Product architecture, configurability and sales-delivery process

According to Tiihonen et al. (1998), configurable products have the following features:

• Each delivered product individual is tailored to the individual needs of an individual customer

• The product has been pre-designed to meet a given range of different customer re- quirements

• Each product individual is specified as a combination of pre-designed components or modules

• The product has a pre-designed general structure

• The sales-delivery process requires only systematic variant design

In a make-to-order environment a company has predefined assets in order to respond to customer needs as soon as possible (Suri 1998). This means that the customer specific product individual will be defined by components or modules that are designed so that the customer variant can be configured from the generic structure as presented by Tiihonen et al. (1998). The ideal situation is when a machine is sold all the parts and components would have lead times so short that they would fit the promised lead time window (Torvinen 2003). This means that the company would only manufacture and purchase the needed parts for the assembly (Suri 1998). This implies that next to tailoring the products according to customer needs there are also implications to the rest of the organization by the product structure. The main point in the above list of configurable product features next to the as- pect of pre-designing the structures is that the sales-delivery process requires only system- atic variant design, i.e. the product development has been isolated from the order-delivery

process and only predefined components and modules can be used (Tiihonen 1998, Salva- dor and Forza 2002a, Lapinleimu 2000, Jorgensen 2001, Steger-Jensen and Svensson 2004, Salvador and Forza 2004, Pulkkinen et al. 2004).

According to Lapinleimu (2000), the product needs to be configurable because during the sales process the suitable module variants need to be selected in order to specify correct customer specific product individual. This selection process needs the configuration knowl- edge to work properly. As Salvador and Forza (2002a) have found the key benefits of the product configuration can be diminished if the coordination of the functions is not ade- quate. For example, the sales personnel need heavy support from the technical side, the technical side is forced to use all their time in checking the validity of the configurations, and false product structures still pass to the production and even to the customer.

Modularity is often considered as the basis for configurability (Tiihonen 1999, Lapinleimu 2000, Pine 1993, Jorgensen 2001). This is the case when the module level of the product architecture is the level where the configuration tasks takes place. Thus, no single compo- nents are configured below the module level. Considering modularity as basis for con- figurability is due to the fact that modular product structures enable the creation of variable functionalities into the product. Modularity provides means to handle complexity of the product structure, thus combining components into larger groups considering the con- figurability of the created structure. Pine (1993) also considers that the best and the hardest method for achieving mass customization is through the modularization. This means that the product structure is somehow sliced into bunches of components through a company- specific way and the customer specific structure is then configured from these pre-defined modules (Pine 1993). In this way the economies of scale are gained through the compo- nents if modularized accordingly. The economies of scope are gained using these modules over and over again in different products (Pine 1993). Pine (1993) describes that modulari- zation is standardization of components in order to increase variety and customization while costs decrease in manufacturing. While these modules are predefined the product structures can easily be configured by combining the existing modules. The problem is that even if the modules are created considering the configurability the customer specifications determine the use of certain modules in product structures. Often the customer specifica- tions have dependencies between each other which make the systematic presentation of configuration knowledge even more important. This actually means that many of the mod- ules are selected by a combination of customer-selected options.

As modularity is often used as a basis for configurable products (Lapinleimu 2000, Tiiho- nen 1999) other views are also available. Salvador and Forza (2004) consider that product modularity is a subset of product configuration, thus the product structure needs not to be modular in order to be configurable. Salvador and Forza (2004) consider configurability differently from Lapinleimu (2000) and Tiihonen (1999). They see that product configura- tion only provides different variants, while Lapinleimu (2000) and Tiihonen (1999) see that configurability is a property related to modularity. Thus, the usage of the term configurabil- ity is different. Also the definition of the explicit structure given by Peltonen et al. (1998) does not consider modularity at all, but defines the structure to be a refinement of a tradi- tional bill-of-materials (BOMs). Also Tiihonen (1999) argues that modularity is not im-

perative for product configuration, and the configurability of the product can be accom- plished by using parameters (also the definition of extended BOMs by Peltonen et al.

1998). Salvador and Forza (2004) consider that the downside of modularity is the func- tional mapping into product components as it is very stringent. According to them, product configurability does not need any type of functional mapping, but needs only a relationship between the component and customer requirement in order to define customer specific structures, thus leaving a very complex set of rules and maintenance to the different opera- tions of the company.

According to Tiihonen (1999), modularity of the product can be based on production view, marketing view or on the combination of these two in the context of configurability. This is also analogous to the division of the product structure into structural and functional mod- ules and their possible combination. Tiihonen (1999) suggests that the two views should be kept separate, but still ensure that the connection between the two is secured. According to Tiihonen (1999), the production view of the modularity is accomplished by dividing the product structure to be strictly according to the production. As noticed in Lehtonen et al.

(2003) the structural modularity, i.e. the production view is the lowest level of modularity found. This division has many implications, but considering the marketing side the depend- encies between the customer requirements and the actual product modules grow substan- tially and the configuration of the product individual becomes difficult. According to Tii- honen (1999), the problem is that structural modularity is too specific for marketing pur- poses, the modules have difficult dependencies, and the connection between customer re- quirements and the modules are not evident. All this affects negatively to product configu- ration.

Tiihonen (1999) considers that the functional division of the product structure, i.e. the mar- keting view is optimal for configuration since marketing sells functionalities rather than assemblies (also Riitahuhta 2000, Mittal and Frayman 1989). Using production based divi- sion the functions are defined indirectly and the dependencies of the configuration model become tedious to handle. If the product structure is not based on modularity, the product is most likely to be easier to handle or the configuration task is handled via parameters, and the amount of components allows the use of such structures. Considering the domain of this thesis and the type of product that includes thousands of components and even hundreds of modules the use of modularity is unavoidable. If the complexity is not divided into mod- ules, the task of configuring such structures would become impossible.

The modules should be designed so that they have a minimal amount of dependencies be- tween each other to ease product configuration (Tiihonen 1999). The idea is that one cus- tomer selection leads to selection of one module or a combination of few modules. The di- vision of modules is very important in the sense that the customer requirements also have dependencies between each other and so the combination of the selected product modules is also affected by the earlier selections and might also be affected by the subsequent selec- tions. This is the field of configuration models to handle. The problem is that this knowl- edge is usually tacit (Salvador and Forza 2002a) and revealing this knowledge and creating the configuration models can be a very tedious job as the products get more complex. Ac- cording to Nummela (2003) and Bongulielmi (2002), modules can be tied to the saleable

options and by representing these dependencies the rules can be formulated. Modeling the product structure and establishing the dependencies form the basis for successful configura- tion models and their maintenance.

In the case of functional modularity, i.e. marketing view, the problems occur in production.

The problem is that the similarity between the production system and the product is not valid (Lapinleimu 2000, Tiihonen 1999). If the modular structure of the product is not ac- cording to the production (assembly based modularity), the similarity between the produc- tion system and the product structure needs to be accomplished by other means. Consider- ing the whole concept of product configuration, the aspect of production and product struc- tures should also be answered in order to create producible products.