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Simplifying the rules of the game called “buying”

November 1, 2012 Leave a comment

Making a right choice all the time is never so easy. It’s been almost a month that I am thinking about buying a Smartphone and finding it extremely difficult to make a decision. In the last few years we have witnessed a great technological advancement in shopping experience both in the real world and as well as in the virtual world but as a consumer I have never been satisfied. The reason for my dissatisfaction is because of the way the vendors puzzle the consumer like me about the product feature offerings and it’s pricing.  The enormous amount of choices available in front of my eyes leads me nowhere and makes me think twice and compare each and every feature or offerings many times before making my decision. For instance, one phone appears to be longer than the normal pocket size and another phone looks quite bulky. Also, sometimes we have an unusual experience which takes us by surprise, like for instance some very good phones don’t come with adaptors whereas some other average phones come with wireless charging. This stops me to ask a question – is this a consumer issue or a phone vendor issue? If it’s a vendor issue then do they really understand Product Configuration concepts?smartphone2.png

The answer to such an issue comes in many folds but first and foremost requirement for any vendor is to have a good product configuration solution. A unique solution that enables the vendor to reduce complexity and also read the minds of their consumers. Product configuration methodology can be explained in different contexts such as– the System Engineering process or the most contemporary Sales Configuration process. In this blog, my focus is more on the concepts behind the Product Configuration process and what is that drives the whole process via simple Smart phone analogy. In order to cater to the market needs, the vendor has to understand the psychology of the consumers and also have a good product configuration solution which will enable them to control the product diversity to an extent. The best-in class product configuration solution must follow certain principles or well known concepts in order to improve accuracy and thereby increase consumer satisfaction.

Let’s dive in to the product configuration world and introspect the well known product configuration concepts available in the current market – Year 2012.

Product configurations are basically unique set of features, sub features and they also define the quantity of each of the selected features. These features are decided based on the market needs. The choices available for the consumers are determined completely based on something called as rules. The rules drive the product configuration.

Rules are the backbone of any product configuration solution. These rules are predefined by the vendors during the system engineering process. In layman terms, rules are – for instance, if you are looking to buy a white colour 16 GB Smartphone then all the related information based on your choice are dynamically displayed on the web page for further selections. The rules are tied to the choices that you make and are often dynamically calculated upon your interaction. Rules basically come in two forms – the traditional program based rules and the modern constraint based rules. Constraint based rules are popular and because of its simplicity it is widely used in highly complex and very dynamic business environments. Constraint based rule engines are applied where configuration decisions are made dynamically based on inputs provided by the consumer.

Rules are expressed in several forms but some of the well known concepts are –

  • Compatibility Rules – this type of rule allows you to express compatibility or incompatibility  between choices
  • Resource Rules – used to model production and consumption of resources
  • Extension Rules – program based rules
  • Preference Rules – set number of choices based on selection

Compatibility Rules

Compatibility rules are one of the most commonly used rules. The compatibility rule helps us define compatibility relationship between various Product Line features, Product specific features and also Product Variant features.  They define a relationship between two features and there are numerous ways of defining it such as Incompatibility, Co-dependency and also based on Necessity. Let’s take the same Smartphone example to understand compatibility rules. Most Smart phones come with adaptors and we know that specifications for these adaptors are different in different countries. How can a vendor arrive at unique product packaging for each of these countries? The answer is quite simple – have a compatibility rule defined on adaptor for each of these countries. If the consumer chooses his country as United Kingdom then the product configuration process directly chooses an UK adaptor. This is achievable only when the Product Managers at the Smartphone companies define a compatibility rule or relationship between the country and the adaptors used. In another approach let’s assume the consumers were allowed to choose the adaptors themselves and they make some wrong selections. In such a case, the product configuration process dynamically displays a visual cue depicting the incompatibility between those selected choices and forces the consumers to reselect the features. The process continues as long as the consumer makes the right choices. In some cases certain features become pre-requisite, let’s assume the vendor decides to buy UK adaptor from a UK supplier and US adaptor from a US supplier. The vendor will now have another rule between the consumer’s country, adaptor and with the supplier. This rule defines that when the consumer chose his country as UK then it is a necessity for the vendor to buy the adaptor from its UK supplier only.

Resource Rules

As the name suggests resource rules refers to the way the vendors can add rules into the system that defines the initial, minimum and maximum number of resources that can be ordered. For instance the vendor decides to sell Smart phones with single as well as dual SIM cards. The single SIM card phone may use up only one slot whereas dual SIM phone has to use 2 slots. Accordingly the vendor would define a resource usage rule in the system with initial and minimum number of slots as 1 and maximum number of slots as 2. This rule comes into play when the consumer opts for a single SIM or dual SIM phone and based on the consumer’s choice the Product Configuration process logically helps the vendors to place an order to its SIM card slot manufacturers or suppliers.

Extension Rules/Program Based Rules

A traditional form of rule where we define programmatically all the probabilities and is basically used to perform validations. They are programs written to perform checks when other forms of rules cannot be used for validations. These programs run after all the other configuration rules have been validated and return a pass/fail at the end of its execution. For instance, the Smart phone vendor can check in their ERP system whether the 10 Mega pixel cameras are available. If the camera is available then the process returns a pass or fails.

Preference Rules

In some situations the vendor may require to provide multiple choices to its consumer. For instance, when the consumer chooses to buy a Smart phone, then the consumer would also be provided with a set of choices such as Bluetooth device, a Protective case, headphones etc as more options. This is also sometimes referred to as cross-selling which enables the vendor to sell other related products along with its main product. Preference rules basically help the consumers to include or exclude their choices and at the same time help the vendor to finally arrive at product configuration and thereby a unique bill of material.

Conclusion

The rules play a very important role in defining product configuration and they act as a backbone in defining a unique consumer bill of material. The vendor’s ability to sell their products in the market entirely depends on the strategy they opt in defining the product configuration rules. The vendors also lose customers if they fail to deliver simplicity in their offerings and the simplicity in selling is achievable only if the vendor wisely uses a unique product configuration solution and consumers always look forward to buy the best available option in the market and always from a trustworthy vendor.

Dassault Systemes provides a unique solution for such a vendor requirement and it’s called ENOVIA Variant Configuration Central. Check out this product on Dassault Systemes website here.

Best Regards, Ajit Kini

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