Construction Management and Economics

ISSN: 0144-6193 (Print) 1466-433X (Online) Journal homepage: http://www.tandfonline.com/loi/rcme20

Production strategies for pre-engineering in

house-building: exploring product development
platforms

Helena Johnsson

To cite this article: Helena Johnsson (2013) Production strategies for pre-engineering in house-
building: exploring product development platforms, Construction Management and Economics,
31:9, 941-958, DOI: 10.1080/01446193.2013.828846

To link to this article: http://dx.doi.org/10.1080/01446193.2013.828846

Published online: 01 Oct 2013.

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 Construction Management and Economics, 2013
Vol. 31, No. 9, 941–958, http://dx.doi.org/10.1080/01446193.2013.828846

Production strategies for pre-engineering in house-

building: exploring product development platforms
HELENA JOHNSSON*
Division of Structural and Construction Engineering, Luleå University of Technology, Luleå, SE-97187 Sweden

Received 30 March 2012; accepted 22 July 2013

Downloaded by [Australian Catholic University] at 04:16 09 October 2017

Construction is a trade where the dominating production strategy is engineer-to-order. House-builders can
pre-engineer their design to different degrees, resulting in variations of the engineer-to-order strategy:
design-to-order, adapt-to-order, and engineer-to-stock. This variation causes different settings for the use of
platforms in house-building. The aim of this research is to diversify the engineer-to-order production
strategy and its consequences for platform organization by studying its use in house-building. The multiple
case study on four engineering/contractor firms reports the core capabilities for engineer-to-order firms: pro-
curement and tendering, market knowledge, engineering, multi-skilled manufacturing, and coordination of
sales and manufacturing. Design-to-order, adapt-to-order and engineer-to stock were shown to be produc-
tion strategies in use in house-building. In design-to-order platforms parts of the platform are undefined
while engineer-to-stock platforms are fully predefined. Coordination between market and manufacturing is a
crucial capability when engaging in platform organization. When an engineering firm and a contractor
collaborate to fulfil client needs, the coordination capability between market and manufacturing was shown
to be low. The case study shows that specialized contractors who integrate the supply chain towards a
specific market segment benefit fully from the platform concept, while contractors with a wider scope could
focus on standardization of processes rather than products.

Keywords: Engineer-to-order, industrialized building, prefabrication, supply chain structures, systems

building.

Introduction materials handling industries (Hicks et al., 2000).

Construction can be identified as a trade dominated
by firms employing an engineer-to-order (ETO) pro-
duction strategy (Gosling and Naim, 2009). In order
to protect their investment, the construction client
demands or is allowed to be very active in the concep-
tualization and design of the product, which means
that the client enters the production information flow
during the design stage. No physical artefact has been
manufactured at the client order decoupling point:
see Figure 1 (courtesy of SIEMENS, presented in
Wiendahl and Scholtissek, 1994). Gosling and Naim
(2009) characterize the ETO production strategy by
work organization in projects, high monetary value of
the product, and high levels of customization. Other
sectors working with an ETO production strategy are
the power generation, offshore and high-integrity
Core capabilities for firms operating with an ETO
strategy are market knowledge, tendering or quotation
capabilities, engineering proficiency, manufacturing
resources, a strong coordination between market and
manufacturing, and good procurement skills
(Konijnendijk, 1994).
Even when working with an ETO strategy it is pos-
sible to pre-engineer solutions in order to streamline
the pipeline between client order decoupling point
and product delivery. In Swedish house-building, the
product view has enabled firms to use pre-engineering
(Johnsson and Sardén, 2008). Johnsson (2011) fur-
ther observed that there are different levels of pre-
engineering in house-building, which lead to different
competitive advantages. The diversification of the
ETO production strategy was classified by Wikner
and Rudberg (2005) between no pre-engineering

*E-mail: helena.johnsson@ltu.se

Ó 2013 Taylor & Francis

 942
Client order
decoupling point
Concept-to-order
Engineer-to-order
SUPPLIER
Make-to-order
Assemble-to-order
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Make-to-stock
Ship-to-stock
Concept Engineering Manufacturing
Production based
on forecast
Figure 1 Identification of decoupling point between supplier and client (revised from Sackett et al., 1997)
work at all up to all design work completed. The
struggle for the house-building firm is to balance stan-
dardization with customization and to reduce uncer-
tainty in its supply chain (Gosling et al., 2013).
Firms deciding to engage in pre-engineering work
could benefit from platform organization of their
product (Robertson and Ulrich, 1998). Platform
organization is a way of operationalizing the pre-
engineering strategy (Jiao et al., 2007). Platforms
disassemble the product parts into two piles: com-
monality parts and modularity parts (ibid.). Platform
thinking builds on modularization (Ericsson and
Erixon, 1999), and is a method to offer many product
variants while keeping the benefits of economies of
scale in production. While the platform originates
from a product view, it is actually a broader concept
incorporating the product, the process, know-how,
and relationships (Robertson and Ulrich, 1998). Jans-
son et al. (2013) identified that house-building firms
operate platforms that have a project-specific part.
Following the tangent of Gosling and Naim’s
(2009) work on manufacturing strategies, the focus is
on the role of pre-engineering in construction. The
diversification of pre-engineering strategies in ETO
firms (Wikner and Rudberg, 2005) is empirically
tested in a multiple case study. The aim is to diversify
Johnsson
Client entrance in
construction
CLIENT
Assembly Shipping
Production based
on client order
and understand the engineer-to-order production
strategy by studying its application in house-building
through presenting four case studies of firms in the
Swedish house-building industry. The case firms all
employ a product platform strategy with different lev-
els of pre-engineering. The firms are presented
through their core competencies identified by
Konijnendijk (1994) and their operationalization of
the pre-engineering strategy through product plat-
forms (Robertson and Ulrich, 1998). In so doing the
following questions were asked:
• Is there empirical evidence for the engineer-to-
order production strategy diversification sug-
gested by Wikner and Rudberg (2005) in
house-building?
• To what extent do the house-building case firms
operating on different levels of pre-engineering
possess the core capabilities for ETO firms
identified by Konijnendijk (1994)?
• How have the house-building case firms opera-
tionalized their pre-engineering strategy in a
product platform?
The pre-engineering strategy of the case study firms is
identified through looking at the interaction with the
 Production strategies pre-engineering
client. Pre-engineering ranges in the multiple case
study from very little pre-engineering to a fully defined
product family. The core capabilities of ETO firms
were identified by looking at the organization of the
firm and tracing the competencies involved in project
conception. The product platform operationalization is
identified by looking at organization and conduct of
engineering, production, and assembly. The result is
important for understanding pre-engineering strategies
in construction and the possible benefits and risks that
lie in deciding on standardization.
Frame of reference
In the frame of reference, the engineer-to-order
Downloaded by [Australian Catholic University] at 04:16 09 October 2017
production strategy is first set apart from other main
production strategies (Figure 1). Secondly, the
engineer-to-order situation is described in detail and
the production strategy diversified, breaking down the
engineer-to-order strategy into three subsets with dif-
ferent levels of pre-engineering in order to provide the
base for answering the first research question. The
core capabilities for engineer-to-order firms are sum-
marized from theory to provide an analytical categori-
zation useful to present the cases and answer the
second research question. Finally, the product plat-
form is presented and its possible application in the
engineer-to-order subsets is discussed as a base to
answer the third research question.
Production strategies
Construction is often treated as a special trade, with
unique ‘products’ of long-lasting economic and client
value and a strong coupling to the building site. On
the other hand, when looking upon construction as
production, it becomes clear that the ‘uniqueness’ of
construction is valid also in other trades. As identified
by Winch (2003), construction is a complex produc-
tion with large variety and small volumes (Porter
et al., 1999). The largest degrees of repetition are
reached in the single-family house-building industry
where catalogue designs are used or, if zooming in, in
the repetition of prefabricated building components.
This jobbing production has a pre-designed set of
solutions, but jobs change along the production line
with very few if any equal jobs in a row.
The reason for construction being a complex pro-
duction performed in discrete jobs is a response to
the meeting of the client demands. In construction,
the client is allowed or demands to enter the produc-
tion information flow at a very early stage, before or
during the design phase (Winch, 2003). By
combining the findings of several researchers, Gosling
943
and Naim (2009) defined six different production
strategies: engineer-to-order (ETO), buy-to-order
(BTO), make-to-order (MTO), assemble-to-order
(ATO), make-to-stock (MTS) and ship-to-stock
(STS). In some projects, the client procures a
supplier (often an architect) even to develop the con-
cept, which results in a concept-to-order strategy
(Winch, 2003) (Figure 1). (Production strategies are
also labelled supply chain structures or even business
models.) The buy-to-order strategy occurs when exist-
ing components are configured, purchased and com-
bined into new products, which is an activity
performed during the engineering stage. It is therefore
seen as part of the ETO strategy (Figure 1).
The divider between the different classes is the
client order decoupling point, before which produc-
tion is made on speculation and after which produc-
tion is made under the certainty of a client order
(SIEMENS in Wiendahl and Scholtissek, 1994;
Wikner and Rudberg, 2005). The P:D ratio (produc-
tion time: delivery time) by Shingo (1981) can also be
used as a divider. Choosing an ETO strategy opens
up the opportunity for high levels of customization,
while at the other end an MTS strategy favours stan-
dardization (Lampel and Mintzberg, 1996). Olhager
(2003) emphasizes the fact that the position of the cli-
ent order decoupling point determines the key charac-
teristics of the supply chain. Caron and Fiore (1995)
pointed out that construction employs the ETO strat-
egy with the twist of onsite production and a very
strong project management culture, which could be
transferred to support innovation projects in more
flow-oriented firms outside construction. The link
between construction and ETO was made also by
Gosling and Naim (2009). As with all classifications,
the boundaries are not sharp but rather a continuum.
The engineer-to-order situation
The engineer-to-order supply involves a non-physical
stage including tendering, engineering, and process
planning activities, and a physical stage that comprises
component manufacturing, assembly and installation
(Bertrand and Muntslag, 1993). Examples of prod-
ucts produced by firms employing an ETO strategy
are power supply systems, offshore appliances, air-
planes, packaging machines, buildings, and civil engi-
neering artefacts. These are all products with deep
and complex product structures (more than six lev-
els), which give rise to many levels also in assembly
processes (Hicks and Braiden, 2000).
In ETO situations the sales process is mostly
focused on performance characteristics, delivery time,
and price (Konijnendijk, 1994). Clients are often
unfamiliar with the product, which constitutes capital
 944
goods with low buying frequency (ibid.). Owing to
the nature of ETO products, clients use quotations
(procurement or tendering) to receive offers from
many suppliers before placing an order (ibid.).
Konijnendijk (1994) states that the success rate for
construction firms in quotations is often less than
30%.
Market knowledge and responsiveness in tendering
are core capabilities for an ETO firm (Hicks et al.,
2000). The sales process is time consuming and can
be seen as a gradual refinement of client require-
ments, which in many cases continue even after the
client order decoupling point (Konijnendijk, 1994).
The engineering phase is difficult to plan and con-
trol and the main mechanism for controlling the lead
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time is the number of people working (ibid.). Hicks
and Braiden (2000) explain how the engineering func-
tion develops and describe the product in terms of
drawings, bills of materials, and specifications, but
not always with a manufacturing orientation.
Engineering is a strategic capability of an engineer-
to-order firm and should not be outsourced (Kon-
ijnendijk, 1994). A conflict can arise in the complex
multi-project setting of the engineers between the
short-term goal to realize current projects and the
long-term goal of supporting quotations for new
projects (Bertrand and Muntslag, 1993).
The manufacturing process is built up with general
purpose tools, to be able to handle large variations in
product solutions (Konijnendijk, 1994). The work-
force is highly skilled and able to perform several
tasks (ibid.). Konijnendijk (1994) further states that
production control must be carried out in coordina-
tion with marketing, since client delivery time and
manufacturing lead times interact closely. The first
decisions on production planning are taken under
great uncertainty as a result of the unknown product
specification (Bertrand and Muntslag, 1993). It is
challenging to implement manufacturing resource
planning (MRPII) in ETO firms, because many sup-
port systems rely on a predefined bill-of-materials
(BOM) structure, which is not easily changed
between projects. Non-physical activities like engi-
neering and design are also difficult to model in a
BOM structure (ibid.). Recent developments have
seen the creation of advanced planning systems (e.g.
Fleischmann and Meyr, 2004), where uncertainties in
client demand are mitigated through safety stocks/
times and changeable BOMs are present.
In ETO firms 75–80% of the total cost is bought-
out components (Hicks et al., 2000), since it is nearly
impossible for an ETO firm to integrate all produc-
tion of components in-house given the complex prod-
uct structure. The variety in specifications and the
high proportion of contract value that is outsourced
Johnsson
makes procurement and purchasing core capabilities
of ETO firms (ibid.).
Subsets of the engineer-to-order strategy
Even though ETO firms have a strategy that allows
the client to affect the product to a large extent, pre-
engineering is a possible choice for a supplier. Wikner
and Rudberg (2005) refine the engineering dimension
(subscript ED) by defining it as a range from original
design-to-order work (DTOED) to a fully defined
engineer-to-stock solution (ETSED). (In their work
(ibid.), DTOED is labelled ETOED.) The ETO situa-
tion with original design work only has been referred
to as design-to-order (Winch, 2003), where entirely
new products are designed (Porter et al., 1999).
Points in between DTOED and ETSED can consist of
different stages of pre-engineering resembling the
assemble-to-order situation transferred to design,
named adapt-to-order (ATOED) (Wikner and
Rudberg, 2005). The ATOED situation is when parts
of the design solution are pre-engineered and the final
product is realized through combining these parts.
Some parts can also be designed especially for the
particular project, i.e. mixing ATOED and DTOED.
The buy-to-order (BTO) strategy is used in combina-
tion with design-to-order, adapt-to-order or engineer-
to-stock. BTO means buying and mixing already
existing parts available on an open market into new
products, while ATO means altering self-owned parts
into new products. As the BTO strategy can form an
integral part of all other ETO strategies, it is left out
in the further presentation. ATO is seen as a subset
of the ETO situation along with design-to-order and
engineer-to-stock (Figure 4). Concluding their devel-
opment, Wikner and Rudberg (2005) define pairs of
feasible combinations of production dimension (sub-
script PD) strategies and engineering dimension strat-
egies in a plane (Figure 2).
Identification of core capabilities for engineer-
to-order firms
Konijnendijk (1994) was one of the first to identify
the coordination between market and manufacturing
as a core capability of an ETO firm. In his description
of an ETO situation (ibid.), a few other core capabili-
ties were identified, which are supported by later
results from other researchers in the section ‘The
engineer-to-order situation’. The core capabilities for
an ETO supplier are summarized:
• Market knowledge. This incorporates meeting
the client at early stages of product conception,
since the ETO strategy implies that the supplier
takes part in product development.
 Production strategies pre-engineering 945

Production dimension

[DTOED,MTOPD]
DTOED−engineer-to-order,
engineering dimension
Non-feasible client
order decoupling points ATOED−adapt-to-order,
engineering dimension

Engineering dimension
ETSED−engineer-to-stock,
engineering dimension
[ATOED,MTOPD]
MTOPD−make-to-order,
production dimension
Feasible client order
decoupling points ATOPD−assemble-to-order,
production dimension
MTSPD−make-to-stock,
production dimension
[ETSED,MTOPD]
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[ETSED,ATOPD] [ETSED,MTSPD]

Figure 2 Two-dimensional client-order decoupling point in the engineering and production dimensions (after Wikner and
Rudberg, 2005)

• Tendering capabilities. Because of the high also examples of self-owned manufacturing in

monetary value of products, the client requests
quotations from several suppliers to choose
from. The quotations should define the product
sufficiently for client decision-making.
• Engineering proficiency. As the meeting with
the client takes place during the engineering
phase, knowledge in engineering and the self-
owned product is needed to be able to fulfil cli-
ent demands.
• Manufacturing resources. In construction, these
resources are not necessarily self-owned, but
often hired through subcontracting. There are
e.g. offsite factories.
• Coordination between market coupling and
manufacturing. One of the strongest competi-
tive factors for ETO firms is the client delivery
time, which is closely linked to manufacturing
lead times. Therefore, coordination between the
two is a core capability of an ETO firm.
• Procurement. As much as three-quarters of
the total cost in a building project is subcon-
tracted, which makes procurement of materials,
resources, and subcontractors a core capability
of ETO firms.

Modularity parts

Commonality parts

Parts: Commonality parts, processes,

Product variants
relationships, know-how

Figure 3 Platform logic and product families (after Jiao et al., 2007)
 946
Platform organization of products in the
engineer-to-order situation
In the continuum of pre-engineering strategies from
design-to-order to engineer-to-stock, different possi-
bilities for predefining the material stock and the
manufacturing process arise. A common way of
responding to a situation where predefinition is
possible is to organize the products of the firm into
product families (Meyer and Utterback, 1992). The
concept first arose in the make-to-order and make-
to-stock situations. The product variants within the
family all share some core parts or technology (Meyer
and Lehnerd, 1997). These are the commonality parts
in the platform for the product family (Erens and
Verhulst, 1997) (Figure 3). Product families can be
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generated by grouping the commonality parts to form
a base to which the modularity or customization parts
are attached to form product variants (Jiao et al.,
2007) as illustrated by dashed lines in Figure 3. Man-
agement of interfaces between parts is an important
task in platform development (Sundgren, 1999), both
between the platform core and the modules and
within the modules. Ericsson and Erixon (1999)
identify that the idea is to separate the in-module
interfaces from the between-module interfaces to be
able to do product development on one module at a
time to reduce product development costs and still
maintain a large variety in the client offer. Platform
organization of products can thus be seen as a
method to accomplish the adapt-to-order or engineer-
to-stock situations described by Wikner and Rudberg
(2005). In a pure design-to-order situation all parts
are designed for the project, and there is no platform.
In an engineer-to-stock situation, the situation in
Figure 3 is possible to realize since all solutions are
pre-engineered. Then the platform organization can
also be used to store product documentation and
drive product development. Finally, for the in-
between case using the adapt-to-order case, it is possi-
ble to define commonality parts, but some modularity
parts are designed in each project or bought specifi-
cally for that project. In consequence, the platform
definition in an adapt-to-order situation is not
complete and balancing between pre-engineering and
new design becomes part of the engineering task.
A platform does not only consist of physical parts.
Robertson and Ulrich (1998) state that a product plat-
form consists of products, processes, know-how and
relationships, which leads to the conclusion that also
process knowledge can be used as a constituent of a
platform (e.g. the knowledge to produce foundation
works for a house). Early works on platform develop-
ment focused on the product and components them-
selves (e.g. Meyer and Utterback, 1992, and later
Johnsson
Ericsson and Erixon, 1999), while later contributions
concern the logic and processes making the platform
work (e.g. Meyer and Lehnerd, 1997; Robertson and
Ulrich, 1998). Lessing (2006) transferred the platform
concept to systems building and identified the techni-
cal platform and the process platform as parts of the
entire platform. Designing a platform is an integrated
problem that entails client needs interpreted in func-
tional requirements translated to design parameters,
realized through process variables and controlled by
logistics variables (Suh, 2001). Investment in a plat-
form is a strategic decision by a firm, since the platform
will constitute large parts of the resource base: see
Schroeder et al. (2002), who link the resource-based
view in strategic management to manufacturing strate-
gies. In order to sustain several platforms the firm
needs large resources. These platforms could possibly
be organized using differing manufacturing strategies
(engineer-to-order, make-to-order, etc.), even though
this would need a differentiation of core capabilities
within the firm to be successful (de Haan et al., 2002).
Small firms will possibly find it economically difficult
to sustain more than one platform and consequently,
the entire firm will be working according to one
manufacturing strategy only.
Possibilities for platform application vis-à-vis
the design decoupling point
Depending on the choice of a firm in terms of
pre-engineering in Figure 2, varying conditions for
organizing the actual manufacturing result. With a
pure design-to-order strategy, no materials can be pre-
ordered and consequently the gain of integrating
manufacturing into the firm is less. Organizing a plat-
form can be difficult since repetition is not evident.
Since the product is so complex that it has to be
designed to order, the subsequent complex manufac-
turing results in large variations in methods and lead
times. Manufacturing can be organized in units that
perform specific tasks (e.g. foundation works, form
work, surveying). These units are multi-competent
and can perform their task within large variations of
their framework, e.g. depending on site conditions.
Another possibility is to not integrate manufacturing
and instead deliver a finished design, which is later
produced by another firm.
Employing an engineer-to-stock strategy means that
all engineering solutions are finalized at the time
when the client places an order. Although nothing has
been manufactured yet, it is possible to organize a
material stock and a manufacturing process that are
fully predefined. A firm with nothing but engineer-to-
stock solutions can organize product development in
full accordance with Figure 3. Manufacturing is
 Production strategies pre-engineering
started through issuing jobs, since client orders
seldom can be batched.
In the midst there are the adapt-to-order and
buy-to-order strategies where parts of the design are
pre-engineered, parts are customized. In the ATO
situation, the material stock consists of the materials
that are common to all product variants (i.e. the
commonality parts in the platform). The full platform
concept in Figure 3 cannot be applied in an adapt-
to-order situation. Manufacturing can be organized in
a job shop manner, but must allow customization.
Combining the adapt-to-order and buy-to-order
strategies could be effective, where BTO implies that
customization is achieved through buying customized
parts on an open market (e.g. concrete hollow decks
Downloaded by [Australian Catholic University] at 04:16 09 October 2017
are available as BTO parts). A summary of the differ-
ent possibilities for client entrance presuming an
ETO situation is presented in Figure 4.
Figure 4 refines the engineering stage and shows
that the ETO situation can comprise several choices
when it comes to pre-engineering.
Method
Following the tangent of Gosling and Naim’s (2009)
work on manufacturing strategies, the focus is on the
role of pre-engineering in construction. The diversifi-
Concept-to-order
Engineer-to-order
Make-to-order
Assemble-to-order
Make-to-stock
n-to
sig
D
e Ad
Ship-to-stock
Figure 4 Different possibilities of pre-engineering in an engineer-to-order situation
947
cation of pre-engineering strategies in ETO firms in
Figure 2 is empirically tested in a multiple case study
within house-building in Sweden where the product
view has enabled firms to apply an engineer-to-stock
strategy (Johnsson and Sardén, 2008). Each ETO
firm should nurture its core capabilities, which was
comprehensively presented by Konijnendijk (1994).
The presence of these core capabilities was identified
in the case study firms. The possibility for integration
of upstream events in the supply chain is illustrated
using platform organization, adopting Robertson and
Ulrich’s (1998) view of a platform as a broader con-
cept than merely a technical view. The unit of analy-
sis in the multiple case study is the pre-engineering
strategy of a firm in the shape of a platform.
The first research question implies that the possibil-
ity to diversify the ETO production strategy in house-
building should be studied. Wikner and Rudberg
(2005) speak of three distinct cases: very little pre-
engineering, adaptable pre-engineering, and full
pre-engineering. Therefore, firms operating each of
these strategies were sought and found as study
objects. The second research question addresses the
presence of certain core capabilities in ETO firms as
identified by Konijnendijk (1994). In order to
discover their presence, either a survey or a multiple
case study is a possibility. In this research, a multiple
k
der er stoc
d
- or - or
r-to-
t-to ee
ap in
Eng
 948
case study was chosen since the third research ques-
tion probes into the relation between the level of pre-
engineering and platform organization. As this is con-
textual knowledge about a systematic approach that
affects many parts of a firm, a multiple case study was
selected (Yin, 2008).
The author of the paper is in a unique position
when it comes to gathering data from the selected
firms. The author is a part-time employee at one of
the firms. The author belongs to a research group
where other members are part-time employees at two
other firms and at the last firm a close collaborator in
research and development is employed. Given the set-
ting of a multiple case study this is an advantage,
since pre-understanding of the issues met by the firms
Downloaded by [Australian Catholic University] at 04:16 09 October 2017
was high, which led to ease in posing questions that
were understandable and ease in understanding and
interpreting answers. In terms of access to data, both
primary and secondary, the situation with complete
membership (Adler and Adler, 1987) led to under-
standing of the platform in use as opposed to recon-
stituted understanding. On the other hand, the role
duality can cause awkward situations for both the
researcher and the firm employees (Brannick and
Coghlan, 2007), especially if organizational politics
cause the credibility of the researcher as a member of
the organization to be questioned. This could possibly
lead to bias in reporting the research. The author
works as a platform manager with the work task to
integrate and balance the platform with the core capa-
bilities of the firm. As a consequence, the core capa-
bilities themselves are not part of the author’s
competence and it was possible to record and analyse
them without much bias (it is part of a platform man-
ager’s task to question them in relation to the plat-
form). The author could in this situation act as an
observing participant (Alvesson, 2003). As for the
description of the platforms and the nuances of the
decoupling point, these descriptions were validated
with employees at the respective firm and through
engaging an uncoupled member of the research group
to verify that data were interpreted and presented
with as little bias as possible.
Selection of cases
The firms chosen belong to one of the following cate-
gories and have been given fictive names:
• House-building consultants with no pre-design
following a design-to-order strategy (Tijmma).
• House-building firms that combine existing
components from suppliers with new solutions
through an adapt-to-order/buy-to-order
approach (Noin).
Johnsson
• House-building firms that combine existing
wholesale components with new solutions
through an adapt-to-order/buy-to-order
approach (Lumi).
• House-building firms working with catalogue
designs in an engineer-to-stock manner (Biedjo).
A common occurrence in house-building is that con-
sultants and contractors join forces and construct a
temporary supply chain, which is illustrated by
Tijmma and Noin. This is the reason for including
Tijmma although it does not possess any manufactur-
ing capabilities. The firms chosen for participation in
the study were all active on the Swedish market for
house-building in 2012. They do not deliver exactly
the same functionality in their products, but all pro-
duce dwellings. Table 1 presents basic data of the
studied firms.
Data collection
Data were collected through combining earlier research
work with new interview and archival data. Sardén
(2005) included Noin in her case study and Jansson
(2010) focused entirely on Lumi in his work on indus-
trialized construction design. The cases Tijmma and
Biedjo were covered entirely within this research.
Interviews were conducted with market and design per-
sonnel at all firms, and product offers were analysed.
The market position vis-à-vis the decoupling point was
investigated through asking questions about the possi-
bility of being competitive in tendering with respect to
other suppliers. The interviews were semi-structured,
face-to-face, and short (typically half an hour to one
hour), asking for facts rather than personal opinions of
the interviewees. The main questions used in the
interviews are presented in Table 2. Depending on the
answers, follow-up questions were asked.
Persons from several departments within each com-
pany were interviewed, typically from the market,
engineering, manufacturing, and materials depart-
ments. In total 14 interviews were conducted, with
one to two interviews per department and firm. The
interview data were recorded through taking notes or
recording the interview.
Archival data consisted of platform documentation
and its organization. Furthermore, documentation on
product offers available to the clients was studied.
These two types of documentation were chosen to
provide a secondary data source covering the same
area as the interviews, confirming or discarding the
results of the interviews. Thus, triangulation was
made possible. When discrepancies occurred, follow-
up questions were asked until understanding was
reached.
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Table 1 Basic data for case study firms (categories from Hicks et al., 2000)

Depth of
No of Typical product Process Manufacturing Manufacturing Engineering
Firm empl. Product order size Customization structure integration process strategy strategy
Tijmma 1200 Multi-family e0.2m Very high Deep CEP None None Design-to-
dwellings design order
Noin 7500 Multi-family e8m High Deep (E)PMACC J Engineer-to- Design/
dwellings order Adapt-to-
order
Lumi 160 Multi-storey e5m High Deep EPMACC J Engineer-to- Adapt-to-
dwellings order order
Biedjo 160 Single- and multi- Low Deep CEPMACC JB Engineer-to- Engineer-to-
Production strategies pre-engineering

e2m
(Stoerre) (9400) family dwellings order stock

Notes: Customization: low = mainly standard products; medium = customized options; high = engineer-to-order; very high = product development.
Depth of product structure: shallow = 1 to 3 levels; medium = 3 to 6 levels; deep = more than 6 levels.
Processes: C = concept, E = engineering, P = project management, M = manufacturing, A= assembly, CC = construction and commissioning.
Manufacturing processes: J = jobbing, B = batch, F = flow, A = assembly.

Table 2 Main questions in interviews, follow-up questions expanded during interviews

Platform Decoupling point Capabilities

Describe the product conception from client
order to finished building
How much of the finished product is fully
designed when the contract is signed?
Do you reuse earlier solutions in your daily
work and to what extent?
Do you have to offer special solutions in
particular projects to satisfy clients?
Do you procure subcontractors for each
project and to what extent?
Describe the relation to the client during a project. When and
how do you meet and when and how do you part?
How important is it to your firm to reuse earlier solutions?
How do you formulate your product offer to the market?
How is the client involved during the engineering phase?
Have clients responded positively to your market offer?
What are the main tasks of the market
department? What are your core values?
How do you act in tendering and with what
freedom concerning the platform?
What are the main tasks of the engineering
department? What are your core values?
What are your manufacturing capabilities and
do they vary between projects?
Who coordinates order specifications with
manufacturing planning?
949
 950
Case study analysis
First, the particularity of the engineer-to-order strat-
egy is identified in each case, identifying that one firm
represents design-to-order, one design/adapt-to-order,
one adapt-to-order, and one engineer-to-stock strate-
gies. To visualize the client decoupling point plane in
Figure 2, their respective position is marked in
Figure 5. In Figure 5, Tijmma and Noin are treated
as one point as an engineering firm and a contractor
in collaboration in the supply chain would emerge as
engineer-to-order in the engineering dimension and
make-to-order in the production dimension. However,
in the case study they are treated separately as they
are different firms with different strategies.
The data from the interviews are analysed through
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organizing the answers according to the core capabili-
ties in ‘Identification of core capabilities for engineer-
to-order firms’, thus producing the backbone for the
case study results, which are presented firm by firm.
In so doing, the second research question is answered,
describing the core capabilities presented by Kon-
ijnendijk (1994) for each firm. The relative strengths
of these capabilities are presented in Figure 6. The
grading in Figure 6 is achieved by comparing the core
capabilities of each firm. The capabilities are
expressed through how much resource (employees or
functions) a firm has allocated to this capability. For
example, the procurement capability would be consid-
ered strong if the firm has a considerable amount of
employees organized to support building projects with
procurement. Check-up questions were posed to the
other participating firms, e.g. ‘Would you consider
Noin to be better at procurement than yourself?’ The
scale in Figure 6 is merely indicative; there is no
quantitative measurement behind the scale. Any
deviations from the core capabilities from theory are
identified.
Thirdly, an analysis of the consequences for
platform application caused by the position of the
decoupling point is made. The analysis draws upon
theoretical findings as well as case findings. A possi-
bility could have been to describe each studied plat-
form in terms of components, processes, know-how,
and relationships as in Robertson and Ulrich (1998).
Although the collected data permit the analysis, this
option is omitted in the current research and will be
presented in future work.
Case study results
Tijmma
Tijmma is a consultancy firm working with develop-
ing building designs for clients. It is paid by the hour
Johnsson
to produce necessary documentation for building pro-
jects, which involves design, calculations, quantity
estimations, and drafting. Tijmma does not specialize
in house-building, it also has capabilities to design
infrastructure and commercial buildings, undertake
urban design and work with environmental and water
issues. The workforce is organized in specialized
departments; house-building specialists work only
with houses. Lately, the firm has been asked by cli-
ents to design platforms intended for prefabrication,
which has spurred an interest in exploring how far the
engineer-to-stock strategy could be developed and
made profitable within a consultancy firm. Tijmma’s
profession is design and its current goal is to master
the entire range between design-to-order and engi-
neer-to-stock (Figure 4).
Tendering and market knowledge
Also consultancy firms place tenders, often in two
steps in the Swedish building process: first the system
design and later the detailed design. It is not uncom-
mon that two different consultancy firms perform the
system and detailed design within the same project.
As Tijmma is capable of undertaking architectural
work, it works closely with the client on conceptuali-
zation of the building project. Within the same firm,
Tijmma can thus be positioned both before and after
the client order decoupling point in construction
(Figure 1). But the majority of the activity takes place
as a gradual refinement of client requirements after
the client order decoupling point (Konijnendijk,
1994). Tijmma’s contact network is vast; it is present
in every major city in Sweden. Tendering is done by
the more experienced members of staff, but many
jobs also originate from good relations with clients.
The competitive edge of Tijmma is its knowledge
within construction. Tijmma operates mainly in
business-to-business relationships.
Engineering
Engineering is Tijmma’s core competence. The entire
firm is organized to capture client needs and trans-
form them into descriptions of technical solutions
using a combination of design calculations and draft-
ing using computer aided design (CAD) or building
information modelling (BIM). The resource base is
controlled by varying the number of persons working
with a project. Experience feedback between engi-
neers varies and is dependent on personal preferences.
Many engineers experience that they complete the
same task over and over again, but every time repeat
the same steps as the previous time. The first time is
therefore as time consuming as the subsequent times.
 Production strategies pre-engineering
This has led Tijmma to consider platform thinking
within its line of work. It started with a bridge design
and is currently spreading its capabilities to elevator
shafts and roundabouts. These can be seen as
components that can be combined into building infor-
mation models in a modularized manner (Meyer and
Utterback, 1992). Tijmma’s goal is to gather these
components in a platform of modularity parts that
can be reused. The solution should be fully designed
and described using CAD/BIM drawings. An impor-
tant aspect is that parameterization is used to allow
for differing project settings. The ideas for platform
implementation arose from a project where develop-
ment of a house-building platform for timber-framed
construction was the quest. In this project, modular-
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ization theory was applied with good results even to
engineering work (Jensen et al., 2012). Receiving
return on investment for its engineer-to-stock efforts
might be limited since Tijmma does not have any
manufacturing capabilities. A survey conducted on
elevator shafts internally showed that three variants
were in use and they were used in 8 cases out of 10.
The ground for parameterization is thereby shown
and possible since Tijmma is a national player and
obtains sufficient repetition when taking the nation-
wide perspective. Within Tijmma, employees are
reluctant about the platform approach, since it means
that fewer hours are needed to produce building doc-
umentation. As its entire business model is built
around charging per hour, the business model would
most likely need to be changed if platform thinking is
implemented throughout.
Manufacturing and procurement
Tijmma is currently not engaged in manufacturing. It
does not procure any subcontractors or material sup-
pliers either.
Noin
Noin produces multi-family dwellings, but also pos-
sesses a wide range of other production capabilities
such as civil engineering and commercial buildings.
Noin has international branches as well and is one of
the largest contractors on the Swedish market. The
firm consists of several departments and can be
seen as a corporation. Noin operates on the business-
to-business market. The ability to solve almost any
problem the client would have is part of the firm
strategy, but lately Noin has begun to organize parts
of its design and production in platforms aiming at
industrialization. Its platforms support the design-
to-order and/or the adapt-to-order strategies. Its
intent is to emphasize the process content of the plat-
form, avoiding investment in production equipment.
951
Its focus is so strong on site production and assembly
that one of the core capabilities in an ETO firm,
namely engineering, in cases of open-bid contracts is
made by another actor. In essence, this makes Noin a
firm that struggles to maintain two main production
strategies: ETO in the case of design-build contracts
and MTO in the case of open bids. This is very diffi-
cult to handle within one organization, which is evi-
dent from the discussions with employees who always
deliver an answer starting with ‘It depends …’. Their
reaction is consistent with the findings of de Haan
et al. (2002) who stress that core capabilities in build-
ing reflect performance of the firm. Noin has a history
of being a contractor, but the current movement is to
integrate downstream to establish closer relationships
with the client. Along that line, design-build contracts
increase as do partnering projects and self-owned con-
struction. There is a department for property develop-
ment within Noin, which sometimes acts as the client
for the house-building department. This situation
facilitates the development of a platform and enables
new solutions to be tested. Noin sustains seven plat-
forms currently; one is the house-building platform.
The house-building platform is mainly a collection of
technical solutions and connected production meth-
ods. The platform does not consist of commonality
parts, but rather comprises commonality methods and
solutions. The work with platforms has resulted in
financial gains. From 2008 to 2011 the cost decreased
by 7% (total building area) nationwide. The decrease
is attributed to the repetition in solutions taking
advantage of the learning curve in work tasks and can
consequently be interpreted as an increase in tact time
that is detected as a cost decrease.
Tendering and market knowledge
Noin’s contact network on the construction market is
vast; Noin has offices in every part of Sweden and is
almost always a contender in open bidding. Tender-
ing is a core competence with Noin, carried out by
the most experienced members of the organization.
Noin works on both open-bid contracts (half of the
contracts) and design-build contracts (half of the con-
tracts). The platforms are not unique technically.
Noin strives to create a competitive advantage
through streamlining design, thus offering a more pre-
dictable and cost efficient product. Coordination with
production is achieved through quotation estimations
only without contacts with production personnel.
Noin does not seek early contact with the client to
affect the settings of the project. Rather, it actively
avoids contact, so as not to be accused of tampering
with the market conditions. Communication with the
client is focused on the tendering process. The lack of
 952
a sales department to nurture the platforms makes the
coupling between client needs and technical solutions
weak. Integration of such a function is currently not
part of the firm strategy. The market performance of
the platform is almost the same in all segments; the
platform can handle many house designs.
Engineering
All platforms used by Noin are handled by a special-
ized department of technical experts. They are 130
persons in total and gather specialists from the entire
corporation. They support the engineers working on
specific building projects. If a platform is used,
instructions are very precise on how drawings should
be drafted and what technical solutions to choose.
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The instructions are less elaborate when it comes to
how production should be conducted. Engineering
work is supported by BIM and Noin is constantly try-
ing to reuse data from the building information
model.
Manufacturing and procurement
The basic technology for house-building with Noin’s
platform is prefabricated flat concrete elements, deliv-
ered to the site from a material supplier. The firm
does not own the factory where the elements are pro-
duced. Instead it owns the assembly process on site.
The assembly on site is Noin’s core business and
much of the organization is designed to support work
on site. Virtual construction is increasing steadily at
Noin and integration with the building site is within
its scope. The work on site is not automated. Onsite
completion for a house-building project takes about
12 months and includes interior finishing and installa-
tion of heating, ventilation and air conditioning
(HVAC) services. Buildings can be constructed from
two to at least 20 storeys high using the house-build-
ing platform, but market demand seldom requires
higher buildings than 15 storeys. Purchase of materi-
als is undertaken by the site manager with strong sup-
port from the central purchasing department where
long-term contracts are sealed with larger suppliers.
At times, there are conflicts between the site manager
who wants a certain material type and the purchasing
department which wants the site manager to follow
the supplier contract. Another core capability of Noin
is coordination and procurement of subcontractors.
Up to 50% of all site work can be subcontracted.
Lumi
Lumi produces multi-family dwellings constructed of
volumetric modules. Lumi is a family-owned med-
Johnsson
ium-sized firm. Its market strategy is to take wholesale
responsibility for the client from sales to completed
building offering to take full liability during the build-
ing process. Lumi operates with professional clients
only in business-to-business relations. It integrates
sales, design, manufacturing, and installation of the
building into one firm. There is also a department for
property development, which sometimes acts as the
client for the house-building department. This situa-
tion facilitates the development of the platform and
enables new solutions to be tested. Lumi nurtures one
platform using the adapt-to-order and buy-to-order
strategies in combination (Figure 4). The entire firm
is organized to support the self-owned platform and
Lumi owns and operates the manufacturing plant
itself. It also installs the platform variants on site. The
platform comprises 60% commonality parts and 40%
customization parts purchased for each building pro-
ject. Short lead times, which lead to fast return on
investments for clients, are a competitive advantage
for Lumi.
Tendering and market knowledge
The sales department has during the last 25 years
built up a large contact network with returning and
potential clients. To enter very early in the conceptual
phase of a building project is crucial for the success of
its specialized platform, since design decisions affect
the ability to use the platform efficiently. The optimal
time for Lumi to enter the building project is even
before the building permit is given. Lumi works with
design-build contracts only. The sales department is
the project leader for the building project until the
contract is signed and is in charge of quotations and
cost estimation. The sales department is also respon-
sible for setting up the production sequence and time
frames for manufacturing and delivery. A selection is
made among projects for which to tender to ensure
later profitability in manufacturing. During the sales
process, the design department assists with technical
solutions, but it is the sales department that negoti-
ates larger adaptations with the client. The cost level
of producing the platform makes it possible to offer
prices 5% lower than those of competing platforms.
The lower cost level is obtained if the project parame-
ters provide a good fit for the platform, but the opti-
mum is quite broad allowing for some variation
without altering cost levels.
Engineering
The engineering department produces all documenta-
tion needed to complete the project. The documenta-
 Production strategies pre-engineering
tion consists of CAD drawings and calculations. It
also generates quantity take-offs for the purchasing
department. All work is done with the platform as a
guide, with the goal of minimizing the number of
variants as far as possible. Drafting of HVAC and
electrical services drawings is done by external
consultants familiar with the platform. Drawings are
created without a BIM process as the core, but
parameterization is applied on the building element
level. The individual clients often have alterations
during the design phase and those are handled by the
project manager for design, which takes over the
responsibility for the project from the sales depart-
ment once the contract is signed. It is the sales
department and the engineering department that
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ensure that the adaptations of the platform are not
too costly, which could lead to lower profit. Between
five and 15 building projects are concurrently active
in the design process at any given moment in different
stages of completion. This is needed to keep level
with the manufacturing process.
Manufacturing and procurement
The parts needed to produce the house-building plat-
form are in 60% of the cases purchased via long-term
contracts with material suppliers and in 40% of the
cases procured for a specific building project. Parts of
the manufacturing are automated and the design
department produces computer files controlling a
nailing portal. Factory production does not start until
finished drawings are produced and all materials are
in place. The size of the modules is typically 4  8 
3 metres. They have a light-weight timber frame,
which is completed with insulation materials and cov-
ered with sheathing. The modules for one project are
produced in the factory in three to four weeks,
whereof half a day is spent producing the flat ele-
ments and the remaining time is spent on interior fin-
ishing. The factory produces around 1000 m2 finished
living area per week. The modules are finished to
about 90% when leaving the factory and then trans-
ported to the building site where they are assembled
into two- to six-storey buildings. Onsite completions
take three to four weeks. The onsite installation is
accomplished by self-owned teams specialized in
assembling the platform variants. The purchasing
department purchases materials directly needed to
complete the project on site and sends them to site
inside the modules. The work with the platform has
been ongoing since 1994; repetition in work tasks has
governed the layout and organization of the entire
company. New work tasks (engineering as well as pro-
duction) are designed for repetition. By focusing the
953
platform using a lean strategy, the output in factory
production has risen from four modules/day in 1997
to eight modules/day in 2012. The workforce
increased from 70 to 110 persons during the same
period. The sales, engineering, and purchasing
departments have increased their capacity by around
40% to keep the same pace, through focusing on effi-
ciency instead of hiring more personnel.
Biedjo
Stoerre is another of Sweden’s largest contractors.
Stoerre has organized its production and sales of low-
rise multi-family dwellings and terraced houses in a
subsidiary: Biedjo, which nurtures one platform for its
product. Just like Noin, Stoerre sustains several plat-
forms, currently six. Biedjo mainly develops owner-
occupied dwellings on its own land, which are later
sold to private clients, but the firm also has profes-
sional clients that provide tenancy dwellings. The
product concept represented in the platform is devel-
oped and owned jointly by Biedjo and a prominent
furniture supplier. The house models that are avail-
able in the product portfolio are developed with a
specific market segment and target price in mind by
cooperation between the two partners. The external
client or the internal land developer cannot change
the floor plans, the building layout or the interior
fittings as Biedjo works with the engineer-to-stock
strategy. However, it is possible to select from a num-
ber of predefined variants of each house model (e.g.
variants of ventilation systems and colour schemes).
The platform consists of 90% commonality parts and
10% customization parts, but all customization parts
are defined by Biedjo.
Tendering and market knowledge
The sales and marketing department and the business
and project development department at Biedjo have
the overall responsibility for the in-house real-estate
development: from the search for land, through urban
planning, sales activities, design, manufacturing, erec-
tion, and up to the point where the end-users move
in. The dwellings themselves are sold through special
sales events at the furniture supplier, which has a vast
network of warehouses. The offer is a pre-engineered
building concept to a low price. Typical clients are
municipal housing firms or smaller private real-estate
owners. The market communication of the concept is
focused on living, not on the actual houses. About 40
employees work with sales, marketing, business, and
project development activities. Biedjo is very active in
creating the right settings for its platform to perform.
If the settings are right, the cost level is low, better
than all competitors on the Swedish market. If the
 954
settings are slightly off, the cost levels rise quite
rapidly.
Engineering
The engineering department produces all documenta-
tion needed to complete a building project (founda-
tion work excluded). It also generates quantity
take-offs for the purchasing department. Since not
only the platform, but also the end products, are
completely designed in the platform development
work, all workshop and procurement drawings and
specifications, and the major part of the necessary
documentation for the client, are established already
in the development phase. Thus, the engineering
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work at Biedjo related to a specific building project is
limited. The engineering resources are instead spent
on refining the platform (continuous improvements as
well as new platform versions) and developing new
house concepts based on the current platform.
Manufacturing and procurement
Since the platforms are planned as engineer-to-stock,
Biedjo can engage several suppliers. At the moment it
has one self-owned production facility which produces
all multi-family dwellings in Sweden. The terraced
houses are produced by an external supplier. Biedjo
uses timber-framed modules as its basic component
(see case Lumi). The modules are produced in a fac-
tory and transported to the building site for assembly.
Since Biedjo focuses on maximum two-storey build-
ings, the service completion on site is less than for
Lumi. The module assembly on site takes one day for
a house with six apartments. The remaining onsite
completions take two to three weeks. The onsite
assembly is accomplished by subcontractors that spe-
cialize in mounting the platform products. All mate-
rial needed to complete the project on site is provided
by the purchasing department. About 130 persons
work in the factory and 12 persons on site per ongo-
ing project. Since the products are standardized with
a limited number of variants, Biedjo has the possibil-
ity to produce to stock (MTS) in order to overcome a
temporary market decrease. This strategy has, how-
ever, not been utilized yet. The standardized products
have enabled the purchasing department to create
long-term relations with material suppliers and work
efficiently with forecasting and material logistics. The
delivery times have been shortened and the delivery
precision improved. The platform has enabled a great
focus on repetition since all variants are known
beforehand, which has led to an output increase from
two modules/day in 2004 to 5.4 modules/day in 2012
Johnsson
without investing in new equipment. The sales, engi-
neering, and purchasing departments have increased
their capacity by 73% during the same time period.
Analysis and discussion
The diversification of the decoupling point
Using the model of the two-dimensional decoupling
point presented by Wikner and Rudberg (2005) the
case study companies are positioned within this
framework in Figure 5.
In Figure 5, Tijmma and Noin are treated as one
point as an engineering firm and a contractor in
collaboration in the supply chain would emerge as
engineer-to-order in the engineering dimension and
make-to-order in the production dimension. Tijmma
and Noin together represent the standard supply
chain of a designer and a contractor. In the situa-
tion of a design-build contract, Noin would act in
exactly the same way as the combination Tijmma +
Noin. All the studied case firms employ a make-
to-order strategy for production (the cases show that
none of the firms manufactures anything unless
there is a client order). The only exception is Biedjo
which claims it has the ability to make products to
stock, but has not actually done it (hence the arrow
in Figure 5).
The reason for choosing a make-to-order strategy for
production in construction, apart from uncertainties in
client requirements, is also the monetary value of the
produced goods, which constitutes a very high inven-
tory cost in terms of storage space and value of assem-
bled goods. The multiple case study shows that several
variants of the engineer-to-order strategy are used in
construction (engineer-to-order, adapt/buy-to-order,
Tijmma + Noin
[DTOED,MTOPD]
Lumi
[ATOED,MTOPD]
Biedjo
[ETSED,MTOPD]
[ETSED,ATOPD] [ETSED,MTSPD]
Figure 5 Two-dimensional decoupling point of case study
firms
 Production strategies pre-engineering
and engineer-to-stock). Thus, the diversification of the
decoupling point of Wikner and Rudberg (2005) is
confirmed in the engineering dimension. However, it is
not confirmed in the production dimension.
The core capabilities of engineer-to-order firms
All of the firms in the multiple case study work in an
ETO situation with different views on pre-engineer-
ing. In Figure 6, the core capabilities for an ETO
company are visualized for each case firm.
Tijmma works with a design-to-order strategy.
Tijmma does not engage in production and has no
procurement or production capabilities. Tijmma’s
engagement in platform thinking is focused on effi-
ciency in engineering work. Compared to Noin,
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Tijmma has a strong engineering capability that can
solve almost any problem. Tendering is a strong capa-
bility with Tijmma and it regularly teams up with
firms like Noin to compete for design-build contracts.
On the other hand, Tijmma never works with firms
like Lumi and Biedjo who have their own, specialized
engineering departments.
Noin represents an ordinary contractor. It faces the
situation of having to handle two distinct cases: when
engineering work is undertaken inside the firm
(design-build contracts) and when engineering work
is already done (open bidding). Using the terminology
of Figure 1, Noin actually maintains two production
strategies at the same time, ETO and MTO. Hence,
it can be difficult to organize the core capabilities of
the firm (de Haan et al., 2002), which might lead to
poor performance. The core capability of engineering
in Figure 6 is active when working with design-build
contracts, but inactive in an open-bid situation (hence
the hatch). Noin is very strong in tendering and is
almost always a contender in any bidding nationally.
Manufacturing is Noin’s main resource and its entire
business is focused on optimizing resource efficiency
in manufacturing. The manufacturing is also very
Market Tendering Engineering Manufacturing market/manuf. Procurement
Tijmma
Noin
Lumi
Biedjo
Figure 6 Core capabilities for engineer-to-order firms visualized for the case study firms
955
flexible in terms of products. Coordination between
market and manufacturing takes place in the pre-bid-
ding phase only. Procurement is an important capa-
bility for Noin, as it subcontracts large parts of its
production.
Lumi has an integrated approach employing an
ATO strategy, where its capabilities are strong within
its market segment. Market knowledge, tendering,
engineering, manufacturing and coordination between
market and manufacturing are all very strong in the
market segment of multi-family housing. In that
segment, Lumi competes well with e.g. the combina-
tion of Tijmma and Noin. Outside this market seg-
ment, e.g. in the segment of office buildings, Lumi
cannot compete at all. Procurement and subcontract-
ing are not strong capabilities of Lumi, since it aims
for long-term relationships.
Biedjo has a very integrated approach employing an
ETS strategy. It has no adaptation possibilities for
requirements outside its market segment and market
knowledge is high regarding potential sites that might
fit its platform. Contract discussions take place very
early in the process, which makes tendering in bids
less important, therefore Biedjo is not so strong in
tendering. Engineering is strong within platform
development and manufacturing is a strong focus to
achieve efficiency. Coordination between market and
manufacturing is crucial for Biedjo since the entire
business is built up around streamlining the supply
chain. Procurement is not particularly strong since
long-term relationships or even in-house management
of large parts of the supply chain are necessary for
streamlining it.
Platform organization in relation to the
decoupling point
It is a common situation in construction that firms
like Tijmma and Noin work in sequence in the supply
chain. Many clients witness that their needs are often
Coordination
 956
lost in the fragmented supply chain of construction:
this can be theoretically visualized in Figure 6, where
the capability to link market and manufacturing
identified by Konijnendijk (1994) is missing when an
engineering firm and a contractor join forces. This
capability is central to working with products, so for
platform management the combination of an engi-
neering firm and a contractor is not fruitful. Several
methods can be applied to work around this situation
in terms of contractual forms, long-term relationships,
profit sharing in projects, etc. Apart from the missing
capability to coordinate market and production, the
temporality in the supply chain is a major obstacle for
platform organization as platforms not only revolve
around physical parts, but to a great extent also con-
Downloaded by [Australian Catholic University] at 04:16 09 October 2017
cern relationships with suppliers (Jiao et al., 2007). As
shown by case Tijmma, there is a growing notion that
the processes are reoccurring and that they could be
possible building blocks in a platform. The same
situation is faced by Noin, where the same processes
are repeated project after project, but with a product
variation. Platform organization of processes could
provide a possible path forward to increase repetition
for firms without forcing them to standardize their
product.
While Noin addresses all market segments in multi-
family dwellings, the specialist contractor Lumi selects
carefully and works together with the client in early
stages of the project. Lumi operates with an adapt-to-
order strategy in combination with buy-to-order.
Compared to Noin, Lumi cannot offer the same
range, but has focused on the most common multi-
storey dwellings requested by clients. Lumi’s platform
work revolves around variability in client demands. In
terms of defining its platform, Lumi has to leave parts
of the platform undefined. This is different from the
situation depicted in Figure 3, where everything is
pre-engineered. Being the ‘middle case’ affords the
opportunity to offer client customization, but has the
drawback of less predefinition in upstream processes.
Lumi’s platform is open for customization and is vul-
nerable if solutions are introduced that lie too far
from the platform. As an example, Lumi once tried
open bidding with discouraging results.
Biedjo on the other hand acquires land to develop
and has integrated much of the client function within
the firm and is the firm among the studied ones that
has the highest vertical integration of the supply chain.
Operating with an engineer-to-stock strategy and
acquiring land to develop enables Biedjo to control the
supply chain very efficiently. The offer to the market is
narrow and targeted. The risk is that if the market
niche decreases in size, Biedjo (like Lumi) is immedi-
ately affected and has difficulties responding to the
new situation. Balancing its platform between com-
Johnsson
monality and customization is very important and is
affected by many factors (Park and Simpson, 2005)
that are also time dependent with market changes.
Biedjo has a fully developed platform as depicted by
Figure 3 and never allows product development (i.e.
customized products) in projects. Instead, the platform
is issued in versions with product variants presented to
the client. In terms of calibration with market needs,
Biedjo has the most sensitive platform and needs the
most correct project definition to succeed in platform
application. If the project setting is wrong, Biedjo has
no possibility of redesigning its product since every-
thing is engineered to stock. This is a risk for the firm
as Biedjo only operates one platform: if the platform is
unsuccessful, the firm is unsuccessful.
Conclusions
The research categorizes the degree of predefinition in
the construction supply chain leading to different
types of industrialized building and highlights the
impact of the client relation for the success of plat-
forms in construction. The lens provided by Wikner
and Rudberg (2005) was successfully used to diversify
the ETO production strategy in house-building in
design-to-order, adapt-to-order, and engineer-to-stock
strategies. Each of these was identified in the multiple
case study (Figure 5). The diversification of the
decoupling point was shown in the engineering dimen-
sion only; in the production dimension no diversifica-
tion of the decoupling point was found, all case study
companies work with a make-to-order strategy.
The core capabilities for ETO firms identified by
Konijnendijk (1994) were present at the case study
firms (Figure 6). Using a design-to-order strategy,
firms seem to lack the coordination between market
and manufacturing. This is especially evident in the
common set-up of an engineering firm and a contrac-
tor. Furthermore, engineering is at times done in-
house by the contractor, at times by an engineering
firm. Firms applying an adapt-to-order or engineer-
to-stock strategy have strong coordination between
market and manufacturing and do engineering work
themselves, but are weaker in subcontracting.
Platforms with differing focus were found: one plat-
form focuses on engineering methods, one on process
content, the third on variability in client demands,
and the fourth on product content. Firms working
with an ETO strategy were shown to benefit from
platform organization, although the platform concept
originates from the make-to-order and assemble-to-
order production strategies (Jiao et al., 2007). Output
increase and lowering of cost levels were found. DTO
and ATO platforms are not full platforms as shown in
 Production strategies pre-engineering
Figure 3. They contain customization parts that can
vary between projects.
Acknowledgements
The author wishes to thank all the employees at the
case study firms for their time and patience with
providing data for the case study. A special thank you
to S.A. for being part of this journey and initiating
the work. Gratitude is also extended to the earlier
researchers in the research group providing basic data
for the study. The centre for Lean Wood Engineering
sponsored by the Swedish Agency for Innovation,
VINNOVA, is gratefully acknowledged for funding.
Furthermore, the Swedish Construction Federation is
Downloaded by [Australian Catholic University] at 04:16 09 October 2017
also acknowledged for funding parts of this effort.
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