Mass Customisation
Definition
Ahlstrom & Westbrook (1999): Production of items for individual customers at a speed,
quality and cost associated with mass production
Boynton, Victor & Pine (1993): Mass customisation exploits product structures where
there is component modularity within a common product architecture and achieves a
batch size of 1
Boynton, Victor & Pine (1993): Mass customisation eliminates waste from the
customer’s perspective
Not merely making operational adjustments for specific orders but developing a process
which can supply very numerous customer-chosen variations on every order with little
lead time or cost penalty
o Customers are integrated in the value creation process of the manufacturer
Otherwise manufacturer unable to fill each individualised product
demand
Piller (2008): Over the last decade, mass customization has emerged as an effective
approach for tackling precisely this task.
Examples
Successful Examples
NikeID, Myvirtualmodel.com, Zazzle, Germany’s Mymuesli customised cereal, BMW
MINI
Piller (2008): 26% of managers in a 2007 study sat that customised demands will
increase by 25-50% in next 2 years
o 67% of build-to-order manufactures has capability to calculate cost to produce
customised products
Failed Examples
Levi’s custom jeans, Wild Things Design Your Own?, Shoesofprey
Reasons for Mass Customisation
Ogawa & Piller (2006): Market research doesn’t work because:
Tests with a few consumers not a reliable predictor
Focus groups not given realistic products to experience
Don’t measure people’s real purchasing behaviour
Test marketing is expensive, time-consuming and subject to noise from competing
organisations
Background data needed to make accurate predictions, which is not available
Many companies don’t use it
Consumers may change their minds by the time the new product is launched
People don’t really know what they want
Ogawa & Piller (2006): Motivation for mass customisation
Customers have rapidly shifting fashions and preferences
, o Ahlstrom & Westbrook (1999): Customers are demanding an increased variety of
products
Declining product life cycles
Decreasing customer loyalty
Escalating price competition
High failure rates of new product introductions
Poor understanding of customers’ needs
Benefits of Mass Customisation to the producer
Early feedback on shifting customer preferences and fashions
Ideas for new products E.g. Threadless example below.
Less waste as producing exactly what consumers want, so no need to offload stock
through cut-price sales
Build strong loyalty with customers which reduce costs of attracting new customers and
have word of mouth recommendations
Capabilities needed to deliver mass customisation
Salvador et al (2009): A set of capabilities for aligning an organisation with its customers’
needs
o Ability to identify product attributes along which customer needs diverge
o Ability to reuse or recombine existing organisations and value-chain resources,
o Ability to help customers identify or build solutions to their own needs
Support customers while they are making their choices
Avoid complexity- Quality of user interface is part of the service offering
to the customer
Reduce number of decisions at each point as too many options can be
overwhelming
Fast cycle, trial and error decision-making between a set of options
Research and investigate users' customisation processes
Barman & Canizares (2015):
o Elicitation- Determining what the customers want or need
o Process Flexibility- E.g. modular design
Piller (2008): Computer aided design (CAD) is the primary tool used to
support MC (92%)
o Logistics- Managing the availability and flow of raw materials, and delivery of
finished goods to customer
Robust design process to ensure supply chain can cope with the enhanced variability so
need to use flexible automation and Process modularity, where one part of the process
is associated with one stream of products
Salvador et al (2009): Difficult for organisations to achieve, but can lead to lasting
competitive advantages
Successful mass customisers build an integrated knowledge flow
Builds up the company’s knowledge interface between manufacturer and customer is
crucial
Need for dialogue between manufacturing & marketing is crucial: What can be done
must be an input to what marketing can offer
Definition
Ahlstrom & Westbrook (1999): Production of items for individual customers at a speed,
quality and cost associated with mass production
Boynton, Victor & Pine (1993): Mass customisation exploits product structures where
there is component modularity within a common product architecture and achieves a
batch size of 1
Boynton, Victor & Pine (1993): Mass customisation eliminates waste from the
customer’s perspective
Not merely making operational adjustments for specific orders but developing a process
which can supply very numerous customer-chosen variations on every order with little
lead time or cost penalty
o Customers are integrated in the value creation process of the manufacturer
Otherwise manufacturer unable to fill each individualised product
demand
Piller (2008): Over the last decade, mass customization has emerged as an effective
approach for tackling precisely this task.
Examples
Successful Examples
NikeID, Myvirtualmodel.com, Zazzle, Germany’s Mymuesli customised cereal, BMW
MINI
Piller (2008): 26% of managers in a 2007 study sat that customised demands will
increase by 25-50% in next 2 years
o 67% of build-to-order manufactures has capability to calculate cost to produce
customised products
Failed Examples
Levi’s custom jeans, Wild Things Design Your Own?, Shoesofprey
Reasons for Mass Customisation
Ogawa & Piller (2006): Market research doesn’t work because:
Tests with a few consumers not a reliable predictor
Focus groups not given realistic products to experience
Don’t measure people’s real purchasing behaviour
Test marketing is expensive, time-consuming and subject to noise from competing
organisations
Background data needed to make accurate predictions, which is not available
Many companies don’t use it
Consumers may change their minds by the time the new product is launched
People don’t really know what they want
Ogawa & Piller (2006): Motivation for mass customisation
Customers have rapidly shifting fashions and preferences
, o Ahlstrom & Westbrook (1999): Customers are demanding an increased variety of
products
Declining product life cycles
Decreasing customer loyalty
Escalating price competition
High failure rates of new product introductions
Poor understanding of customers’ needs
Benefits of Mass Customisation to the producer
Early feedback on shifting customer preferences and fashions
Ideas for new products E.g. Threadless example below.
Less waste as producing exactly what consumers want, so no need to offload stock
through cut-price sales
Build strong loyalty with customers which reduce costs of attracting new customers and
have word of mouth recommendations
Capabilities needed to deliver mass customisation
Salvador et al (2009): A set of capabilities for aligning an organisation with its customers’
needs
o Ability to identify product attributes along which customer needs diverge
o Ability to reuse or recombine existing organisations and value-chain resources,
o Ability to help customers identify or build solutions to their own needs
Support customers while they are making their choices
Avoid complexity- Quality of user interface is part of the service offering
to the customer
Reduce number of decisions at each point as too many options can be
overwhelming
Fast cycle, trial and error decision-making between a set of options
Research and investigate users' customisation processes
Barman & Canizares (2015):
o Elicitation- Determining what the customers want or need
o Process Flexibility- E.g. modular design
Piller (2008): Computer aided design (CAD) is the primary tool used to
support MC (92%)
o Logistics- Managing the availability and flow of raw materials, and delivery of
finished goods to customer
Robust design process to ensure supply chain can cope with the enhanced variability so
need to use flexible automation and Process modularity, where one part of the process
is associated with one stream of products
Salvador et al (2009): Difficult for organisations to achieve, but can lead to lasting
competitive advantages
Successful mass customisers build an integrated knowledge flow
Builds up the company’s knowledge interface between manufacturer and customer is
crucial
Need for dialogue between manufacturing & marketing is crucial: What can be done
must be an input to what marketing can offer
