An analytical framework for evaluating the value of enhanced customisation: an integrated operations-marketing perspective

Abstract

In this paper we present a formal approach to evaluate the value of enhanced customisation. The suggested approach is based on a new perspective addressing the important alignment between the operations and marketing functions, under which we are able to obtain a more holistic understanding of the extent to which enhanced customisation may influence profitability. The model we develop captures the interaction between several factors including the inventory level, number of product variety, price, and delivery lead time. The numerical findings provide insights regarding some important aspects that may inhibit as well as facilitate the progress towards the manufacturing concept with a greater degree of personalised offerings.

Keywords:

• mass customisation
• postponement
• integrated operations-marketing problem