Mass Customization Theory and Implementation Framework

Abstract

The term “mass customization,” abridged with MC, was anticipated by Stan Davis in the book, “Future Perfect,” in 1987: “the same large number of customers can be reached as in mass markets… and simultaneously they can be treated individually as in the customized markets of pre-industrial economies.”

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2.1 Mass Customization Definition

The term “mass customization,” abridged with MC, was anticipated by Stan Davis in the book, “Future Perfect,” in 1987: “the same large number of customers can be reached as in mass markets… and simultaneously they can be treated individually as in the customized markets of pre-industrial economies” (Davis 1987). Pine in 1993 introduced an industrial perspective in the new-born concept and defined mass customization as “providing tremendous variety and individual customization, at prices comparable to standard goods and services” to enable the production of products and services “with enough variety and customization that nearly everyone finds exactly what they want” (Pine and Davis 1993).

In 2001, Tseng and Jiao provided a popular and intuitive definition: Mass customization corresponds to “the technologies and systems to deliver goods and services that meet individual customers’ needs with near mass production efficiency” (Tseng and Jiao 2001).

In 2007 Pine was back again to his definition of mass customization and revised it as “the low-cost, high volume, efficient production of individually customized offerings” (Piller 2007a). To reach this efficiency requirement, a mass customization system should possess a stable although still flexible and responsive set of processes, that are capable to deliver a finite number of customization options. As a result, the costs associated with mass customization should lead to a price level similar to the mass produced product.

Finally Piller, who devoted consistent efforts in MC related research, provided his definition of mass customization, focusing on key concepts that really distinguish mass customization from similar approaches. While taking into account the previous approaches to Mass Customization concept definition, we choose to start from the work done by Frank Piller. “Mass Customization refers to customer co-design process of products and services, which meet the needs of each individual customer with regard to certain product features. All operations are performed within a fixed solution space, characterized by stable but still flexible and responsive processes. As a result, the costs associated with customization allow for a price level that does not imply a switch in an upper market segment.” (Piller 2004; Boër and Dulio 2007). Following Piller’s argument and work, this definition can be further decomposed into four statements (Piller 2004):

2.1.1 ITEM 1: Customer Co-design

Customers are integrated into value creation by defining and configuring an individual solution. Customization is about the concretization of the end-user needs and desires into concrete product specifications. A tool is then needed: whether a paper catalog, listing variants and combinations, or a digital configuration software, the co-design is empowered by a proper mean. The footwear sector offers several examples of web-based tools meant to provide these functions: Mi-Adidas, Converse, Footjoy, Keds, Left, Morgan Miller, Nikeid, Otabo, Ryz, Vans, Preschoolians, Timberland.

2.1.2 ITEM 2: The Needs of Each Individual Customer

The co-design procedure, mentioned in ITEM 1, is an action that concretizes the customization potential, expressed by all the possible products configurations (the degree of customization offered by the manufacturer), into a single customized product. The goal is then to correctly identify the customization options and dimensions meant to satisfy the customer needs. To better express the level of customization offered, three dimensions are highlighted: fit, style, or functionality (Piller 2004, Boër and Dulio 2007) (Fig. 2.1). Style (aesthetic design) relates to modifications aiming at sensual or optical senses, i.e., selecting colors, styles, applications, cuts… Many mass customization offerings are based on the possibility to co-design the outer appearance of a product. This kind of customization is often rather easy to implement in manufacturing, demanding a late degree of postponement. Fit and comfort (measurements) is based on the fit of a product with the dimensions of the recipient, i.e., tailoring a product according to a body measurement or the dimensions of a room or other physical objects. In the case of footwear, this means to measure the two feet in 3D and extract the necessary information to choose the best fitting last or even to make the personalized one. It is the most difficult dimension to achieve in both manufacturing and customer interaction, demanding expensive and complex systems to gather the customers’ dimensions exactly and transfer them into a product. Functionality addresses issues like selecting speed, precision, power, cushioning, output devices, interfaces, connectivity, upgradeability, or similar technical attributes of an offering. These dimensions of customization offered may be plotted on a three-branch radar graph, as shown in the picture above. By grading the three axes with a given customization scale, by then evaluating the level of personalization offered in each dimension, and by eventually connecting the resulting points, we obtain different triangles describing different customization scenarios. Each triangle represents the offer proposed to the customer, i.e., the degree of customization he will be able to take advantage from (Fig 2.1).

Fig. 2.1

The customization axes

It is important to highlight that the final customer, as a single entity, differently from what happens within the co-design in ITEM-1, does not individually impact the company choices in defining the customization dimensions of the product: those options are defined eliciting the “needs of the many” by market research, surveys, and anticipation of trends.

2.1.3 ITEM 3: Stable Solution Space

The term solution space represents “the pre-existing capability and degrees of freedom built into a given manufacturer’s production system” (Piller 2004). A successful mass customization system is characterized by a stable while flexible processes distributed along the whole supply network, used to deliver high variety goods, with “near mass production efficiency.” This generally implies that the customization options are limited to certain product features. Customers perform co-design activities (ITEM-1) within a list of options and predefined components, that were chosen, thanks to surveys and analysis (ITEM-2), before their customization activity. Those options were defined trying to meet the needs of the individual customer, by analyzing the needs of the many. There is a strict link among (1) the “needs of the many,” that define a potential solution space from the desires and point of view of the customers, (2) the “capability and degrees of freedom built into a given production system,” that defines a potential solution space coping with technological and economical consideration of the manufacturer, and (3) the “company specific strategy and policies,” that may limit the customization offer due to tactical considerations (this is the case of a shoe company that limits the combination of colors to given pre-accepted sets, to preserve the brand style, or do not give the possibility to move along the “aesthetic dimension,” again to preserve brand name, but are eager to promote fitting). Thus the stable solution space (SSS) is the result of an interaction of those three elements (see Fig. 2.2), whose KPIs (Key Performances Indicator) may significantly differ from one another.

Fig. 2.2

The recursive design of the stable solution space

Once defined, the SSS represents: (1) the yet undifferentiated product blueprints (that is the sum of all the potential customization options for the MC product); (2) the capability and degrees of freedom of the production system; (3) the adequate supply chain capable to support the product variants.

Figure 2.3 shows the mapping of the SSS onto the four ITEMs of the Mass Customization definition: the SSS is defined thanks to the interaction of the desires of the customers (mapped on MC ITEM 2) and of the potential solution space coping with technological and economical consideration of the manufacturer (mapped on MC ITEM 3).

Fig. 2.3

The stable solution space mapped on the mass customization items

The SSS, as mentioned before, represents the potential product configurations, the production system and the supply chain meant to manufacture the final product (again Fig. 2.3). The potential product configurations are the starting points used by “customer co-design tools,” ITEM-1, in order to define the specification of the final goods (e.g., the “product configurators” for the personalization available in the websites for shoe personalization aforementioned). Figure 2.3 anticipates also the relation with the MC ITEM 4, hereinafter described: the adequate price.

2.1.4 ITEM 4: Adequate Price

Mass customization practice and studies (see for example Piller 2013) show that consumers are frequently willing to pay a premium price for customization to reflect the increment of utility they gain from a product that better fits their needs than the standard product. Mass customized goods are targeting the same market segment that was purchasing the standard goods before, but with adequate price increase.

The SSS is then subject to another constrain, as again shown in Fig. 2.3 by the large arrows with dotted lines. The number and type of product options, the related manufacturing system and the adequate supply chain contribute to define the cost for the final customized product. This cost must be compatible with an adequate price so that the customized product does not target a different market segment, if compared with the standard one. The EUROShoE project (Boër and Dulio 2007) demonstrated, by relevant consumer analysis, that in footwear a premium price for customized shoes of 20–40 % is acceptable… It is worth noticing that if we consider the premium price percentage, a luxury brand with a small number of products asks for a higher profit margin (per product) than a cheap brand where the overall “premium” profit is distributed on wider (also mass) volumes. This is still a debate in the MC community if a luxury brand like Ferrari, with its all personalized cars, can be taken as an example of MC or if it is more pertinent the Fiat 500, where customization is at a much lesser degree, but much closer to the “mass” concept (especially considering the low premium price asked for these, few, customizations). The same applies in the footwear sector, of course.

2.2 A Template to Jump in

This book has a predominantly applicative attitude: providing actual, practical, and intuitive tools to entrepreneurs aiming at implementing MC within their businesses is one of the main goals pursued. The template here presented (Fig. 2.4) and the following discussion and examples are meant to enable prospective (but also current) MC adopters to identify MC implementation procedures suitable for their businesses, and to qualitatively investigate and assess their approaches in comparison to others’.

Fig. 2.4

The mass customization implementation template

In the last 15 years, many researchers have approached the MC theme from a wide spectrum of points of view (see the four research domains cited in Fogliatto et al. (2012)) and many industrial case studies have also been cited as relevant examples of MC implementation in real industrial environments. This notwithstanding, it appears to be difficult for an apprentice entrepreneur to understand the best path he can follow in order to actually implement MC within its business. Many times an entrepreneur asks: “How can I adopt MC within my business?” With the hereinafter-discussed methodology, this chapter aims at supporting this businessman in finding valuable answers to this question. For this reason, the point of view of this chapter is different (and probably complementary) from others' approaches in the literature. Three are the elements the proposed methodology is composed of:

• 1. a template with seven blocks chosen as the building elements of an MC company business environment (Fig. 2.4). A good starting point to successfully implement an MC transformation is the exploitation of a roadmap, that it is here actualized with a conceptual template that everybody can understand and that facilitates discussion. In the following paragraphs we propose such a template (MCIT—Mass Customization Implementation Template), which allows to describe and to think through the MC options and implementation issues;

• 2. a set of questions supporting the entrepreneur in understanding the key elements to be considered for each block of the MCIT. Specific topics and challenges have to be faced for each building element while implementing Mass Customization. Answering to these will support in taking a step closer to the actual implementation of MC;

• 3. real-case examples providing actual answers that existing MC businesses gave to these questions.

The MCIT template is thus meant to describe different situations where any company can jump-in into the most appropriate block, to easily describe and explore different alternatives. There is not a correct starting block, or an exact time or logical sequence to walk through the blocks. Each MC implementation will have different genesis, needs, and paths: the template will support the implementer by providing inspiration and making the right questions, not to forget essential aspects. Examples taken from the literature are finally meant both to provide concrete responses and to suggest applicable implementation paths.

Block1—CUSTOMER: Customers are at the core of any production paradigm, not just MC. Without customers, no production system may work for long. We have to carefully address the following questions, to pave the way for a sound MC business implementation:

What’s the Target Market? This deals with the identification of a group of customers that we decide to aim toward. A well-defined target market is a key element to successful MC implementation. Different segmentation approaches may apply.

E.g., different segmentation dimensions can be taken into account in order to identify the target customers of an MC offer. Adopted elements are the same of traditional marketing approaches: age, sex, location, spending power, sector-specific categories,… It is important to notice that the relevance of the segmentation elements is usually different in traditional and MC businesses (attitude toward customization is often correlated with products contexts of application, but also with the spending power). In some cases, segmentation has allowed to define a path from pilot to large-scale MC applications. The mi adidas customization initiative (Seifert 2006) was structured in four sequential phases. Segmentation allowed to identify a promising market context where to test the pilot service (2001) on 300 customers from six European countries (geographical segmentation), all athletes (activity-related segmentation) interested in customizing soccer footwear (sector-specific element of segmentation). In phase 2 (late 2001), other segments were explored relaxing some of these constraints: not only athletes but any sportive customer, not only European, but also from U.S., not only soccer, but also running footwear. In phases III and IV, any kind of sport was addressed all over the world. In this case, segmentation has been thus used to approach MC gradually, starting with a test addressing the customer segment virtually more interested in product customization, then applying lessons learnt also to other segments.

Usually MC initiatives start with the goal to answer to increasingly demanding customers, asking for more customized products or for a wider product portfolio. This happened, for example, in Andersen’ Windows (Gamble et al. 2003), a U.S.-based manufacturer of windows for the home building industry. Until the mid 80s, Andersen was a mass producer of a variety of standard windows in large batches. Increasingly demanding customers forced the company to widen its product portfolio, including new product lines, new options, and a wide set of add-ins. Andersen was driven to move toward MC in order to be able to answer to changing needs of its current market segment. Almost the same happened for Nike id (Mistler 2001): mi adidas allowed the German company to steal customers to Nike, which implemented its own MC strategy in order to retain market shares in existing segments. Sometimes, MC allowed to identify a different market segment, such in NIBC (Suresh 1996), the National Industrial Bicycle Company of Japan, where an MC adoption project started with the goal to answer to customers asking for customized solutions, and ended identifying a precise market segment interested in this kind of solutions, thus keeping the mass production facilities active. Characterizing a completely new market segment is also the challenge an (MC) start-up has to face. Interesting examples are CHIP-N-DOUGH, a cookie company in U.S. enabling its customer to place corporate logos on the cookie tins, or ZYRRA, a company providing women with bras that really fit (Tahmincioglu 2007). In both these cases, these start-up companies have had to investigate the market segment to address, almost from scratch.

What’s the Expected Volume? The estimated volume of MC products sold for a future period is a key driver to assess profitability and properly design the production system.

E.g., Pondering the expected volume of the addressed market segment is fundamental for both estimating the envisaged turnover, but also to size the commensurate investments or the needed production capabilities. Internet-based MC initiatives such as Picaboo (2013) or LuLu (2013) have had to size their servers and adopted database software according to the amount of data to be handled.

What’s the expected degree of customer satisfaction in relation with balance Price/Personalization? We have to address ITEM 4 of the MC definition. Consumers are willing to pay a premium price for customization, to reflect the increment of perceived value, and the balance of this equation must be addressed from the very beginning of the MC implementation.

E.g., MC entrepreneur has to understand the premium price a customer is willing to pay for a given degree of customization. This investigation is expected to provide valuable insights on the value perception of a given customer and to judge whether the required investments enabling this kind of customization affect the final product price less than (or, at least, equal to) the granted premium price. Many scientists investigated this topic from a micro-economics perspective, while we try to deal with this topic empirically citing a couple of examples. Christi Andersen, one of the owner of the already mentioned Zyrra personalized bras producer, says their target customers do not even ask the price of the custom products, and she also says that “Zyrra’s intended demographic is women who are 30 or older and who have made a little money and have less patience in finding this stuff” (Verghese 2007). This highlights at least two elements: (1) customization can be worth a lot and (2) this is true just for given customers, thus it is important to accurately select the target market. Another interesting example is the widely cited Dell mass customization initiative. This sentence has been published on their website (Williams 2010): “In the past, we utilized a single direct configure to order model and we gave our customers a cascade of options to choose from when configuring a product specifically for their needs. This was, and still is, a great model for custom configuration where our customers value and will pay for this service but it has become too complex and costly for significant portions of consumer and some portions of our commercial businesses. As a result, we are addressing this complexity and added cost with client reinvention.” This statement seems to imply that: (1) MC has a price, (2) some customers are willing to pay for this additional value, and (3) some others do not. If there’s no match between your target segment price expectations and your increased costs, your MC initiative is likely to fail.

Satisfaction with involvement in design? Satisfaction is the result of a comparison between expectation and experiences. Customer satisfaction is categorized by Franke and Piller (2003), in (1) satisfaction related with the decision made, once got the product, and (2) satisfaction with the experience of getting the product, by co-designing it. We address here the second item: we have to clearly picture the customization experience we want to offer, tackling the perceived value associated with each related customization feature, and define the impact on the block 3.

E.g., Co-designing or simply letting the customer to autonomously design its own product has two roles within the MC context: on one side it is an enabler, namely the means a company can use in order to acquire its customers’ requirements; on the other, it is part of the offered value: the customer is interested in buying both the product and the customization service; he’s willing to pay for the design experience. While implementing an MC strategy, the entrepreneur has to accurately ponder the co-design phase considering both the customization dimensions that fit its market segment expectations and the constraints coming from its manufacturing process and supply chain. Various examples can be mentioned highlighting the need to heterogeneously grading this element. ChemStation (Gilmore and Pine 2000), a U.S.-based manufacturer of soap intended for industrial applications (e.g., car washes and cleaning factory floors) decided to mass customize a product that most of its competitors treat as a commodity. After analyzing each customer’s needs, ChemStation custom-formulates the right mixture of soap, which goes into a standard ChemStation tank on the customer’s premises. Through constant monitoring of its tanks, the company learns each customer’s usage pattern and presciently delivers more soap before the customer has to ask. In this example, the co-design experience of the customer is really low: needs and expectations are gathered by the manufacturer merely analyzing its customer behavior and practices. As reported in the mentioned book, this approach “eliminates the need for customers to spend time creating or reviewing orders. They do not know which soap formulation they have, how much is in inventory, or when the soap was delivered. They only know—and care—that the soap works and is always there when they need it.” Acumin Corporation (Wind and Rangaswamy 2001) enabled its customers to create their own specialized mix of vitamins. A tool available at their website called “SmartSelect” asked customers about their lifestyles and health and created a personalized nutritional supplement the user could modify and order. Given the complexity of the knowledge required for defining a recipe starting from physical characteristics, the company decided to create a sort of decision support system, partially embedding this knowledge. The customer was asked to express elements any customer can formalize, such as health status, sports activities, physical characteristics, just giving the final option to personalize the vitamin mix. A completely free design of the recipe would have discouraged many potential customers to use the service. Customatix (Piller 2008b) allowed footwear customers to design their own sneakers, choosing colors, symbols, and fabrics. The company was one of the first competitors entering the MC arena at the beginning of 2000s. Its online configurators were really powerful for that time, giving users a great amount of choices, resulting in millions of possible alternative configurations of the final product. The company then failed and “consumers not really educated in mass customization configurators” is one of the reasons mentioned by its former CEO for this failure. Here’s an interesting 2002’s feedback from a Customatix user (Customatix 2002): “when I checked out www.customatix.com, I was ecstatic to see that I could design my own shoes and have them shipped to my doorstep. So I went to work. I created the most obnoxious pair of tennis shoes possible, with pink and navy blue lining. You can influence the design on practically every inch of your shoe, from adding a devil on the tongue to having silver shoelaces. […] When the shoes arrived, everyone was pretty much speechless because they were so ridiculous. But they are mine, designed by me, just for me.”

These examples highlight the importance of a careful investigation of customer needs both in terms of product/service envisaged characteristics and of required (and transposable) customization dimensions.

Block2—CUSTOMIZATION OFFERED: customization refers here to the use of manufacturing technology to satisfy differences in terms of expectation between individuals.

What degree of customization can our current manufacturing system offer?How much does it cost to extend this degree? As seen in Sect. 2.1 of this chapter, we may plot on a radar graph the three dimensions of customization offered (fit-comfort, style-aesthetic, function) and by grading the three axes with a specific customization scale given by the sector we are confronting with, we can visualize an overview of what our system can offer. Within this block we create, define, and discuss the radar graph related with what we can/want to offer.

The style-aesthetics axis represents how the production system can cope with fulfilling personalization, by providing, e.g., choices of fabrics, colors, style-lines, accessories, etc. Figure 2.5 provides an example tied to the footwear sector. The final evaluation of customization offered (pictured by the position of the circle on the style/aesthetic axis) is built by adding four different options offered: number of possible colors, knick-knack applied to laces, material, and style-line of the upper. When mapping these options, we take into consideration the effort and the level of complexity from the point of view of the manufacturing system by estimating different “arrows” lengths that contribute to build up the final level of customization offered. In the example, we estimate that providing different style-lines (which impact on knifes and knitting sector of the factory) is far more complex than offering knick-knack of choice. Thus, this final estimation represents also the level of capability of the manufacturing system.

Fig. 2.5

Production system capabilities mapped on the customization axes

The Fit-Comfort axis represents how the production system can cope with single customer fitting. In the shoe sector, we propose an ideal graduations of this axis, where longer arrows correspond to major effort: (1) standard set of grading (2) best match fit—examination of each customer foot in order to march it to an existing library of lasts and related upper and sole, with a much higher granularity (3) tailor made—examination of each customer foot in order to make an individual last. For instance, the capability to satisfy fitting is very low if the customer buys a shoe built from a standard set of grading (first level). We can consider another scenario, still based on standard grading shoes but with a higher capability to satisfy fitting: the best fitting shoe is chosen after an examination of the customer foot (second level). Then a scenario, where we use a foot examination in order to match it to an existing library of lasts with a much higher granularity, has a better capability to satisfy fitting (third level). However, the production of that shoe will require a very high effort by the whole system, because the shoe is made on demand and in lot-size-one. The maximum level (fourth level) is reached with the examination of each customer foot in order to make an individual last. In the example given in Fig. 2.5, the production system can provide best match fit capability.

The functionality axis represents how the production system can cope with technical solutions that implement specific functional requirements such as precision, cushioning, interfaces, connectivity, shock absorption, flexibility, transpiration, thermal requirements… Back to Fig. 2.5 and to the footwear sector, the manufacturing system is capable, by introducing different cushions in the sole, to provide different levels of shock absorption, and offers two different sole profiles, for running or trekking.

The construction of this radar graph is a mandatory step to gather, discuss on, summarize, and easily present product customization attributes from the perspective of the manufacturing system.

E.g., The degree of customization our production process and supply chain currently allow and the costs related with an extension of this are strictly sector-specific. Manufacturing machines able to produce multi-color electronic boards would be of less importance than mixers used to manufacture multi-color inks. The enabled level of customization has also to be carefully pondered from a cost point of view: sometimes, existing manufacturing technologies have been designed for big batches of standard products. They can also run lot-size-one productions, but with setup costs drastically affecting the final cost of the single product. Customization offered is embedded in the options provided within the co-design phase. Different options can be given to final customers, depending on brand strategy but, above all, on brand capability to offer customization options. Comparing, for example, the customization website of the two major competitors in the footwear industry, we can derive some interesting hints on what “customization offered” does it mean. Various online and literature resources (see, for example, Strauss 2007, Soccerleats 2010) compare NIKEiD and mi adidas. The two web-based tools have many functions in common: in both cases you have to start from an existing model (you are not allowed to create your own model), you can choose different color combination, and select a word printed on the shoe. However, the mi adidas shoe is actually created from the ground up for the user’s feet, with personal measurements. This option is paid in terms of price: in mi adidas you can just choose among a few number of high-price models (no cheaper options are given). Going to the MC T-shirts manufacturers sector and comparing the customization tools, we can notice great differences among Bivolino, Spreadshirts, Spamshirts, Signatures Network, Shirtsweb, ShirtPainter, … and many others competitors. In some cases you can select among different models, materials, colors, custom- or pre-defined sentences, sometimes not. Sometimes shirts are shipped locally, in other cases worldwide, this is because behind the offered customization, different production processes and supply chains provide heterogeneous degrees of enabled customization. In an interview (Piller 2007b), the Spreadshirts CEO argued: “When people visit one of Spreadshirts manufacturing sites, they are often surprised. They expected a big machine, somebody pressing a few buttons and a customized shirt to emerge. Instead they find real manufacturing. Real people taking real apparel from shelves (hard till impossible to replace with robots at a competitive price with nowadays tech), real people preparing the designs, real people pressing the shirts, real people doing quality control and packaging.” Human-intensive productions are probably more flexible than a “big machine,” here resulting in a wider set of customization options.

Block3—CUSTOMIZATION REQUIRED: customization refers here to the expectations expressed by our target group.

What options of customization does our customer want? Again we exploit the radar graph to categorize and plot the three aspects of customization required by our customers (fit-comfort, style-aesthetic, function) and by grading the three axes with a specific customization scale given by the sector we are confronting with, we can visualize an overview of the main customization demand trends. Within this block we create, define, and discuss the radar graph related with what the customer expects.

Same considerations on the nature of the axes apply as per the previous paragraph, but seen from the customer point of view. Figure 2.6 provides an example linked to the footwear sector. The final evaluation of the customization required (pictured by the position of the circles on the three axis) is built by assessing the different options offered. When mapping these options, we take into consideration the perceived value of that option from the point of view of the customer by estimating different “arrows” lengths that contribute to build up the final level of customization required. In the example, we estimate that providing different style-lines is more important than offering color option, that is nevertheless required. Note that arrows of specific length may vary from the “customization offered” graph, because here we reflect a different type of evaluation. Indeed, this assessment does not represent the level of capability of the manufacturing system, but the customization desires that must be faced. The construction of this radar graph, as per the previous one, is a mandatory step to gather, discuss on, summarize, and easily present product personalization attributes from the perspective of the customer.

Fig. 2.6

Customers requirements mapped on the customization axes

E.g., Questions a prospective MC entrepreneur has here to answer are: how can I collect the customization dimensions and degrees “my market segment” asks for? How can I ponder and rank them? One of the research projects we describe in Chap. 6 (Dorothy) addressed this issue for the footwear industry contemplating two design steps for a “new season collection”: the “Basic Design” and the “Shoe Customer Driven Design”. The Basic Design of the Shoe addresses concept, component design, and customization design. The customer impacts even in this very first stage, thanks to a mass data acquisition campaign meant to drive the shoe concept and to gather required customization dimensions. The Shoe Customer Driven Design is the more “traditional” (in an MC competitive environment) co-design phase, where the customer interacts with the manufacturer in order to create his own pair of shoes within the boundaries outlined thanks to the output of the Basic Design. This two-step approach would be valid especially when customization dimensions are accurately targeted in the first phase. Examples cited answering to the “Satisfaction with involvement in design?” show how much a wrong or partial understanding of the customization dimensions required by the customer can result into a wrong offer.

Different ways of investigating customers’ attitude toward (and requirements concerning) mass customization have been (consciously or unconsciously) explored by MC companies from different sectors. One of the most direct ways to face the problem is evidenced in the Cemex (2013) experience. CEMEX is one of the world’s largest building materials suppliers and cement producers based in Mexico. They mass customized the service of delivering their ready-mix concrete to their customers (Pine and Gilmore 2011). Individual building sites often have tight deadlines for pouring the concrete to fit the weather and their construction schedules, with traffic conditions often being a significant impediment to on-time delivery. So CEMEX developed an operational system called GINCO to handle all of its logistics, including GPS locators on each of its trucks. Customers can now order the product just 2 h before they need it. The system finds the truck with the proper mixtures in the correct amounts and dispatches them to the right place in the right time. CEMEX simply found an MC answer to a single customer requirement they registered in their everyday experience.

As already mentioned, Andersen (Gamble et al. 2003) is a manufacturer of windows for the home building industry. They acted as mass producers until many of their customers asked for a wider product portfolio, with more options and personalization opportunities. In an effort to meet these requests, they widened their product lines, resulting into a really complex and time-spending quotation process. Customers were asked to provide data and selections for over ten pages of quotation request, sometimes needing the support of a technical consultant from Andersen or from the shop. This complexity also affected the final quality of the products provided and forced the company to investigate alternative patterns. They solved the problem by equipping their retailers with a PC-based interactive software easily driving the customer through the selection process. Unlike CEMEX, Andersen firstly answered to customers’ needs using an ineffective solution, then redirecting their choices in a second shot. This was something like a “trial and error” approach.

Other companies adopted a more rational path, structuring a multi-phases strategy, such as the four steps mi adidas went through before reaching a full MC implementation (see description given answering to What’s the Target Market? question), but also the cautionary approach used by Lands’ End (2013), the American clothing specialized in casual clothing, luggage, and home furnishings. As reported (Stevieawards 2002), before launching custom dress shirts, Lands’ End Custom focused primarily on the fit of custom products. When customers began to request Custom dress shirts, Lands’ End broadened this focus to include both fit and options on the clothing… This allowed these two companies to abate the overall risk related with their MC initiative: they started investing a few and testing on small groups, then broadening the degree of customization offered in accordance to the expectations of the wider market segment they were addressing.

A similar approach was used by Lutron (2013), a U.S. company producing lighting switches and dimmers for various markets. According to reports (Hart 2006), Lutron has been able to customize its lighting systems to individual specifications while maintaining low costs thanks to modularization of components. Lutron developed its strategy in response to a competitive threat by General Electric, entering the market with low-cost solutions and found a solution to the emerging problems thanks to a strict interaction with its “gold” customers (i.e., architects and interior designers), which expressed the need to customize some of the elements of the offered products. Lutron experience is quite similar to Lands’ End or mi adidas ones, even if they were more focused on understanding the customization dimensions. They actually implemented something we can call a “co-design of the customization dimensions.”

Block4—STABLE SOLUTION SPACE: the SSS represents both the product blueprints (i.e., the sum of all the potential customization options for the MC product) and the capability and degrees of freedom of the production system and its supply chain. It is thus the synthesis of the analysis performed in the “customization offered” and “customization required” blocks. Within the SSS Block, we confront the personalization needs derived by the analysis or anticipation of customer needs with the actual or anticipated capability of the production system. This is where we discuss the final configuration of the MC implementation we are going to implement. Specific questions to be answered are:

Are the customization needs highlighted covered by our production system? We must discuss here whether the needs from the customer meet a proper capability in the production system (existing or designed) and whether unsatisfied needs can trigger a manufacturing system upgrade. The analysis done here is strictly linked with Block 5 investigation (production system).

Do the personalization potential expressed by our manufacturing system find the customer interested? We confront our manufacturing system capability with the market requirements, deciding whether to scale the system down or to push (by marketing, for example) new needs for the customer.

Figure 2.7 uses the examples made in blocks 2 and 3. By analyzing the two radar graphs we highlight that the manufacturing system can easily cope with the “number of colors” requirements (or that this capability to further personalize colors can be pushed further to the market), but that we need to modify the manufacturing system to be able to cope with the other Style/Aesthetic requirements. This can trigger the discussion whether we want to modify the system or not, thus accepting not to be able to offer all the options that were considered to compose the personalization required.

Fig. 2.7

Comparing the required customization with the offered one

E.g., A useful example on the consequences of an inaccurate management of the gaps between the different elements of the solution space can be the MC experience by LEGO, the popular Danish toys manufacturer. The company (Piller 2005) has experimented with mass customization since 2001, getting to the ambitious Lego Factory (then Design byME), a really advanced toolkit enabling users to create (and share) their own designs and order the corresponding bricks. The created solutions were really expensive and did not accept returns. The initiative shut down in early 2012. On the website¹ they reported: “the original Design byMe vision was for a unique customization service, where consumers could design whatever they imagined on their computer, and buy the real model in their own LEGO box. Design byMe attracted several million people each year to build a huge range of amazing creations using the LEGO digital designer (LDD) software. Despite this success, the overall Design byMe experience has struggled to live up to the quality standards for a LEGO service. As a result, the LEGO® Design byME service was closed in January 2012”. Different reasons have been mentioned for such a shutdown: too many errors in the delivered orders, design tool not calibrated on children ability… in the first case, there’s a gap between the “promised” customization and the actually “offered” one, as a result of a gap between the production process (thus the offered customization) and the required customization. In the second case, technical characteristics of the customization means are not adequate to market segment characteristics (i.e., mass customization toolkit usage alphabetization).

How to manage these gaps in order to reach an SSS? Different solutions can be proposed in different contexts: LEGO closed its MC service, Zyrra (the MC bras manufacturer) focused on a specific market segment, Dell limited the number of options given to its customer (as reported in What’s the expected degree of customer satisfaction in relation with balance Price/Personalization?), Timbuk2 (2013) started combining MC and standard products (Piller 2008a). The prospective MC entrepreneur has obviously to avoid business re-definition while running.

Block5—PRODUCTION SYSTEM: The production system is composed by a set of workers, machines, equipment, and organizational means arranged along a material-information flow whose scope is to transform raw material and information into the final product. As far as our template is concerned, we need to address the following issues.

Do the production means need to evolve toward specific Customization technologies? Do we fully exploit the customization opportunities given by our current production processes? The customization option offered may impact significantly the production technologies. This is clearly a sector-specific issue. In footwear, moving toward a tailor-made production has several implications. As an example, if the “upper” parts have to be cut on a specific measured size, the standard production mean (i.e., knives: a cutting tool of a given shape, pressed on the leather so that it cuts exactly that shape, over and over) is no longer usable, as the shape varies from customer to customer and we cannot obviously create a different knife for each one of them. Thus the “cutting table” is introduced: a numerical control driven cutting device that can perform any desired shape. This is generally slower, more expensive (and thus its introduction must be carefully pondered) but far more flexible.

Do the skills and attitude of the current human operators fit? In case of a highly labor-intensive manufacturing, it becomes important to evaluate the capability of the workforce to adapt to continuously changing specs and workloads.

How does the Product Design impact on the Production Process? Here we must discuss with the production managers how the personalized product design, whose final configuration is not known till the order is done, impacts the production process, in terms of testing its flexibility and capability to work efficiently on a variegated demand.

E.g., Analyzing MC industrial experiences, it emerged that in many cases the production process had to be completely revised in order to widen the degree of customization offered by the company. The already mentioned Dell MC initiative is much more than the customization service offered online. As reported in a detailed study performed on the company before the revision of their MC project (Kepczyk 2001), the Dell production process is based on a lean approach, with minimum WIP, abated setup times, standard components assembled to form non-standard final products, strong partnership with suppliers, full tracing of the production flows, and smart management of the faulty elements.

Going back to the Andersen’ Windows (Gamble et al. 2003) example, in order to properly take care of all the different orders coming from the customers, the company had to implement a tracking system following each order along the entire production chain and, furthermore, had to redesign both the product (in a modular way) and the production process handling lot-size-one production, thus completely abating setup time and costs and radically reducing the inventory of completed products.

Motorola Pager Division (Pine and Davis 1993) is another well-known example of successful MC implementation triggered by a high degree of market turbulence in the 1980s, when Japanese companies entered the U.S. pager market with high-quality products with low prices. Motorola put together a cross-functional team to design a new manufacturing process and assembly line to produce its Bravo line of pagers. This team was charged with creating a completely automated, computer-integrated assembly line yielding tremendous economies of scale but with lot-size-one. All the technology would be purchased off the shelf. The team completely re-engineered the Bravo pager, cutting to 134 the number of parts designed for robotic assembly. The pager had 29 millions of possible variations each producible with zero setup. The manufacturing time was cut from 5 to 2 h. Motorola also re-defined the entire business cycle, from the salesperson until final shipping.

By contrast, technology can also be the trigger for customization: digital textile printing allows near-zero setup times with economically sustainable small lots. Digital printing was born primarily for samples manufacturing, thus its customization attitude is somehow a side effect. Innovative materials such as shape memory alloys are really promising candidate to support mass customization applications (completely different shapes can be taken in a given status—of temperature, acidity, …—by elements that are completely identical in another status. Exploiting this property would allow to perform costly manufacturing operations in this second status and customization in the first). Many examples can be cited where technology is surely an enabler (such as GPS locating CEMEX trucks). In other cases, human flexibility is the only “must have” element (such as in the cited Spreadshirt example).

Block6—MEANS: Mass Customization foresees design and sales activities before production takes place. Customers need to be engaged to design their unique products that meet their requirements (the design can include simulation, so that customers can virtually try the product). Thus customization experience (block 1) and the means through which this is accomplished are of supreme importance.

How and where does the co-design takes place? The customization experience is offered through specific channels. These can be a web-based tool (option preferred by shoe manufacturers who highly invest on aesthetic customization) or a coaching session in a shop, where the customer is “measured” and guided through options. The co-design option and mean selected must address both utilitarian options while empowering uniqueness. But there’s a deceitful threat to be thoughtfully addressed: asking the consumer to identify the features of a product with almost no constraint could generate choice complexity and might result in “mass confusion” (Huffman and Kahn 1998).

How do we rise awareness on our product? Communicating with customers is always fundamental, but it becomes essential especially for innovative products or products that are delivered in an innovative way. This implies that proper communication means have to be created and adapted in accordance to the target customer segment and to the peculiarities of the MC offer.

How do we deliver? Delivery costs are often a major problem for MC products: while traditional business to consumer markets rely on a numbered set of clearly located retailers, shops, re-sellers, resulting into a “one to many” delivery network, in modern business configurations, such as the MC productions, products are (usually) delivered directly to the final customers, creating a “one to almost infinite” delivery network, where delivery routes are not predictable and optimization of logistics operations is left in delivery service suppliers’ hands.

E.g., Internet-based co-design tools are one of the most important enablers of MC initiatives. We can mention again Dell, Timbuk2, Lego, mi adidas, NIKEiD, Zazzle, Yankee candles, Customatix, McGraw Hill custom college textbooks (Albright and Lam 2006), Acumins, Lands’ End, reflect.com (Kurt 2003), and many others, all offering online configurators where the final user can configure its customized solution. These customization experiences are sometimes assisted, such as in Zyrra business, where the company sells bras through home parties, in which one of the company’s salespeople takes 12 different measurements for each customer. Customers then choose colors and trim within properly organized events (also strengthening customer acceptance of the product) such as in the first phases of the mi adidas initiative, or in the shop. In other cases, means used to gather customer preferences are indirect, such as the ChemStation MC service, based on autonomously learnt customer needs.

American Art Resources (2013) is meant to commission and install artwork, from huge sculptures to photographs of historic buildings, for health-care facilities. Through the website, hospitals and other health-care facilities commission art pieces to a network of about 1,900 artists working in practically every possible medium, including painting, photography, fiber, ceramics, and drawing. In this case, the MEANS is the core business: the website enables suppliers and customers to meet, with different customers accessing “mass customized” artworks.

Block7—SUPPLY CHAIN: Mass Customization requires an agile supply chain whose speed and flexibility can support the manufacturing system toward the realization of customer needs.

Can the supply chain cope with the erraticism in terms of variations and volumes imposed by my MC implementation? Which kind of contract/relationship do we have with our suppliers? Which is our negotiation power with them? Which is the benefit they would derive from a redefined agreement? The prospective MC entrepreneurs have to focus on all these issues in order to size the customization potential enabled by their supplier and supply chain configuration. Though the capability of our production system is critical in defining our mass customization capability, also the significance of supply chain and logistics management in empowering mass customization strategies is to be taken into serious consideration as it becomes of capital importance to procure appropriate and accurate supplies for the timely manufacture and delivery of individualized product.

How does this flexibility impact costs? When facing the above-mentioned issues, we have to address the typical cost increase connected with flexible and small-lots procurement.

E.g., In some MC examples, the supply chain is fundamental: creating strong, though flexible, relationships with suppliers is mandatory to access a wide variety of components in a timely and inexpensive way.

TaylorMade is a good example on how a well-performing supply chain can make the difference in an MC strategy implementation process (Bowman 2002). The company is the number-two maker of clubs. In early 2000 the market was steady, with near-zero growth and TaylorMade competitors outperformed company’s performances in delivering custom-made golf clubs. Actually, TaylorMade had one of the slowest supply chains requiring between 30 and 90 days to recognize demand changes at the retail level, 5 more to update the forecast, 7 to convert it to a materials plan, 5 to release assembly or purchase orders, 60-day lead-time with vendors, and 8 days for converting to a required shipment. In a 3-year program costing close to $10 m, TaylorMade stabilized and improved basic business processes, developed enhanced supply-chain capabilities, including fast delivery of customized product, installed a set of new software applications. All these investments resulted into a renewed competitive positioning of the company within the market, with lead times comparable with competitors’ ones and higher quality product.

In other cases, MC is implemented just in the final steps of the manufacturing process. In that case, supply chain is just marginally affected by the MC strategy implementation process. Lenscrafter (Albright and Lam 2006) is an international retailer of prescription eyewear that has customized products to individual customers at a cost comparable to mass-produced goods. Each Lenscrafters store maintains a production facility to avoid the costs and delays of sending prescriptions to labs that use batch production techniques. The result is a prescription lens quickly delivered to an individual customer. In this case, customization is directly implemented in the shop and strongly connected with the customization experience (with really short lead times).

2.3 How to Use the MCIT Template

As mentioned, we may step into the template in different blocks. There is no right starting block, or exact logical sequence: each MC implementation will have its own genesis, sector specificity, and evolution paths. As a usage example, we may think that we have production system that offers, thanks to his machinery, customization potential unexploited: can I offer something different to my customers? We’ll step in to the “production system” block (Fig. 2.8), and characterize our manufacturing plant from an MC point of view, getting inspiration from the issues and suggestion early in this chapter mentioned. This should be done in team, possibly heterogeneous, using a blackboard and many post-it (this approach is valid in the first steps of any factory-wide and business-wide significant change implementation, e.g., in a lean implementation). Once done, we have then to think about the changes and challenges that our supply chain will have to cope with. Similarly we have to characterize the new customization level offered, that will be targeted to a specific market segment to be pointed out clearly. The “means” to make information flow from the customer to the factory will be the next logical step to be investigated. By answering systematically, block by block in the MCIT template, to the questions above highlighted, we will be drafting our implementation and qualitatively investigate our approach.

Fig. 2.8

An example of the strategy generation on the MCIT

2.4 Conclusions

This chapter confirms the predominantly applicative attitude of this work by providing a practical and intuitive guide for entrepreneurs aiming at implementing MC. To work with and fill the MCIT template is an important step toward the acknowledgment of the complexity of an MC instantiation: it is not just about a customizable product. The chapter provides a method, procedures, and ideas suitable for MC businesses’ development to get off on the right foot (even if mentioning feet may seem a little bit too self-referring).