Build-to-Order as a Competitive Strategy to Dampen Nervousness within the Production Plan

Essay from the year 2014 in the subject Business economics - Supply, Production, Logistics, grade: 1,2, University of Paderborn (DSOR Lab), language: English, abstract: In times of globalization and increasing product complexity and variety due to sophisticated customer demand, new priorities for production planning must be set. The observable trend from supply-driven to demand-driven production will continue forcing more and more manufacturers to revise their production concept. A possible approach to face this challenge is the pull-based Build-to-Order (BTO) system. In terms of production planning, it will be indispensable to integrate the entire process chain. Nervousness is largely caused by external parties such as the supplier and the customer. Therefore, integrated approaches with focus on the customer will gain in importance and become the dominant cross-industrial mode of production. In this paper Build-to-Order is analyzed and evaluated as a specific solution approach by focusing on how it dampens nervousness within the production plan. Broadly speaking, nervousness within the production process can be caused by demand variability (downstream) and supply difficulties (upstream). In this seminar paper Dell serves as an example to illustrate BTO's effect on nervousness reduction.