Mass customization: fundamental modes of operation and study of an order fulfilment model

Brabazon, Philip G. (2006) Mass customization: fundamental modes of operation and study of an order fulfilment model. PhD thesis, University of Nottingham.

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Abstract

This research studies Mass Customization as an operations strategy and model. Opinions differ over whether MC should be a label for a specific business model in which customers select from pre-engineered product options, or whether it should be interpreted as a performance goal that has wider relevance. In this research it is viewed as the latter and a manufacturing enterprise is considered to be a mass customizer if it gives its customers the opportunity to have a product any time they want it, anywhere they want it, any way they want it and in any volume they want it, and at the same time brings the benefits that are associated with mass operations, in particular those of price and quality.

In the literature MC is not one operations strategy but a family of sub-strategies and there are several classification schemes, most of which delineate the sub-strategies by the point along the value chain that customization takes place. Other than for one scheme for which correlations between technologies and MC types has been sought by means of a survey, no progress has been made in developing operations configurations models.

Through the study of primary and secondary case studies several classification schemes are appraised and a new framework of five fundamental operations Modes is developed. The Modes are the kernel of a theory of MC, with the other elements being:

- A model for Mode selection that uses four factors to determine when a Mode is suitable;

- Indicative models of the information infrastructures of two Modes that demonstrate the Modes to be different and that they can be a foundation for configurations models;

- A set of product customizable attributes that reveals the multifaceted nature of customization and extends the terminology of customization;

- The delta Value concept that links the motivation for customizing attributes to differences between customers.

A theory of MC is proposed, which postulates:

- An MC strategy is relevant when there are differences across customers in how they value the configurations of customizable attributes;

- There are five operational sub-strategies of MC;

- The choice of sub-strategy for an enterprise is contingent on its organisation and its business environment.

One of the five modes, Catalogue MC, is the Mode that is commonly associated with MC. It is the Mode in which all product variants are fully engineered before being ordered. A diverse set of order fulfilment models of relevance to this Mode are reviewed and organised into four types: fulfilment from stock; fulfilment from a single decoupling point; fulfilment from several decoupling points; and fulfilment from a floating decoupling point. The term floating decoupling point is coined to describe systems that can allocate a product to a customer wherever the product lies, whether it be a finished product in stock, a part processed product or a product that does not yet exist but is in the production plan. In the automotive sector this system has been called Virtual-Build-to-Order (VBTO) and in this research the generic characteristics of VBTO systems are described and key concepts developed, in particular the concept of reconfiguration flexibility.

Discrete event simulation and Markov models are developed to study the behaviour of the VBTO fulfilment model. The non-dimensional ratio of product variety / pipeline length is identified to be a fundamental indicator of performance. By comparing the VBTO system to a conventional system that can fulfil a customer from stock or by BTO only, the role of pipeline fulfilment is identified and a surprising observation is that it can cause stock levels and average customer waiting time to be higher than in a conventional system. The study examines also how customer differences, in particular their willingness to compromise and their aversion to waiting, affect fulfilment and how fulfilment is dependent on reconfiguration flexibility.

Item Type:Thesis (PhD)
Supervisors:MacCarthy, B.L.
Uncontrolled Keywords:Mass Customization, configuration models, order fulfilment, reconfiguration flexibility, virtual build to order, open pipeline, customer compromise, simulation, Markov chain
Faculties/Schools:UK Campuses > Faculty of Social Sciences, Law and Education > Nottingham University Business School
ID Code:182
Deposited By:Philip Brabazon
Deposited On:05 Sep 2006
Last Modified:06 Feb 2009 14:43

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