The Life Cycle of Manufacturing Networks in the Mass Customisation Era
Read this article. The research focuses on network design performance in our current era of product customization and personalization. With online order volume steadily increasing, what network design considerations do you feel are necessary to successfully fulfill custom orders?
Evolution of manufacturing and current challenges
Evolution of manufacturing paradigms
Over time, manufacturing paradigms, driven by the pressure of the environment in which they operate, change in character and evolve in patterns (Fig. 2). The various patterns witnessed up to now can be roughly correlated to movements between three stages: (1) craft shops that employ skilled artisans, (2) long-linked industrial systems using rigid automation, and (3) post-industrial enterprises characterised by flexible resources and information intensive intellectual work. Prevailing manufacturing paradigms are, in chronological order of appearance, the following: craft production, American production, mass production, lean production, mass customisation, and global manufacturing. Apart from American production, all other paradigms are still "operational" today in different industrial sectors.
Fig. 2 Evolution of manufacturing paradigms (adapted from [11])
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By
studying these notable transitions, which are attributed to the
pressure applied by social needs, political factors, and advances in
technology, it is noticeable that factory systems and technologies have
been evolving in two directions. Firstly, they increased the versatility
of the allowable products' variety that they produced. This resulted in
numerous production innovations, design technology advances, and
evolution in management techniques. Secondly, companies have extended
factories like tools and techniques. Factories emerged from firms that
introduced a series of product and process innovations that made
possible the efficient replication of a limited number of designs in
massive quantities. This tactic is widely known as economies of scale. Factory systems replaced craft modes of production as firms
learned how to rationalise and product designs as well as standardise
production itself. Although factory organisations provided higher
worker and capital productivity, their structure made it difficult to
introduce new products or processes quickly and economically, or to meet
the demands of customers with distinctive tastes; factory-oriented
design and production systems have never completely replaced
craftsmanship or job shops even if the new technologies continue to
appear. The result, in economic, manufacturing, and design concepts, has
been a shift from simple economies of scale, as in the conventional MP
of a limited number of products, to economies of scope and customer
integration. It is clear that MP factories or their analogues are
not appropriate for all types of products or competitive strategies.
Moreover, they have traditionally worked best for limited numbers of
variants suited to mass replication and mass consumption. The craft
approach offers a less efficient process, at least for commodity
products, but remains necessary for technologies that are still new or
emerging and continues to serve specific market niches, such as for
tailoring products for individual needs and luxury or traditional items.
A categorisation of the different production concepts based on the
indicators system reconfigurability, demand volatility, and product
complexity is depicted in Fig. 3.
Fig. 3 Characterisation of production paradigms based on demand structure, product complexity, and product flexibility
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Today,
issues introduced by the shift of business models towards online
purchasing and customisation must be tackled in cost-efficient and
sustainable ways in order for companies to maintain their
competitiveness and create value. To respond to consumer demand for
higher product variety, manufacturers started to offer increased
numbers of product "options" or variants of their standard product.
Therefore, practice nowadays focuses on strategies and methods for
managing product, process, and production systems development that are
capable of supporting product variety, adaptability, and leanness, built
upon the paradigms of MC and product personalisation. The currently
widespread MC is defined as a paradigm for "developing, producing,
marketing and delivering affordable goods, and services with enough
variety and customisation that nearly everyone finds exactly what they
want". This is achieved mostly through modularised product/service
design, flexible processes, and integration between supply chain members. MC targets economies of scope through market segmentation, by
designing variants according to a product family architecture and
allowing customers to choose between design combinations. At the
same time, however, MC must achieve economies of scale, in a degree
compared to that of MP, due to the fact that it addresses a mass market.
Another significant objective for companies operating in an MC
landscape is the achievement of economies of customer integration in
order to produce designs that the customers really want. On the
other hand, personalised production aims to please individual customer
needs through the direct integration of the customer in the design of
products. The major differences between the prominent paradigms of MP,
MC, and personalisation in terms of goals, customer involvement,
production system, and product structure are depicted in Fig. 4.
Fig. 4 Differences between production paradigms (adapted from [20])
![](https://learn.saylor.org/pluginfile.php/5619134/mod_book/chapter/50003/04.jpeg)
A
research conducted in the UK related to automotive products revealed
that 61 % of the customers wanted their vehicle to be delivered within
14 days, whereas consumers from North America responded that they
could wait no longer than 3 weeks for their car, even if it is custom
built. Such studies point out the importance of responsiveness and
pro-activeness for manufacturers in product and production design.
During
the last 15 years, the number of online purchases has increased and
recent surveys show that 89 % of the buyers prefer shopping online to
in-store shopping. Web-based and e-commerce systems have been
implemented and have proved to be very effective in capturing the pulse
of the market. These web-based toolkits aim at providing a set of
user-friendly design tools that allow trial-and-error experimentation
processes and deliver immediate simulated feedback on the outcome of
design ideas. Once a satisfactory design is found, the product
specifications can be transferred into the firm's production system and
the custom product is subsequently produced and delivered to the
customer. Still online 2D and 3D configurators do not solve
practical issues such as the assembly process of these unique variants.
Although proposed approaches include e-assembly systems for
collaborative assembly representation and web-based collaboration
systems, the research in this area needs to be expanded in order to
provide tools for assembly representation and product variant
customisation. An additional constraint is that globalised design and
manufacturing often require the variants for local markets to be
generated by regional design teams, which use different assembly
software and source parts from different supply bases. The
incorporation of the customers' unique tastes in the product design
phase is a fairly new approach to the established ways of achieving
product variety and entails significant reorganisation, reconfiguration,
and adaptation efforts for the company's production system. Variety is
normally realised at different stages of a product life cycle. It can be
realised during design, assembly, at the stage of sales and
distribution, and through adjustments at the usage phase. Moreover,
variety can be realised during the fabrication process, e.g. through
rapid prototyping.
It should finally be noted that
naturally, even if the trends dictate a shift towards personalised
product requirements, it should always be considered that forms of
production such as MP cannot be abandoned for commodities and
general-purpose products, raw materials, and equipment. After all,
paradigms are shaped to serve specific market and economical situations.
Globalisation
Globalisation
in manufacturing activities, apart from its apparent advantages,
introduces a set of challenges. On the one hand, a globalised market
offers opportunities for expanding the sphere of influence of a company,
by widening its customer base and production capacity. Information and
communication technologies (ICT) and the Internet have played a
significant role to that. On the other hand, regional
particularities greatly complicate the transportation logistics and the
identification of optimum product volume procurement, among other.
Indicatively, the difficulty in forecasting product demand was
highlighted as early as in 1986 by the following observation from Intel
laboratories: when investigating the match between actual call off and
the actual forecast, they estimated that supply and demand were in
equilibrium for only 35 min in the period between 1976 and 1986. Enterprises started locating their main production facilities in
countries with favourable legislation and low cost of human labour;
thus, the management of the supply chain became extremely complex,
owing primarily to the fact that a great number of business partners
have to mutually cooperate in order to carry out a project, while being
driven by opportunistic behaviours. Thus, manufacturing networks need to
properly coordinate, collaborate, and communicate in order to survive.
On a manufacturing facility level, the impact of supply
chain uncertainties and market fluctuations is also considerable. The
design and engineering analysis of a complex manufacturing system is a
devious task, and the operation of the systems becomes even harder when
flexibility and reconfigurability parameters must be incorporated.
The process is iterative and can be separated into smaller tasks of
manageable complexity. Resource requirements, resource layout, material
flow, and capacity planning are some of these tasks, which even
after decomposition and relaxation remain challenging. In
particular, in the context of production for MC businesses, issues such
as task-sequence-dependent inter-task times between product families are
usually ignored, leading to inexact, and in many cases non-feasible,
planning and scheduling. Even rebalancing strategies for serial lines
with no other interdependencies is challenging, leaving ample room for
improvement in order for the inconsistencies between process planning
and line balancing to be minimised.
From a technological
perspective, the increased penetration of ICT in all aspects of product
and production life cycles enables a ubiquitous environment for the
acquisition, processing, and distribution of information, which is
especially beneficial for a globalised paradigm. With the introduction
of concepts like cyber physical systems (CPS) and Internet of things
(IoT) in manufacturing, new horizons are presented for improving
awareness, diagnosis, prognosis, and control. Also, the relatively new
paradigm of agent-based computation provides great potential for
realising desirable characteristics in production, such as autonomy,
responsiveness, distributiveness, and openness.