11. Cost Estimation and Optimisation Framework for Rapid Product Development

The ultimate goal of mass customisation is to achieve economies of both scope and scale. This goal implies a conflict between customisation and economy of scale (or mass production) in the traditional manufacturing paradigm. However, recent developments in computer and Internet communication technologies, along with concurrent engineering, as well as modular design methodology provide concepts, methods and technology infrastructure for realising mass customisation. One of the findings from numerous research efforts on mass customisation is the use of e-commerce technologies to manage a product development chain that links customers, suppliers and manufacturers together to approach concurrently customised products in a short time and at the low cost level of mass production, which is the very definition of mass customisation. To ensure the success of mass customisation in a product development (PD) chain, a rapid, automatic yet accurate cost estimate and control system is needed. This chapter presents a novel cost index structure, together with two novel cost estimate methods, namely the generative cost estimate method and the variant cost estimate method, used for the development of a semiautomatic or fully automatic computer aided cost estimate and control system in mass customisation. Finally, an industrial case is reported to illustrate the principles and feasibility of the proposed data structure, methods and system framework.