A Study On The Impact Of Component Commonality On Product Delivery Time Compression In ATO

With the development of technology and intensifying of market competition, the rapidly change of customer demands and the requirement of quick-response become urgent. This trend leads to that companies chase after satisfying variety of demands in shorter delivery time. Many advanced production technology and management theory including ATO (Assemble-to-order) have been implied to reach the goal. In ATO environment, component commonality is prevalent for its character of the flexibility in function to decrease the variety of design and production and for the potential of leading to delivery time reduction. Theoretical literature and empirical evidences show that component sharing in ATO has attracted extremely attention. Therefore, it makes great sense to study on the economical and effective performance of product delivery time compression by using component commonality in ATO.This thesis analyzed the structure of product delivery time in ATO environment, based on which a simplified formula was proposed to calculate the expected value. And then two analytical models were built from two aspects to study the main impact of component commonality on product assembly waiting time on the base of the formula. Expected product delivery time was structured to be an objective function in the first model with the component lead time and reorder quantity as decision variables and the operation cost of product assembly manufacturer subjected to the budget. The optimal solutions under two kinds of different product configuration (with or without sharing component) were compared to discuss the effect of using component commonality in shortening product delivery time. The optimization formulation in the second model was made to calculate the total operation cost of product manufacturer in the case that the crashing cost of component lead time reduction was sharing both by component supplier and product manufacturer. With decision variables of component lead time and reorder quantity as well as the first model, the impact of component commonality on the optimal operation cost and product delivery time was discussed as the sharing fraction of crashing cost changed by product manufacturer. Through the analytical solution comparison and chart examination, some conclusion about the economical and valid performance of component commonality on product delivery time compression has been advanced.