Abstract
Companies in high wage countries are increasingly confronted with the challenge of optimizing economies of scope and economies of scale simultaneously to succeed on a global market place. An integrated assessment of production systems facing this challenge is essential to evaluate the actual state of a company and to provide a basis for drawing the right conclusions to reconfigure production systems successfully. In this paper an integrated model for measuring economies of scope as well as economies of scale is introduced, defining the fundamental domains of a production system. The major objectives resulting from the overall scale-scope dilemma are broken down for each domain and the main dimensions for an assessment of each domain are defined. A new measure named Degree of Efficiency is defined, quantifying the fulfillment of the opposing objectives in each domain and hence, the contribution to an overall resolution of the scale-scope dilemma.
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Notes
In this case equivalent pathways for the isoquants in each domain are sketched which is not necessarily the case for a particular production system.
E.g. an automotive OEM should most likely weight the Product Architecture Flexibility differently in relation to the Product Architecture Commonality compared to a tool making company due to substantially different constraints in market and customer requirements resulting in totally different business models.
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Acknowledgments
The presented results have been developed within the Cluster Domain “Individualized Production” of the Cluster of Excellence “Integrative Production Technology for High-wage Countries” funded by the Deutsche Forschungsgemeinschaft (DFG).
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Schuh, G., Arnoscht, J., Bohl, A. et al. Assessment of the scale-scope dilemma in production systems: an integrative approach. Prod. Eng. Res. Devel. 5, 341–350 (2011). https://doi.org/10.1007/s11740-011-0315-0
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DOI: https://doi.org/10.1007/s11740-011-0315-0