Build to order
April 8, 2011 at 9:50 pm by Alexandra Gatzweiler
General Description:
Build to order(BTO) and sometimes referred to as make to order (MTO), is a production approach where once a confirmed order for products is received, products are built. BTO is the oldest style of order fulfillment and is the most appropriate approach used for highly customized or low volume products.
Buildt to order as a strategy can be defined as “the value chain that manufactures quality products or services based on the requirements of an individual customer or a group of customers at competitive prices, within a short span of time by leveraging the core competencies of partnering firms or suppliers and information technologies such as the internet and www to integrate such a value chain.” It provides a level of responsiveness, cost effective ness and flexibility that enables companies to deliver the products that customers have chosen at the time they requested it.
Recently, it has become a popular operations paradigm after the success of its implementation in Dell Computers, BMW, and Compaq.
References:
Anderson, David M. (1997) Agile product development for mass customization: how to develop and deliver products for mass customization, niche markets, JIT, build-to-order, and flexible manufacturing. Chicago, IL: Productivity Press.
Holweg, M. and Pil, F. (2001) Successful Build-to-Order Strategies start with the Customer, MIT Sloan Management Review, Fall issue, Vol. 43, No. 1, p. 74-83.
