| Term Definition The ease of which a product can be madeTerm Definition The process of defining all of the product's characteristicsTerm Definition The process of establishing all the characteristics of the service, including physical, sensual, and psychological benefitsTerm Definition The process of studying the practices of companies considered "best-in-class" and comparing your company's performance against theirsTerm Definition The process of disassembling a product to analyze it's design featuresTerm Early Supplier Involvement (ESI)Definition Involving suppliers in the early stages of product designTerm Definition A technique used to compute the amount of goods a company needs to sell to cover it's costsTerm Definition Costs a company incurs regardless of how much it producesTerm Definition Costs that vary directly with the amount of units producedTerm Design For Manufacture (DFM)Definition A series of guidelines to follow in order to produce a product easily and profitablyTerm Definition A series of stages that products pass through in their lifetime, characterized by changing product demands over timeTerm Definition An approach that brings together multifunction teams in the early phase of product design in order to simultaneously design the product and the processTerm Definition The concept of using components of old products in the production of new onesTerm Definition Processes used to produce a variety of products with different processing requirements in low volumesTerm Definition Processes used to produce one or few standardized products in high volumeTerm Definition A type of process used to make a one-at-a-time product exactly to customer specificationsTerm Definition A type of process used to produce a small quantity of products in groups or batches based on customer orders or specificationsTerm Definition A type of process used to produce a large volume of a standardized productTerm Definition A type of process that operates continually to produce a high volume of a fully standardized productTerm Definition A technique used for evaluating a process in terms of the sequence of steps from inputs to outputs with the goal of improving its designTerm Definition A chart showing the sequence of steps in producing the product or serviceTerm Definition Longest task in the processTerm Definition Produces standard products and services for immediate sale or deliveryTerm Assemble-to-order StrategyDefinition Produces standard components that can be combined to customer specificationsTerm Definition Produces products to customer specifications after an order has been receivedTerm Process Performance MetricsDefinition Measurements of different process characteristics that tell how a process is performingTerm Definition Average amount of time it takes a product to move through the systemTerm Definition Ratio of throughput time to value-added timeTerm Definition Ratio of time a resource is used to time it is available for useTerm Definition Ratio of actual output to standard outputTerm Information Technology (IT)Definition Technology that enables storage, processing, and communication of information within and between firmsTerm Enterprise Resource Planning (ERP)Definition Large software programs used for planning and coordinating all resources throughout the entire enterpriseTerm Global Positioning Systems (GPS)Definition A type of wireless technology that uses satellite transmission to communicate exact locationsTerm Radio Frequency Identification (REID)Definition A wireless technology that uses memory chips equipped with radio antennas attached to objects used to transmit streams of dataTerm Definition Using Machinery to perform work without human operatorsTerm Flexible Manufacturing Systems (FMS)Definition A type of automated system that combines the flexibility of intermittent operations with the efficiency of continuous operationsTerm Numerically Controlled (NC) MachineDefinition A machine controlled by a computer that can perform a variety of tasksTerm Computer-aided Design (CAD)Definition A system that uses computer graphics to design new productsTerm Computer-integrated Manufacturing (CIM)Definition The integration of product design, process planning, and manufacturing using an integrated computer systemTerm Definition A grouping a physical, sensual, and psychological benefits that are purchased together as part of the service Assemble-to-order (ATO) is a business production strategy where products that are ordered by customers are produced quickly and are customizable to a certain extent. It typically requires that the basic parts of the product are already manufactured but not yet assembled. Once an order is received, the parts are assembled quickly and the final product is sent to the customer. Show
Key Takeaways
Understanding Assemble-to-Order (ATO)The assemble-to-order strategy is a hybrid between the make-to-stock strategy (MTS) and the make-to-order strategy (MTO). A make-to-stock strategy is one where products are fully produced in advance. The idea is to build an inventory that matches expected or anticipated consumer demand. This method would consist of setting a production level, building up inventory, and then attempting to sell as much assembled product as possible. It's used mostly for high-volume goods, consumables, and items that can be bought in bulk or as a single unit. A make-to-order strategy is one where products are manufactured once the order has been received. Production is driven by demand and items are only produced when orders are confirmed. In other words, the supply chain operation does not begin until there is evidence of sufficient customer demand. This strategy is often employed for high-end goods or items made individually or in small batches. The ATO strategy attempts to combine the benefits of both make-to-order and make-to-stock—getting products into customers' hands quickly while allowing for the product to be adapted or altered in certain ways, as per customer request. In most cases, the time and costs associated with building the product from its components are minimal. However, the time and costs to build the components, which are usually ordered from a supplier, can be considerable. Enabled by technology, advancements in production processes and inventory management systems have played a big part in making assemble-to-order strategies a reality. Add cheaper methods of shipping products, and the strategy has been a boon for product customization opportunities. Pros and Cons Assemble-to-Order (ATO)Like many methods that chart a middle course, assemble-to-order has both advantages and disadvantages. Pros
Cons
Example of Assemble-to-Order (ATO)Consider a manufacturer of personal computers. It might have all of the essential parts of a computer—motherboards, graphic cards, processors, monitors, keyboards—in stock and already manufactured. The company depends on various suppliers for these components. When orders for new PCs arrive, it is easy for the company to assemble and customize the computers using the various components. The process is driven by customer demand, however, and until the order arrives, the components sit on shelves. Which manufacturing process is used to produce items to each customer's specifications?Make-to-order manufacturing, or mass customization, is a production process where a company creates products to meet the specifications of customer orders. Job shops and other specialized manufacturing facilities might use this process, which allows them to design and create a new product for each customer order.
Under what production goods are produced to specific customer orders?Make to Order (MTO) is a production technique in which producers start manufacturing a product only after the customer places an order for it. Unlike Make to Stock, MTO does not require companies to hold inventories of finished goods. Therefore, there is no risk of wastage of inventory.
Where production is carried on according to the orders of the customer it is called?Assemble-to-order (ATO) is a business production strategy where products that are ordered by customers are produced quickly and are customizable to a certain extent.
What is production to order?Produce to order is an approach to production where the production of an item begins only after a confirmed customer order is received. By using mass customisation techniques, it is possible to include a customer's specific requirements into the product.
|
