Logic-Based Configurator on the Web, Term Paper

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Total Length: 960 words ( 3 double-spaced pages)

Total Sources: 1

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deal size by customer

Sales

Order cycle time

Order cycle times reduction of 65% or more recorded with mftrs contacted

Cost of Sales

Days Sales Outstanding reduction from 60 to 29 days on average

Cross-sell and up-sell revenue

Increase of 33% on aggregate

Average sales price per order

Increase from 9% to 26%

Quote and Order

Average costs to complete an order

95% reduction in cost per order

Special Pricing Requests

Over 100% ROI on automating Special Pricing Requests

Bad or incomplete orders

Incomplete order reductions of 20%

Customer Service

Number of customer complaints

98% reduction in cost of simple requests

Revenue lost to churn

60% when cross-selling is used with quote-to-order

Number of calls on order status

Median level of 500 per week to 70

Warranty and Returns

Reduction in warranty cost on customized products

10% reduction at a minimum

Labor cost reductions

Decrease order re-work from 15% to 2%

Future Research

What is most lacking in the article however is a progression of where their research could be applied throughout the complexity levels of mass customization. The graphic below based on analysis from Columbus (2003) shows the varying levels of mass customization with color gradations applied to the definition of guided selling, quote-to-order or sales configuration, and product configuration.

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The message of this chart is that constraint-based engines can scale from the most simplistic (Assemble to Order) functions to the most complex (Engineer-to-Order) through the more exhaustive and extensive use of constraint logic in conjunction with an order state engine to track progress of nested configurations.

Enhancements to Readers' Knowledge

The article reviewed adds to the knowledge of readers interested in the progression of constraint-based configurators relative to their rules-based counterparts, and also provides a good foundation for seeing how telecommunications systems drove the development of nested configuration logic. The reader also get a good sense of where the authors see the growth trajectories of these technologies moving more into transactional workflows (they were right) and the need to have greater integration at the knowledge management level (also correct). The authors could have brought in more of the aspects of the use of the evolutionary role of rules-based configurators to the role of catalog and content management, which became the basis of guided selling and assemble-to-order, which led to the revolution in e-commerce mass customization......

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