In today’s competitive world, customers want products that arrive quickly and are specifically tailored to their needs, and they want to buy them. This presents a continual challenge to businesses to create fully standardized products that allow for speed and efficiency but do not allow for customization flexibility, or fully custom-engineered solutions, which are the most customizable but take time, are complicated, and require significant engineering work. Therefore, more and more businesses are looking to create a new, more efficient solution, known as “configured standard”.
What a Configured Standard Product Means
Configured Standard Product (CSP) is an established term for the type of pre-engineered, standardized product that allows for minor modifications without any major changes to its underlying core design or additional new engineering efforts. The actual product platform that the product is built on does not change, and only controlled variations based on pre-approved configurations, for instance, user-defined options are permitted. To clarify this point: while the CSP has the same structural design as the standard CSP, the added available options create a more flexible CSP, thereby allowing a company to meet customer requests for specific types of products without starting from scratch with a new design each time.
How a CSP is Different from a Standard or Custom Product
CSP’s have some clear differences from standard (fixed) products (which have little or no flexibility and require no engineering work on a per-order basis) and custom/no installation products (each time has a unique design, and each custom order requires extensive engineering work). CSP’s reside somewhere in between these two extremes (standard and custom), thus offering limited flexibility with minimal engineering involvement, allowing companies to offer their customers repeatable and adaptable solutions.
Core Architecture and Controlled Options
A configured standard product has a core configuration defined by a fixed architecture. The core architecture is a well-established type of product and has a defined interface that enables users to choose different design variations while maintaining the product’s stability. The customer is provided with the capability of selecting approved options, for instance, size, capacity, material, performance rating, color, and software features based on the established engineering and commercial rules that enforce a proper and allowable combination of the selected options.
Rule-Based Configuration & The Efficiency of Engineering Operations
A key benefit of this business model is that the customer’s configuration will always follow strict engineering rules that will prevent the selection of combinations of options that are not allowed. Before the customer can select an option, the option has to be validated against the appropriate engineering and commercial constraints. Because the configurations are based on existing designs, drawings, and BOMs, the requirement for developing new engineering work and documentation is not required. As a result, engineering effort is limited to validating an existing product configuration versus developing a completely new product configuration. Therefore, engineering has a significantly reduced workload and error rate and a decrease in lead time.
How Configured Standard Products Are Delivered
With Configured Standard Products, it is necessary to employ a Configure-To-Order manufacturing strategy to deliver a complete product to a customer. Configured Standard Products require that the platform for the standard product be designed and frozen before configuration of the product. Once the configuration rules have been established, customers can select from the approved configuration options. Once all configuration options have been validated according to the rules established, the order is processed through assembly, testing, and transportation/delivery. The manufacturing methodology consists of both Make-to-Stock tiers for standard modules, Configure-To-Order for final assembly, and limited Make-To-Order steps where necessary.
Why do Organizations Adopt this Strategy?
The advantages of configured standard products are the balance between control and flexibility. Configured standard products provide shorter lead times, simplified engineering processes, consistent quality levels, and the ability to grow more efficiently while accommodating the variety of customer preferences. In many cases, configured standard products work best when some variation is required in the marketplace, and full customization is not necessary.
Conclusion
The difference between a configured standard product and a custom engineering project boils down to design ownership. A configured standard product uses pre-existing components and makes a selection based on those components. A custom engineering project builds something from scratch. Therefore, by creating a standardized core product and controlling the acceptable variation of it, organizations can provide solutions that meet each customer’s needs at a fraction of the cost of providing a custom-designed solution to each customer. Configured standard products do not represent a compromise; instead, they represent a specific strategy that allows organizations to offer fast time to market, scalable solutions, and maximize customer options.
Karthik S is our in-house Master Data Quality Manager certified by ISO-8000 for Data Quality and Enterprise Master Data. He comes with 10+ years of experience with prior experience in handling customer, asset & engineering data, improving data quality & accessibility, eliminating data loss and standardizing data to match industry standards.
