Koren Y. The Global Manufacturing Revolution: Product-Process-Business Integration and Reconfigurable Systems
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2.6 What are the five most important inventions of Thomas Edison?
2.7 What are the five most important inventions of ancient China?
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REFERENCES 71
Chapter 3
Customized, Personalized
and Reconfigurable Products
Central to the idea of global manufacturing is the premise that the variability of
product markets is an ever-intensifying driver of industrial production and profit-
ability. Gone are the days when a manufacturer could dictate to customers “you can
have any color you want, as long as it is black.” With competition now on a worldwide
scale, customers can be sure to find desirable products in almost every color of the
rainbow. To stay competitive, manufacturers must develop strategies for cost-effec-
tive product customization and personalization. A common strategy is to produce
modular product components that can be readily assembled into customized and
personalized products. Furthermore, customers often prefer a product that can be
adapted to different applications when needed, or that can evolve as a child grows up.
Therefore, a popular goal for consumer goods is personalized products that are also
reconfigurable according to the changing needs of the customer.
The concept of reconfigurable products is not new, and it is mentioned in the bible
in the context of converting weapons into agricultural tools when there will be peace
on land [Isaiah, 2; 4]: “They will beat their swords into ploughshares and their spears
into pruning hooks.”
3.1 INTRODUCTION TO CUSTOMIZATION
Mass customization started in the late 1980s when companies, faced with increased
competition in the marketplace, started to look for alternatives to the mass p roduction
The Global Manufacturing Revolution: Product-Process-Business Integration and Reconfigurable Systems
By Yoram Koren
Copyright 2010 John Wiley & Sons, Inc.
72
paradigm. At first, mass production manufacturers simply added minor variations
to their normal product output based on assumptions about what customers wanted
and what was easy to implement. Later they began to apply information technology
to better meet consumer desires. The driving force of mass customization is the
consumer, and the driving enabler is information technology.
Mass customization does not mean producing one-of-a-kind products, as in the
craft production era but rather to producing relatively large quantities of varieties
of products from the same product family at mass production competitive cost
and economies of scale. For example, shopping carts (Figure 3.1) are all of the same
product family, but each supermarket chain has its own carts, and there are many
variations that are produced in large quantities. Mass customization takes advantage
of many if not all mass production strategies. Very personalized products (such as
tooth crowns) are not suitable for mass customization production methods.
Our definition of mass customization is as follows.
Mass Cus tomization
A paradigm in which many optional product variants, manufactured at mass
production cost, are offered to customers.
The offering of a wide variety of products satisfies the needs and tastes of more
customers, and expands the potential market. Producing these products at mass
production costs enables manufacturers to offer them at affordable prices, increasing
sales and profits.
Figure 3.1 Shopping carts.
INTRODUCTION TO CUSTOMIZATION 73
Mass-customized products can be produced at low cost if the product design is
done with the set of options and produc t variations in mind. The greatest opportunity
for minimizing cost is in the product architecture stage. And yet this high-leverage
opportunity is virtually ignored in many product development projects, when
designers assume the product will have the same architecture as previous or
competitive products.
1
Cost is very difficult to reduce after the product architecture
and its design are completed.
A Google search for the word “customized” in July 2003 turned up more than
21 million websites, and in July 2008 42 million. Companies from a diverse product
range are all selling customized products to fit to your requirements, your taste, and
your style, as can be seen in the examples below.
A Broad Spectrum of Products are Customized to Your Requirements
Product Website Website Slogan
Autos www2.ford.com Equipped to your specifications
CDs www.cductive.com Custom-mixed to your taste
Computers www.dell.com Configured to your requirements
Eyewear www.paris-miki.com.au Customized to fit your face and
personality
Golf clubs www.golftofit.com Customized to your body and
playing style
News lineup customnews.cnn.com/ Matched to your interests
Shoes www.digitoe.com Fitted to a precise 3D model of
your foot
Vitamins www.acumins.com Formulated to your nutritional
needs
Greeting
cards
www.americangreetings.com Personalized with your look and
sentiment
Shirts www.shirtcreations.com Tailored to your build and taste
Dolls www.mytwinn.com Designed to look like your child
Jeans www.ic3d.com Tailored to your shape and style
Weather
forecasts
www.weather.com Customized to your location or trip
Did you know that you had so many personal desires and physical attributes? And
can these manufacturers really build products just for you, or will you be buying
packages of options?
The definition of a product family and the architecture phase will determine how
many useful options can be offered and to what extent the products can actually be
personalized. This phase determines the optimal balance between modularity, variety,
and cost.
Consumer goods that do fit the mass customization profile include bicycles,
wheelchairs, in-line skates, scooters, watches, backpacks, certain classes of cars,
office furniture, comfort chairs, kitchen cabinets, toys, rearview mirrors, computer
keyboard, golf clubs, shopping carts, cosmetics, jeans, suits, boots, to name just a few.
74 CUSTOMIZED, PERSONALIZED AND RECONFIGURABLE PRODUCTS
3.2 DESIGN FOR MASS CUSTOMIZATION
On one level, mass customization may be as simple as a pair of blue jeans of the right
size. That is not to say that blue jeans are simple to make, but once having developed
a system for making them, customization can be as simple as manufacturing a range
of sizes of the very same product. By adding this size range, man ufacturers greatly
expand the market for the same product—no one likes jeans that are too loose or that fit
too tight.
At this level all the products look the same, and with the exception of the amount
of material involved, they are the same. They have the same stitching, the same
accessories, and more importantly they require essentially the same number of
operational steps in their manufacturing.
The key to this level of customization (Strategy 1) is that it accommodates only
one or two variations (waist size and length) based on the variety of anatomy of the
customer base. Customization at this level is simple but critical to the widespread
marketing of some products. The sales approach of this level of customization is a
push-type business model—products are sent (“pushed”) to the stores and the
customers purchase them off the shelves with zero delivery time. Strategy 1 is actually
a transition stage between mass production and mass customization.
A more sophisticated model of mass customization (Strategy 2) is known as the
“option package.” Again returning to the automotive industry for an example, once
the initial auto manufacturing market leveled out from its extreme supply-driven
mode, designers began looking for ways to offer products that were different from the
norm but not so different as to significantly alter their costs or their manufacturing
schemes. Carmakers started offering sets or “packages ” of options to appeal to various
driving markets. There remained the “standard” option of a fully functional vehicle,
but in addition, there now appeared a “sports model” and typically, a “luxury” edition
as well. The sports model might offer a more powerful engine; different transmission,
tires, wheels, and seats. The luxury edition attended more to comfort features such as
furniture wood and metal finished interiors as well as better sound-dampened interiors
and powered controls.
One of the main issues with opti on packages is that customers often do not get the
exact features that they need. This issue was articulated by two of our students:
“My father bought a Toyota Camry in Israel. He wanted the model with a sunroof. But he
had to pay also for heated seats—this is the option that Toyota offers in Israel: A
Sunroof þ Heated Seats. But who needs heated seats in a hot country like Israel? Why
cannot Toyota create a product with features that are more precisely tuned to customer’s
needs?” Tamar Erlich, 2007.
“In the US auto industry selling ‘option packages is the form of mass customization.
Customers are sometimes pushed to purchase items that they wouldn’t normally choose.
An example is the moon and tunes’ package, where a deluxe stereo system is paired with
a moonroof. Each of these items can be purchased separately for a higher cost than to
purchase the whole package. In this case, a customer may only want one, but must choose
both. So the customers aren’t truly getting what they want.” Cindie Niemann, 2004.
DESIGN FOR MASS CUSTOMIZATION 75
The marketing of options packages focuses more on the unique features being
offered, and these may or may not actually add significant cost to the product. But
options packages do add to a manufacturers menu of offerings enabling them to reach
markets that they otherwise could not without creating whole new product lines.
And, manufacturers are able to sell the packaged models at much higher markups to
customers who want and are willing to pay for the novelty of those unique features.
The computer industry (e.g., Dell Computers) offers hundreds of packages for laptops
and deskt op computers.
The difference between the two strategies of mass customization is significant in
terms of both manufacturing and marketing. At the first level (Strategy 1) products
that include all options are made and sent to the stores and dealerships for sale—a
push-type business model. Products that are not sold amount to a loss of sales.
In a real mass customization (Strategy 2), all options are designed (e.g., car
package options, computer packages, etc.), but only the product with the option being
ordered is made. The financial transaction with the customer (i.e., the Sell phase)
occurs between the product design phase and the manufacturing phase (Make), as
shown in Figure 3.2. From the produc t design standpoint this is still a push-type
business model, but from the manufacturing aspect it is a pull-type model (i.e., built-
to-order). The combined design and manufacturing aspects create a push–pull type
business model.
Figure 3.2 The Design–Make–Sell sequence models of mass customization and per-
sonalized production.
76
CUSTOMIZED, PERSONALIZED AND RECONFIGURABLE PRODUCTS
Offering a range of options is a significant step up in the marketing of the product,
but at this stage the option packages are just that—packages. A customer cannot
choose features from one package and mix them with features of other packages
because it would cause significant strain on the marketing, distribution, and
manufacturing systems that provide them. Most manufacturers do not or choose not
to try to accommodate them, since doing so increases the complexity of their
operations and reduces their profit on the product.
Over time, and as markets continue to exert pressure on manufacturers, smaller,
more discrete packages of options have been made available. Some single features:
climate control systems, tinted windows, window defog gers, leather interiors to
name but a few, can be gotten without committing to full “luxury” packages and their
exceptional pricing. As product design and manufacturing systems develop, more and
more of these single options become available and simpler to install.
In fact, the ease of applying some of these options has becom e so simple that they
are now “dealer o ptions.” Dealer options are those that can be applied at the finish
stages of final assembly, where auto dealers can handle simple customization projects
for individual customers at the point of sale. The point-of-delivery customization
(or point-of-delivery personalization) is actually the simplest level of personalized
products. Our student in Australia sent us a comment about a shortcoming of this
strategy.
“I live in Adelaide, Australia, where two auto-manufacturing plants are located,”
Steve Pratt wrote us in 2006. “In Australia, personalized production comes in the
form of after-market modifications offered by a subsidiary company at a premium
price. However, these modifications are still merely options offered for customers to
‘personalize their vehicles.”
3.3 PERSONALIZED PRODUCTS
The evolution of mass customization has led eventually to some levels of person-
alization. Like mass customization, personalized production may be as simple as a
pair of blue jeans, but these jeans would be of exactly the right size. With personalized
production, the jeans are made exclusively for a particular customer at exactly the size
that they need. A longer version of the following article, written by Rose-Marie Turk,
appeared in the New York Times in the winter of 1996.
“If the Levi’s Fit, will people order them?”
Would you pay an extra $10 to let a computer choose your next pair of Levi’s?
And why not? The customer would get “individually tailored goods,” while the manu-
facturer would avoid costly over-production. “You’re not mass-producing product and
hoping it sells. You’ve already got a sale,” a Levi Strauss & Co. executive told the New
York Times. Everyone, seemingly, would win.
PERSONALIZED PRODUCTS 77
A woman who visited a selected Original Levi’s Store, had her measurements fed into a
computer and paid the $10 fee could have a pair of jeans custom-made for her particular
body.
After two months, the program’s title was revised to ‘personal fit,’ rather than ‘custom
fit.’ But the “personal fit” jeans are limited to the approximately 400 samples contained
in each store. A salesperson measures the customer’s waist, hips, inseam and rise. She
punches the information into a computer, which suggests a sample for the customer to
try.
If the first sample doesn’t fit perfectly, the customer can indicate where she wants improve-
ment. The salesperson then either feeds the new data into the computer or simply pulls
another sample off the rack.
Even then a woman might not find her Personal Pair (the trademark name). “We hope
to fit a lot of women, but you can’t fit everyone,” said Kates, the director of Original Levi’s
Stores.
Levi’s is targeting two consumer groups. The first contains “a small percentage of women
who feel they never received a pair of jeans that fit,” said company spokesman Sean
Fitzgerald. “The second group is those women who have to have the ultimate pair of
jeans.”
With personalized production, products are cost-effectively made or assembled to
fit the exact personal needs of individual custom ers. A very basic example is custom
kitchen design; considering room shape, window location, size, and illumination,
each kitchen starts out being different. A different individual customer who has his/
her needs, preferences, and taste will use each kitchen—which adds another level of
difference. However, kitchens are made with a technique in which customers select
preferred modules from a large list of possible modules that eventually allows offering
“personalized” kitchens at affordable prices.
The low-cost production of personalized products is accomplished by dividing
the product design process into two phases. The first phase, which is done by the
manufacturer, includes the design of the building blocks, or modules, of the product
(type, function, shape, material, etc.), and the general architecture that specifies how
modules will be connected, interfaced, and integrated with each other when con-
sidering three aspects: (1) mechanical (e.g., brackets, bolts, grooves, etc.), (2) power
(electrical, hydraulic, water, etc.), and (3) information (sensor signals and controls).
Then the financial transaction—the sale to a customer—occurs, and the cus-
tomer starts to be involved in the personalized design phase (see Figure 3.2).
Based on the modules offered, the physical constraints, and the customer’s body
measurements and preferences, the personalized design is finalized. Only then are
the modules (the cabinets and accessories, for example) manufactured and the
product is assembled.
Indeed, both mass customization and personalized production are supplying
products that fit the customer’s needs and preferences. The basic difference between
the two is that in mass customization the customer selects options packages and get
what they want combined with things they may not want or need. By contrast, in
personalized production the customer is involved in the design process and selects
78 CUSTOMIZED, PERSONALIZED AND RECONFIGURABLE PRODUCTS
individual modules that once combined create a personalized product. The modular
product design methodology enables the low-cost manufacturing of personalized
product.
Products that are produced for personalized production may require measuring
the customer at the point-of-order (e.g., in the store). One example is the Levi’s
personalized jeans mentioned above. Similarly, the com pany VSUITO (Ann Arbor,
2003) manufactured tailored suits, with 14,000 ways to personalize a suit to fit
customer preferences, based on customer’s seven measurements (Figure 3.3).
VSUITO developed two special measurement systems to take the needed mea-
surements of the customer, either in stores located at targeted sale markets, or with the
aid of the Internet. The custom er sends the measurements to the factory online.
Another small start-up company in Ann Arbor worked to manufacture personal-
ized backpacks based on a person’s body shape and size. This required simple
measurements of a few dimensions of the customer’s back in the store, or supplying
these measurements over the Internet.
To achieve these levels of mini-customization and personalized production, and
do it cost-effectively, industry must pursue a whole new paradigm in the design and
operations of manufacturing systems. Manufacturing systems must be reconfigur-
able and flexible enough to provide acceptable levels of response to customer’s
demand.
Figure 3.3 Customer’s seven measurements.
PERSONALIZED PRODUCTS 79
3.3.1 Airplane Interior Personalization
For years the interior of airplanes have been designed with the customers (i.e., the
airlines) in mind. The main modules are the passenger seats and the galleys (the
kitchen on the aircraft). The airlines make decisions regarding the spacing between
rows, the size of each cabin, the location of the kitchen, etc. Some airlines have special
security requirements that also change the interior design. El-Al airlines for example,
has a small, one-person-fit secured corridor with doors on each end betwee n the
cockpit and the passenger cabin to protect the pilots. Each airline chooses the color of
the cabins. At the end of the day, the interior of the plane does not look so different
from one airline to another, but still the airplane interior is designed exactly as the
customer, the airline, wants it.
Our student Rachel Krueger wrote the following descr iption of airplane person-
alization: “I’m working in the airline industry. In addition to the interior personal-
ization of the plane, the exterior—the engines and almost every feature on an
aircraft—is customized or personalized. Each aircraft manufacturer will offer an
airframe that can be configured with up to three different engine types. The wings and
nacelle casing are customized depending on the engine that is chosen. Next, the
customer can determine the thrust rating that the engine has. Each engine will be rated
in an engine class with a range. Each plane ordered has a purpose: Short flights, long
flights, or cargo—which is a major decisi on-maker for the engine. Next, some of the
parts installed in the engine are interchangeable depend ing on where the aircraft will
operate. Aircraft that operate in sandy conditions, such as desert operators, require
different hardware installed to account for the additional sand ingestion that will occur
during each takeoff and landing.”
3.3.2 Personalized and Reconfigurable Displays for Automobiles
Future automob iles will have reconfigurable digital displays, which can be configured
by the driver, thereby making them personal. The driver will be able to select the
information to be shown on the display, such as the fuel tank level, speed, navigation
instructions, various warnings, etc. It will be possible for cars to recognize a driver’s
display preferences based on their individual keys or fingerprints and automatically
adjust according to those parameters. These parameters depend on the recorded
driving style of the individual, and his/her preferences (e.g., voice instructions or
visual disp lays).
The operation of these displays will be based on software with embedded
intelligence that contains information about the individual’s driving habits, age, and
desires. For example, a car could have sensors measuring the distance to the vehicles
in front and back, and suggest when to break safely (by voice or displayed warnings).
The distances from the cars in front and back that evoke the warning signal could be
adjustable by the driver, but perha ps be fine-tuned based on the car’s speed, the driver’s
age, and accumulated data about their breaking habits. This intelligent system might
also sense (by using fuzzy-logic algorithms) whether the driver is tired (for example,
based on the driver’s reaction time) and adjust the warning signals accordingly.
80 CUSTOMIZED, PERSONALIZED AND RECONFIGURABLE PRODUCTS