The document discusses key concepts related to mass customization and its implications for supply chain management. It summarizes challenges like increased complexity, the bullwhip effect, and difficulties meeting demand variability. It also outlines opportunities like modular product design, delayed differentiation, and information systems that improve coordination across the supply chain. Mass customization approaches aim to provide customized products and services at low costs by standardizing components and postponing final assembly or configuration until customer orders are received.

1. Challenges & Opportunities for Operation Managers in case of Mass Customization in Supply Chain Management Satendra Katoch Suvigya Singh Shalini Piyush Neeraj D Mohapatra

8. Manufacturing Paradigm Shifts 1900 2000 Craft Sum of All Manufacturing types 1980s Mass Production Mass Production Options ++ Mass Customisation 1910 Different philosophies for manufacturing mass-customized, low-volume, high-mix mass-produced, high-volume, low-mix

11. Customer Order Decoupling Point: Make to Stock Make to Stock Push 2nd tier supplier 1st tier (main) supplier Distributor Retailer Orignal Equipment Manufacturer

12. Customer Order Decoupling Point: Engineer to Order Engineer to Order 2nd tier supplier 1st tier (main) supplier Distributor Retailer Orignal Equipment Manufacturer

13. Make to Stock Customer Order Decoupling Point: Assemble to Order Assemble to order 2nd tier supplier 1st tier (main) supplier Distributor Retailer Orignal Equipment Manufacturer

23. Platform engineering: Different models used by multiple brands within a group of companies

32. Modular Design e.g. Chrysler 300C, Dodge Magnum, Dodge Charger Current : Integral Designs New : Modular Design

37. Benetton’s innovation: postponement of differentiation Making wool Wool dying Distributor Retailer knitting

38. Benetton’s innovation: Postponement of differentiation Making wool Wool dying Distributor Retailer Knitting

43. HP DeskJet Printer Supply Chain US DC Europe DC Far East DC Customer Customer Customer Vancouver Plant Suppliers HP * DC = Distribution Centre

46. Dell’s innovation: assemble to internet order Chips Components Computers

59. Indirect Sales Module Manufacturers PC Manufacturer Customers Distributor/ Retailer Orders Products Forecast Products Orders Modules

60. Direct Sales Module Manufacturers PC Manufacturer Customers Orders Products Orders Modules

64. The Bullwhip Effect Order Quantity Time Retailer’s Orders Order Quantity Time Wholesaler’s Orders Order Quantity Time Manufacturer’s Orders The magnification of variability in orders in the supply-chain A lot of retailers each with little variability in their orders…. … can lead to greater variability for a fewer number of wholesalers, and… … can lead to even greater variability for a single manufacturer .

65. TRADITIONAL PC LOGISTICS COMPONENT MAKERS PC ASSEMBLERS (IBM, COMPAQ) OEM’S DISTRIBUTORS RETAILERS ALL END-USERS (arms-length, multiple handoffs) DELL’S DIRECT BUSINESS MODEL COMPONENT MAKERS DELL DELL.COM CORPORATE END-USERS INDIVIDUAL END-USERS (direct marketing, supplier and customer partnerships)

66. Opportunities

67. New Paradigms in Procurement Ford engineers are not allowed to discuss price with suppliers. Price negotiation is the sole responsibility of Purchasing. CEO finance purchasing purchasing traditional (Ford) product development purchasing DELL

73. The Context of E-Ops Business Model “ How to make money?” Operations “ How to manage production of the product or service?” Information System Architecture “ Set of tools used to support processes.”

74. Business Web Models B-Web Model Example Marketplace Ebay Aggregator E-Trade Alliance AOL Value Chain Dell Computers Distributive Network UPS

75. A Make-to-Order Fulfillment Process B01.2314 -- Operations -- Prof. Juran Customers Product Company Factory Step II: Build Plan Orders sent System provides information Step I: Retailer Factory updates customer Step III: Logistics Order fulfillment flows Customer/Product info. flows Suppliers Develop Products

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