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Value analysis for customizable modular product platforms: theory and case study

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Abstract

Mass customization and product platform design can exploit the benefits of modularity and provide personalized devices at competitive costs through economies of scope. However, customization-intense platforms can have thousands of potential configurations, whose development and verification must be prioritized. This paper develops a value analysis methodology that is able to rank alternative platform configurations according to customers’ preferences. It introduces Logit value, a definition of value based on a well-known stated choice model and explains the five steps of platform-based value analysis. Since product platforms are complex technical systems, particular attention is given to the gathering of information, the automatic generation of platform architectures and the visualization of results. A case study based on Google ARA’s Spiral-2 modular smart phone concept demonstrates an application of the methodology and shows its potential benefits. The case study leverages data from a conjoint analysis and survey of 200 potential customers in Puerto Rico and a generated set of over 21,000 potential configurations of which less than 1% are shown to be non-dominated. The value analysis identifies module types that are compatible with the modular product platform and appear in a high percentage of Pareto architectures. Knowledge pertaining to non-dominated configurations can provide insights into module development strategy and verification/validation activities.

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Abbreviations

\(v_{j}^{{\{ h\} }}\) :

Utility of product j according to agent h

\(b_{i}^{{\{ h\} }}\) :

Part-worth utility of i-th feature according to agent h

\(u_{i}\) :

Binary variable of i-th feature

\(u_{c}^{{\{ h\} }} (p)\) :

Part-worth utility for price p

\(P_{i}\) :

Probability of i-th choice

\(V_{i}^{{\{ h\} }}\) :

Logit value of i-th choice

\(b_{F,i}^{{\{ h\} }}\) :

Part-worth utility of i-th function according to agent h

\(b_{P,i}^{{\{ h\} }}\) :

Part-worth utility due to performance level of i-th function according to agent h

\(V_{0}^{{\{ h\} }}\) :

Baseline value according to agent h

\(V_{\text{cust}}^{{\{ h\} }}\) :

Benefits of customizability according to agent h

\(V_{\text{uniq}}^{{\{ h\} }}\) :

Benefits of uniqueness according to agent h

\((U_{F,i}^{{\{ h\} }} P_{i}^{{\{ h\} }} )_{emerg}\) :

Benefits of i-th emergent function

\((U_{F,i}^{{\{ h\} }} P_{i}^{{\{ h\} }} )_{\text{md}}\) :

Benefits of i-th module function

\(U_{c}^{{\{ h\} }}\)(p):

Price sensitivity for price p according to agent h

\(c_{{w,{\text{md}}}}\) :

Price of w-th module

\(c_{\text{core}}\) :

Price of platform core

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Authors and Affiliations

  1. Department of Mechanical Engineering, Politecnico di Milano, Via La Masa 1, Milan, Italy

    E. F. Colombo & G. Cascini

  2. Department of Aeronautics and Astronautics, Massachusetts Institute of Technology, 77 Massachusetts Avenue, Cambridge, MA, USA

    N. Shougarian & O. L. de Weck

  3. Institute for Data, Systems and Society, Massachusetts Institute of Technology, 77 Massachusetts Avenue, Cambridge, MA, USA

    K. Sinha & O. L. de Weck

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  1. E. F. Colombo
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  2. N. Shougarian
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  3. K. Sinha
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  4. G. Cascini
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  5. O. L. de Weck
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Correspondence to G. Cascini.

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Colombo, E.F., Shougarian, N., Sinha, K. et al. Value analysis for customizable modular product platforms: theory and case study. Res Eng Design 31, 123–140 (2020). https://doi.org/10.1007/s00163-019-00326-4

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