Mass customization is a process in which a company moves away from mass production and toward mass customization. To do this, an organization needs to build three organizational capabilities. The first is developing a solution space -- identifying the product attributes that need to diverge. The second is developing a process design -- figuring out the best way to reuse or combine existing resources to fulfill customer needs. And the third is choice navigation -- helping customers identify their own solutions while minimizing complexities. During this overall process, a company might decide to improve all three capabilities simultaneously or, rather, to prioritize one or two of them. Dell Inc., for instance, has perfected its capability to define its solution space and to set up a very robust process, but the company now needs to improve its choice navigation. Currently, Dell customers need to know pretty clearly which computer they want ahead of time, whereas many would benefit from having a recommendation system that would lead them to the best product based on their individual needs.
This article is adapted from “Cracking the Code of Mass Customization,” by Fabrizio Salvador, Pablo Martin de Holan and Frank Piller, which appeared in the Spring 2009 issue of MIT Sloan Management Review. The complete article is available at http://sloanreview.mit.edu/smr/.