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Chapter 3 Variety Reduction through Modular

In this chapter,
the requirements, for a company, to achieve variant-oriented product design are
discussed. This involves understanding complexity and variety induced costs in
an organization. Following this is a brief introduction to various product
structure models, including modular design, which help in reducing complexity.
The chapter ends with a representation of Dieffenbacher modularization

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3.1 Complexity

Constantly changing business and market conditions pose a
number of new challenges for a company. A transition from a seller’s market to
a buyer’s market has convinced many companies to pay more attention to customer
needs. Although, this approach helps in acquiring new customers and retaining
existing ones, the variety of products and processes increase significantly.
Moreover, rapidly evolving technology has made engineering more complex and
demanding which in turn increases the variety of components and functions. This
diversity, collectively known as complexity, affects the entire enterprise. The
number of locations and size of an enterprise also contributes to the

 A more competitive market enforces
companies to strive for higher efficiency, quality and reduced cost. But high
complexity negatively affects these requirements. Figure x shows an overview of the impact of complexity on a business.
Therefore, to structure their products and to balance the opposing forces of
customization and standardization, more and more companies depend on modularity.

The benefits of reducing complexity are not limited to a
particular industry. For example, the automation department of Dieffenbacher’s composite division designs
and develops customized end-of-arm-tools for handling advance composites. A
standardized tool design process, using pre-configured construction modules, would
not only save research and design time but also help in standardizing the
production and assembly process. This should help in reducing costs and open up
new markets. Further reduction in complexity can be achieved by applying a
similar model to standardize the robot configuration process where standard
robots with pre-defined peripherals are used to achieve customer requirements.

3.2 Variety
Induced Costs

As discussed earlier, complexity leads to additional costs
called variety induced costs. They can be divided into two categories. The
first category is directly related to the amount of variety. Every time a new
product or component is introduced, this type of cost is incurred. This
includes, for example, cost for design, R and marketing efforts. The
second category has an indirect relation to the level of variety. This cost is
not generated after introduction of every new variant but comes up after a
certain level of complexity is reached. Cost of additional manufacturing
equipment and the related resources is a good example of this type of cost. Therefore,
for smaller increases in diversity, initially no significant increase in costs can
be observed. Only when a certain limit has been reached will new investments
become necessary. These generally include fixed costs like investment on
buildings, machines and computer systems.

Increase in production of non-standard or “exotic” product variants
leads to another problem in terms of cost. Their prices are often calculated
below their incurred costs. These losses are compensated by an increase in
overhead costs which lead to increase in cost of standard products. This leads
to a competitive disadvantage. Figure y gives an
overview of the cost distribution between standards and exotics.

3.3 Product
Structure Models

Various product structure types are available in literature.
Their definitions often differ greatly. This section discusses some of the most
commonly used product structuring models that can be used to control diversity
in an organization. (See Figure z)



Figure z

 Product Structure Models by SCHUH


Construction Kits or Baukasten

A “Baukasten”
system makes it possible to create different products from a pre-defined number
of building blocks. Typical of these systems is the use of one or a few basic
bodies or basic structures on the basis of which different products can be
configured. In contrast to modular design, the interfaces exist in the first
place between the add-on parts and the base body. This type of product
structuring is often used in plant construction.


Package building combines add-on parts for various functions
or equipment in one package. This limits the configuration options of a product.
Package formation is often used in the automotive industry, example. for
special sports or equipment packages.


Series have the same type of attachments. These models are
offered in different sizes. This type of product structuring is found
predominantly in structurally complex products like turbines and engines.


Modules are independent function blocks that can be combined
in many ways due to standardized interfaces. They make it possible to produce a
large number of end variants with a small number of modules.

A clear demarcation of the aforementioned product structure
types is not clearly possible due to their different origin and history. Thus,
in practical applications, the different types often overlap.

3.4 Modularity

The process or activity of structuring a product in modules
is called modularization. Modularity represents the characteristics of a
product structure. A modular system, which is composed of modules, is a result
of the modularization process and possesses an attribute called modularity. It
can be considered as a technique to balance the opposing forces of
standardization and customization.

  3.4.1 The Concept

The concept of modular design revolves around the development of products
through modules which are building blocks with specifications of functionality
and interface. Replacing a module with another module leads to a new product
variant. The traditional definition of a building block does not take
functionality into consideration. But a module should possess some kind of
functionality with respect to the final product. Therefore, a module is
directly linked to a specific function of the finished product and can be
considered as physical realization of a function. Figure a depicts function and module types in a modular and
non-modular system.

Figure a Function and Module Types

Considering the example of standardizing the design process of
a robotic end-of-arm tool for different composite handling applications, we can
use functionality as a means to divide an EOAT into modules. For example, the gripping
function of a tool is realized through its end-effectors. Therefore, we can define
end-effector modules which are directly linked to the tools gripping function. Similarly,
other functions can also be identified and their physical representations can be
grouped into modules. Chapter 5 explains the complete modular design structure of
our standardization process.

Another important feature of a module is the presence of a standard
interface for higher flexibility and adaptation.

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