Common Policy On Revenue Management. The Ato System Impact

Recently, many manufactures begin to apply Assemble-to-Order (ATO) manufacturing strategy in the increasingly competitive marketplace, where customer's demand is more individual. Base on the mass customization theory, ATO manufacturing strategy, as a new product and manage model, can meet the individual demands and reduce inventory costs. When products are customized, it leads to product variety. It makes enterprises feel that it is more complicated to manage product variety. Component commonality is one of the well-known tools. It can help enterprises in the ATO to lower the complexity of production, improve customization level and optimize inventory management.The change of production process makes enterprise to divert their attention from controlling stock to matching supply and demand. Revenue Management, as an effective tool in balancing supply/demand, has been widely used in service industry and achieved great success. It has also considerable potential for ATO manufacturing environments.This paper introduces Revenue Management into ATO manufacturing industry and combines operation management theory. From the ATO inventory model, we design an ATO revenue model under the production capability constrains. We study the characteristic of ATO manufacturing strategy and component commonality policy, and analysis the effects of different production structure and component allocation policies in increasing revenue and improving allocation efficiency.