A Group presentation:


SAMEER BHATIA 09EP-
036
SMITA NAHATA
09EP-047
VIVEK MOHAN 09EP-
054

Theme of the case
BMW the company
Business Environment
Mass Customization as a concept
Mass Customization at BMW (I.C.)
Relaunch of I.C. program
Recommendations
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Individual Collection program at

BMW (I.C.)
Corporate measures.
Retailers
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 BMW Canada
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ØEstablished in 1986.
Ø Canada operations divided into three
regions

North American Automotive

industry
ØCompetition from foreign manufacturers
ØWTO
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Mass customization refers to production
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of personalized or custom tailored
 goods or services to meet consumer's

diverse and changing needs at near mass
production prices.

It is a customer co-design process

which meet the needs of each individual
customer with regard to certain product
features.
 
 Middle Ages : Craft Production
  
 
18 th Century : Mass Production
üIndustrial Revolution

üProduction in large Volumes
üRequired Low variety and Standard products
 üEconomies of Scales
 1970 - 80 : Customization
üIncreasing Competition
üNeed for Competitive Advantage
üEmphasis on variety led to customization
1980 - 90 : Mass Customization
üInformation Revolution and Globalization
üNo distinct difference between competing rivals
üPrices slashed down by Japanese manufactures due to Lean
Manufacturing
üDifferentiation all the more important
üTailor Made Products
üEconomies of Scope

1)customization relates to changing, assembling or
 modifying product or service components
according to customers' needs and desires.


2)
3)Personalization involves intense communication and
interaction between the customer and supplier.

4)
5)Personalization in general is about selecting or
filtering information objects for an individual
by using information from the customer profile
and then negotiating the selection with the
individual.

6)
7)Customization compares to co- design and co-creation
whereas personalization compares strongly to
 The Four Faces of Mass Customization –


 1. Collaborative Customization:
Consumer and producer engage in a dialogue
 to determine customer requirements.
E.g. Computers, clothing and footwear,
furniture, some services
2. Adaptive Customization:
Product is designed so that users can alter
it themselves to fit unique requirements on
different occasions.
E.g. High-end office chairs, R7 golf club,
certain electronic devices
 3. Cosmetic Customization:

Product is unique in appearance only.
 E.g. Customer’s chosen text or image on T-
shirts, mouse mats, baseball caps, mugs.

4. Transparent Customization:
Producer provides customized product
without consumer being necessarily being
aware that it has been customized.
Can be used when consumer’s needs are
predictable or can be easily deduced, and
when customers do not want their
requirements repeated.
E.g. Repeat orders for customized clothing,
chemicals
Integrated Information System
Flexible Manufacturing System
(Build-To-Order)
Sophisticated Order Management
Mass Customization Mentality of
each Employee.




Advantage to company
 vLess Inventory parked with
dealer.
vCustomer Satisfaction.
vHuge sales.
Advantage to customers
vCars as per their requirement.
vSatisfying ego.
 

Time taken for an order to

process.
Integrated customer preference.


Intensive focus on Supply Chain

Mgmt.
Changing customer needs.
Dependence on the suppliers.
Different scheduling program.
Having a proper assembly line.

 Individual Collection program.
q Exterior
q Interior
q Combination

CRM at BMW-Build Your Own Car.

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First time Offer in the Market.
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Strong Internal & retail support
at Launch.
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Separate Product planning

department.
Segmentation: Top-end variants
only.

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Stringent
retailer requirements.
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No Incentives for retailers.
Huge investments in setting up


company owned showrooms.

Lackadaisical approach of the
management.
Absence of training of retailers.
Appeal to only very select portion
of customer base.

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 
Why?
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 üBrand Building benefits

üExclusivity

üCompetitive advantage against rivals
How?
üParticipation of company in collaboration with
retailers.
üEmphasis on training of employees.
üIncentive scheme for retailers.
üMonitoring retailer’s focus on I.C.
üDevice a marketing communication plan to build
excitement .


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Open Innovation technique.



Customer integration.
Use of CRM to target customers

&
move him upward in customer
pyramid.
BMW relationship managers at
retail outlets.
Relaxing the terms of agreement
with retailers.

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