In this article, I hope to provide information on the current state of configurator technology and why this technology will play a vital role in the future of manufacturing. I also explain why this technology must do much more than what the current definition implies.

I include as well a checklist of features for those manufacturers and product designers who are in the market for this technology. Not every enterprise needs each feature, but everyone should be aware of the broad range of functionality that does exist among product configuration systems currently available. Power, quality, feature sets, ease-of-use, and pricing vary widely among these software packages and you should carefully investigate each based on the needs of your company.

Why Product Configuration is so Important

Simply put, manufacturing has changed. In the current customer-driven marketplace, to-order manufacturing, whether it’s assembled, made, or engineered-to-order, is now a well-entrenched alternative to the traditional modes of repetitive, process, and discrete manufacturing.

Many traditional industries such as windows, doors, office furniture, truck trailers, and even entire process plants, to name but a few, are rapidly moving toward to-order manufacturing so they can meet the consumer's increasing demand for individualized products at mass-produced prices. This drive has been labeled "mass customization" and is already well underway. As Joseph Pine says, "Mass Customization is the new frontier in business competition for both manufacturing and service industries." (Mass Customization: The New Frontier in Business Competition, Harvard Business School Press, Boston, Mass)

To meet this challenge, a company that wants to be in the manufacturing business of the future cannot afford to be without software that configures its products and concurrently empowers its sales force and even its customers.

Configurators are big news

Responding to this paradigm shift, many ERP/MRP system vendors have introduced software designed for build-to-order manufacturing. The critical component in these packages is a product configuration capability. Automated configuration and selling systems are hot items these days and vendors will be scrambling to either acquire them or substantially enhance their existing components.

On the other side of the fence, more and more manufacturing companies are becoming aware of mass customization and the need for configuration and sales systems. The use of a configuration system with the right features and capabilities can have a huge impact on operating costs, sales and marketing, resulting in big improvements in customer service market share and profits. The impact can be so dramatic on the sales side of a business that it is more appropriate to describe the new breed of configurators as Sales Configuration Software (SCS), a term becoming more widely recognized.

What is a Configuration System?

In current terms, configuration software is a computer application that defines the characteristics of a product and uses this definition to determine if, how, and when to produce it, and at what price. It encapsulates the range of options and design rules of your products, as well as business information such as costs and prices. Traditionally, configurators have been used only at the plant or in the "back office" because they require a technical expert to operate them. However, times are changing due to the need for more enterprise-wide use of product knowledge.

Vendor Choices

In general, there are two sources of configuration software:

• those which are supplied by ERP/MRP vendors and integrated with their systems
• add-on or third-party packages that interface to ERP/MRP systems.

There are advantages and disadvantages to both.

Many configurators that come with ERP systems have been built specifically for the vertical markets in which the vendor has been successful. Almost all have been designed to work within the confines of the ERP system. As a result, they must conform to the platform, database and user interfaces of that system rather than be free to meet the specific individual needs of the manufacturer. Moreover, most have been added as an afterthought, and to date, ERP vendors have concentrated on database, accounting and manufacturing system components. So far they have payed little attention to product configuration and invested relatively few resources in the technology.

Third-party configurators usually provide more advanced functionality, since their creators are able to focus specifically on configuration system features and are not burdened with the overhead of implementing and supporting modules such as accounting and inventory. The level of integration and types of interfaces in place are crucial to how well a configurator system will work in your business. Third-party systems often provide little or no integration with a company’s business system. However, those that do provide a high level of integration are almost always superior to the offerings of the ERP vendor.

Moving from "Configurators" to Sales Configuration Systems

Traditional manufacturing-based configuration software is very specific and one-dimensional. However, today’s manufacturing requires that tools do more than just configure products. Product design information needs to be shared interactively and in real time throughout an organization as well as with customers, allowing companies to maximize the value of this information.

If a product configuration system has integrated features for enterprise-wide deployment, it can be highly effective in allowing sales reps, distributors and even customers to access product information when and where they want it. This transfer of knowledge to the front office is what sets manufacturing or plant-based configurators used by production experts apart from the new breed of sales configuration systems that are for both technical and non-technical users. These new "configurators" are much more. They are interactive sales productivity tools that can link back office functions with those in the front office and deliver a host of operational and service improvements. Product configuration systems must deliver interactive sales configuration functionality. Those that don't will fall by the wayside.

Features

A product configuration system should allow a manufacturer to produce a high volume of customized products efficiently, with consistent quality, and within competitive cycle times. Most configurators provide this basic functionality, but the following is a list of specific features that you should be looking for to achieve the qualitative and quantitative benefits you require.

Input and User-defined variables

All configurators must have the ability to ask users questions about the product being ordered. They must then validate the answers to ensure consistency, buildability and profitability. Questions may be as simple as "What material?" or may be a complex chain of queries. For example, the answer to "Electric or gas heating?" may bring up further questions such as "voltage" or "flow rate". Alternatively, the answer may eliminate the need for such follow-on questions.

These questions require the definition of input "variables". In a configuration system, a variable may take several forms, and the configurator you select should support the types of variables needed in your manufacturing process. As with most software applications, there are four types of variables:

• A discrete variable is one that has a finite list of values. The list may be short, such as "steel" or "aluminum". Or it can be long, as with a cabinet maker who offers several hundred colors of finish. In the latter case, the configurator should provide a way to easily and rapidly search through the choices.
• A continuous variable is numeric and can take on an infinite number of values. For example, a cabinet maker can build cabinets as narrow as 6 inches and as wide as 80 feet or any value in between. A configurator that did not support continuous variables would fail for this company.
• A text variable could be a word, phrase, name or statement. Salespeople may want to place notes on a quote form, or a manufacturer of circuit boards might want to imprint customer information on a board.
• A logical variable provides for "yes/no" options such as "Include a drain valve?"

Since products such as gas plants may be extremely complex, it is important that there be no limit on the number of variables.

It is also very important in setting up and customizing a configurator that the person performing this task be able to identify variables, inputs and rules using the terminology of the company. For example, you should be able to define and use the variables "Cabinet Width" and "Cabinet Height" rather than be forced to use terms or database fields that are pre-defined by the configuration vendor, such as "Dimension 1" and "Dimension 2".

Non-programming environment

A configuration system should allow users to customize it without complicated programming. These days, businesses cannot rely on programmers, who often have little product knowledge, to maintain and update the configurator. This can cause delays, inaccuracies and cost overruns and can defeat the very purpose of the system. Those who know the products best should be able to define the variables, rules, and documentation. This provides ideal internal system control.

User Interfaces

Configurators must have User Interfaces that are friendly and customizable to reflect the way you do business and how your staff want to interact with it. Users are now demanding Graphical User Interfaces (GUIs) with "point and click" functionality, windowing, and online help. First rate configuration systems have menus with dialog boxes and input controls that can be laid out and customized in a way that exactly meets the needs of the company. Moreover, the finished interface should be easy enough to learn and use so that non-technical users, such as sales people and order-entry personnel, can put it to work with minimum training. And, as with other components of the configurator, company staff should have the ability to create and maintain the interface without doing any programming.

User interfaces should also provide an easy way for users to go through "what-if" scenarios in real time. For example, a salesperson could be having a telephone conversation with a customer, answering such questions as "What would the price be if I used a cheaper material?". The salesperson should be able to quickly locate the material list and select another one. The system should then recalculate immediately, displaying the new price(s) and possibly flagging errors or warnings such as "Selected material is not strong enough."

Rule creation

The defined rules of a configurator translate the user’s response to questions into accurate prices, documents, bills of materials and routings. A configurator must provide fast, concise methods for creating rules. Moreover, the rules must be created using general-purpose tools. Many configurators have special-purpose tools that are designed for a particular industry. For example, there are many special-purpose configurators for the window and door industry. These tools rarely do 100% of what the company wants, and even if they did, they couldn’t be modified to include products that are substantially different.

Rules are generally defined using logical or "Boolean" methods. Boolean operators such as "And-Or" and "If-Then-Else", make rule construction relatively easy, but for complex products the rules can rapidly multiply. This makes it vital that configurators make it easy to create, find, and maintain rules.

Engineering Calculations

Often, complex products must be designed and checked by an engineer. This design process can be long and tedious leading to extended cycle times. First-class configuration systems capture this process by providing a wide range of built-in mathematical and engineering calculations and functions. If you are in the engineer-to-order business, pay careful attention to the "number crunching" capabilities of the configuration software. At a very minimum, this functionality should be at the level of top spreadsheet software such as Microsoft Excel. Some configurators don’t even have such fundamental trigonometric functions as sine and cosine and you’d be stuck with expensive add-on programming to get what you want, assuming you could even add such programming to these systems.

For highly engineered products there should be easy-to-implement linkage to external analytical or optimization packages. For example, an architectural lighting company may want to run configured layouts through a separate, existing luminosity package whose complex calculations are beyond the capacity of the system to implement. The configurator transmits its data to the external package via the link and the package sends information about the configuration back, such as "Layout OK" or "Too dark for the room", or "Here is the data defining the optimum layout". This type of link extends the power of both the configurator and the external software.

Object Oriented

In the past decade or so, great progress has been made in software development by using "object-oriented" techniques. Given that manufactures make objects (which are in turn made out of other objects), object-oriented product modeling techniques are a natural fit for configuration software. By defining Objects and relating them to each other, those who set up and customize a configuration system will complete the task in a much shorter time frame. Moreover, the re-usability of objects will provide great productivity gains in the modification of existing products and the development of new ones.

CAD interface

You probably already have invested in a CAD system and the training of CAD operators. Many configurators have interfaces to CAD, where configured bills of materials are passed to and from the CAD system so that drawings can be produced for the shop floor or even sent to customers.

These links exist for two reasons. First, almost all configurators have no internal graphical or CAD capability. And second, much of the engineering logic rules, and calculations are performed within some component of the CAD system because the configurator cannot cope with these tasks.

While links to CAD systems can add much value to any configurator, a first rate configurator will have parametric CAD and graphics as integral components. Drawings and documents are generated "on the fly" from input data and rules, allowing the front office to produce them for whatever purpose the company needs.

Documentation

In the selling process, documents such as cover letters, quote sheets, drawings and assembly instructions are important both for the manufacturer and its customers. Good documentation, customized with company specific logos and customer information and that is generated rapidly for customers to examine provides a professional, business-like image for the company. Configurators should be able to automatically generate these documents or at the very least link to word-processor, report generator, and CAD systems with a minimum of effort on the part of the user.

Pricing and Costing Models

Configurators should also be able to accurately and completely model costs and prices for any product configuration. Taking the burden of guesswork, catalogue/pricebook searching, and manual calculations out of the hands of salespeople is something that every configurator should do. And accurate costing, when viewed against prices, can flag margins that may be too low on products that, say, have never been built before in a specific configuration.

It is critical that you carefully examine the pricing capabilities of any configurator you are evaluating. Pricing of configured products is complex because it stems from base prices plus different add-on charges for each option selected by the customer and/or unit costs for "continuous" options such as lengths. Additional complexity arises when factors such as customer-specific or quantity discounts come into play.

Incorrect pricing calculations result in complaints from customers and lower margins, not to mention added overhead for credits and adjustments.

Linkage to data

A configurator should be able to access any information in the corporate database (for example, part or customer masters) to generate prices, construct rules, define product options, etc. A manufacturer may use its configurator to discount its customers differently or prevent some of its customers from ordering certain types of products. While this functionality can be provided elsewhere in the business system, having the configurator check this during quoting or order entry can prevent delays or confusion for the customers.

Web-enabled

Many manufacturers will be moving to push the configuration/quotation process out to the Internet, with customers logging on to the company website and doing their own product configurations. This will free up the company’s sales staff from doing routine smaller quotes and enable them to work on larger accounts or perform other tasks. The explosive growth of the Internet and global markets will make web-enabled configuration systems a huge growth industry.

Creating BOMs and routings

Configuration systems must have the ability to create production BOMs and routings dynamically. Dynamic generation of routings vary widely from configurator to configurator: some do not support routing creation at all, while others activate correct routing operations as well as dynamically calculate setup and production run times.

A configuration system should provide either single or multilevel processing. A multilevel configurator can create configured lower-level components or subassemblies that are part of a finished configured product. For example, several independently-configured parts may go into a final pump assembly.

Generation of assembly instructions

Many to-order manufacturers depend on the knowledge of shop floor staff instead of formal instructions when it comes time to assemble products. This is true in spite of the infinite variety of items flowing past a particular worker or cell. The result can be a loss of uniformity and quality, and staff turnover can lead to disaster in this circumstance. Configurators that can produce detailed printed instructions or shop drawings that show definitively how to assemble a product will reduce assembly time and production errors and greatly ease staff turnover difficulties.

A good example of this is where products are made up of components cut from raw materials. There should be an automatically-generated "cut list" explaining to shop floor staff which stock pieces to select and exactly how to cut them.

Interface to ERP

Configuring products is of no value if it does not lead to production. This means that an interface to ERP is required. Configuration modules provided by ERP vendors obviously will work well with their systems. Third party configurators must provide a clean and seamless interface to the manufacturer’s ERP systems. With today's open software architecture, this is easier that in previous years. And those systems, both SCS and ERP, that allow for this provide users increased flexibility and value.

Conclusion

Manufacturing is going through dramatic changes in response to competitive pressures, and the product delivery process is an important part of these changes. There are significant differences between traditional manufacturing configurators and the new sales configuration systems, ones that combine product design and configuration with interactive sales capabilities.

The bottom line is that every company is different, with different products, equipment, facilities and personnel and you should focus on those features in the above checklist which meet your requirements.