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Assemble To Order - Types of Operations Systems
This is an intermediate category, where varied products are quickly put together from stocks of standard components or sub-assemblies. It requires the product to be designed on the Lego-block principle, to give the operations system the benefit of a relatively simple planning task, economies of scale and low unit costs, whilst offering the customer a wide range of product choice at an affordable price.
Nowadays car manufacturers, in response to dealers' requests, assemble cars with customer-selected options: body colour, upholstery, engine type and size, automatic transmission, air conditioning, etc. A fast-food 'burger' outlet might be considered to be an assemble-to-order operation.
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Consider the WBS shown below: 1.00.00 1.1.0 1.1.1 1.1.2 1.2.0 1.2.1 1.2.2 If the total program costs $100,000 and 1.2.1 and 1.2.2 are each $20 K, then the cost of 1.1.0 is:
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