From 'Engineering To Order' to 'Configure To Order'

Within the manufacturing industry, many companies still use an Engineering To Order (ETO) method. Each order is redesigned each time, a time-consuming and labour-intensive process. Many companies are switching to a Configure To Order (CTO) driven process.

Business impact

Customization as standard

By using a CTO process to develop your products modularly and offer them to your customers, you benefit from a number of advantages.

  • Reducing the lead time of your projects.
  • An error-free flow of information.
  • Can absorb peaks in production by pre-production of modules during quieter periods.
  • Reducing risks in projects because your products have a known quality in advance.
  • Reducing your project costs.
  • Your organization is Smart Industry proof.

Do you recognize these characteristics of 'Engineering To Order'?

Symptoms

Long lead times

When orders are based on the wishes of the customer, you are continuously in tune. Consultation between the customer, sales, and engineering about the correctness of the specifications and the design. And with the feedback back to the proverbial drawing board. This makes weeks fly by while production hasn't even started yet.

Symptoms

Slow quotation process

Because products are complex and knowledge is not secured, this makes for a complicated quotation process. This affects your entire supply chain. Wrong products are sold, which leads to unnecessary consultation and misunderstanding between Sales, Engineering and Production. In short, a lot of frustration internally and with your customer.

 

Symptoms

Little innovation

Engineers prefer to focus on innovation, but due to a continuous focus on customer orders, conscious innovation comes to a standstill. In addition to the long-term consequences for your competitive position, this has a direct effect on your growth, Smart Industry roll-out, and the job satisfaction of your engineers.

What benefits does 'Configure To Order' offer you

Advantages CTO

Short turnaround

Because product knowledge is fixed, engineering no longer needs to be involved in the sales process. Coordination between Sales and the customer is sufficient because they together configure a solution for the customer's needs. With the error-free quotation, bill of materials and drawing that follow from this, production can start immediately.

Advantages CTO

A clear process

Because the knowledge of your modular products is secured throughout the organization, Sales only sells products that Engineering and Production can make. Quotations for the most complex machines and installations are always correct. No more frustrations and delays in your process.

Advantages CTO

Time for innovation

Because order-driven engineering is kept to a minimum in a CTO process, Engineers can do what they are really good at, which is coming up with innovative solutions. There is now time and space to develop valuable products to achieve the long-term objectives of your organization.

The steps towards a CTO process

 

Modularization and standardization

By mapping the market requirements and the characteristics of your products, an overview is created of solutions that are interesting to supply. Standardizing on this does not mean that you limit yourself in your offer. On the contrary, all possible combinations of modules and dimensions create an almost infinite number of possible solutions.

The customer-specific final solution consists of a unique combination of standardized modules. As a result, you not only have control over the quality, costs, and delivery times of hardware, software, and electronics, but also control over the production systems.

Modulair

Configure quotes

When you have modularized your products, it is important that they are also offered to your customers in this way. Since the projects within the manufacturing industry are often complex, they require quite a lot of knowledge from Sales. As a result, organizations are less able to scale up, as this knowledge is difficult to transfer. By deploying a CPQ (Configure Price Quote) solution in your organization, you can unambiguously record knowledge. In this way, you tackle important bottlenecks, such as errors in orders, and you gain more control over the margins in your projects. CPQ reduces the time it takes to create an error-free quote from days to minutes.

Tacton CPQ

Technical product configurator

When Sales can configure quotations flawlessly, the next step is to also control production based on the configured model. By applying Design Automation (DA) through a product configurator, the drawings, parts lists, and accompanying documents are automatically generated on the basis of the quotation. In this way, your process is controlled quickly, unambiguously, and error-free without the intervention of Engineering. Engineering thus has the time and space to work on innovations that will take your organization further.

Design automation

From ETO to CTO by organizing these processes

Variant & alternative part mngt

Control over product structures

Configure Price Quote

Feed logistics and administrative processes from your bill of materials

Information in PDM and ERP overlaps. Integration between both systems increases the Return on Investment.

Design Automation

Access to the right data at the right time

To work successfully with multiple people, it is crucial that everyone has the right data at the right time.

Discover how to harness the full potential of your manufacturing company

Let a Cadmes expert take a closer look at your business processes and:

  • Significantly shorten your lead time

  • Get more done with existing capacity

  • Increase your profits and achieve healthy growth


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