Modularity and Delayed Product Differentiation in Assemble-to-order Systems: Analysis and Extensions from a Complexity Perspective
AbstractThe paper assumes a product design around modular architectures and discusses the suitability of the principle of delayed product differentiation in assemble-to-order environments. We demonstrate that this principle does not enable one to make optimal decisions concerning how variety should proliferate in the assembly process. Therefore, we propose to complement this principle in that we additionally consider the variety induced complexity throughout the assembly process. The weighted Shannon entropy is proposed as a measure for the evaluation of this complexity. Our results show that the delayed product differentiation principle is reliable when the selection probabilities of module variants at each assembly stage are equal and the pace at which value is added in the whole assembly process is constant. Otherwise, the proposed measure provides different results. Furthermore, the entropy measure provides interesting clues concerning eventual reversals of assembly sequences and supports decisions regarding what modules in an assembly stage could be substituted by a common module.
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Bibliographic InfoPaper provided by University Library of Munich, Germany in its series MPRA Paper with number 5286.
Date of creation: 2005
Date of revision:
modularity; complexity; ATO; delayed product differentiation;
Find related papers by JEL classification:
- M11 - Business Administration and Business Economics; Marketing; Accounting - - Business Administration - - - Production Management
- E23 - Macroeconomics and Monetary Economics - - Macroeconomics: Consumption, Saving, Production, Employment, and Investment - - - Production
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- Blecker, Thorsten & Abdelkafi, Nizar, 2006. "Variety Management in Assemble-to-Order Supply Chains," MPRA Paper 5250, University Library of Munich, Germany.
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