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The application of form postponement in manufacturing

By Heather Skipworth

Abstract

Postponement is widely recognised as an approach that can lead to superior supply chains, and its application is widely observed as a growing trend in manufacturing. Form postponement (FPp) involves the delay of final manufacturing until a customer order is received and is commonly regarded as an approach to mass customisation. However, while much is written in the literature on the benefits and strategic impact of FPp, little is still known about its application. Thus this research project aims to address how FPp is applied in terms of the operational implications within the manufacturing facility. Here the ‘postponed’ manufacturing processes are performed in the factory where the preceding processes are carried out. An in-depth case study research design was developed and involved case studies at three manufacturing facilities, which provided diverse contexts in which to study FPp applications. Each case study incorporated multiple units of analysis which were based around product groups subject to different inventory management policies – FPp, make to order (MTO) and make to stock (MTS). The same research design was used in each study and involved both qualitative and quantitative evidence. Qualitative evidence was gathered via structured interviews and included the operational changes required to apply FPp in a previously MTO and MTS environment. Eleven quantitative variables, providing a broad based measurement instrument, were compared across the three units of analysis to test the hypotheses. This combination of qualitative and quantitative evidence in the case studies helped to triangulate the research findings. Comparison between the three case studies provided further conclusions regarding operational implications that were context specific and those which were not. The research concludes that the manufacturing planning system presents a major obstacle to the application of FPp in a MTO and MTS environment. In spite of this, and even when the FPp application is flawed, the benefits of FPp still justify its application. The research also contributes two frameworks: one which determines when FPp is a viable alternative to MTO or MTS; and another that illustrates the major operational implications of applying FPp to a product exhibiting component swapping modularity

Topics: Supply chain, Postponement, FPp, Make to order, Make to stock
Publisher: School of Management
Year: 2003
OAI identifier: oai:dspace.lib.cranfield.ac.uk:1826/116
Provided by: Cranfield CERES

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