Implications of form postponement to manufacturing: a cross case comparison

Abstract

While much is written in the literature about the benefits and strategic impact of form postponement (FPp), little is still known about its application. We address ‘how’ FPp is applied in terms of its operational and logistics implications within manufacturing facilities. This paper is a retrospective study of the application of FPp in three diverse manufacturing environments: a manufacturer of specialist high voltage cabling equipment we call Electrico; a manufacturer of industrial electric motors we call Motorco; and a manufacturer of control systems and components mainly for automated telling machines we call Controlco. Our findings show that FPp improved responsiveness of manufacturing in all cases, but that none of the applications of FPp was ideal from a theoretical perspective. The production planning system must be both responsive and flexible to support the application. For highly customised products, the customer order decoupling point (CODP) must be located sufficiently upstream in the manufacturing process to avoid removal of components and time-consuming modifications. We present conclusions from all three studies, including an inventory management decision framework for FPp and a framework for the application of FPp which encompasses a number of practical considerations.