10.3 Mass customisation and supply chains
The concept of mass customisation is built on the concept of postponement. As stated earlier, this is the extreme form of postponement as the product is subject to the final configuration as and when the customers specific order is known. The aim is to provide the customer with custom solutions or, in other words, exactly what he or she wants, but to provide this with the same efficiency achieved in mass production. This is a considerable challenge when we consider how individual choices can vary and what it means to configure products, especially complex products, to each customer desired configuration given that firms are always under pressure of reducing system wide costs through reduction in inventory and the achievement of shorter lead times.
In spite of this challenge, if mass customisation can be successfully implemented, it is possible to see intuitively that it is the key to increasing value through the provision of unique personal satisfaction; and, of course, this has the potential to generate additional marginal revenue. A second consideration, a more profound and fundamental one, is that the overall effect on inventory related costs can be very positive as production is based on real demand. This is essentially the transformation of the supply chain to a pull system at the customer end. This means that the manufacturing process is completed when definite information regarding customers' preferred configuration or design is available. And, you may have guessed correctly, this information, along with the customers' willingness to wait for the product, are crucial elements, along with the specific characteristics of the product, which would make mass customisation successful.
The most outstanding example of mass customisation using the BTO (build to order) model or pull system is Dell computers. Dell's direct supply chain model based on Internet orders and direct shipment to customers in their preferred configuration has made Dell the favoured subject matter of many case studies. In recent years, traditional apparel manufacturers like the famed jeans wear maker Levis have moved into the mass customisation market to provide custom fitted jeans to consumers.
The following article from the ATA journal provides useful information regarding the impact of technology on mass customisation (of apparels in this case).
Fitting Everybody
by Lucio Carpio, http://www.2456.com/eng/epub/content.asp?epubiid=4&pg=1 ,
Accessed 8.8.2002
A top fashion label on the inside of your shirt or coat used to be all you needed to denote your fashion taste. Today, it is much more prestigious if you're wearing designs that are custom-made for you.
Made-to-measure has now taken on a new meaning, thanks to sophisticated technology for mass customisation. Consumers today are not only spoiled for choice, but much more demanding when it comes to fit and product design.
Mass customisation is the key to better fitting clothes using a 3-dimensional application that allows retailers to produce the right product that is adapted to individual tastes and allows designs to be manipulated quickly at minimal cost, and produced in shorter and more cost-effective runs.
Body measurements can now be taken with a non-contact 3-D body scanner from a number of companies such as Techmath, TC2, Telmat, or Cyberware. The scanner records millions of body measurements that are analysed into useable information and transmitted via the Internet to the factory. The customer also has the opportunity to choose the garment design and any style changes from a menu of design options, along with the fabric and colour. The customer can even view a virtual copy of the garment before the order is placed.
At a recent German menswear fair, a German menswear exporter Odermark promoted its new Corpus Line which has been made possible by a body scanning technology devised by Techmath, designed to meet the growing consumer demand for individuality.
Techmath's MtM-Shop has a Vitus/Smart 3-D scanner which is a modular system with four columns, in each of which are two CCD-cameras and one laser. Scanning time is only 19 minutes. There is also a Pedus 3-D scanner designed to scan feet for footwear retailers. Scanning time for a foot takes only 10 seconds. Software includes a product configurator with the integration of several collections and size charts, and a ScanWorX, which is like a digital tape measure for 3-D editing and measuring.
Data on computer system
Digital measurement of a customer can be stored on smart cards as data for future repeat purchasing. The 3-D scanner provides a virtual representation of the customer and is linked to a computer with CAD pattern capabilities.
The customer's data will be digitally available throughout the whole textile chain and support the production of customised products. The data can be exchanged with other systems, such as non-stationary retail outlets like Internet shops or mail order retailers.
Odermark said this new customisation method minimises the pre-order risk, inventory costs as well as rebate-sales, and provides better one-to-one customer services and marketing. Incidences for returns can be minimised too as clothing sold this way tends to fit the consumer better.
In Spring this year, American menswear label Brooks Brothers' flagship store on New York 's Madison Avenue introduced body scanning technology as the vertical retailer's digital tailoring initiative.
The scanner was provided by the Textile/Clothing Technology Corp. The process starts with the customer stepping into the first of two dressing rooms, which is outfitted with magnetically sealed doors to ensure privacy. He then changes into a pair of heather grey biker shorts and steps into the scanner room.
Passing through a light beam as he enters the scanner room, the customer activates a digital voice that explains how the process works and what to do. The actual scanning process takes about 12 seconds and includes a white light-based scan, which captures more than 200,000 data points, creating a 3-D map of the body. Information is fed to a database and the information is then transferred via the Internet to the company's intranet and stored in a database.
Total channel integration
In a world where the fast-growing Internet is seen as a vehicle for bringing increased apparel sales, retailers are focused on total channel integration, that is marketing and making their products available anywhere and at all times, through e-commerce web sites, online portals, wireless devices, in-store kiosks, catalogues, traditional brick-and-mortar stores and even at point-of-sale centres.
One company that represents many new technologies is FitMe.Com. Its product, Size Genie, a web-based software application, uses a consumer's specific measurements to recommend the most appropriate sizes of a particular garment. The company holds size information on about 300 brands of clothing.This extract shows how the apparel industry is changing its focus towards mass customisation and how the advent of Internet and advanced information technology have enabled the industry to go in that direction.
While the trends of mass customisation are obviously affecting many industries and supply chains due to obvious reasons, the journey towards a mass customising company is not that easy. The most obvious difficulties lie in the nature of the product, the manufacturing difficulty, long established company processes, information management and customer perception of value and their willingness to wait for a product.
The following two readings deal comprehensively with relevant issues related to mass customisation.
Reading 10. 3
Pine, J II; Victor, B & Boynton, AC (1993, September-October) 'Making mass customization work', Harvard Business Review , pp.108-114.
Reading 10.4
Agrawal, M; Kumaresh, TV & Mercer , GA (2001) 'The false promise of mass customization', The McKinsey Quarterly , number 3, pp.62-71.
Activity 10.3
Consult the readings above and identify the critical factors which a firm must consider when contemplating a mass customisation strategy.
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