Production Planning, Make-To-Order (MTO) for the Bespoke Experience

In manufacturing, offering personalized products to meet customer demands can be achieved through Make-To-Order (MTO) production planning. In Production Planning, Which Strategy is Right for Your Business? I highlighted four standard production planning methods; let’s dig deeper into MTO, when to implement it, and what you’ll need to be successful. While I strongly advocate for a Make-To-Stock (MTS) production plan, MTO has its time and place, especially in the artisanal world. However, have you considered how you can incorporate MTO into your MTS strategy? Limited MTO products can be great for marketing strategies and as exclusives for top-tier customers.

Make-To-Order (MTO) is a production planning strategy for businesses offering customized or highly variable products. Unlike other methods, MTO produces goods specifically in response to customer orders. This approach allows manufacturers to tailor products to individual customer specifications, providing high customization and flexibility.

When to Use Make-To-Order Production Planning

Make-To-Order production planning is particularly suitable for companies that deal with variable demand patterns, offer customized products, or are refining their final product offerings. Some scenarios where MTO can be advantageous include:

Customization and Personalization: If your business specializes in bespoke products, where customers can choose specific features, designs, or configurations, Make-To-Order planning is the ideal strategy. This allows you to deliver unique, personalized products that meet individual customer requirements.
Variable Demand Patterns: MTO is well-suited for products that experience fluctuating demand levels or have seasonal variations. By producing goods based on actual customer orders, you can avoid the risks of overproduction or excess inventory during periods of low demand.
Resource Optimization: Make-To-Order planning allows you to optimize your resources by reducing the need for extensive pre-production inventory. With MTO, you can focus on producing what is required, minimizing waste, and optimizing your manufacturing processes.

Setting Up Make-To-Order Production Planning

To make the most of Make-To-Order production planning, consider the following key aspects:

Streamlined Order Management: Implement an efficient order management system that enables seamless communication between sales, production, and customer service teams. This ensures customer orders are promptly received, specifications are accurate, and the production process is timely.
Agile Manufacturing Processes: Flexibility and agility are essential in Make-To-Order production. Streamline your manufacturing processes to accommodate varying order volumes, lead times, and customization requirements. Adopt lean manufacturing principles and continuous improvement methodologies to optimize efficiency and reduce production lead times.
Supplier Collaboration: Establish strong partnerships with reliable suppliers who deliver a timely supply of raw materials or components required for each order. Collaborate closely with them to ensure a seamless supply chain, avoiding delays or disruptions that may impact order fulfillment.
Real-time Communication: Utilize technology and communication tools to facilitate real-time collaboration between different departments involved in the production process. This enables quick information exchange, allows for immediate updates on order status, and ensures smooth coordination throughout the entire production cycle.
Quality Assurance: Maintain a strong focus on quality control throughout the Make-To-Order production process. Implement rigorous inspection protocols, conduct thorough testing, and establish quality checkpoints to ensure that each product meets the specified requirements before delivery to the customer.

Make-To-Order production planning allows businesses to provide customized products, optimize resource utilization, and enhance customer satisfaction. By strategically implementing streamlined order management, agile manufacturing processes, supplier collaboration, real-time communication, and robust quality assurance, manufacturers can maximize the benefits of Make-To-Order production planning and deliver exceptional products tailored to each customer.

EAF Logistics