How to respond when customers demand more personalized products, better customer service, and instant feedback on orders.
Director, Product Management
Henry Ford's idea of marketing the Model T to the masses was simple yet revolutionary. His engineers used interchangeable parts to make the same car by the millions. Any valve fit any engine, any steering wheel fit any chassis. As a result, low-skilled laborers could quickly assemble the cars, which drove down prices. The only downside was that all cars were the same.
The market today is almost exactly opposite. Customers tell companies what they want and winning products are tailored to their requirements. More manufacturers would like to rise to the challenge. Their big question is how to quickly give customers what they want cost efficiently and with high quality?
The payoff is customer loyalty. The automobile industry provides an example of moderate success. For instance, buyers already choose car options that reflect individual needs cloth seats or leather, a DVD player or stereo, manual or automatic transmission, and so on. Similarly, customers across all sorts of industries can now "design their own" products, from office chairs, computers, and food-packaging machines. Of course, anyone can make a personalized product with unlimited funds and resources. The trick is to deliver the product quickly and at a competitive price. Here are a few guidelines:
STEP 1: EVALUATE
The problem with a manual approach to customizing products is that designs are often documented and managed in paper notebooks, with 2D drawings, or on spreadsheets. These take too long to manipulate. If you think your manual processes are fast, answer these questions. Has your company ever:
- Lost a great customer opportunity because it took too long to accurately bid on their request?
- Gone straight from order to production without validating the design, and found that the haste produced only scrap?
- Spent too much time in corrective action after the customer's requirements were supposedly "locked?"
- Had difficulty reusing existing product configurations because a new order was tweaked just a little?
Answering "yes" to even one of these questions is not unusual. The fact is, nearly 90% of companies rely on some sort of manual process for managing the wide variety of configurations or product variants they support.
STEP 2: ALIGN PRODUCTS WITH BUSINESS STRATEGIES
The overall goal is finding an efficient way to offer customized products. To do so, designs must be less complex yet innovative. Companies must easily reuse existing parts in new products. One way is by switching to a modular product architecture, an approach that builds configuration flexibility into the design.
Of course it's easier said than done. Finding the right balance of cost savings and product differentiation is a major challenge for most companies. It's not about buying more software. It's about designing a flexible architecture a product that can be assembled into many different configurations . to meet company objectives.
This step aligns company products and platforms to meet every customer requirement, which should be a business goal. A migration of this sort also means considering how market trends will affect your company's future growth and profitability. Customers show they are more comfortable buying products from companies that provide all the options they can imagine. Dell Computer's success is one example.
STEP 3: MODULAR DESIGN
To deliver more personalized products, it's necessary to get closer to customers. A modular product architecture helps a company better support buyers' unique requirements. This involves designing products into "functional modules" rather than traditional assemblies and subassemblies. To that end, streamlining the engineering process means:
- Capturing customer, engineering, and manufacturing requirements to develop rules and constraints for configuring single or multiple product platforms.
- Designing automation by creating and publishing automatically configurable product designs.
- Designers and customers should be able to easily configure the design for an application by selecting and specifying variables and using predefined business and design-constraint logic.
Control of configuration management is key. A traditional product structure is often too inflexible for handling modern configuration requirements. Hence, the need for a more-modular approach. This is one in which the traditional product structure is embedded with configuration intelligence: generic definitions of outsourced and manufactured parts tied together by specific rules and constraints.
Inevitable changes during product development slow customization the most. A product structure must quickly and efficiently absorb and respond to changes. Capturing variability and modularity in the structure can help with ever-changing customer needs. For example, you don't want a customer asking for a convertible and getting a sunroof instead.
Nearly half of all designs are modifications of existing work. Therefore, using technology to access and reuse existing products means designers and engineers spend less time making modifications. Finding the right existing work means they start with a partially completed design with which to derive a new product.
A modular product structure lets companies digitally capture and store engineering intelligence. What's more, modular product structure can automate the variation to better manage multiple design configurations, accommodate design alternatives, and design improvements.
STEP 4: AUTOMATE BIT BY BIT
The good news is that even small changes in process and technology can have a big impact on customize-to-order goals. The objective is to reduce product complexity and reuse more parts for greater product differentiation.
Beyond manual processes, there are three levels of configuration management that help companies see the benefits of a customizeto-order strategy.
The first level is a model-centric, generic-CAD structure. For most companies, model centric means building a generic CAD structure. It involves moving from a paper-based, spreadsheetmanaged, and 2D environment to digitally capturing designs in 3D models.
A few advanced model-centric CAD tools let users capture variability in the CAD structure. Examples include families of parts, interchangeable features, and constraint equations. A 3D CAD system lets companies:
- Capture engineering variability and configuration early in design.
- Involve customers in design to decrease quality issues.
- Reduce the number of physical prototypes.
- Generate engineering deliverables fast.
For many small companies, model-centric designs may be all the customization they need. But medium-size and large companies are likely to find greater benefits on the second level of configuration management. It's called a heterogeneous enterprise system with PDM. It's a mouthful but it means design departments (there may be several) use different 3D CAD systems coupled by a product-datamanagement system for better part tracking and to find startingpoint designs from anywhere in the company. Those that employ such systems report:
- Greater involvement with customers.
- Lower total product development costs.
- Increased product customization.
- Improved operating efficiency
As you might expect, this enterprise structure brings more challenges than a simple CAD structure. A company will have to manage different MCAD structures as well as ECAD and software structures.
In addition, CAD systems must work with the PDM system so engineers can make best use of the variability captured on each level of product development.
A third automation level, the extended enterprise, gives manufacturers the full potential of customizing to order. The extended enterprise is characterized by:
- Fully integrated engineering configuration management. This system stores and cross-references MCAD, ECAD, software, documents, configurations, parts, assemblies and, theoretically, everything else. And it's accessible to everyone who needs it.
- Extended enterprise applications. This means going beyond the boundaries of a company into supplier firms, partner offices, and even customer facilities to hear their wishes.
- Rules-based integrated generic structures that work with legacy CAD systems. This hierarchical structure is composed of generic definitions of outsourced and manufactured parts tied together by design rules. This structure uses rules and data from even legacy engineering systems.
Suppliers, partners, and now customers play a crucial role in product development. And offices spread across the globe complicate the development process.
The advantage of the extended enterprise is that everyone from customer to supplier to manufacturer is part of the design chain. Of course, making the leap to modular design and variant generation is an evolving process. The key to success is to make gradual improvements. It's only a matter of time before mass customization becomes the norm.
PTC Inc., (781) 370-5000,John Wylie firstname.lastname@example.org