Abstract
Product modularity can be considered as a product design strategy. It provides many benefits for companies that adapt it. However, there is little empirical evidence to support such an expectation. This study aims to measure the effects of product modularity on the efficiency and productivity of the product engineering area of a bus manufacturer. To reach the proposed objective, a longitudinal case study was conducted on the product engineering department of a company covering a period of three consecutive years. We used Data Envelopment Analysis (DEA) combined with Mann–Whitney U test and Malmquist index. The results show an increase of 18.40% in the efficiency indexes of the company’s products engineering. In addition, positive changes can be observed, that is, there was a 63.50% increase in Total Factor Productivity Index (TFPI). The improvements are attributed to the implementation of product modularity in the organization under study. In this sense, the main contribution of this paper to the field is to present the increment of productivity with the insertion of the product modularity in the product engineering in a bus manufacturing company. Thus, product modularity can be considered a technology that increases the Total Factor Productivity Index (TPFI) of the companies that use it.
Similar content being viewed by others
References
Ahn YH, Min H (2014) Evaluating the multi-period operating efficiency of international airports using data envelopment analysis and the Malmquist productivity index. J Air Transp Manag 39:12–22
Antonio KWL, Yam RCM, Tang E (2007) The impacts of product modularity on competitive capabilities and performance: an empirical study. Int J Prod Econ 105:1–20. https://doi.org/10.1016/j.ijpe.2006.02.002
Antonio KWL, Richard CMY, Tang E (2009) The complementarity of internal integration and product modularity: an empirical study of their interaction effect on competitive capabilities. J Eng Technol Manag 26:305–326. https://doi.org/10.1016/j.jengtecman.2009.10.005
Aparicio J, Garcia-Nove EM, Kapelko M, Pastor JT (2016) Graph productivity change measure using the least distance to the pareto-efficient frontier in data envelopment analysis. Omega 72:1–14. https://doi.org/10.1016/j.omega.2016.10.005
Asan U, Polat S, Serdar S (2004) An integrated method for designing modular products. J Manuf Technol Manag 15:29–49. https://doi.org/10.1108/09576060410512257
Baldwin CY, Clark KB (1997) Managing in an age of modularity. Harv Bus Rev September
Baldwin CY, Clark KB (2000) Design rules: the power of modularity. MIT Press, Cambridge
Barbosa LM, Lacerda DP, Piran FAS, Dresch A (2017) Exploratory analysis of the variables prevailing on the effects of product modularization on production volume and efficiency. Int J Prod Econ 193:677–690. https://doi.org/10.1016/j.ijpe.2017.08.028
Barratt M, Choi TY, Li M (2011) Qualitative case studies in operations management: trends, research outcomes, and future research implications. J Oper Manag 29:329–342. https://doi.org/10.1016/j.jom.2010.06.002
Boer HE (2014) Product, Organizational, and Performance Effects of Product Modularity. In: Proceedings of the 7th World conference on mass customization, personalization, and co-creation (MCPC 2014). Springer International Publishing, Aalborg, Denmark, pp 449–460
Cabigiosu A, Zirpoli F, Camuffo A (2013) Modularity, interfaces definition and the integration of external sources of innovation in the automotive industry. Res Policy 42:662–675
Campagnolo D, Camuffo A (2009) What really drives the adoption of modular organizational forms? an institutional perspective from Italian industry-level data. Ind Innov 16:291–314
Caves DW, Christensen LR, Diewert W (1982) The economic theory of index numbers and the measurement of input, output, and productivity. Econometrica 50:1393–1414
Chakravarty AK, Balakrishnan N (2007) Achieving product variety through optimal choice of module variations. IIE Trans (Institute Ind Eng) 33:587–598. https://doi.org/10.1023/A:1010896517590
Chandra P, Cooper WW, Li S, Rahman A (1998) Using DEA to evaluate 29 Canadian textile companies—considering returns to scale. Int J Prod Econ 54:129–141
Charnes A, Cooper WW, Rhodes E (1978) Measuring the efficiency of decision making units. Eur J Oper Res 2:429–444
Cook W, Seiford L (2009) Data envelopment analysis (DEA) –Thirty years on. Eur J Oper Res 192:1–17
Cook W, Tone K, Zhu J (2014) Data envelopment analysis: prior to choosing a model. Omega 44:1–4
Cummins JD, Weiss MA (2012) Analyzing firm performance in the insurance industry using frontier efficiency and productivity methods. In: Dionne G (ed) Handbook of insurance economics. Kluwer Academic Publishers, Boston, pp 1–79
Danese P, Filippini R (2010) Modularity and impact on new product development time performance. Int J Oper Prod Manag 30:1191–1209
Danese P, Filippini R (2013) Direct and mediated effects of product modularity on development time and product performance. IEEE Trans Eng Manag 60:260–271
Dubé L, Paré G (2003) Rigor in information systems positivist case research: current practices, trends, and recommendations. Mis Q 27:597–636
Duzakin E, Duzakin H (2007) Measuring the performance of manufacturing firms with super slacks based model of data envelopment analysis: an application of 500 major industrial enterprises in Turkey. Eur J Oper Res 182:1412–1432
Eidelwein F, Piran FAS, Lacerda DP et al (2018) Exploratory analysis of modularization strategy based on the theory of constraints thinking process. Glob J Flex Syst Manag 19:111–122. https://doi.org/10.1007/s40171-017-0177-1
Engel A, Reich Y (2015) Advancing architecture options theory: six industrial case studies. Syst Eng 18:396–414. https://doi.org/10.1002/sys.21312
Engel A, Browning TR, Reich Y (2017) Designing products for adaptability: insights from four industrial cases. Decis Sci 48:875–917. https://doi.org/10.1111/deci.12254
Feng T, Zhang F (2013) The impact of modular assembly on supply chain. Prod Oper Manag. https://doi.org/10.1111/poms.12182
Fine CH, Golany B, Naseraldin H (2005) Modeling tradeoffs in three-dimensional concurrent engineering: a goal programming approach. J Oper Manag 23:389–403. https://doi.org/10.1016/j.jom.2004.09.005
Frandsen T (2017) Evolution of modularity literature: a 25-year bibliometric analysis. Int J Oper Prod Manag 37:703–747. https://doi.org/10.1108/IJOPM-06-2015-0366
Gärtner C, Schön O (2016) J Strateg Manag 9:39–57. https://doi.org/10.1108/MRR-09-2015-0216
Gilsa CV, Lacerda DP, Camargo LFR, Cassel RA (2017) Longitudinal evaluation of efficiency in a petrochemical company. Benchmarking An Int J 24:1786–1813
Hamdan A, Rogers KJJ (2008) Evaluating the efficiency of 3PL logistics operations. Int J Prod Econ 113:235–244. https://doi.org/10.1016/j.ijpe.2007.05.019
Iyer A, Saranga H, Seshadri S (2013) Effect of quality management systems and total quality management on productivity before and after: empirical evidence from the Indian auto component industry. Prod Oper Manag 22:283–301. https://doi.org/10.1111/poms.12000
Jacobs M, Droge C, Vickery SK, Calantone R (2011) Product and process modularity’s effects on manufacturing agility and firm growth performance. J Prod Innov Manag 28:123–137
Jain S, Triantis KP, Liu S (2011) Manufacturing performance measurement and target setting: a data envelopment analysis approach q. Eur J Oper Res 214:616–626. https://doi.org/10.1016/j.ejor.2011.05.028
Joneja A, Lee N (2007) A modular, parametric vibratory feeder: a case study for flexible assembly tools for mass customization. IEEE Trans 30:923–931
Krishnan V, Ramachandran K (2011) Integrated product architecture and pricing for managing sequential innovation. Manage Sci 57:2040–2053
Leary-kelly SWO, Vokurka RJ (1998) The empirical assessment of construct validity. J Oper Manag 16:387–405
Lee H, Kim C (2014) Benchmarking of service quality with data envelopment analysis. Expert Syst Appl 41:3761–3768. https://doi.org/10.1016/j.eswa.2013.12.008
Lin Y, Ma S, Zhou L (2012) Manufacturing strategies for time based competitive advantages. Ind Manag Data Syst 112:729–747. https://doi.org/10.1108/02635571211232299
Liu JS, Lu LYY, Lu W, Lin BJY (2013) Data envelopment analysis 1978–2010: a citation-based literature survey. Omega 41:3–15. https://doi.org/10.1016/j.omega.2010.12.006
Løkkegaard M, Mortensen NH, McAloone TC (2016) Towards a framework for modular service design synthesis. Res Eng Des 27:237–249. https://doi.org/10.1007/s00163-016-0215-6
Macduffie JP (2013) Modularity-as-property, modularization-as-process, and ‘Modularity’-as-frame: lessons from product architecture initiatives in the global automotive industry. Glob Strateg J 3:8–40
Malmquist S (1953) Index number and indifference surfaces. Trab Estad Investig Oper 4:209–242
Martínez-Murcia FJ, Górriz JM, Ramírez J et al (2012) Computer aided diagnosis tool for Alzheimer’s disease based on Mann–Whitney–Wilcoxon U Test. Expert Syst Appl 39:9676–9685. https://doi.org/10.1016/j.eswa.2012.02.153
Matsubara K, Pourmohammadi H (2010) Modular vehicle production method for improved efficiency, quality, and environmental responsibility. Rev Bus Res 10:127–132
Napper R (2014) Modular route bus design—a method of meeting transport operation and vehicle manufacturing requirements. Transp Res Part A 38:56–72. https://doi.org/10.1016/j.trc.2013.11.002
Örkcü HH, Balıkçı C, Dogan MI, Genç A (2016) An evaluation of the operational efficiency of turkish airports using data envelopment analysis and the Malmquist productivity index: 2009–2014 case. Transp Policy 48:92–104
Palencia AER, Delagadillo GEM (2012) A computer application for a bus body assembly line using Genetic Algorithms. Int J Prod Econ 140:431–438. https://doi.org/10.1016/j.ijpe.2012.06.026
Pandremenos J, Paralikas J, Salonitis G, Chryssolouris J (2009) Modularity concepts for the automative industry: a critical review. CIRP J Manuf Sci Technol 1:148–152
Park J, Lee D, Zhu J (2014) An integrated approach for ship block manufacturing process performance evaluation: case from a Korean shipbuilding company. Int J Prod Econ 156:214–222. https://doi.org/10.1016/j.ijpe.2014.06.012
Patel PC, Jayaram J (2014) The antecedents and consequences of product variety in new ventures: an empirical study. J Oper Manag 32:34–50. https://doi.org/10.1016/j.jom.2013.07.002
Perona M, Miragliotta G (2004) Complexity management and supply chain performance assessment. A field study and a conceptual framework. Int J Prod Econ 90:103–115
Persson M, Åhlström P (2006) Managerial issues in modularising complex products. Technovation 26:1201–1209. https://doi.org/10.1016/j.technovation.2005.09.020
Piran FAS, Lacerda DP, Antunes JAV et al (2016a) Modularization strategy: analysis of published articles on production and operations management (1999 to 2013). Int J Adv Manuf Technol. https://doi.org/10.1007/s00170-015-8221-9
Piran FAS, Lacerda DP, Camargo LFR et al (2016b) Product modularity and its effects on the production process: an analysis in a bus manufacturer. Int J Adv Manuf Technol 84:1–15. https://doi.org/10.1007/s00170-016-8906-8
Piran FAS, Lacerda DP, Camargo LFR et al (2016c) Product modularization and effects on efficiency: an analysis of a bus manufacturer using data envelopment analysis (DEA). Int J Prod Econ 182:1–13. https://doi.org/10.1016/j.ijpe.2016.08.008
Salvador F (2007) Toward a product system modularity construct: literature review and reconceptualization. Eng Manag IEEE Trans 54:219–240
Salvador F, Forza C, Rungtusanatham M (2002) Modularity, product variety, production volume, and component sourcing: theorizing beyond generic prescriptions. J Oper Manag 20:549–575. https://doi.org/10.1016/S0272-6963(02)00027-X
Shammari M (1999) Optimization modeling for estimating and enhancing relative efficiency with application to industrial companies. Eur J Oper Res 115:488–496
Song Z, Kusiak A (2010) Mining Pareto-optimal modules for delayed product differentiation. Eur J Oper Res 201:123–128. https://doi.org/10.1016/j.ejor.2009.02.013
Starr MK (1965) Modular Production: a new concept. Harv Bus Rev 3:131–142
Starr MK (1975) There is a productivity problem in the world. Perspectives (Montclair) 3:6–7
Starr MK (2010) Modular production: a 45-year-old concept. Int J Oper Prod Manag 30:7–19
Sushandoyo D, Magnusson T (2012) A two-way relationship between multi-level technological change and organisational characteristics-cases involving the development of heavy hybrid buses. Technovation 32:477–486. https://doi.org/10.1016/j.technovation.2012.05.002
Telles ES, Lacerda DP, Morandi MIWM, Piran FAS (2019) Drum-buffer-rope in an engineering-to-order system: an analysis of an aerospace manufacturer using data envelopment analysis (DEA). Int J Prod Econ. https://doi.org/10.1016/j.ijpe.2019.09.021(in press)
Trappey A, Chiang T (2008) A DEA benchmarking methodology for project planning and management of new product development under decentralized profit-center business model. Adv Eng Inform 22:438–444
Vickery SK, Bolumole YA, Castel MJ, Calantone RJ (2015a) The effects of product modularity on launch speed. Int J Prod Res 53:5369–5381
Vickery SK, Koufteros X, Dröge C, Calantone R (2015b) Product modularity, process modularity, and new product introduction performance: does complexity matter? Prod Oper Manag 25:751–770
Voss C, Tsikriktsis N, Frohlich M (2002) Case research in operations management. Int J Oper Prod Manag 22:195–219
Worren N, Moore K, Cardona P (2002) Modularituy, strategic flexibility, and firm performance: a study of the home appliance industry. Strateg Manag J 23:1123–1140. https://doi.org/10.1002/smj.276
Zhu J (2000) Multi-factor performance measure model with an application to Fortune 500 companies. Eur J Oper Res 123:105–124
Author information
Authors and Affiliations
Corresponding author
Additional information
Publisher's Note
Springer Nature remains neutral with regard to jurisdictional claims in published maps and institutional affiliations.
Appendix
Appendix
See Table 11 in Appendix.
Rights and permissions
About this article
Cite this article
Piran, F.A.S., Lacerda, D.P., Camargo, L.F.R. et al. Effects of product modularity on productivity: an analysis using data envelopment analysis and Malmquist index. Res Eng Design 31, 143–156 (2020). https://doi.org/10.1007/s00163-019-00327-3
Received:
Revised:
Accepted:
Published:
Issue Date:
DOI: https://doi.org/10.1007/s00163-019-00327-3