From Mass Production to Mass Personalization
Since the earliest artisans offered items for sale, customization and price have been two important product characteristics to the consumer. So it is today, but with a few twists. Toward the end of the 18th century, the French military made the breakthrough of using interchangeable parts for cannons and muskets.
By the middle of the 19th century, many more products were being made from interchangeable parts. This paradigm shift caused consumers to become comfortable with buying standard products that were easier and cheaper to repair. Mass production became king because it allowed complex products like automobiles to be made cheaply enough that average people could afford them. The general trend of standard designs competing on price and customized products being offered for a premium continued until about two decades ago.
The recent shift towards Mass Customization was forecasted in 1987. This ability to deliver products customized to each consumer’s specifications at near mass production prices is the Holy Grail of retailing. Giving customers the opportunity to have a product any time they want it, anywhere they want it, any way they want it resonates extremely well with consumers. The number of mass customized products is steadily growing as are personalized services, and this is what we call Mass Personalization.
By 2025, retailers must be capable of supporting a highly diverse set of order and distribution channels in keeping with mass customized products and delivery methods. Customers will want to order with their phones, mobile devices and computers, as well as through traditional retail outlets, kiosks and perhaps as-yet-unimagined channels. Delivery modes will be just as diverse from time-definite, long-lead-time delivery to next-day delivery, same-day delivery and even same-hour delivery.
Sensors & Internet of Things
In 1999, Kevin Ashton saw Radio Frequency IDentification (RFID) as a mechanism by which physical things could directly communicate with the Internet: “If we had computers that knew everything there was to know about things — using data they gathered without any help from us — we would be able to track and count everything, and greatly reduce waste, loss and cost. We would know when things needed replacing, repairing or recalling, and whether they were fresh or past their best.”
Since then, the proliferation of embedded sensors that can communicate with the Internet without human intervention is staggering. Consider that today GPS allows real-time tracking of cars and trucks — and people through mobile phones. Strain gauges rest on structural members of bridges that automatically broadcast critical information to alert highway engineers of potential problems. Vision systems can identify defects in high-speed production environments, so non-complying products can be automatically ejected from the stream prior to shipping. RFID tags attached to shipping containers can record important measurements like drop forces that the container experiences and a continuous recording of temperature in the container during transit.
Every year, sensor technology is creating smaller and better devices that can “talk” to the Internet without human intervention. The increasing array of functions that these sensors perform is advancing at an incredible pace as is the accuracy they can achieve. By 2025, much of Ashton’s vision could be realized. Sensors that automatically communicate with the Internet without human intervention could be almost ubiquitous. Every step of the manufacturing process could have sensors communicating directly with the Internet, so operators would be warned of problems and be told precisely what to do. End-item packages, unit-load containers and transportation containers could have continuous GPS tracking — optimizing routing and delivery decisions. Containers should have sensors communicating vital information in real time, such as shock and temperature so remedial actions can be made if an unsafe condition is encountered.
Mobile & Wearable Computing
A magnificent advance in the information revolution has been to divorce access to knowledge from stationary computing devices. We have arrived at the point in history in which it is possible to acquire knowledge, communicate with others, act on decisions, and engage in commerce at any moment from any location. Mobile computing is changing the way we live and at a pace that few could have imagined even 10 years ago. In 2006, Steve Jobs announced the iPhone and “the Internet in your pocket.” Wearable Computing, in which a computing device or a collection of sensors is embedded in a small, wearable accessory such as eyeglasses, a wristwatch or even fabric in clothing is the next trend in mobile that makes possible a life and workplace of continuous digital input, sharing, interaction and recording.
Big Data & Predictive Analytics
“Big Data” refers to extraordinarily large data sets that companies and other organizations now collect and store about their operations, sales, customers and nearly any other transaction of interest. How is our business affected by hurricane activity in the Atlantic? Do sales increase on Mondays because of Monday Night Football? Do customers really tend to order orange sleeveless shirts with purple socks? Big Data is supposed to tell us while bringing about the ultimate future of Mass Personalization.
Predictive Analytics is a related concept that uses data mining and other techniques to predict the future. It differs from forecasting in that the latter applies mathematical relationships directly to historical data to predict future values (demand, for example), while accounting for variation, trends and seasonality. Predictive Analytics looks for correlation between past, perhaps disparate events and predicts future events based on current and emerging conditions.
Robotics, Autonomous Control & Distributed Intelligence
While the headlines are mostly filled with innovations in personal electronics and mobile computing, the Robotics industry is in the midst of a true revolution as capabilities increase and costs decrease. The International Federation for Robotics estimates that the global population of industrial robots is around 1.5 million units. An associated technology is Autonomous Control, in which a vehicle or other device has sufficient intelligence to sense its environment and make independent, local decisions. As the complexity of Cyber-Physical Systems that will facilitate Mass Personalization throughtout society continues to increase in the future, Autonomous Control and Distributed Intelligence will offer a robust and flexible means of control.
This article was creatively adapted from the 2014 U.S. Roadmap for Material Handling & Logistics.