Cost-benefit ratio of the diversity of variants: As much as necessary and as little as possible

Growth, new markets, intensified competition, innovations and a dynamic market environment are usually accompanied by an increase in product diversity. As long as this growth continues, additional variants and product line components can guarantee a positive earnings situation. However, as soon as market conditions change, larger product ranges can increasingly become a burden. It is important to distinguish profitable product diversity from loss-making product diversity. The following key questions are in the focus here:

  • Which products cause which effort in order processing?
  • At what level does the cost of additional product variety exceed the benefit?
  • How much are the true costs of additional variety?
  • How many variants do we have and are these precisely adjusted to the market requirements?
  • Is there a consistently implemented product launch and product phase-out scenario (release management)?
  • Are our product architecture and variety of parts well enough prepared for changing market requirements?
  • Which trends and requirements can already be identified on the market and how do they affect our future product and parts diversity?
  • How do I efficiently organize order processing for standard and special products (configurator or separate order-related)?

As the market leader in the field of Complexity Management, we turn our mostly software-based methods into successes quickly and precisely. By using our Complexity Manager software we are a highly efficient partner for our clients. Depending on the operational scope, we achieve with our clients up to

  • 30 % higher profitability
  • 13 % lower order processing costs
  • 25 % faster lead times
  • 10 % lower tool costs

A selection of the tools used

Planning and control of the product portfolio
Planning and control of the product portfolio

Planning and control of the product portfolio

Further information

  • 13.03.2020
    2 min.
    Variantenvielfalt
    Variantenvielfalt

    26.07.2019
    15 min.
    Journal - Ausgabe 1/2019
    Journal - Ausgabe 1/2019

    09.03.2016
    10 min.
    Beherrschen Sie Ihre Produktkomplexität
    Beherrschen Sie Ihre Produktkomplexität


    • What amount of data really needs to be entered in the variant configurator?


      Electric engines are used in the most diverse applications. A mid-sized company had to plan and control a correspondingly high variance. It was decided to use a variant configurator. This requires data, rules and information on which variants to configure. After all the possible variants that the market might need were to be entered there first, it was realized that the effort involved would be too high. Using the Complexity Manager, it was quickly determined that with just under 30% of the total variance, a good 90% of the sales volume had already been achieved and only half of the part numbers were needed for this ("optimal variance"). The data volume of the configurator was thus determined. For more unusual variants a different order processing process was chosen.

    • Complexity cost quick check to raise awareness


      The question of the benefits of dealing with variant diversity and the effects of removing variants from the range is an issue that is relevant to many projects. A manufacturer in the print machine industry, for example, also asked himself this question. Facts were needed to demonstrate the importance of the topic of variant management to all those involved. With the help of a complexity cost quick check, it was possible to quickly show, by asking specific questions, which expenses could be avoided in the case of variant planning and which could be saved in the case of variant adjustment. The need for action was identified and implemented in detail in a follow-up project.

    • Nothing is as constant as change, but how does it affect us?


      A mid-sized company from the mechanical and plant engineering sector developed and produced numerous variants for its customers. Due to frequently changing customer demands and market requirements, problems arose in the production process and component manufacturing. By means of the variant driver analysis with the Complexity Manager, a direct connection between the component variety and the external requirements could be established. As a result, it is now possible to identify which components will be subject to frequent changes in the future, which will be less frequent and which may never be. The change profile of the market could thus be harmonized with that of production and lead to significant savings in processing.

    • Complexity Manager (Software for market-oriented planning and control of the diversity of variants)
    • Variant Mode and Effects Analysis (VMEA)
    • Product-related complexity cost calculation
    • Target price evaluation
    • Release Management
    • Product-Lifecycle-Management (PLM)

Contact

Klaus D. Schopf
+49 241 51031 0
klaus.schopf@schuh-group.com


Back