The document discusses manufacturing flow management (MFM) as a supply chain management process. MFM involves activities to obtain, implement, and manage manufacturing flexibility in the supply chain and move products through manufacturing plants. Five generic manufacturing strategies are presented from least to most flexible: shop to stock (STS), make to stock (MTS), assemble to order (ATO), make to order (MTO), and buy to order (BTO). Each strategy is briefly defined.

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Supply Chain
Management,
The Manufacturing Flow Management
Process
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MFM
Manufacturing flow management is the SCM process that includes all activities
necessary to obtain, implement, and manage manufacturing flexibility in the SC
and to move products through the plants.
 Manufacturing, the conversion of raw materials and components into finished
goods, represents one of the most value-adding activities in the SC.
 Manufacturing is a pervasive business activity that finds relevance in virtually
any enterprise, whether involved in the distribution of goods or provisions of
services.

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MFM Flexibility
• Manufacturing flexibility is defined as, “the ability to respond to environmental
changes with less time and cost.”
• The challenge is determining the right degree of flexibility to build into the
manufacturing system given that increased flexibility typically is accompanied by
higher costs or increased investments.

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Strategic Manufacturing Flow Management
Process
Source
Figure
8.1:
Robert
A.
Novack,
Ph.D.
Used
with
permission.
Review Manufacturing, Sourcing, Marketing, and
Logistics Strategies

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Five generic manufacturing
strategies from least to most
flexible

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Shop to Stock (STS)
Shop to Stock (STS) – products are standardized and pre-positioned in the
market; customers’ expectations of immediate availability support the
maintenance of speculative safety stock at all points of distribution.

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Shop to Stock (STS)
Shop to Stock (STS) – products are standardized and pre-positioned in the
market; customers’ expectations of immediate availability support the
maintenance of speculative safety stock at all points of distribution.

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Make to Stock (MTS)
Make to Stock (MTS) – Products are standardized but not necessarily allocated to
specific locations; demand is anticipated to be stable or readily forecasted at an
aggregate level.

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Assemble to Order(ATO)
Assemble to Order (ATO) – Products can be customized within a range of
possibilities, usually based upon a standard platform; final form of the product is
postponed until demand is known; also, known as “mass customization.”

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Make to Order(MTO)
Make to Order (MTO) – Raw materials and components are common but can be
configured into a wide variety of products; final assembly commences when the
customer order is in-hand.

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Buy to Order(BTO)
Buy to Order (BTO) – Products can be unique right down to the raw material
level; product variety is virtually limitless, though lead time is long as materials are
procured, processed into finished goods, and delivered.