Mass Customization Strategy in Global Supply Chain Management

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Master of International Business Administration

12
Mass Customization
International Supply Chain Management
Yuliya Samokhina, Olga Baranova, Yuliya Pronkina, Alexander Manzhosov

Content

The basic concepts of mass customization. Principles and goals. (by Yulia Samokhina) Introduction3
Mass Customization: main definitions3
Evolution of mass customization………………………………………………………...4 Mass customization strategies: advantages and disadvantages…………………………..4 Mass customization as a process…………………………………………………………6 Conclusion8

Postponement strategies (by Olga Baranova)
What is postponement?9
Postponement typology based on value chain activity9
Benefits of using postponement strategy13
Critical success factors and ideal candidate for postponement strategy14 Modular concepts (by Yulia Pronkina)
Definition of modules in the framework of global supply chain management15 Types of modularity18
Benefits and drawbacks of modularity.
Requirements for implication of the concept modularity19
Modularization in automotive industry (Volkswagen’s modular strategy) 21 Shared platform strategies (by Alexander Manzhosov)
Introduction23
Platform concept 24
The reasons of implementing platforms25
Advantages and disadvantages of implementing shared platform strategies26 Shared platform strategies 28
Volkswagen Group. MQB strategy 29
Conclusion29
References

The basic concepts of mass customization. Principles and goals. By Yuliya Samokhina
Introduction
Today, people live in the world with developing technologies, where everyone wants to be distinguished. Companies compete with other similar firms, because they want to attract customers as much as possible. Mass customization can satisfy customers’ demand to help them buy products with necessary characteristics. Previously, mass production systems can’t be sufficient for manufacturer and consumers. However, mass customization decided this problem to create comfortable conditions for all to provide individual product. For example, nowadays retailers don’t want to have more collections per season, but they want to possess more styles within the season. Companies produce new lines of clothes to their shops every four to six weeks. H&M and Zara have increased production to use computer technology. «Zara uses data from its 426 stores to spot new trends, and offers 10,000 new products a year. TopShop sells as many as 30 pairs of knickers a minute, 6,000 pairs of jeans a day and 35,000 pairs of shoes every week». Why it occurs? The answer is very simple: supply chain in mass customization business model has to be flexible and responsive to consumer demand. Main issues will be considered in the essay below. Mass Customization: main definitions

Usually, mass customization requires very advanced and flexible network, because the original purpose of mass customization is adapting one-to-one. Now, everyone can make products by themselves. Here, I want to give more successful definitions of Mass Customization: «Mass customization is not a pure but a hybrid manufacturing concept, which joins the efficiency of operations and differentiation by providing highly value added products». «Mass customization refers to a customer co-design process of products and services, which meet the needs of each individual customer with regard to certain product features. All operations are performed within a fixed solution space, characterized by stable but still flexible and responsive processes. As a result, the costs associated with customization allow for a price level that does not imply a switch in an upper market segment». (Piller 2005c, p.315; emphasis in original). Thus, now each buyer can acquire any goods, but the price for it will be higher. Commonly, it isn’t problem, because each person wants to be allocated from crowd. For instance, if two girls come in school-leaving party in one dress, it will be catastrophe for them. Fortunately, our...
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