Reconciling Product Flexibility with Cost, Delivery, and Quality: The Importance of Bundling Mass Customization Practices

Abstract Reconciling product flexibility with cost, delivery, and quality is an ambidextrous organizational capability known as mass customization capability. This study focuses on how this capability is affected by the joint implementation of three organizational practices––knowledge absorption from customers, product modularity, and online sales configurator use––that directly correspond to the three fundamental building blocks of mass customization identified by prior, influential research. By drawing upon a central tenet of resource orchestration theory, the fit-as-covariation perspective, and prior mass customization research, we conceptually develop the hypothesis that the fit-as-covariation of these practices has a stronger positive association with mass customization capability than the same practices implemented in isolation. This hypothesis was tested using covariance-based structural equation modeling and survey data from 213 manufacturing plants in three industries across 16 countries. Our results support the hypothesis, showing that the joint effect of these practices explains substantially more mass customization capability variation (41.9%) than their isolated effects (13.9%). This amount of variation indicates an effect size that is greater than that reported by most previous survey-based studies on the antecedents of this capability. Theoretically, this paper adds to the relatively limited body of knowledge on the relationships among the enablers of mass customization by highlighting the benefits of a holistic approach in the implementation of the three practices under investigation. Pragmatically, this study helps companies create flexible systems that are able to provide customized products without compromising cost, delivery, or quality.