An experimental study for the selection of modules and facilities in a mass customization context

To design an efficient product family, designers have to anticipate the production process and, more generally, the supply chain costs. But this is a difficult problem, and designers often propose a solution which is subsequently evaluated in terms of logistical costs. This paper presents a design problem in which the product and the supply chain design are considered at the same time. It consists in selecting a set of modules that will be manufactured at distant facilities and then shipped to a plant close to the market for final, customized assembly under time constraints. The goal is to obtain the bill of materials for all the items in the product family, each of which is made up of a set of modules, and specifying the location where these modules will be built, in order to minimize the total production costs for the supply chain. The objective of the study is to analyze both, for small instances, the impact of the costs (fixed and variable) on the optimal solutions, and to compare an integrated approach minimizing the total cost in one model with a two-phases approach in which the decisions relating to the design of the products and the allocation of modules to distant sites are made separately.