An Investigation of Product Modularity and Supply Chain Performance at the Product Design Stage

Abstract

The benefit of integrating product design decisions and supply chain design decisions has been noticed by researchers. This integration can provide better communication between design teams and operations groups. Accordingly, potential supply chain risks can be highlighted before the launch of a new product. Modularization is one of the most critical product design and supply chain design decisions because it will determine the assembly sequence and potential suppliers of the product in the supply chain execution. However, the impact of modularity level on supply chain performance is still unclear. The objective of this study is to tackle this issue. The proposed method covers product design functions and supply chain design functions, hence the product design decisions and supply chain design decisions can be considered simultaneously. The supply chain performance of all design concepts is comprehensively investigated so as to analyze the impact of modularity on supply chain performance regarding lead-time and cost. The results show that increased modularity is advantageous for the time-based performance of supply chain network whereas decreased modularity demonstrates superiority on cost performance.