroom discussion questions:

Where do you think all EVs are on the life cycle curve?
Why did so many auto manufacturers misread the demand for electric pickups?

Guest Post: Postal Service Life Cycle Decline

Prof. Howard Weiss shares his insights with our readers monthly.

As discussed in Chapter 2, when a product or service is in the decline stage of its life cycle, cost control is critical. Currently, demand for postal services is in the decline stage in many, if not most, countries. The decline is due to two main factors.

 Digital communication has greatly reduced the number of letters being sent. In the U.S., first class mail volume has dropped to 20% of what it was in 1997. Similarly, Canada Post reported a decline from 5.5 billion letters delivered annually 2 decades ago to only 2 billion today.
 Parcel delivery—once a potential growth area—has increasingly been dominated by private competitors such as UPS, FedEx, and Amazon, which can operate flexibly without the regulatory obligations imposed on government-run postal services.

As a result, national postal authorities are incurring substantial financial losses: $9.5 billion in the U.S., $1 billion in Canada, and $427 million in the UK. There are several ways to cut costs, and different countries are taking different approaches:

Job cuts The most obvious way to reduce costs is to reduce the number of employees. The U.S.P.S. has announced plans to eliminate 10,000 positions, largely through voluntary retirement incentives, while Deutsche Post in Germany anticipates cutting 8,000 jobs.

Close facilities The U.S. is considering closing some of its 31,000 post offices when their leases expire. Canada is going to close some mostly rural post offices. On the other hand, a new law in Germany requires the postal service to not close any of its current facilities.

Rural delivery
In the U.S., Canada and England the postal authorities are required to provide universal service to all addresses and for facilities to be open 6 days a week. In Germany the expectation is 5 days per week. Universal service is costly as it requires more time to deliver mail to rural areas than to urban areas.

Door to door delivery Canada has transitioned many households from door-to-door delivery to centralized community mailboxes, a shift projected to save $300 million annually. A majority of Canadians already receive their mail through community, apartment or rural mailboxes.

Extended delivery times In some countries the required time to deliver mail may be increased. In Germany the expected time is now 3 days rather than the former 2 days. In all countries delivery of mail could be delayed by a day or more.

Classroom discussion questions:
1. What else can you suggest to save money?
2. Is it reasonable to expect the post office to deliver to very rural addresses?

OM in the News: Life Cycle and the Last Boeing 747

Some legends really are true, writes The New York Times (Feb. 1, 2023), and indeed it is the case that two men on an Alaskan fishing trip in the mid-1960s struck a bargain that wound up starting the era of the jumbo jetliner, which democratized air travel.

The first 747 being rolled out of the factory in 1968

“If you build it, I’ll buy it,” said Juan Trippe, the head of Pan American World Airways.

“If you buy it, I’ll build it,” countered Bill Allen, the president of the Boeing.

Remarkably, barely three years after a handshake agreement, the Boeing 747 rolled out of a giant factory north of Seattle. It quickly made global air travel more affordable than it had ever been. This week, 53 years after the first Pan Am passenger flights between New York and London, the 1,574th — and last — Boeing 747 took to the skies.

The 747 was nearly three times the size and capacity of any jet airliner at the time, and with that distinctive double-decker bulge, it looked like none of its predecessors. All told, 747s have carried more than six billion passengers 60 billion nautical miles, the equivalent of 144,000 trips to the moon and back.

The last Boeing 747 leaves Everett, Wash.

The “Queen of the Skies” is passing out of fashion because nimbler, more energy efficient jetliners with just two engines have come along to do a better job of getting people from point to point internationally. In the mid-90s, Boeing introduced the two-engine 777, which was about as big as the 747, but more advanced and efficient. A decade later, Boeing’s main rival, Airbus, debuted the A380, which can carry more passengers than the 747. But Airbus struggled to sell the plane and ended production in 2019.

The 747 is composed of about 6 million parts produced all over the world. But the final work of assembling them into an airplane was completed at a factory in Everett, Washington. That plant, regarded as the world’s largest building by volume, was built for the 747 in the 1960s.

The final 747 went to Apex Logistics, a huge transport company, which still views it as an ideal choice because of its reliability and ability to fly huge amounts of goods.

Classroom discussion questions:

Figure 2.5 in your Heizer/Render/Munson text illustrates the life cycle of 10 products. Where do the current Boeing planes (737 Max, 747, 777, and 787) each fall?
Why was the 13 year life cycle of Airbus’ Superjumbo A380 so much briefer?

OM in the News: The Problem with Solar

California has been pushing for rooftop solar power, building up the largest solar market in the U.S., reports The Los Angeles Times (July 15, 2022) More than 20 years and 1.3 million rooftops later, the bill is coming due. Since 2006, the state, focused on incentivizing people to use solar power, showering subsidies on homeowners who installed panels but had no plan to dispose of them. Now, panels purchased under those programs are nearing the end of their 25-to-30-year life cycle.

The majority of solar panels are ending up in landfills

Many are winding up in landfills, and in some cases, contaminating groundwater with toxic heavy metals. Only 1 in 10 panels are actually recycled. The challenge over how to handle truckloads of contaminated waste illustrates how cutting-edge environmental policy can create unforeseen problems. “The industry is supposed to be green,” said an industry expert. “But in reality, it’s all about the money.”

“This trash is probably going to arrive sooner than we expected and it is going to be huge,” writes Harvard Business Review. “While all the focus has been on building this renewable capacity, not much consideration has been put on the end of life of these technologies.” Disassembling panels and recovering the glass, silver and silicon is extremely difficult.

Highly specialized equipment, furnaces, and workers are needed. Panels are classified as hazardous materials, which require expensive restrictions on packaging, transport and storage. The economics of the process don’t make a compelling case for recycling. Only $2 to $4 worth of materials are recovered from each panel. It costs $20 to $30 to recycle a panel versus $1 to $2 to send it to a landfill.

The number of installed solar panels in the next decade will exceed hundreds of millions in California alone, and that recycling will become even more crucial as cheaper panels with shorter life spans become more popular.

A lack of consumer awareness about the toxicity of panels and how to dispose of them is part of the problem. “There’s an informational gap, a technological gap, and a financial gap,” say experts. The only solution seems to be extended producer responsibility, in which the cost of recycling is built into the cost of a product at its initial purchase. Business entities in the product chain — rather than the public — would become responsible for end-of-life costs, including recycling costs.

Classroom discussion questions:

Supp. 5 in your Heizer/Render/Munson text deals with this issue in detail. Which model(s) can be applied here?
What is the “systems view,” the “commons view,” and the “triple bottom line view” in this case?

OM in the News: In Tech Years, 2010 Was Eons Ago

Abbott Lab’s flash glucose monitoring device.

Now that was a decade! Ten years ago we wore analog watches, had landline phones, hung out in bookstores, and even hailed taxis, we are reminded by The Wall Street Journal (Dec. 30, 2019). Ah, the good old days. (Mind you, TV remote controls are only a few decades older).

In 2009 Apple started selling the iPhone 3GS. For $199, it had a 3½-inch screen with a 480-by-320 display—less than half the resolution of a 20th-century TV set. The hot feature was a “built-in digital compass.” In 2019 the $999 iPhone 11 Pro has a 5.8-inch screen and a 2,436-by-1,125 display. It features 30,000 infrared probes that can read your face.

The Boeing 787 Dreamliner, which we feature in the Global Company Profile in Chapter 2, can fly nonstop from just about anywhere to anywhere. Streaming radically changed how cable companies and studios deal with customers. Almost all of Netflix’s growth in streaming movies took place in the past 10 years. The Brookings Institution projects that advances in logistics and food distribution have reduced poverty in most of the world—from 550 million poor outside Africa in 2009 to fewer than 100 million today.

Epitomizing the 2010s is the glucose monitor that reads from a patch with a small sensor stuck under your skin and update a smartphone app. The app also lets caregivers follow patients’ readings, replacing finger pricks, pens and phone calls—all to the benefit of the 30 million Americans who suffer from diabetes.

This decade has proved that progress is relentless. Expect it, even though we should never take it for granted. Property rights, an educated workforce, fair tax codes that enable capital formation, and light-touch regulations are essential ingredients. It’s why the U.S., not China, has driven global innovation (again) in the 2010s.

Classroom discussion questions:

Referring to Figure 2.5 in your Heizer/Render/Munson text, where do you think the following products will be on the product life cycle curve in 2029: iPhone 11, Boeing 787, glucose monitor?
Where will the products shown in that figure be in 2029?

OM in the News: Life Cycles and the Smartphone

When Steve Jobs demonstrated the first iPhone in 2007, the audience was amazed by features we consider mundane today

“Steve Jobs took to a stage a dozen years ago this week to introduce a revolutionary new product to the world: the first Apple iPhone,” writes The Wall Street Journal (Jan. 16, 2019). That groundbreaking device, and the competitors that followed, changed the way people communicated, ordered dinner and hailed a taxi. The technology world reoriented around the smartphone, supplanting the PC, MP3 players, the digital camera and maps. The mobile economy was born.

Today, it looks like the era of smartphone supremacy is starting to wane. The devices aren’t going away any time soon, but their grip on the consumer is weakening. A global sales slump and a lack of hit new advancements has underlined a painful reality for the matured industry: smartphones don’t look so smart anymore. Wristwatches can now text emojis. Televisions can talk and listen. Voice-activated speakers can order diapers.

The number of “connected” devices in use that can stream music, clock mileage or download apps has more than doubled to 14 billion in the past 3 years. Now the universe has expanded to voice apps, car infotainment centers and wearable devices. Like the arc of the PC, smartphones may be engaged in a race downward. Titans Apple and Samsung risk seeing their high-end phones become commoditized, as Chinese rivals Huawei and Xiaomi prove capable of making similar devices at lower prices.

More than half of the world’s population now owns a smartphone. While that leaves billions of potential first-time buyers in poorer areas, they offer lower profits. Meanwhile, the market in the U.S. has become saturated, as the improvements in the devices become more incremental and many consumers have decided they don’t need to get each new upgrade. In developed markets, smartphone usage may be reaching its upper limits, as some consumers pull back amid acknowledgment their phones can be addictive, spur anxiety, distract drivers and cast a pall of silence over the dinner table.

Classroom discussion questions:

Referring to the product life cycle curve in Figure 2.5, where does the iPhone fit?
Do your students agree that smartphones are “in a race downward”?

OM in the News: Everything Has a Life Cycle, Including the 747

Retired Delta 747s in the Arizona desert

There may be no airliner as recognizable as the Boeing 747, the world’s first jumbo jet, with its iconic hump of an upper deck. The introduction of the “Queen of the Skies” was a triumph of engineering and grace: unprecedented size and speed with spiral-staircase international glamour. But the airline business has changed, and the giant plane has become more expensive to operate. A couple of weeks ago, the final 747 flight by any commercial U.S. airline took to the sky.

“Like so many others before it,” writes The New York Times (Jan. 20, 2018), “the plane was heading to the Southwest to retire.” Hours after takeoff from Delta’s Atlanta hub, the jet was circling Arizona’s Sonoran Desert, making its final approach to Pinal Airpark, between Phoenix and Tucson. It’s an ideal place to store airplanes long-term, and about 120 aircraft are parked there now, scattered across the desert floor. The dry air prevents major corrosion, so their parts can be used to help keep other planes flying. About 50% of the retirees are stripped and sold for scrap. But some end up working for air carriers in Africa, Asia and South America, for whom buying a used aircraft is a lot more affordable than buying new, even though they are less fuel-efficient.

The 747 aircraft was a marvel for when it was built. But, a marvel of 1960s engineering is not necessarily suited to 2018 industry needs. Many airlines are moving to a business model that focuses on connecting more cities directly with smaller, more fuel-efficient planes, rather than funneling passengers through a few large hubs. As we state in Chapter 5: “Products are born. They live and they die.”

Classroom discussion questions:

How is production of a 747 different from making a 737?
What are the major OM issues facing Boeing, as maker of the 747, and customers of the plane, such as Delta?

Guest Post: Total Cost of Ownership

Our Guest Post today comes from John Bowler, who is Visiting Professor at DeVry University’ s College of Business.

As the Heizer/Render OM text suggests in Chapter 11, the collaborative relationship between buyer and supplier should yield the lowest total cost of ownership (TCO). TCO is the sum of all direct, indirect, and opportunity costs over the life cycle of a purchase. The goal of the TCO approach is to obtain the most economical total price and not necessarily the lowest initial price. This is the focus of many successful collaborative supplier-client relationships.

The elements of TCO are (but not limited to): Item price; Item ordering cost; Transportation costs; Receiving costs; Inventory carrying cost; Shortage cost; Warranty cost; and Aftermarket/preventative maintenance cost.

TCO composition varies by the type of product, the product’s life-cycle stage, supplier’s location, the buyer’s production methodology and/or method of service delivery. Determining the TCO can be a challenging task. One way to start is to identify the supplier’s costs (or contributions) in regard to the following:

Integration relates to how well the supplier meshes with the buyer’s established infrastructure and processes to include the ease by which information flows both ways between buyer and the supplier. In today’s supply chain, timely and accessible information flow is very much as important as on time, in spec, delivery of the product or service.
Collaboration relates to the ease of doing business with the supplier.
Synchronization refers to supply chain capabilities such as the flexibility to drop ship direct to the end user.
Leverage focuses relates to the competitive advantage a supplier contributes to the client’s competitive capabilities.
Acceptable risk relates to the level of the supplier’s reliability and resiliency in supporting the buyer’s ability to maximize chosen profit opportunities.

TCO data-driven conclusions provide a competitive advantage to firms across various industries. Thinking outside the box of ways to maximize profitability in supplier relationships rather than calculating ways to minimize supplier costs will earmark industry leaders in the future.

OM in the News: Where Does Your Old CRT or TV Go When it Dies?

Old TVs waiting for recycling in Philadelphia

Last year, inspectors from California’s hazardous waste agency were visiting an electronics recycling company for a routine review when they came across a warehouse the size of a football field, packed with tens of thousands of old computer monitors and televisions. As recently as a few years ago, broken monitors and televisions like those were being recycled profitably. The big, glassy funnels inside these machines — CRTs — were melted down and turned into new ones. But flat-screen technology has made those monitors and televisions obsolete, writes The New York Times (March 19, 2013), decimating the demand for the recycled tube glass used in them and creating a “glass tsunami” as stockpiles of the useless material accumulate across the country.

Small changes in the marketplace can suddenly transform a product into a liability and demonstrate the difficulties regulators face in keeping up with rapid shifts. The growing stockpiles, much of which contain lead that has zero economic value, find few buyers. The bulk of this waste is being stored, sent to landfills or smelters, or disposed of in other ways that are environmentally destructive. Instead of recycling the waste, many recyclers have been illegally storing millions of the monitors in warehouses. Each CRT includes up to 8 pounds of lead.

In 2000, there were 12 plants in the U.S. and 13 more worldwide that were taking old TVs and CRTs and using the glass to produce new tubes. Now, there are only 2 plants in India doing so. Although the larger solution to the problem is for technology companies to design products that last longer, use fewer toxic components and are more easily recycled, the industry is heading in the opposite direction. CRTs have been largely replaced by flat panels that use fluorescent lights with highly toxic mercury in them.

The federal government, among the world’s largest producer of electronic waste, disposes more than 10,000 computers a week, some of which are dumped illegally in developing countries.

Discussion questions:

1. If you were in charge of sustainability in your firm, how would you deal with discarded computers?

2. Relate the issue to life cycle assessment (see Chapter 5).

OM in the News: The Nintendo Product Life Cycle Game

This week, Nintendo launched its first all-new machine in 5 years, a hand-held player with a 3-D display that doesn’t require the user to wear glasses. The company has dreamed for 15 years of 3-D game systems, but two previous attempts (the Family Computer 3-D System in 1985 the Virtual Boy System in 1993) required glasses or goggles and were both embarrassing flops.

With the game world gravitating towards the use of sophisticated apps on cell phones (LEGO Harry Potter costs $4.99 on an iPhone), The Wall Street Journal (Mar. 2,2011) reports Nintendo is facing the classic product life-cycle curve on its most popular products, its DS and Wii game players. The DS came out in 2004 and the Wii in 2006. Demand for both peaked in 2009 and sales of games for them are on the decline as well. The goal is for the 3-D player (called the 3DS) to restart the life cycles for both machine and games.

The 3DS is a clamshell device, about the size of a passport when closed and 8/10 of an inch thick. The first units went on sale in Japan this week for $299, with more than 90% of the first 400,000 units shipped to retailers sold in 2 days. It will soon arrive in the US and Europe.

The only catch: Nintendo is warning that children 6 and under should not play the games, as it could have a negative effect on their eyesight development. The 3DS delivers separate images to the left and right eyes. The device is very sophisticated and even includes a 3-D digital camera.

Discussion questions:

1. Why is this project critical to Nintendo?

2. In a SWOT analysis (Ch.2), what are the weaknesses and threats?

3. Do students believe this is the “next wave”?

OM in the News: Product Life-Cycle and the Death of the Station Wagon

“Products are born. They live and they die.” This we write in Chapter 5, Design of Goods and Services. And so we sadly announce that the station wagon is dead. At least this is the headline in today’s Fortune (Feb.15,2011). Volvo, the company most associated with station wagons for the past 20 years, will stop selling them in the US after moving just 450 in all of 2010 (an average of 2 per dealer).

The Ford Country Squire, pictured here, has been gone for some time now. It was the quintessential suburban family vehicle since World War II. If you had 3 kids and a dog, the wagon was almost standard equipment.

Product innovation, the gas crisis, and the boxy look all took their toll on station wagons. In the 1980’s the minivan came along and stole the people-mover business. Then the SUV took over in the 1990’s with more cargo space, better seating, and 4-wheel drive. And in the 2000’s the crossover combined the best features of the minivan and the SUV.

Volvo, with annual sales overall of only 400,000 cars, never enjoyed the scale to support R&D on the new models or frequent style changes. The company was also slow to move production out of high-cost Sweden, and it never built cars in the US, its largest market.

Although BMW, Audi, and Mercedes still offer wagons in the US, they don’t call them that. The new terms are “touring”, ‘avant”, and “estate”, respectively.

Can the station wagon ever come back to life? The 1976 Cadillac Eldorado was lionized as the last American convertible–until Lee Iacocca brought out the 1982 Chrysler LeBaron ragtop. Researcher Kevin Kelly, on NPR last week, has made the claim that “no human invention, no tool has totally vanished”.

Discussion questions:

1. Can you name any product that no longer is made anywhere in the world that was once popular in the US?

2. What did Volvo do to help doom its own vehicle sales?