Friday, October 9, 2009

How can IT enhance mass customization?

IT has played a pivotal role in the mass-customization industry that is common today. Without the technology that enables customers to visualize their options through a website and the globalization 3.0 infrastructure that allows companies to manage their products and offerings, mass-customization would be difficult and costly to deploy in the ubiquitous manner now experienced.

Mass-customization is the method of "effectively postponing the task of differentiating a product for a specific customer until the latest possible point in the supply network." (Chase, Jacobs, Aquilano, 2006, p.419).

This is largely made possible through IT systems that allow the customer to order a base product that is mass-produced such as a My-Touch from T-Mobile and add a personalized design to the phone exterior, selected apps, or other features, and it is through the same IT system which enables customers to "try out" a design at their convenience before committing to the order. For example, the website invites you to "Imagine being able to create a phone as individual as you are. One that you can make completely your own —inside and out—with dynamic apps, one-of-a-kind home screen themes and exterior shells and gel skins." The advertisements for the phone emphasize this personalization by showing such diverse personalities as Whoopi Goldberg and Phil Jackson that have each customized their own phone.

Another company that has employed the mass-customization concept is Disney. Instead of a product, Disney mass-customizes the type of experience you are willing to design. When you buy your ticket to the park it is a base ticket. Then you can add features just as you would to a Dell laptop or a Nissan Cube. Maybe you would like to stay on one of the many resorts or add a dining plan to better suit your vacation dreams. There are many other additional choices you can make such as stay length, park-hopper, in-room flowers, have a cake ordered or a special fireworks cruise. You can even have lunch with one of the Imagineers. The options for customization are quite vast and are limited only by your fiscal resources. This gives each customer the ability to design the vacation package that will extract the most value for their families needs, which helps Disney provide the experience that each guest is expecting.

A third example is the new Coke vending machine, Freestyle, that can hold more than 100 sodas. The new fountain is like an ink printer with space for hundreds of cartridges. Each cartridge contains a concentrated formula of ingredients. When you press your choice, say Diet Coke, the machine will tell cartridge 12 to release three squirts, cartridge 81 two squirts and so on, then it combines it with carbonated water and you get the same drink as old machines. According to Fast Company, Freestyle machines are currently being tested in Georgia, California, and Utah and Coca-Cola has said it plans to place 60 test dispensers around the country by the end of the summer.

Finally, mass-customization has allowed business to hold on to the product rule, Hotelling’s Law, that states it’s natural and rational for businesses to make their products as similar as possible for cost effective reasons, while also taking these very similar base products and allowing the customer to "make it their own" by adding features they want at the moment of purchase. As technology continues to advance, I think that we will soon have something like a replicator as featured in STTNG.

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