CTO is the acronym for Configure to Order. In a nutshell, configure to order is the process of configuring a product or service to meet the specific needs of a customer. This could be something as simple as choosing the color of a product or selecting the features that will be included in a service. All this without the drawback of diversity for the supplying organisation.
There are many benefits of using configure to order, both for companies and for customers. Companies can benefit from improved quality, reduced development costs, and reduced production time. Customers can benefit from having a product that is tailored to their specific needs and preferences.
As you can see, there are many benefits of using configure to order, both for companies and customers. If you are not currently using this approach in your business, we hope that this blog has inspired you to give it a try!f
Some benefits addressed in this course
- Managing High Customer Diversity
One of the challenges that companies face is managing high customer diversity. This means that there are many different types of customers with different needs and preferences. Configure to order helps companies to manage this diversity by allowing them to create products and services that are customized for each individual customer. This way, every customer feels like they are getting exactly what they want, instead of feeling like they have to settle for a one-size-fits-all solution.
- Overcoming Engineering Shortage
Another challenge that companies face is finding enough engineers to design and develop all of the different products and services that they offer. By using configure to order, companies can overcome this engineering shortage by designing modular products and services that can be easily configured to meet the needs of each individual customer. This way, far fewer engineers are needed to design and develop a large number of different products and services.
- Stock Reduction
Another benefit of using configure to order is stock reduction. This means that because each product is configured from standard and diversity modules, there is no need to keep large inventories of finished products on hand. This reduces storage costs and helps to free up cash flow so that it can be used for other purposes.
- Delivery Time Reduction
Another benefit of using configure to order is delivery time reduction. This means that because each product is based on a majority of standard modules, most of the manufacturing can be done without knowing the exact customers specification. This helps to improve customer satisfaction by ensuring that they receive their products sooner after ordering.
- And quite a few others
You will find quite a few others addressed in this course