Implementation of Demand Forecasting Module of ERP System in Mass Customization Industry—Case Studies

Abstract

Mass customization production is a manufacturing process in which mass-produced products are modified according to specific customer needs. An example of such production is furniture production, where multiple options options for various components or features are available. Demand forecasting in mass customization industry is a difficult task for organizations and is both crucial for their profits and for market penetration. Unfortunately, the currently available tools are focused on more standard demand forecasts, which lack interpretable representation of information relevant for mass customization products. This is especially relevant for ERP systems, which are the backbone of modern manufacturing. We propose a forecasting method adapted to the needs of mass customization by focusing on demand prediction—not on finished products, but on key intermediate goods. Moreover, we provide a method for determining such goods. As an additional consequence we provide an implementation strategy that reduces the risk and time consumption when implementing forecasting in ERP systems. All the results are implemented as appropriate functionalities of a IFS Application ERP system.

Keywords

• ERP system
• ERP implementation
• historical demand
• demand forecasting method
• sales and operation planning
• mass customization production