From the introduction: We provide a survey of analytical models which can be used to assess the benefits and costs associated with delayed product differentiation in a large variety of settings. The concept of delayed product differentiation was first introduced in the marketing literature. We give a classification of the different ways in which product differentiation can be delayed, and review several documented implementations and case studies. In reviewing analytical models, we first consider those relating to a single point of differentiation. We discuss a simple model due to H. Lee [“Design for supply chain management: concepts and examples”, in Perspectives in Operations Management, (R. Sarin Ed.), Kluwer Academic Publishers, Norwell, Mass. (1993); Oper. Res. 44, 151–159 (1996) which is applicable when only the intermediate product is made to stock. This is followed by an extension, based on H. Lee and C. S. Tang [Management Science 43 (1997)], in which each of the two stages is modeled in more detail, as consisting of a number of discrete stages, such that each stage maintains inventories, both those before and those after the point of differentiation. The first model can be analyzed via a single location, single item model. The second model assumes that each stage is governed by a local order-up-to rule and it evaluates each stage as if its preceding stage never runs out of stock. Under these simplifying assumptions, the second model decomposes straightforwardly into a number of simple single item systems, one for each stage.
We consider models for settings where inventories are kept for all end products, possibly in combination with inventories for the intermediate product. We discuss a few models that characterize the benefits of capacity sharing as enabled by delayed differentiation. We conclude this chapter with an overview of models addressing multiple points of differentiation. We particularly focus on a model designed to analyze the optimal sequencing of differentiating operations, one of the types of postponement strategies.
For the entire collection see [Zbl 0932.00033].