In today’s consumer driven economy, you must fully satisfy your customer’s needs or your competitors will. But as customers’ needs grow increasingly diverse, keeping up with their demands can be overwhelmingly difficult.

In the 21st century, customer differentiation is based more and more on market segmentation, not national borders. Consequently, your target market — which is more like a moving target — may span dozens of countries. This brings rise to the concept of the “global consumer.”

What Is Mass Customization?

Dynamic global markets, rapidly changing consumer needs, and emerging technologies have challenged the existing manufacturing paradigm of mass production. Instead of large plants turning out mass quantities of the same product, a highly flexible manufacturing process that can efficiently produce small lots of specialized products at a low cost is required. This is called “mass customization.”

In order to achieve this, you’ll need a sophisticated system of communications among all levels of distribution. This is made possible by advanced information technology that closely links the producer all the way up the chain to the customer. So you’ll know exactly what to produce and when to produce it.

And that’s not all. New technologies, like CAD/CAM, make possible instantaneous changes in the specifications and customized adjustments in production without any machine downtime.

Mass Customization Is Not New — But the Elimination of the Waiting Period Is

Mass customization has been going on for years. What is changing today is the elimination of the waiting period.

In some stores, you can now have shirts made to order in 24 hours. And in Japan, the majority of men’s suits are sold door to door. Salesmen employed by department stores carry 10 sizes for fitting and they customize by color, fabric and style.

Years ago only a few TV channels were available. Today, cable networks cater to very select interests, including food preparation and fitness. Even birthday cards can be tailor-made satisfying your interests.

Some large eyewear retailers now allow their customers to build a pair of glasses, choosing the lens shape and style, nose bridge, hinges and arms. The design system takes a digital picture of the customer’s face, analyzes the attributes and customer-provided information, and prints out a photo-quality picture of the customer wearing the proposed eyeglasses.

Some auto manufacturers can even deliver a custom-built car in just a few weeks with no extra cost. Mass customization can and will be applied to every industry — even agriculture, which now offers custom-blended fertilizers.

You Must Achieve Economies of Scope — Not Economies of Scale

The message is clear. Industries must learn how to engineer for economies of scope rather than economies of scale. Thus, the more your company can deliver customized goods on a mass basis, the greater your level of competitiveness.

With the emergence of globalization, and the global consumer, manufacturers in every industry will need to mass customize their products. And distributors and retailers must be in a position to sell them — domestically and internationally.

This article appeared in October 2000. (CB)
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John Manzella
About The Author John Manzella [Full Bio]
John Manzella, founder of the ManzellaReport.com, is a world-recognized speaker, author of several books, and a nationally syndicated columnist on global business, trade policy, and economic trends. His latest book is Global America: Understanding Global and Economic Trends and How To Ensure Competitiveness.




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