Date: 24 Apr 2008

From mass customization to mass personalization: a strategic transformation

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Abstract

Business and operations strategists have long sought to formulate strategies that would serve profitably for a market of one. Two decades after its conception, there is growing evidence that mass customization strategy is transforming into a mass personalization strategy, making the market of one a reality, at least in select industries. The degree of transformation of a company depends on the extent to which its product is soft, i.e., can be produced electronically. Thus, at the lower end of the personalization spectrum are manufacturing companies engaged in producing hard, configurable products, while on the high end of the spectrum are service companies whose product can be totally configured and delivered electronically. The underlying factors that are enabling this transformation, in our view, are: (1) development of information technologies such as peer to peer (P2P), business to consumer (B2C), and Web 2.0, (2) near-universal availability of the Internet, (3) customer willingness and preparedness to be integrated into the process of product co-design and co-creation, (4) modern manufacturing systems, such as flexible manufacturing and, of course, (5) mass customization tools such as modularity and delayed differentiation, which help reduce manufacturing cost and cycle times and (6) deployment of customer-satisfaction-specific software called customer relationship management (CRM) to engender customer retention. Due to the importance and strategic success of affordable personalization, this issue is dedicated to that theme. The articles included in this issue would, I believe, serve as significant decision support mechanisms for companies pursuing a mass customization and personalization strategy. In addition to providing a brief perspective on articles included in this issue, we also summarize the state of the art of mass customization research.