The challenge for manufacturers who wish to remain competitive today is to conceive, develop, design and produce innovative new products that drive future revenues and mesh perfectly with the needs of users. What makes this even more challenging is they must do so quickly and cost-effectively. After all, coming out with innovative products works only if those products meet the cost/price expectations of their intended users. Adding even more complexity is the fact that customers are demanding increased customization in products.
As a result of these complexities, manufacturers are constantly looking for ways to optimize the product development process in order to cut excess costs out of the process while also speeding development. One way to do so is through modular product design, which involves sets of common modules that are shared among a product family. Though the deployment of modular design varies across companies and industries, the principals remain the same. Products are broken down into systems of discrete modules, each of which can interchange with each other through well-defined component interfaces.
The benefits of modular design—if executed effectively—are numerous. Modular design enables companies to be more agile and competitive in rapidly changing and volatile market conditions, while also driving cost efficiencies internally. Modular product design also speeds the introduction of multiple product variants, enabling greater product customization to satisfy changing customer needs. Modular product design also facilitates more time- and cost-efficient manufacturing by capitalizing on economies of scale and streamlining assembly lines.
With modular product design, product components can be changed and interchanged with other components easily. Modular product components enable manufacturers to keep pace with market changes by being able to quickly and easily swap out or change various components—to improve performance or efficiency. Products can then be tweaked cost-effectively since some components can be left unchanged, reducing the investment required of product changes.
Another way to reap the benefits of modular design is by designing and producing modular product components, or modules, that can be used by other companies in their own products. By designing these products in modules, rather than a specific, proprietary form, these components can be sold to other companies to be used or incorporated into their own products. This helps the module manufacturer boost revenue by sharing the costs of product development.
Modularization also reduces manufacturing costs because higher numbers of standardized modules leads to a reduction in changeover costs and the number of tools required for production. In addition, with different product lines using the same module design, manufacturing can implement shared processes across product lines. Assembly lines can manufacture modules independently and concurrently, enabling more agile and flexible resource planning.
While modular product design’s advantages sound intriguing, organizations must be cautious before deploying product modularization. Let’s take a look at a few things to keep in mind before considering implementing modular product design.
Pick the right pilot. Though any product could be modularized, companies must be selective in deciding which products to redesign. To reap the full benefits of modular design, target products that have a large number of shared components with other product lines, high sales volumes, and/or contain platform technologies.
Obtain early buy-in from stakeholders. One of the impediments to implementing modular design is a lack of early widespread support within the organization. Keep in mind that modular design fundamentally changes not only the product architecture, but the manufacturing architecture as well, which impacts the entire organization.
Let the customer speak. Companies should do their research and test and screen any new products directly with customers before considering their adoption. This is the only way to determine if new design alternatives are aligned with market expectations.
Establish a cross-functional team. Assemble team with broad technical and market skills to evaluate modular design possibilities that exist across the company’s existing product lines.
Anticipate supply chain disruptions. When adopting modular design, keep in mind that it will change your supplier base and the services required, often causing supply chain disruptions. When collaborating with new suppliers, be clear about new specifications and cost expectations, though be cautious about surrendering too much technical expertise.
Increased IP risk. Producing discrete modules simplifies the product architecture, enabling competitors to more easily discern technologies and steal valuable design IP. To protect IP, organizations must increase patent documentation to prevent competitors from using key modules in their product architectures.