2015 International Conference on Management Science & Engineering (22th)

October 19-22, 2015 Dubai, United Arab Emirates

A Conceptual Framework for Product-Process Matrix:

A Supply Chain Perspective
PAN Lin1，ZHOU Shui-yin 2
School of Management, Huazhong University of Science and Technology, Wuhan 430074, P.R. Chain

Abstract: The paper integrates insights from
previous research on operation management and supply
chain management into generalization and extension of
the product-process matrix. We propose a conceptual
model on product-process matrix from a supply chain
perspective, and to discuss the impact of collaboration
with supply chain partners on product-process matrix.
From an operational viewpoint, the model proposes that
process (included new product development, production
and delivery) flexibility should be aligned with the level
of product customization. Meanwhile, from a
collaborative strategy viewpoint, this model indicates
that collaboration with supply chain partners exert a
positive impact on matching of process and product on
operational level. At last, a single case study by
conducting in-depth surveys and interviews in one
company is employed to verify and adjust the conceptual
mode.
Keywords: conceptual mode, case study,
product-process matrix, supply chain management
1 Introduction
Over the years, the market environments are
changing in dramatic ways—for customers, demand for
product customization is swelling; for firms, supply
chain collaboration as a key source of competitive
advantages is flourishing [1-3]. Intensive competition in
the market place has forced companies to respond more
quickly to requirements through faster product
development, more flexible production process and
shorter delivery time[4]. One fundamental challenge for
operations managers is to design proper processes that
satisfy the customization requirements in the supply
chain environment[5]. For the past three decades,
practitioners could obtain guidance from the
product-process matrix (PPMX) of Hayes and
Wheelwright [6]. They emphasized that that small batch
and various variety product mix should be accordance
with the high flexible production process such as job
shop, whereas the high volume and commodity product
mix needs low-cost and standardization production
process such as assembly line. Many researchers has
been updating the model for the purpose of matching the
rapidly changing market environment, including
extending from the product dimension to service
dimension, introducing this dynamic environment as a
third dimension, discussing the influences of initiatives
(flexible technology, modular design, managerial
innovation, etc.)[7-8]. However, previous studies mostly
followed fixed research paradigm: firstly, the object of
research focused on the matching the internal process of
firms and product from an operational perspective,
whereas ignoring the impact of external process from
supply chain partners, especially strategic collaboration;
secondly, the process dimension are defined as
production process, but other processes(such as: product
development, delivery process) which are equally related
to product dimension have been disregarded.
This paper intends to contribute to filling this gap
by structuring the PPMX model from a supply chain
perspective. The aim of this model to answer the
following questions:
RQ1: From an operation perspective, how should
the model be updated to take into account the
customization requirements?
RQ2: From a supply chain perspective, how should
the current product-process matrix model be revised to
take into account the collaboration strategy with supply
chain partners?
RQ3: Nowadays, why can some excellent firms
achieve the best operational performance when their
internal processes structure fail to match with the product
characteristic?
2 Literature reviews on PPMX
The traditional product-process matrix (PPMX)
proposed by Hayes and Wheelwright [6] links different
production processes to the different product life cycle
stages, and focuses on goods manufacturing operations
(see Fig. 1). This two-dimensional model represents a
direct relationship between product structure and process
structure. The underlying logic of this matrix is that a
product would need different types of process in different
stages of the product life cycle. As the product matures
and the sales volume increases, there is a need to shift
from the initial low-volume/high-flexibility stage to a
high-volume/low-cost manufacturing process. On the

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 Fig.1 Product process matrix (Source Hayes and Wheelwright)
base of Skinner's trade-off theory, Hayes and
Wheelwright developed the product-process matrix to
emphasize the importance of cooperation between
manufacturing (process) and marketing (product) to
achieve the unified goals [6].
Nowadays the environment of firms are changing in
dramatic ways, product life cycle is shorter, demand for
product customization is swelling, and pressures for
globalization and technological innovation are
overwhelming[9]. Under this circumstances, firms must
be able to meet what have traditionally been
contradictory requirements: continuously delivering
customized, high-quality goods and services while
simultaneously keeping costs down and getting products
to market quickly[10]. Although the PPMX is one of the
most widely recognized concepts in the manufacturing
strategy area, its adaptability is decreasing with the
environment changes.
Up till now, the traditional PPMX has been
frequently verified and commented upon by researchers.
First, with the changes of environment, many
researchers have discussed the simplicity of dimensions
under the new contemporary industrial condition. Hill et
al. applied the PPMX as well as product profiling to
study the fit between product mix and process structure
in one case company[5]. They concluded that it was
difficult to explain the alignment between manufacturing
orientation and the characteristics of the market by using
the traditional PPMX. Bozarth and Berry argued that
PPMX is based on assumptions about the characteristics
of classic process choices which have significant
limitations[11]. Given recent developments in
manufacturing technologies and approaches, current
research suggests that these assumption or identification
of dimensions may not be valid, or at least should be
critically reevaluated and enriched. Helkiö and Tenhiälä
proposed a modification model based on contingency
theory as the generalization and extension of the
traditional matrix[7]. They extended the original process
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dimension into a specificity dimension which depended
on the layout and flexibility of the process. Similarly, the
product dimension was generalized to the complexity of
the production task. Meanwhile, they extended the model
to accommodate the dynamism of the task environment
and added a third dimension—the dynamism of the
production task. Most of these modifications have
greatly enriched the dimensions and enhanced the match
between product and process structure.
Second, there have also been some other studies
focused on analyzing the influence of flexible process
capability (FPC) on the validity of traditional PPMX.
Particularly, in order to make up for the inability to
account for the dynamic nature of firms’ operating
environments, this kind of study was mainly resulted in
numerous modifications and extensions on traditional
PPMX . With advanced manufacturing technologies,
Noori argued that the idea of coupled product-process
life cycles is no longer valid because products can pass
through their entire life cycle by using one single flexible
facility [12]. In order to explain the validity of the
off-diagonal area in traditional PPMX, Ariss and Zhang
have discussed and empirically tested the impact of FPC
on the PPMX and introduced a third dimension,
innovative initiatives, which represents the proactiveness
of an organization towards adopting, implementing and
practicing innovative processing technology, product
design, and managerial practice [13].
Third, discussing the multiple performances
implication instead of trade-offs, the product-process
matrix of Hayes and Wheelwright has been widely
known for its prescriptive managerial guidance. Yet,
most empirical studies have found no support for its
performance assertions or have even contradicted them.
With the dramatically changed environments, some
authors have empirically verified that firms can achieve
multiple competitive performances simultaneously[14-15].
Especially, a number of researchers have argued that the
use of certain new management or technological
initiatives which usually refer to the flexibility can
eliminate or at least minimize some of the trade-offs
[16-17]
. Nowadays, we often find that enterprises which
deviated from the diagonal area will still be able to
succeed. This phenomenon was well explained in the
research of Ariss[13]. And their study also provides further
evidence of the compatibility of multipl competitive
performances rather than trade-offs, by considering the
influence of flexible process capability.
In summary, the explanations for the limited
empirical support for the traditional PPMX fall into three
main categories: simplicity of the dimensions, influence
of FPC on the validity and performance implication of
PPMX, and inability to account for the dynamic nature
of firms’ operating environments. Therefore, on the base
of previous research and considering nowadays supply
chain competition environment, the traditional
product-process matrix needs some further modifications;
extending from individual firm’s manufacturing
operations to supply chain strategy. Then, in the
following sections, we will synthesize the findings of the
earlier studies with the objective of amending the
shortcomings of the original model; particularly, we will
hold the perspective of supply chain management and
take the core firms’ collaboration with upstream and
downstream partners as the starting point to conduct
modification.
3 Conceptual model
3.1 Customization as product dimension
In previous research on the product-process matrix,
the market demands were linked with product structure
which consists of the product volume and variety, and
Pure Segmented
Standardization Standardization
Design Design
Fabrication Fabrication
Assembly Assembly
Distribution
Distribution
Standardization Customization
Fig.2 A continuum of customization strategies (source: Lampel and Mintzbergy)
the product dimension was usually based on volume,
ranging from high variety/low volume to low
variety/high volume[5-6] [18]. Nevertheless, today, product
variety and volume fails to describe the multiple market
needs, for example, product mass customization (MC)
make it possible to produce varied and customized
products at low cost with standardized and mass
production system, being characterized by high
variety/high volume [19]. In addition, the coupling of
volume and the degree of customization in the
product-process matrix may not hold true for some
manufacturing firms [20]. In fact, customers nowadays
require products to be almost individually tailored to
their needs, desires, and personalized statements, then, it
is a trend to connect market demands of product in term
of customization.
Consequently, the product volume dimension of the
original matrix should be extended to the degree of
product customization. In order to represent how
extensively the products are customized, Ahmad and
Roger recognized that customized products could be
divided to five categories: highly customized, somewhat
customized, standard with custom options, somewhat
standardized and highly standardized[21]. Lampel and
Mintzberg argued that customization was involved the
entire product life cycle stages from the distribution,
assembly, fabrication, to finally design[22]. From the
value chain perspective, product customization was
classified to five types: pure standardization, segmented
standardization, customized standardization, tailored
customization and pure customization, as showed in
figure2. Therefore, the customization is taken as product
dimension instead of “product variety” or “product
volume” in this research.
Customized Tailored Pure
Standardization Customization Customization
Design Design Design
Fabrication
Fabrication Fabrication
Assembly Assembly
v
Assembly
v
Distribution Distribution Distribution
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3.2 Flexibility as process dimension
The process dimension of the original matrix
focused on the layout of the production process,
including four types: job shop, batch shop, assembly line
and continuous [6]. The process evolution typically begins
with a fluid process (highly flexible) and proceeds
toward increasing standardization, mechanization, and
automation (highly rigid). However, the process
flexibility technologies have changed fundamentally and
the production layout may not hold true, for example, the
use of modular parts and flexible manufacture systems
(FMS) has allowed some assembly/continuous flow shop
to achieve customization in mass quantities, similarly,
some batch shops apply similar methods to produce
standardized product in moderate to high volumes. It is
argued that flexible technologies have important
implication for product process matrix framework.
Leschke emphasized that firm could use flexible process
technologies to enhance mix flexibility (product mix)
when the varieties of product mix have changed and the
production process was stabilized [23]. Thus, the model
should be updated to accommodate the flexibility of
modern process technologies [7].
In essence, the process flexible technologies
increase the process flexibility, thus, the process choice
should take the flexible capability into account rather
than the layout. Ariss contended that high flexible
process capability (FPC) which is the firms’ ability to
customize the products enlarged the feasible zones and
Segmented
Pure Standardization
Standardization
Process Sequel
Product
Development Design Design
Process
Fabrication Fabrication
Production Process &Assemble &Assemble
Delivery Distribution Distribution
Process
Fig.3 Linkages between the process structure and customization degree
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reduced the constrained zone in the product-process
matrix [13]. As the result, Helkiö labeled “the specificity
of production process” as the process dimension and
defined it as the degree to which the process is limited to
producing certain outputs. Hence, to follow the logic of
original process evolution and to grasp the essential
characteristics of flexible process technologies, the
flexibility will be chose as process dimension [7].
Meanwhile, due to the customization happened from
product design to distribution, a characterization of the
dominant production process can fail to illustrate the
process structure and process choice [18]. It is necessary
to extend the process from single production process to
multiple processes which impacts the customization,
including new product development (product design),
production (product fabrication and assembly), and
delivery (product distribution). To simplify the process
stages, the fabrication and assembly stages are combined
as production process instead, for accommodating the
change, the customized standardization also merges into
the tailored customization in this paper, as showed in
figure3.
In summary, in this study, the process dimension is
amended in term of two main aspects. For one thing, the
process content is enriched from sole production process
to new product development, production and delivery
process. For another, the flexibility is introduced as
process dimension rather than “process layout” or
“process type”.
Tailored Pure
Custoization Customization
Design Design
Fabrication Fabrication
&Assemble &Assemble
Distribution Distribution
3.3 Supply chain environment as an additional
dimension
To develop a product-process matrix that better
corresponds with the contemporary industrial reality, it is
insufficient only to enhance its original dimensions.
Kemppainen indicated that an important area of
product-process matrix in the future research was an
extension of tool into assessment of supply chain
environment [18]. Moreover, with the efficient
development of the global market economy, competition
no longer take place between individual enterprises, but
between entire supply chains[24]. That is to say, the
supply chain partners will play an important role in the
mapping of process and product. For example, as for the
segmented standardization products, if enterprises could
not provide an appropriate delivery process to meet the
customized distribution, then it is a good choice for them
to cooperate with logistics enterprises to make the fit of
delivery process and segmented standardization of
product (work this out). In other words, the process
dimension can be transformed by collaboration with
supply chain partners. In addition, from the strategic
perspective, the strategy such as integration, cooperation,
and collaboration plays an important role on the product
and process dimension [25-26].
Therefore, there is a need for the supply chain
environment to be incorporated into the matrix. In order
to link closely the supply chain environment with the
original two dimensions, the process dimension is
enriched into two aspects, including internal process and
external process, see figure 4. And internal process
indicates the process of core firm in supply chain, on the
contrary, the external process is the product process of
other stakeholders (such as: suppliers, manufactures,
Product
distributors and customers) in supply chain.
(Other Supply Chain Members)
External
Process
(Core Firm)
Internal Process
Supply Chain Environment
Fig.4 Process dimension in supply chain environment
3.4 Product-Process Matrix: a supply chain
perspective
As mentioned previously, the existing literature give
three main explanations for original product process
matrix’s limitations. First, the product dimension (i.e.,
product volume and variety) is too narrow as a proxy to
reflect the individual requests of customers. Similarly,
the process dimension (i.e., process type) does not
concern the effect of process flexible technologies.
Secondly, scholars mostly focus on the match of product
and single production process, whereas other processes
which are equally related to product dimension have
been ignored. Third, the original matrix disregards the
vital impact of the supply chain strategy. In order to
amend these limitations, a modified product process
matrix (PPM) model is proposed, shown in figure5.

.
Customization

C D
Pure customization

G
A
H
F

E
.
B’
C’
D’ Flexibility
Internal Process
Development
Production
Delivery

A’

Flexibility

External Process
Development
Production
Delivery

Fig.5 Product-process matrix: a supply chain perspective

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 In this model, the product and process characteristic
are revised respectively as customization and flexibility.
What is more, instead of focusing on the single
production process, the process is extended from single
production process to three kinds of processes, including
NPD, production, and delivery process. Lastly, to link
the supply chain strategy (such as: process integration or
collaboration) with the matrix, the process dimension is
enriched as internal process and external process. For
these reasons, the feasible region of the PPM is a kind of
irregular stereoscopic area which consists of two main
cross-sectional zones. In line with previous studies on
PPM, one of the main feasible zones is traditional two-
dimensions diagonal area such as the AA’BB’ and
CC’DD planes, it indicates that the internal process
structure of individual firms should be aligned with the
product structure on operational level. And then, from
the supply chain perspective, the supply partners also
exert equally influence on the match of process and
product, especially when the internal process is unable to
meet the demand of product customization. That is, the
core firms could better locate in the feasible region by
integrating internal and external process. Hence, the
other feasible zone represents that the internal process
and external process can be concordant with product
characteristic, and it is a three-dimensional surface such
as the ABCD or EFGH surface.
3.4.1 Matching process and product: an operational
strategy
Traditional product-process matrix indicates that
small batch and various variety product mix (high
customization level) should be accordance with the high
flexible production process such as job shop, whereas the
high volume and commodity product mix (low
customization level) needs low-cost and standardization
production process such as assembly line [6]. However, in
the entire process sequence comprised product
development, production and delivery process maintain
the flexibility accordingly to satisfy pure customization
requirements. In contrast, as for pure standardization
product, the specific process sequence can be taken to
map the product structure.
In conclusion, product customization is supposed to
degree links with the process flexibility, that is, if
customization reached a certain product stage, then the
relevant process should keep appropriate flexibility
accordingly. Hence, the matching between the multiple
process flexibility and product customization is shown in
figure6. It is interesting that the feasible zone in this
model is analogous to traditional two- dimensions
diagonal area. There are two reasons to explain this
phenomenon. Firstly, according to the previous
literatures, it is argued that there is a direct positive
correlation between the process flexibility capability and
product customization level, that is to say, the higher
level of customization, the higher process flexibility
should be embed. Secondly, we focus on both the
connection with process and product from an operational
viewpoint. Hence, the research target essentially explains
how individual firms match internal process structure
and product customization, whereas ignoring the impact
of strategic collaboration with supply partners to the
feasible area.
Product structure
Product customization
I II III IV
Process structure
Process flexibility
Pure
Standardization
Segmented
Customization
Tailored
Customization
Pure
Customization
I
Specific development,
production
and delivery

view of the development of advanced technologies and

methodologies, which makes the original PPM to be II

suffered questions [27]. Many authors contended that the Specific development,
production

feasible zones could be enlarged by adopting the flexible

and Flexible delivery

technologies or innovative initiatives [16-17]. Likewise,

Ariss illustrated how the high flexible process capability III
Specific development,
that a firm possesses to overcome the technological or Flexible
production and delivery

economic constrains in product-process matrix so as to

succeed in the market [13]. They asserted that the process
IV
flexibility which can be enhanced by flexible Flexible development,
production
technologies or “management innovation” is a key factor and delivery

to meet the product customization level. Consequently,

drawing from the generalization in previous research on
PPM, we propose that the production process flexibility
should be aligned with the product customization.
Meanwhile, the higher level of customization, the higher
process flexibility should be coupled. In a similar manner,
the other processes (development and delivery process)
flexibility also should work in concert with the
customization. For example, the“ pure customization
product” means that the product of all stages (design,
fabrication, assemble and distribution) are all largely
customized, it is a conventional wisdom to suggests that
Fig.6 Linking with product customization
and process flexibility
3.4.2 Matching internal, external process and product: a
collaboration strategy
Collaboration strategy to PPM
In contrast to the traditional intra-enterprises that
only focus on the relationship of internal processes
structure and product characteristic, collaboration
between supply chain partners as a key and vital strategy
for enterprises’ success has received increased

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attention[28-29]. From the Resource-Based View (RBV)
theory perspective, three major reasons contribute to the
significance of collaboration [30]. First, it is generally
agreed that the competitiveness of the enterprise depends
on the resource heterogeneity. However, the resource
heterogeneity also determines that enterprises hold
limited and differentiated resources. Second, the limited
resources are given priority to develop the core activity
to maintain competence. For these reasons, it is almost
impossible for individual enterprises to obtain
simultaneously all processes flexibility capability and
match product customization with each process. Third, to
date, the production efficiency and effectiveness could
be both achieved by professional specialization.
However, it is uneconomical for enterprises to establish
entire processes to content with product customization.
To take better advantage of different enterprises’
heterogeneous core resources so as to make firms locate
the feasible zone in the PPM (organize and link process
with other firms), collaboration with partners is taken as
a valid strategy. Simatupang demonstrated the
importance of collaboration among the core firms,
suppliers, manufacturers and retailers in supply chain to
meet the demand of customers for product variety and
just-in-time distribution[31]. Holmstrom indicates that
implementing collaborative process network has a
positive effect on distribution logistic, product
development and manufacture [32]. Hence, to be effective
in matching process with product, supply chain partners
need to collaborate with each other. And a new feasible
region emerges to account for matching internal and
external process with product.
Collaboration becomes crucial to explain the match
Collaboration Process
NPD
flexibility
External
Production
&
Internal
flexibility
Delivery
flexibility
Fig.7 Linking the collaborative process with product
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between process and product, especially when the firms
stay out of the traditional diagonal area. In order to
satisfy the product customization, it is an advisable
strategy to integrate external process, in addition to
exploiting the internal process. Drawing from the
generalizations in the sections above, we propose that the
product customization should be aligned with two
distinct dimensions of supply chain environment: the
internal process and external process. Thus, we
summarize this extension of original product-process
matrix into three propositions from the collaborative
strategy perspective, see figure7.
Product development process
Recent researches on new product development
(NPD) have pointed out that to announce new products
efficiently and effectively, firms must secure the
involvement and support from their partners, such as
suppliers [33-34]. In order to improve the product
development performance, firms are increasingly
engaging in collaborative product development (CPD)
with their external partners [35]. Benefits of CPD include
higher return on R&D investments, faster product
development, reduced product development cost,
increased flexibility, reduced risk, and access to product
development capabilities of the supplier [36-37]. In order to
satisfy customers’ customization requirement better,
firms which adopt the CPD tactic to continuously update
their product offers are on the rise. As a result, the
following proposition is proposed:
P1: Collaboration with supply chain partners
positively enhance the matching of product development
process and product customization.
P1
+ Product
P2
customization
+
P3
+
Production process
It is conventional wisdom that core process should
stay in house, while noncore process should be
outsourced [38-39]. Indeed, outsourcing is led by strategic
consideration to concentrate on optimum distribution of
resources and process integration [40]. Specially,
production outsourcing such as Original Equipment
Manufacturer (OEM) can help companies which take the
manufacture process as noncore activity improve quality
and efficiency, reduce costs, build process flexibility and
enhance business strategy alliances [41-42]. So, firms can
attempt to develop collaboration relationship with OEM
to deal with the mismatch of production process
flexibility with product customization. Basing on the
analysis above, we make the second proposition as
follows:
P2: Collaboration with supply chain partners
positively enhance the matching of production process
and product customization.
Delivery process
Higher customized requirement on delivery time
and quality makes firms an obligatory to set up a
sophisticated logistics, while it is a big challenge for
most firms to finish this work by themselves. Then, the
idea of collaboration with professional logistic
enterprises to improve the distribution performances is a
widespread phenomenon; the typical way of cooperation
is to outsource isolated logistics to Third Party Logistic
[43-44]
. It is notable that it brings many benefits by
collaborating with TPL: reduce cost, improve the level of
service or increase flexibility toward the changing
requirement of customers [45-46]. Hence, if the delivery
process was incompatible with product customization, it
is a wise choice for firms to corporate with TPL. Then,
the last proposition could be concluded:
P3: Collaboration with supply chain partners
positively enhance the matching of delivery process and
product customization.
4 Case study
4.1 Case study design
On the basis of the above conceptual model
construction, next, we will illustrate and verify the
propositions by a single qualitative case study. As a more
descriptive and exploratory approach, case study
research allows for more rich insights into the research
object [47]. Like many other qualitative methods, it is
characterized by its commitment to collecting data from
the context in which social phenomena naturally occur
and generate an understanding that is grounded in the
perspectives of research participants [48]. Case study
research has been recognized as an increasingly
important type of research in the area of supply chain
management, since traditional research strategies have
been often proved to be limited in their applicability and
scope. Especially, under the condition that the boundaries
between the phenomenon and context are not clearly
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evident, case study research is enable to analysis the
phenomenon deeply within its real life context through
empirical investigation [47].
The case study presented in this research is about
Lanesync (LC), one of the biggest frozen food marketing
companies in China, and in collaboration with Guo Lian
Aquatic (GLA), a state-own enterprise (SOE, which
become one of Lanesync’s biggest suppliers of sea food).
Lanesync’s subsidiaries distribute all over the country,
employing five hundred and sixty people. Its main
business activity includes frozen food design, production,
sale and delivery. Meanwhile, it has a wide range of
products consisting of sea food, meat and vegetables, the
product structure could be comprised of three categories:
“platform” products, alliance products and brand
products. Nearly 70 percent of the products go to
restaurants, while the remaining 30 percent products go
to families. In order to collect data, we investigated and
surveyed LC and its partners (such as GLA, suppliers
and manufactures) for nearly eight months, including
interviewing with department managers, attending
conferences, visiting factories and so on.
4.2 Findings discussion of results
The propositions formulated in the conceptual
model can now be supported or not, based on the
empirical results of the case study.
P1: Collaboration with supply chain partners
positively enhance the matching of product development
process and product customization.
The case study revealed that collaboration with
partners can enhance the matching of product
development process and product customization. As for
product development process, LC has been engaged in
collaborative product development (CPD) with their
external partners to meet customers’ customized
requirements, thus, the members of LC’s Product
Development Center (PDC) are made of LC, suppliers
and even customers. For example, the outstanding chefs
who come from restaurants constitute “chef club” which
is a part of PDC to research and develop the new
products under customer demand. Furthermore, LC
invites their suppliers and customers to participate in
“market day 18” to experience and taste the up-to-date
products in the 18th of each month. According to
“market 18”, it is advantageous for LC to improve and
develop product by collecting participants’ suggestions
and ideas. With the help of CPD, LC can design and
develop high level of customized products quickly, a
specific example will be presented. Product named
“Family Feast” which aims to specialize families is a
kind of pure customized product, customers can order
personalized cuisine, for example, customers can pick
several dishes from different restaurant at one time, or
customers can enjoy the dishes which are cooked
according to what they want to. Due to that the “family
feast” is a pure customization, then a flexible
development process should be coupled. To provide
flexible development process, LC cooperates broadly
 Product
. Pure Customization
External
Flexible joint development process
Fig.8 Linking the new product development process with product
with restaurants by means of jointly product
development (such as “chef club” and “market day 18”)
to cope with it, as in figure8. That is, integrating the
internal (LC) and external (restaurants) product
development process makes a positive impact on meeting
product customization.
P2: Collaboration with supply chain partners
positively enhance the matching of production process
and product customization.
The case study indicates that collaboration with
partner can promote the matching of production process
and product customization. Indeed, due to the wide range
of products, it is difficult for LC to introduce all types of
production lines. Furthermore, on the base of matching
relation of PPM, to achieve better production
performances, different product characteristics should
correspond with different production processes.
Consequently, as for LC, it is widespread and valid to
map the production process to product structure by
cooperating with OEM. By the end of 2012, there are
about 50 manufacturers to provide production services
for LC. For example (see,figure9), cuisine of “Family
Feast” are all cooked by “restaurant alliance” which is
organized by restaurant customers of LC to meet the high
flexible production process, for developing this issue
further, another example will be taken, see figue9. The
new product named “Frozen Butterfly cut Shrimp” which
mainly focus on the restaurants clients is a kind of
segmented standardized product in high volume, thus a
specific production process( such as assemble line) is
strongly recommended. However, LC has not any
assemble line about shrimp, in order to map production
process to this new product, LC collaborates with GLA,
its biggest supplier of the raw shrimp and is also a big
seafood manufacturer. Meanwhile, LC and GLA jointly
update and improve this product, and the production
process is outsourced to GLA. As for LC, collaboration
with partners not only reduces the logistic costs and
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IV
Internal
Development (desgin) Process
“chef club”
“market day 18th”
production costs, but also improves the product quality
and productivity， more important, it is advisable to
resolve the problem of mismatching production process
effectively.
P3: Collaboration with supply chain partners
positively enhance the matching of delivery process and
product customization.
The case study identifies that collaboration with
partners makes a better matching of delivery process and
production customization. To satisfy customers’ desires
and expectations, it is very important to deliver the
products within the promised deadline, especially the
food as products [4]. Nevertheless, there is no perfect
logistic system for LC to support delivery process, hence,
LC cooperates with the TPL, supplier partners and even
individual drivers in different cities to establish the “city
distribution system” to insure the on time delivery as
well as strengthened logistics capability. For example
(see figure 10), as for pure customization product,
“family Feast”, one of the attractive characteristics is that
customers can enjoy food at home any time, similarly,
tailored customization (“every-flavor shrimp” mainly
focus on the major hotels, customers can purchase
customized shrimps, such as specific shrimps source,
size, breed, processing methods, and delivery demands)
and segmented standardization (“Frozen Butterfly cut
Shrimp”) both are characterized by customized delivery
demand, so a flexible delivery process should be
employed. In contrary, it is the standardization product
(such as “stinky mandarin fish”, a kind of LC’s brand
product) that usually marks by high volume, low variety
and relatively stable supply demands, so a standardized
delivery process can be suited. In order to provide
appropriate delivery process for different level of
customized products, LC establishes collaborative
relationship with different logistic enterprises in different
cities, one of biggest driving force in selecting the
 Product

. IV
Pure Customization

“Family Feast”

. II Segmented Standardization

Frozen Butterfly
Cut Shrimp
Internal

Production Process

Specific Production Process Collaboration with supply

External chain partners
Assembly line
ie: outsourcing
Flexible Production Process production, OEM
“restaurant alliance”

Fig.9 Linking the production process with product

.
Product

IV Pure Customization

“Family Feast”
. III
Tailored customization

“Every-Flavor Shrimp
“
. II
Segmented standardization

“Frozen Butterfly cut

Shrimp” . I
Pure standardization

Internal
Delivery Process

“stinky mandarin fish”

External
Flexible / specific
delivery process

Integrating logistics and internal logistics

“city distribution system”
Fig.10 Linking delivery process with product

partners can be conclude as enhancing the delivery applicable processes (flexible or specific delivery
process to fit the product characteristic. In other words, process). Thus, the collaborative strategy can enhance
with the help of “city distribution system”, the different the matching of delivery process and product
level of customized products can be connected to customization.

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LC &family Customers LC &Restaurant customers
Participants
Product Development
Means
Joint development
“chef club”
Internal and external process integration
Fig.11 The relations of process cooperation in “Family Feast”
In general, the core resources and competitiveness
of LC respectively are terminal customers and marketing
capability instead of product development, production or
delivery ability. From the perspective of traditional
matrix, LC is supposed to locate far away from the
feasible region because of lacking of enough process
capability to fit product-variety marketing. Take the
“Family Feast” for example, it is a pure customized
product which matches the flexible product development,
production and delivery process, but, LC cannot be
equipped with corresponding processes capability.
However, LC introduces this product and achieves a
great success by collaboration with supply chain partners
to extend its processes capability to enhance the
matching of process and product, seeing figure8. Hence,
as for LC, the collaboration strategy makes a positive
momentum to push LC to locate in feasible zone.
5 Conclusion
In this paper, we provide a supply chain insight into
product-process matrix and attempt to structure a new
model to illustrate the impact of collaboration strategy on
PPM. Our model develops and extends the original
matrix in three way: first, it generalizes the product
dimension (originally: product variety or volume) to
“customization” of product; second, it generalizes the
process dimension (originally: process type) to
“flexibility” of process, meanwhile, the process content
is enriched from sole production process to new product
development, production and delivery process; and third,
in view of supply chain environment, it adds an external
process dimension. Basing on this model, two major
contributions can be concluded. On the one hand, from
an operational viewpoint, the model proposes that
process (included NPD, production and delivery)
flexibility should be aligned with the level of product
customization, that is, the higher level of customization,
the higher process flexibility should be coupled. On the
other hand, from a collaborative strategy viewpoint, this
model indicates that collaboration with supply chain
partners exerts a positive impact on matching of process
Supply chain members
Logistic companies
Participants Participants
Production Delivery
Means Means
Outsourcing production Logistics business outsourcing
(OEM) (TPL)
and product on operational level, that is, in today’s
supply chain collaboration environment, collaboration is
crucial for individual firms to break the technological or
economic constraints in PPM so as to succeed in the
market.
It is acknowledged that there are two main
limitations of this study. Firstly, we have investigated
only a company in chain to suppose our propositions,
more empirical research on large samples to verify and
test this model is imperative. Secondly, this model
demonstrates that collaboration is vital for firms to map
the process to product, but it does not go deep into
exploring this regulations of collaboration, such as the
ways, intensity, width, depth of collaboration,
information sharing, incentive alliance, and further
research on these aspects is required in order to develop
a more detail and practical model. In addition, there is a
prevailing trend towards the integration of products and
services into a single customer offering, implying that
production means the creation of a combined goods and
services product. Further research can aim to incorporate
the service into PPM from a supply chain collaboration
perspective. Moreover, in addition to case study, more
empirical analysis and theoretical development are
needed to advance this model.
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