Title: A case of cost estimation in an engineer-to-order company moving towards mass customisation

Authors: Thomas Ditlev Brunoe; Peter Nielsen

Addresses: Department of Mechanical and Manufacturing Engineering, Aalborg University, Fibigerstraede 16, DK-9220 Aalborg East, Denmark. ' Department of Mechanical and Manufacturing Engineering, Aalborg University, Fibigerstraede 16, DK-9220 Aalborg East, Denmark

Abstract: Engineer-to-order companies have a tremendous product variety compared to mass produced or even mass customised products, implying high costs in both business and production processes. In recent years however some engineer-to-order companies have acknowledged the great potential in applying principles and methods from mass customisation to reduce the cost of variety, including modularisation, product configuration and process automation. This paper presents a case study of applying a statistical method for cost estimation for quotation purposes in an engineer-to-order environment, where cost estimation can be resource intensive and time consuming. The method finds cost critical parameters within a product family. The potential benefits from applying the method includes: simplifying the quotation process and reducing the resources needed to issue a quotation. However, due to the nature of the method consistent data quality and substantial historical data are required.

Keywords: engineer to order; mass customisation; product configuration; cost estimation; product families; quotation process; data quality; historical data.

DOI: 10.1504/IJMASSC.2012.047400

International Journal of Mass Customisation, 2012 Vol.4 No.3/4, pp.239 - 254

Available online: 18 Jun 2012 *

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