AUTHOR(S): Ryan Chin, Patrik Künzler, and Raul-David Poblano
ABSTRACT: The rise of mass customization has led to changes in supply chain management, openness to customer co-design, and an emphasis on flexible and modular product architectures. The search for better, more compact and efficient modules and product families places a heavy emphasis on compartmentalized customization strategies consisting of cosmetic skins, both large and small plug-in electronics and interior modules, ergonomic treatments, and battery storage. Such strategies allow for endless variation in the elements deemed most meaningful to the customer. However the tradeoffs can lead to wastefulness in materials, poor packaging, issues with structural integrity, and postponement in the fabrication of elements until user preferences are determined.
AUTHOR(S): Ryan Chin and Patrik Künzler
ABSTRACT: Developing adaptable and flexible product architectures provides for meaningful levels of cosmetic, electronic, ergonomic, structural, and material customization. Today, automobiles are the result of intricate supply chains, integrated manufacturing techniques and just-in-time manufacture of component modules. While these changes have compensated for increased complexity and sophistication at component and system levels, the automotive industry has relied on vehicle platforms to create vehicle family lines that reduce engineering costs, yet limit radical changes and high levels of customization. The challenge of designing successful mass customized products is balancing product variety and adaptability. To achieve this, the Smart Cities group of the MIT Media Lab in collaboration with General Motors has developed a new vehicle architecture consisting of two primary elements: 1) self-contained, digitally controlled “Wheel Robots,” which incorporate all drive-train elements and, 2) a highly customizable passenger cabin and chassis.
AUTHOR(S): Ryan Chin
ABSTRACT: Long before B. Joseph Pine II established a viable economic strategy around the concept of Mass Customization, and Dell Computer’s execution of a custom build-to-order strategy, combinatorial theory (configuring of modular components) and generative systems have been employed in biological systems, grammatical sentence structure in linguistics, and also in architectural and urban design. This paper will trace the conceptual roots of Mass Customization through the examination of historical precedents:
AUTHOR(S): Frank Piller
ABSTRACT: A demanding task for many companies today is that of learning to regard customers as individuals, of proactively developing products and services according to the individual customer preferences, and of subsequently producing and distributing these offerings. Over the last decade, mass customization has emerged as an effective approach for tackling precisely this task. In this paper, I discuss the background of mass customization and the elements of this strategy. I will then comment on the implementation of mass customization in practice. I will end with a brief discussion of alternative strategies in this domain, namely personalization and matching services.
AUTHOR(S): Nikolaus Franke and Frank Piller
ABSTRACT: This study analyzes the value created by so-called ‘‘toolkits for user innovation and design,’’ a new method of integrating customers into new product development and design. Toolkits allow customers to create their own product, which in turn is produced by the manufacturer. In the present study, questions asked were (1) if customers actually make use of the solution space offered by toolkits, and, if so, (2) how much value the self-design actually creates. In this study, a relatively simple, design-focused toolkit was used for a set of four experiments with a total of 717 participants, 267 of whom actually created their own watches. The heterogeneity of the resulting design solutions was calculated using the entropy concept, and willingness to pay (WTP) was measured by the contingent valuation method and Vickrey auctions. Entropy coefficients showed that self-designed watches vary quite widely. On the other hand, significant patterns still are visible despite this high level of entropy, meaning that customer preferences are highly heterogeneous and diverse in style but not completely random. It also was found that consumers are willing to pay a considerable price premium. Their WTP for a self-designed watch exceeds the WTP for standard watches by far, even for the best-selling standard watches of the same technical quality. On average, a 100% value increment was found for watches designed by users with the help of the toolkit. Taken together, these findings suggest that the toolkit’s ability to allow customers to customize products to suit their individual preferences creates value for them in a business-to-consumer (B2C) setting even when only a simple toolkit is employed. Alternative explanations, implications, and necessary future research are discussed.
AUTHOR(S): Fabrizio Salvador, Pablo Martin de Holan and Frank Piller
ABSTRACT: The concept of mass customization makes sense. Why wouldn’t people want to be treated as individual customers, with products tailored to their specific needs? But mass customization has been trickier to implement than first anticipated, and many companies soured on the approach after a number of high-profile flops, including Levi Strauss & Co.’s failed attempt at manufacturing custom jeans. Now, executives tend to think of mass customization as a fascinating but impractical idea, the preserve of a small number of extreme cases, such as Dell Inc. in the PC market.
Visit the Sloan Management Review site to read the full article.
AUTHOR(S): Frank Piller and Ashok Kumar
ABSTRACT: Many companies are flummoxed by an unprecedented trend toward individualization. While customization is a known strategy in many business-to-business markets, today’s markets are also increasingly compelling consumer companies to offer customized products. In particular, consumers with great purchasing power are attempting to express their personality through customized product choices. As a result, manufacturers are forced to build production systems with an increasing number of variants, right down to the production of units of one.
AUTHOR(S): Ryan Chin and Daniel Smithwick
ABSTRACT: In 2005 Sanders Consulting published its ground-breaking research, “Why Mass Customization is the Ultimate Lean Manufacturing System.” Using the textile industry as their primary example, Sanders’ research showed that, when framed from the entire product lifecycle—from raw material production to point of purchase, the standard best practice of mass production was actually very inefficient and indeed wasteful in terms of money, time and natural resources. Beginning from this lifecycle framework provided by Sanders, this paper answers the question: What are the environmental impacts of utilizing mass customization compared to the impacts of utilizing mass production?
MIT Media Lab
The MIT Smart Customization Group is an MIT-Industry collaboration devoted to improving the ability of companies to efficiently customize products, services, and experiences in various industries and for diverse customer groups. This industry interest group aggregates the key players in the area of mass customization and strives to become a vital community of practice in this field.