Product Line Flexibility for Agile and Adaptable Operations

• 成果类型: Article
• 署名作者: Yayla-Kullu, H. Muge; Ryan, Jennifer K.; Swaminathan, Jayashankar M.
• 署名单位: State University System of Florida; University of Central Florida; University of Nebraska System; University of Nebraska Lincoln; University of North Carolina; University of North Carolina Chapel Hill
• 刊物名称: PRODUCTION AND OPERATIONS MANAGEMENT
• ISSN/ISSBN: 1059-1478
• DOI: 10.1111/poms.13313
• 发表日期: 2021
• 页码: 725-737
• 关键词: Product line design; willingness‐ to‐ pay uncertainty; ADAPTABILITY; agility; Postponement

摘要

Firms increasingly need to manage uncertainty and become more agile and adaptable. This study considers how a multi-product firm can use its product mix, resource capacity allocation, and pricing decisions to manage challenges such as structural economic shifts or changes in consumers' willingness-to-pay. Firms that seek to develop and use such a product line face a fundamental trade-off. On the one hand, multiple products compete for the demand externally (i.e., cannibalization effects), as well as for the limited resource capacity internally. On the other hand, a multi-product firm does have the ability to change the product mix and to adjust the production quantity and pricing of each product in order to manipulate supply and demand as conditions change. In this study, we demonstrate that a multi-product firm can become more agile and adaptable under consumer purchasing behavior uncertainty by employing postponement in product mix, quantity, and pricing decisions, and by allocating capacities appropriately. In particular, we show that a firm can use its product line flexibility to make strategic adjustments after understanding the realized economic conditions, and to decide whether to follow a focus or segmentation strategy. We also extend the model to look at the value of resource flexibility and find that it has little or no benefit above and beyond the product line flexibility studied here.