A discussion of future challenges to “built to order” SME’s. Mass customization: A threat or a challenge?

Today we begin to see a market situation between customer and manufacturer based on 1:1 relations. In order for the manufacturer to remain competitive, it is no longer sufficient to meet the requirements of the average customer, because there is no longer such thing as an average customer. We see how there is an increased interest in products that can be adapted according to the individual customers needs and wishes. This leads to the development of efficient production of customized high quality products for the individual consumer, instead of the traditional production of uniform products for a homogenous market. The development is made possible by the developments in informationand production technology. Some SME’s (small and medium sized enterprises) within the “built to order” segment perceive this individualization trend as an opportunity to produce customized craft products, because they already master the variation sought by the customer. But the question is whether this increased interest in “built to order production” will backfire in the long run? An increased customer interest will presumably result in more intensive competition, as the traditional mass producers move an attracted by the lucrative market for customized products. Consequently it is necessary for the SME’s to shape up and industrialize their production, in order to remain competitive. This paper addresses the issue of the industrial development as a condition for mass customization. The evolution from crafting of customized products to manufacturer of mass customized products, and beyond will be described. The aim is to present trends on the future market for “built to order products”, and thereby give an indication of the measures needed in the industrialization of the future SME. The contribution will be a focus on the sequential development of SME’s through internal industrialization. It is done through a discussion of literature supported by observations form industry, and results in four steps that will help the SME in identifying the challenges of mass customization.