Mass customization (MC) is considered to be an important competitive tool to increase the performance of manufacturers. Due to the importance of MC as part of the manufacturing process, there is an increasing amount of research devoted to exploring the nature of MC and how to effectively implement MC processes. Based on the theory of complementary assets, this study investigates the relationships between different MC practices and the effects of these practices on the firm's financial performance.
Mass customization systems: complementarities and performance consequences
The adoption of mass customization (MC) requires that manufacturers apply a variety of technologies and practices to develop an integrated manufacturing system that provides a high volume of products for a relatively large market without substantial trade-offs in costs, delivery times, or quality (Pine 1993 Pine, B. J. 1993. Mass Customization: The New Frontier in Business Competition. Boston, MA: Harvard Business School Press.; Tseng and Jiao 2001 Tseng, M. M., and J. Jiao. 2001. Mass Customization. In Handbook of Industrial Engineering: Technology and Operations Management, edited by Graviel Salvendy, 3rd ed, 684-709. New York: Wiley. Tu, Vonderembse, and Ragu-Nathan 2001 Tu, Q., M. A. Vonderembse, and T. S. Ragu-Nathan. 2001. "The Impact of Time-based Manufacturing Practices on Mass Customization and Value to Customer." Journal of Operations Management 19 (2): 201-217. doi: 10.1016/S0272-6963(00)00056-5). One of the distinguishing features of MC is that it enables manufacturers to match their offerings to the rapidly changing economic environment, which is characterized by heterogeneity of customer demands, acceleration of new product developments and shortened product life cycles (Alfnes and Strandhagen 2000 Alfnes, E., and J. O. Strandhagen. 2000. "Enterprise Design for Mass Customization: The Control Model Methodology." International Journal of Logistics: Research and Applications 3 (2): 111-125. doi: 10.1080/713682750; Tu, Vonderembse, and Ragu-Nathan 2001 Tu, Q., M. A. Vonderembse, and T. S. Ragu-Nathan. 2001. "The Impact of Time-based Manufacturing Practices on Mass Customization and Value to Customer." Journal of Operations Management 19 (2): 201-217. doi: 10.1016/S0272-6963(00)00056-5, Lai et al. 2012 Lai, F., M. Zhang, D. M. S. Lee, and X. Zhao. 2012. "The Impact of Supply Chain Integration on Mass Customization Capability: An Extended Resource-based View." IEEE Transactions on Engineering Management 59 (3): 443-456. doi: 10.1109/TEM.2012.2189009). MC also enables manufacturers to provide customized solutions in innovative ways, resulting in an increase in the firm's performance (van Hoek and Weken 1998 van Hoek, R. I., and H. A. M. Weken. 1998. "How Modular Production can Contribute to Integration in Inbound and Outbound Logistics." International Journal of Logistics Research and Applications 1 (1): 39-55. doi: 10.1080/13675569808962037; Da Silveira, Borenstein, and Fogliatto 2001 Da Silveira, G. J. C., D. Borenstein, and F. S. Fogliatto. 2001. "Mass Customization: Literature Review and Research Directions." International Journal of Production Economics 72 (1): 1-13. doi: 10.1016/S0925-5273(00)00079-7; Zhang, Qi, and Zhao 2011 Zhang, M., Y. Qi, and X. Zhao. 2011. "The Impact of Mass Customization Practices on Performances: An Exploratory Study of Chinese Manufacturers." International Journal of Mass Customization 4 (1/2): 44-66. doi: 10.1504/IJMASSC.2011.042959; Liu, Shah, and Babakus 2012 Liu, G., R. Shah, and E. Babakus. 2012. "When to Mass Customize: The Impact of Environmental Uncertainty." Decision Sciences 43 (5): 851-887. doi: 10.1111/j.1540-5915.2012.00374.x). The complexity and variety associated with MC require that manufacturers develop an integrated system with unique operational capabilities to align manufacturing with customer needs (Zipkin 2001 Zipkin, P. 2001. "The Limits of Mass Customization." MIT Sloan Management Review 42 (3): 81-87; Salvador, de Holan, and Piller 2009 Salvador, F., P. M. de Holan, and F. T. Piller. 2009. "Cracking the Code of Mass Customization." MIT Sloan Management Review 50 (3): 71-78). Given this fact, inefficient operations are generally viewed as a significant hindrance to successful MC implementation (Rungtusanatham and Salvador 2008 Rungtusanatham, M. J., and F. Salvador. 2008. "From Mass Production to Mass Customization: Hindrance Factors, Structural Inertia, and Transition Hazard." Production and Operations Management 17 (3): 385-396. doi: 10.3401/poms.1080.0025; Salvador, de Holan, and Piller 2009 Salvador, F., P. M. de Holan, and F. T. Piller. 2009. "Cracking the Code of Mass Customization." MIT Sloan Management Review 50 (3): 71-78.).