Abstract:
Postponement is an approach that helps to deliver more responsive supply chains.
Form postponement involves the delay of final manufacturing until a customer
order is received and is commonly regarded as an approach to mass customization.
However, while much is written in the literature about the benefits and
strategic impact of form postponement, little is still known about its
application. This paper addresses how form postponement was applied in terms of
its operational implications within a manufacturing facility through a
retrospective study that tracked implementation of form postponement in a
manufacturer of specialist high-voltage cabling equipment, called here
'ElectriCo'. The operational measures for products selected for form
postponement were compared with those for products that continued to be made
under make-to-order and make-to-stock regimes. Propositions were tested that
addressed the operational implications of form postponement within the
manufacturing facility, the impact of form postponement on selected performance
metrics, and the demand profile for which form postponement was the preferred
regime. Multiple data collection methods were used whereby documentary, archival
and database evidence were used to measure operational characteristics across a
broad front. The findings show that form postponement improved responsiveness
but did not necessarily improve delivery reliability. The extent to which the
order lead time can be reduced is dependent not only on the responsiveness of
the postponed process, but also crucially on the responsiveness of the planning
system. It was found that the problem of adapting the manufacturing planning and
production scheduling systems at ElectriCo had been underestimated. This and
other problems subsequently undermined the form postponement application and led
to its eventual abandonment. The authors are undertaking further research of
form postponement applications in different production contexts to provide
further evidence for its operational implications.
