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Production Planning Solutions for Mass Customised Fashion Master Thesis Written by Berit Janssen and Anne Müller Master Thesis at the University of Borås Swedish School of Textiles June 2012 Raportnr.: 2012.9.8 Examiner: Håkan Torstensson Supervisor: Jonas Larsson Production Planning Solutions for Mass Customised Fashion Abstract The emergence of customised products is a consequence of behavioural changes within western societies, as well as recent technological developments Therefore the fulfilment of customers’ needs became one major aim businesses have to follow nowadays This progress has paved the way to a new business concept, namely mass customisation that aims to satisfy individual requirements at relatively low costs Especially for small and medium sized enterprises (SMEs) mass customisation developed into a favourable and successful business strategy Given that the fashion industry can be classified as an emotional and fast paced industry sector that needs to capture customers’ desires in a quick and precise manner, the concept of mass customisation seems to be an adequate strategy Moreover, fashion products have a high potential to be customised Due to the fact, that the implementation of mass customisation will have an impact on the entire business strategy and operational sequences, the transition needs to be carefully planned In particular the whole production unit should be managed cautiously in order to assure seamless supply chain processes For that reason this thesis concentrates on different production planning solutions for mass customised fashion with regard to machine setups The purpose of this research is to reveal the significant aspects and challenges for SMEs that have to be considered when production steps need to be aligned to the mass customisation principle Therefore a theoretical framework will approach the subject of production planning, as well as mass customisation In addition, a case study will assure scientific support by developing and examining production planning solutions The different levels of production set-ups induce the technological facilities that are indispensable for an integration of mass customisation Finally it will be analysed and discussed whether it is feasible for an SME to invest in such a business strategy Especially in a SME the boundaries between pure tailor- made customisation and pure mass customisation are often blurred, wherefore the findings should contribute to a clarification Since mass customisation is a future- oriented concept, this paper is of definite interest to small companies, which intend to successfully achieve mass customisation Key words: Mass customisation, production planning and controlling, small and medium sized enterprise (SME) Production Planning Solutions for Mass Customised Fashion Table of Content 1Introduction 1.1Background 1.1.1The emergi 1.1.2SOMconce 1.1.3Problem D 1.2Purpose 1.3Research Question 1.4Delimitation 2Methodology 2.1Research Approach and Process 2.2Case Study 3Theoretical Framework 3.1Production Planning and Controlling 3.2Organizing the information flows 3.2.1Investment 3.2.2ERP system 3.3Theoretical Set up for optimal production flow 3.4Mass Customisation 3.4.1Approache 3.4.2Definitions 3.4.3A successfu 3.4.4Benefits an 3.4.5Impact of m 4Case Study: SOMconcept 4.1Materials and Products 4.2Machines and materials 4.3Machines, cost and dimensions Janssen, Müller Production Planning Solutions for Mass Customised Fashion 4.3.1 B 4.3.2 H 4.3.3 L 4.3.4 L 4.4Production Set- ups 4.4.1 H 4.4.2 L 4.4.3 L 4.4.4 S 4.5Cost analysis 4.6General additional production suggestions 4.7Additional suggested equipment Analysis Discussion Conclusion 7.1Future research List of abbreviations List of References 10 Appendix Janssen, Müller Production Planning Solutions for Mass Customised Fashion List of Figures Figure Delimitation on the value chain Figure Sheer´s Y translated Figure Structural building of an ERP-System by E.Züfle 11 Figure Decisions tree model by Subba Rao, 2000 12 Figure Material-/Product flows by Eberle et.al 13 Figure Hand usable cutting machine 14 Figure Working area by Eberle et.al 14 Figure Overview on the working area by Eberle et.al 15 Figure Four faces of mass customisation modified by Larsson, 2011 17 Figure 10 Development of production condition 19 Figure 11 Economic Implications of mass customisation by Tseng and Jiao .22 Figure 12 Customer order decoupling point by Rudberg & Wikner, 2004 24 Figure 13 ZOJE ZJ-8700 29 Figure 14 Siruba FA007-248 30 Figure 15 JUKI DU 1181S 30 Figure 16 JUKI 6716 30 Figure 17 Domostir 3000 with Faber 1231 30 Figure 18 Pfaff 3119 30 Figure 19 HOOGS 31 Figure 20 Sieck Typ FL 600 32 Figure 21 Dürkopp-Adler 511-211 32 Figure 22Eastmann Multi-Roll-Carousel 32 Figure 23 LS-5000TY 32 Figure 24 Berning + Söhne AZ/P160 33 Figure 25 Dürkopp-Adler 511-211 33 Figure 26 A-Frame-Roll-Rack 34 Figure 27 Punch press/machine 34 Figure 28 Manual screw press 35 Janssen, Müller Production Planning Solutions for Mass Customised Fashion Figure 29 Fabric storage 35 Figure 30 Production flow for set-up with high use of special machines 37 Figure 31 Set-up for high use of special machines 38 Figure 32 Production flow for set-up with less use of special machines .40 Figure 33 Set-up with less use of special machines 41 Figure 34 Production flow for set-up with low use of special machines 43 Figure 35 Set-up for low use of special machines 44 Figure 36 Production flow for set-up with suggested use of special machines 46 Figure 37 Set-up with suggested use of special machines 47 Janssen, Müller Production Planning Solutions for Mass Customised Fashion List of Table Table Products and material 27 Table Machines and products 28 Table 3Measurement and costs for basic machines 31 Table Measurement and costs for high-tech machines 33 Table Measurement and costs for less special machines 34 Table Measurement and costs for low use of special machines 35 Table Cost-efficiency for set-up with high use of special machines 49 Table Cost-efficiency for set-up with less use of special machines .49 Table Cost-efficiency for set-up with low use of special machines 50 Table 10 Cost-efficiency for set-up with suggested range of special machines 50 Janssen, Müller Production Planning Solutions for Mass Customised Fashion Introduction This thesis analyses how a mass customised fashion production can be developed in SME, shown with the practical case of the Swedish company SOMconcept The following chapter will introduce the reader to the background of the thesis and the focus topic of mass customisation 1.1 Background The research of the thesis is based on a combination of two different subjects: namely the general production set- up for mass customised fashion and SOMconcept’s implementation of such a production model for their customised goods Therefore a brief background of both themes is given in the following section 1.1.1 The emerging paradigm mass customisation Mass customisation is a well-known term nowadays Recently the New York Times published an article about a service, named Amuse Me that offers customised video games (Pfeiffer, 2011) News like this is not unusual anymore Furthermore mass customisation evolved to a trend in many different industry sectors More and more companies implement or rather start a new business by using mass customisation as their strategy The strategy of offering customised products is actually an old paradigm Through the handcraft era in the early 1900 goods were always manufactured according to customers’ unique requirements Whereas the latest concept of mass customisation uses modern information and communication technology (ICT) to deliver customised goods in a cost efficient way for the mass market It becomes more and more attractive for young and unique brands to apply this business strategy in order to create a deeper uniqueness or offer a broader range of individual fashion, and thus more individuality for their customer The implementation of mass customisation into business is a challenge and depends on different aspects for instance to select a suitable customisation approach Hence mass customisation is a business strategy Mass customisation is now beside mass production, i.e fast fashion, an opportunity to win the customer over and stimulate continuously innovation Janssen, Müller Production Planning Solutions for Mass Customised Fashion 1.1.2 SOMconcept SOMconcept was founded 2006 in Stockholm by Lotta Hjelte, Simon Hjelte and Daniel Bates During the last years “SOMconcept” operated through a shop-inshop principle a department in Paul Urban Bergström (PUB) departm ent store, which is located in Slöjdgatan, Stockholm Besides offering mass cust omised jeans and chinos they sold jeans, trousers, shirt, shoes and accessories from other brands like Falke, Amanda Christensen, Atlas Design and Human scales Since 2009 their income rose through increasing numbers of sales (allabolag.se, 2012) In order to enable a steady growth in the future, SOMconcept decided to leave PUB and to open an own small pop-up store for tailored garments The new production place is located in Montörsvägen 12, 168 31 Bromma, Stockholm and is about 32m This production plant is able to produce jeans, chinos, slacks and accessories that are ordered at the pop-up store in Regeringsgatan 30, Stockholm and are send immediately to the customers By employing four employees and achieving an annual turnover of 665 000 SEK, SOMconcept is defined as a SME according to the European Union law (EU-Definiton, 2012) SOMconcept makes use of mass customisation as a business concept and provides its customer the opportunity to design and create their own, personalized clothes and accessories according to the designer’s sketches 1.1.3 Problem Description The production of mass customised fashion deals with items, which usually change their appearance for each single product The complexity of such a production increases and impacts entire processes within any company’s value chain Hence the production process needs to be precisely planned and to ensure a seamless workflow Many producers face the problem nowadays by reorganizing the manufacturing process and invest in suitable equipment to implement the strategy of mass customisation (Owen, Matthews, McIntosh, & Culley, 2011) However, in the case of small companies a lack of thoughtful process design often evinces due to their limited spatial and financial capabilities Fogliatto et al also revealed through a profound literature review that the implementation of mass customisation results in a lack of “literature related with ma nufacturing planning and control” (Fogliatto, Da Silveira, & Borenstein, 2012) These problems also exist at SOMconcept where the given circumstances of this company impede the proper integration of a mass customisation production This particular example supports Fogliatto et al’s findings and proof the difficulties of finding the right solution for an efficient and effective production set- up for mass customised fashion Janssen, Müller Production Planning Solutions for Mass Customised Fashion 1.2 Purpose The purpose of this thesis is to present different production planning solutions for mass customised fashion that enable a successful implementation for SOMconcept Therefore this paper will discuss the significant aspects and challenges, which arise for a SME during the planning process and creation of production aligned to mass customisation Thus different variation of production set-ups for mass customised fashionable clothes are developed by considering the given circumstances of the company SOMconcept The aim is to achieve a suitable concept for mass manufacturing of customised products 1.3 Research Question The idea behind mass customisation is to focus more on customers’ individual needs and wishes in order to increase customers’ satisfaction In former industrialized times of mass production the power of supply chains was placed on the supplier, since the goal was to ensure a high capacity of products at the lowest possible costs Nowadays western markets became so oversaturated that the power has shifted from suppliers to consumers This fact has placed business concentrations downstream the supply chain to the customers Consequently, many firms start processes at the demand side, which brought up the term demand chain management (Gattorna, 2010) Through offering customers to actively take part in value added processes by customer co-creation, many companies in the textile industry are implementing mass customisation as their business strategy Particularly big companies such as Adidas (Adidas, 2012) or Burberry (Burberry Limited, 2012) make use of this strategy that compliments their regular business concept In addition, many startup companies implement the concept of mass customisation as their core strategy like the online brand youtailor.eu (Your Tailor, 2012) Since SOMconcept decided to implement a spatial separation of the production and sales department, new solutions for the production planning need to be developed, which include the material and information flow, the machinery and technology as well as arising expenses So the major challenge for SOMconcept is to develop the best solution to organize a production set- up for mass customisation While exploring the subject of mass customisation in the production process a further important aspect needs to be considered, namely the challenges embedded within mass customisation for business processes of SME Janssen, Müller Production Planning Solutions for Mass Customised Fashion Bryman, A (2008) Social Research Methods (3rd ed.) 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Edinburgh: Pearson Education Ldt - FT Prentice Hall Haug, A., Ladeby, K., & Kasper, E (2009) From engineer-to-order to mass customization Management Research News , 32 (7), 633 Hoogs (2012) hoogs.de Retrieved 03 28, 2012 from http://www.hoogs.de/deutsch/tische-/ Hunt, J (1993) Computers in Manufacturing In D Koshal, Manufacturing Engineer's Reference Book Butterworth- Heinemann Iron (2012) wasch- und bügeltechnik Retrieved 04 03, 2012 from http://www.wasch-und-buegeltechnik.de/index.php?page=product&info=41 Klaus, H., Rosemann, M., & Gable, G (2000) What is ERP? Journal Information Systems Frontiers , (2), 141- 162 Kumar, A (n.d.) Production planning and control Retrieved 01 26, 2012 from www.du.ac.ic: http://www.du.ac.in/fileadmin/DU/Academics/course_material/EP_08.pdf MacDuffie, J., Sethuraman, K., & Marshall Fisher, L (1996) Product Variety and Manufacturing Performance: Evidence from the InternationalAutomotive Assembly Plant Study Retrieved 01 24, 2012 from http://www.jstor.org/pss/2634348 made-in-china.com (2012) Retrieved 04 03, 2012 from http://de.made-inchina.com/co_wxjindian/product_Leather-Embossing-KS-5000TY_hrseherrg.html MTM (2012) dmtm Retrieved 04 23, 2012 from https://www.dmtm.com/index/index.php Nyhuis, D.-I., & Nyhuis, D.-I (2001) Produktionsplannung und -steuerun (PPS) Basiswissen Fachhochschule Gießen-Friedberg: Fachhochschule Gießen-Friedberg Nyhuis, Münzberg, & Kennmanns (2009, 07 23) Configuration and Regulation of PPC German Academic Society for Production Engineering , p Owen, G., Matthews, J., McIntosh, R., & Culley, S (2011) Design for Changeover (DFC): Enabling Flexible and Highly Responsive Manufacturing In F S Fogliatto, & G J Da Silveira, Mass Customization - Engineering and Managing Global Operations (pp 247- 273) London: Springer Verlag London Ltd Pfeiffer, A (2011, 11 21) Inspired by Your Life, a Custom-Designed Video Game Retrieved 04 16, 2012 from http://www.nytimes.com/2011/11/22/arts/inspired-by-yourlife-a-custom-designed-videogame.html?_r=1&scp=4&sq=mass%20customization&st=cse Janssen, Müller 63 Production Planning Solutions for Mass Customised Fashion Piller, F (2004) Mass customization (S AG, Ed.) SAP Info (120), 13 preisvergleich.de (2012) Retrieved 04 16, 2012 from http://preisvergleich.ebay.de/like/251034923346?clk_rvr_id=332794296452 Quiescenti, M., Bruccoleri, M., La Commare, U., Noto La Diega, S., & Perrone, G (2006) Business process-oriented design of Enterprise Resource Planning (ERP) systems for small and medium enterprises International Journal of Production Research , 44 (18- 19), 3797 - 3811 Rangaswamy, A., & Wind, J (2001) Customerization: the next revolution in mass customization Journal of Interactive Marketing , 15 (01), 13- 32 Rao, S S (2000) Enterprise resource planning: business needs and technologies Industrial Management & Data Systems , 100 (02), 81- 88 Rudberg, M., & Wikner, J (2005) Integrating production and engineering perspectives on the customer order decoupling point International Journal of Operations & Production Management , 25 (07), 623- 641 Salvadora, F., Forzab, C., & Rungtusanathama, M (2002) Modularity, product variety, production volume, and component sourcing: theorizing beyond generic prescriptions Journal of Operations Management , 20 (05), 549- 575 Schuh, G., Kampker, A., & Wesch-Potente, C (2010, 11 1) Condition based factory planning German Academic Society for Production Engineering , pp 89-94 Senanayake, M., & Little, T (2010) Mass customization: points and extent of apparel customization Journal of Fashion Marketing and Management , 14 (2), 282- 299 Shtub, A., & Karni, R (2010) ERP - The Dynamics of Supply Chain and Process Management (2nd edition ed.) New York: Springer Science+Business Media Sieck (2012) Sieck.de Retrieved 04 03, 2012 from http://www.sieck.de/maschinen/nieten/details/sieck-typ-fl-600-pneumatischeeinsetzmaschine-fuer-nieten-oder-oesen-mit-werkzeugschnellwechsel-1/ SoftGuide (n.d.) http://www.softguide.de Retrieved 01 31, 2012 from http://www.softguide.de/software/produktion.htm SOMconcept (2012) SOMconcept.com Retrieved 05 2012, 11 from http://somconcept.com/om-oss/manniskorna-bakom The Henry Ford AAM (2003) The life of Henry Ford Retrieved 01 24, 2012 from http://www.hfmgv.org/exhibits/hf/ Tixit- Maschinen (2012) Retrieved 04 03, 2012 from http://stores.ebay.de/TIXITMASCHINEN?_trksid=p4340.l2568 Janssen, Müller 64 Production Planning Solutions for Mass Customised Fashion trendwatching.com (2007, 07) trendwatching.com From http://trendwatching.com/trends/stillmadehere.htm Tseng, M M., & Jiao, J (2001) Mass Customization In G Salvendy, Handbook of Industrial Engineering - Technology and Operation Management (3rd ed., pp 684706) John Wiley & Sons Inc WDN GmbH (2012) Retrieved 04 03, 2012 from http://www.wdn.de/index.php? option=com_content&view=article&id=108&Itemid=11 Yin, R K (2003) Applications of Case Study Research (2nd ed.) London: Sage Publications Inc Yin, R K (1981) The Case Study as a Serious Research Strategy Science Communication , (01), 97-114 Your Tailor (2012) Retrieved 04 10, 2012 from http://www.youtailor.eu/ Zipkin, P (2001) The limits of mass customization (M I Technology, Ed.) MIT Sloan Management Review , 42 (3), 81 Janssen, Müller 65 Production Planning Solutions for Mass Customised Fashion 10 Appendix Janssen, Müller 66 Production Planning Solutions for Mass Customised Fashion MTM-Table Janssen, Müller Production Planning Solutions for Mass Customised Fashion Janssen, Müller Production Planning Solutions for Mass Customised Fashion SOMconcept Product range Janssen, Müller Production Planning Solutions for Mass Customised Fashion Janssen, Müller Production Planning Solutions for Mass Customised Fashion Cost analysis of salary, products and machines Janssen, Müller Production Planning Solutions for Mass Customised Fashion Janssen, Müller Production Planning Solutions for Mass Customised Fashion Janssen, Müller Production Planning Solutions for Mass Customised Fashion Janssen, Müller Production Planning Solutions for Mass Customised Fashion Janssen, Müller Production Planning Solutions for Mass Customised Fashion Janssen, Müller ... up for mass customised fashion Janssen, Müller Production Planning Solutions for Mass Customised Fashion 1.2 Purpose The purpose of this thesis is to present different production planning solutions. .. special machines 50 Janssen, Müller Production Planning Solutions for Mass Customised Fashion Introduction This thesis analyses how a mass customised fashion production can be developed in SME,... within mass customisation for business processes of SME Janssen, Müller Production Planning Solutions for Mass Customised Fashion The article Limits and opportunities in mass customization for “build
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