1) Build to Order (BTO) is a manufacturing strategy that aims to minimize costs, increase flexibility, and improve responsiveness by adopting techniques that allow for production based on customer orders rather than forecasts. 2) BTO evolved from Lean Manufacturing techniques used by Toyota and other manufacturers to respond to unpredictable demand and reduce inventory costs. 3) BTO can be applied in both low-volume, high-mix production as well as high-volume manufacturing by designing flexible production systems and changeover processes.

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Build To Order - A Historical Timeline and a Possible Roadmap to the Future
Author: Robert Gray
Executive Summary:
Often the SIPLACE team encounters questions about Build to Order (BTO):
• What is BTO?
• Is it Lean Manufacturing?
• Where is BTO best suited for use?
• Is there also a place for BTO in high volume manufacturing?
It is very easy to enter Build to Order in an internet search and find many valuable and
detailed resources explaining BTO in great detail. I encourage you to use the internet to
investigate this and some of the other topics mentioned here. In addition, I would like to take
you on the journey to ‘BTO in Electronics Assembly’ and:
• Provide you with a high level overview of the evolution of the BTO theory &
practice.
• Explain this in practical manufacturing terms.
• Show how it applies to Electronics manufacturing.
• Give an account of some of the best practices that are essential to a BTO
system.
• Hopefully inspire you to explore these topics further and embark on your
own BTO journey.
What is Build to Order?
Build to Order is the adoption of one or more techniques in a manufacturing system or
subsystem to minimize costs, increase flexibility, & improve responsiveness. These
initiatives can be taken as a result of such pressures as:
• Unpredictable product demand of one or many products that may also require
almost instant order fulfilment
• High cost of carrying inventory
• Low volume demand across multiple products negating the ability to dedicate
production capacity to one or a few products.

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BTO (Build to Order) can therefore take many guises and be adopted plant wide or in a finite
capacity. In today’s internet enabled world there are many sources available that the reader
can use to understand multiple practical examples of BTO. Unfortunately, not many of these
examples are in the Electronics assembly process. Therefore, I would like to introduce some
of the techniques and processes that can be used to empower you on the start of your BTO
journey. Answering the next questions will help you to understand some of the history and
science behind BTO systems.
Is BTO based on Lean?
I think by now many people know that Lean Manufacturing is a technique that has its origins
in the Toyota Production System. Indeed within the Toyota production system there are
aspects of BTO mentioned and applied.
A quick search on the Toyota Production System will find many references crediting Taiichi
Ohno with the invention of the Toyota Production System, however it is very likely that this
gentleman did not have a “Eureka Moment” of inspiration and that very day transformed the
entire manufacturing systems of Toyota!
Indeed closer analysis reveals that the Toyota production system does not stand in isolation
as the only manufacturing technique adapted at Toyota. Other practices and techniques such
as Total Quality Management (Perhaps an evolutionary step in the path towards Six Sigma), Total
Preventative Maintenance, SMED (single minute exchange of dies a setup and changeover time
reduction methodology developed by Shigeo Shingo one of the other giants of Japanese manufacturing
engineering) and many more excellent systems, were and still are employed.
Undoubtedly these gentlemen are to be given credit for their outstanding results in furthering
manufacturing Engineering science; however it is also true that they themselves received
guidance and inspiration from other people, as you will see in their publications through their
references.
The Answer:
The point is that Lean is not a single all encompassing technique that suddenly flashed into
existence completely unrelated to all other techniques in manufacturing. So too BTO is a
system that evolved and is inter related with many sub systems and applications that can be
applied on an as needed basis depending on the particular needs of the situation.
If you would like to go into depth about some of the key dates and events in the evolution of
today’s manufacturing best practices, please see Appendix 01 on page 10.
We are all fortunate to have access to the wealth of knowledge encompassed in such
systems as Lean Manufacturing, Six Sigma, Build to Order etc. However, these techniques
did not develop in isolation and actually consist of many sub processes and techniques which
are common between them due to their shared genetic history.

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Where is BTO best suited for use in low volume high mix production and/or
high value products?
Is there also a place for BTO in high volume manufacturing?
To answer this I would like to provide some practical examples of BTO implementation. As a
manufacturing engineer it is my belief that the Electronics manufacturing industry has a lot to
learn from other more mature industries. Such techniques have been implemented in direct
response to pressures of evolving markets, which this “Sunrise” industry may now be facing
in some sectors at least.
I will therefore give two examples from other industries so that readers will be able to see
the underlying similarities to the electronics industries situation. Then I will provide some
discussion on applications directly within our industry.
Example 1:
“Manufacturer of Truck Engines” -
High volume manufacturing becomes flexible high mix
Many years ago I visited a factory that manufactured engines for trucks and they provided
me with a tour of their cylinder head manufacturing work cells.
The tour started by showing me the showpiece flexible manufacturing work cell that was
used to machine the raw castings for the cylinder heads. This system was a completely
autonomous area consisting of multiple fully automated CNC controlled FMC machines.
Each machine was operating automatically and raw castings were transported throughout the
area on automatic guided vehicles. Some machines were specialized for specific functions,
but in general all machines were able to perform multiple machining stages. The entire work
cell was capable of producing many different types of end products each with their own
particular requirements for machining processes. This was all handled automatically with no
impact to setup and changeover time due to this flexible production capability.
Next I was taken to a very old production area. Here a “Transfer line” was in operation on a
one shift basis producing cylinder heads for one product only. A transfer line is a production
process consisting of multiple sequential processing machines each of which perform a sub
set of the entire sequence of operations required. So in a line of say twenty sequential
workstations some would perform surface milling, others drilling operations and so on. Also
to balance the entire operational sequence some operations were performed by dividing the
work over a multiple sequence of work cells. All work cells were automatically cycled
according to the tact time of the slowest operation.
It was explained to me that this work cell was originally installed to mass produce one model
of cylinder head for trucks to supply the troops in World War II. At that time it was recognized
that logistics would be a strategically important element to ensure success and mass
production of one version of truck allowed for better logistics in the field as well as better
efficiency in manufacturing. Therefore, they all had the same engine with no variation
needed.
After the war production was converted to civilian transportation vehicles, but with no need
for such massive production volumes in peace time. Additionally, market pressure
demanded more variation (Engines of Six, eight, and twelve cylinder). This now meant that
the transfer line had to undergo setup changes between product runs, with major problems

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encountered to rebalance work cells (A six cylinder head needs more drilling than a four cylinder head
compared to milling operations).
Also production efficiency suffered if one of the work cells had a breakdown because all of
them were out of production due to dependencies until it was repaired or moved offline and
the work cells were rebalanced. As a way to cope, cylinder heads were produced to stock as
finished goods awaiting assembly resulting in high inventory carrying costs, or potentially if
rush orders were received the stock did not have the right model head available leading to
long lead times or lost orders.
The decision was taken to invest in a flexible manufacturing system that was capable of
machining any of the models required. The inherent flexibility of the Cellular manufacturing
area allowed for mass production by essentially making all products flow through the same
work cells with no effect on changeover times. Essentially a batch size of one could be
achieved with multiple parallel flexible workstations being used to ensure flexibility and
robustness of efficiency by avoiding the dependencies of the transfer line sequential
operations.
Result and Consequences
Here we can see as a result of changing market forces, the evolution from a mass production
concept towards one that has a higher flexibility was a necessity. Consequently, by carefully
adopting the techniques of Group Technology & Cellular Manufacture a Build to Order
capability was implemented.
Example 2:
Manufacturer of Valves for the Chemical and Oil Chemistry -
Volume manufacture with responsive high value capability
I once visited a factory that produced valves for the chemical and oil industry. Their product
range consisted of several regular running standard products. Also there were models that
were made for demanding environments such as “Sour oil wells” (Oil with high sulphur content was
very corrosive in nature and also may contain hydrogen which can lead to hydrogen embrittlment and
catastrophic failure) In these situations valves were manufactured from very high grade
(Expensive and difficult to machine) alloys. Also a lucrative market was the ability to manufacture
custom valves on demand with short lead times (For emergency repairs when entire plants were down
due to failure of just one valve).
The strategy adopted at this factory was to specialize on these demanding markets, produce
standard products in volume on equipment that at the same time could also produce on
demand any other specification of product in low volumes. They machined the valve bodies
on one single FMC work cell that was the size of an entire room. This work cell had multiple
machining heads that were interchangeable, combined with multiple work holders and tool
holders. Everything was automated and finished valve bodies were produced on demand.
The high cost of this equipment was amortized over the high volume production of the
regular products. However, by designing the work cell to also be able to produce with no
changeover time, the special or urgent products low cost and flexibility was maintained.
Result and Consequences
This illustrates the ability to design a manufacturing system to have the low cost capabilities
of high volume production but still maintain the agility and flexibility of a Build to Order
system.

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The Transfer to electronics manufacturing
Example 3:
Electronics Assembly mass production
It is ten years now since I was involved in designing and commissioning a production line that
would produce 10,000 consumer products or PCBs per day at a placement rate of 200,000
components per hour. To my knowledge this was the highest volume production line of its
day. Additionally, the line was designed to have very high operating efficiency in excess of
90%.
Since then the market for that kind of product is ten times the size it was then, and production
lines can now be more than double the capacity!
This surely is mass production - so what room is there you may ask, for Build to order?
Today such super high volume lines as mentioned above are producing ten times the volume
compared to lines of twelve or more years ago. That is ten times the volume on similar floor
space, people, facilities, and investment! This drive to volume is to allow amortization of
costs over a higher production volume - in this way allowing for lower overall costs of
production. However, some problems may arise from this strategy:
• With volumes escalating exponentially eventually everyone in the world will own
one of these products and unless it becomes a disposable product demand will dry
up to the replacement rate due to obsolescence.
• For a finite demand, as a lines production capacity increases so does the number
of lines required decrease. This means that if a number of different versions of the
product are to be produced then each line will experience higher numbers of
changeovers potentially leading to lower efficiencies.
• Specialization of production lines to one product family can mean that the transfer
of a product to other lines due to market demand changes is disruptive.
Clearly the ability to minimize costs by amortizing over higher volumes on these very high
volume production lines is appealing, but it can come with significant implications on flexibility
and responsiveness.
Is it possible to have the best of both worlds?
Example 4:
Highly flexible electronics production in high volume production situation
More than twelve years ago I was involved in the DFM (Design for Manufacturability) of a
family of products for such a market. Even at that time the concept of Build to Order was in
my mind. I provided input requirements to the design group for: both symmetrical and
asymmetrical fiducial’s (Top to bottom side of the PCB), and ink spot positioning for multi panels
that could also be used to differentiate between three families of the same product group.
The intention was to be able to change production on the SMT line by simply sending down
the placement line the different product PCB (Within the same family) and have the placement
line change the placement sequence to build the similar product having a different set of
component placements with no changeover time. These techniques have successfully been
implemented in multiple applications, indeed they have been enhanced by the adoption of
PCB barcode identification and placement head step determination, the use of multiple
transport lanes allowing even different PCB widths to be produced at the same time. They

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have successfully been implemented in volume manufacturing, and even may be
implemented in the highest volume situations.
By the adoption of these techniques (within a set of pre conditions) it is possible to have high
volume manufacturing while still maintaining the flexibility of being able to produce multiple
products at the same time or even on demand (BTO).
So in this case just like in the example of the cylinder head transfer line, changes in market,
market share, and end user preferences can readily make a very efficient super high volume
low cost production system a liability. This liability can in some cases provide such inertia
that a strategy shift towards higher value or higher flexibility production can be impossible.
However, with careful consideration it is possible to have flexible production even in a high
volume production situation.
Example 5:
Manufacturing industrial products -
Volume manufacturing with responsive high value capability in SMT!
High volume manufacturing in many ways can be the easiest kind of production to develop
and manage. But what if it is not possible to have one line dedicated to one product?
A manufacturer of industrial products had a variety of products to manufacture, product batch
sizes per shift ranged from a few hundred for established products to less than ten at a time
for end of life products and new product runs. On average production batches were a few
tens of PCB. In order to maximize production line efficiency, he developed a setup strategy
where he would group as many products into one large group feeder setup, and run these
jobs in sequence with placement program download changes between products within the
batch. Between feeder setups he would have a longer changeover involving table exchange
of pre prepared setups to the next group setup of products.
As batch sizes went down he noticed the time taken to prepare the offline setups could
become the critical bottleneck with on line production time becoming very small within a
group of jobs. In response to this he bought some pre owned placement equipment at low
cost and added feeder space capacity to the line in order to allow for even larger families of
products. However, he noticed that the effective placement rate of the line was not what it
should be and I was asked to take a look and provide advice.
Upon investigation I found a few areas where room for improvement were apparent:
• This long line of many machines sometimes had very fast cycle times for products
with a low to medium placement count (Many of the products were like this).
• With cycle times in the single second range secondary times such as transport and
fiducial time’s became a dominant factor directly reducing the effectiveness of the
placement machine.
• Other processes such as paste printing could not keep up with this fast cycle time.
The result was that though there were several placement machines on the line at
any one time only one or two actually had a PCB in them being placed.
• For small batches all placement stations did not have a PCB to populate.
• Changeovers were done on a line basis and the longer the line, the longer it took
to empty it in order to change the program.

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• It was hard to fit urgent production lots in because a complete group setup had to
be finished before a feeder changeover could be done.
• There was a validation process where the first product produced had to be
inspected prior to running any more resulting in idle time on all machines.
In committing to a strategy of ever increasing group setups and using old equipment to
increase the lines setup capacity, they had actually limited the lines flexibility as the older
equipment was not equipped to perform changeovers effectively.
Recommendations for the electronics production processes were:
• Replace the line with modern equipment capable of intelligent setup and
changeover concepts.
• Have less machines on the line (Less placement areas, but maximizing the available feeder
space per placement area)
• Produce with smaller group setups (Less feeder space available)
• Group the higher volume product runs with lower volume product runs, and
sequence them to avoid having multiple batches of small volumes run together
emptying the line.
• Have a group setup strategy with an exchange table changeover for the line
whereby some groups could be setup on only one side of the line allowing the
other side of the line to have a single product setup installed during operation.
• Produce the larger volume product during the times when small batches and or the
validation process are being done.
With this new operating strategy the line could
have a higher operating efficiency, while still
allowing for small batch sizes. Also urgent
batches could be fast tracked through the line
by having a dual mode setup strategy for the
line.
So just like in the case of the Valve
manufacturer if high mix low volume production
is the norm, it is still possible to design a
production system that can have high
operating efficiencies and allow for fast track
response times for urgent jobs.
Indeed, when it is the case that several changeovers per hour is the norm it is possible to
have average changeovers in single minute times (SMED). Some businesses can even
make a business model of this ability to fast track product through manufacture giving the
ability to charge a premium for such a service or offer the service at very competitive rates.

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Best practices that are essential for a BTO system
Build to order does not need to be implemented system wide; it can be implemented within
one work cell or even only on a finite group of products. However, in order to have security
and confidence of building the right product, at the right time, on short notice, with the right
quality, dependable and robust processes need to be in place. There are multiple best
practices in manufacturing that can be implemented to enable an effective BTO system and
in later papers we will focus one at a time on these best practices in detail. However to
illustrate the future topics here are some of them:
• Key Performance indicators
• Total Productive Maintenance
• Team working and Empowerment
• 5S and Visual control systems
• Six sigma and Statistical process control
• Lean Manufacturing
• Zero defects production
• Setup and changeover methodologies
The entire manufacturing value stream can be considered as a series inter linked sub
systems. Each of these subsystems can have effects and be influenced by the other
downstream and upstream systems. In the past, in order to minimize the effects of one
system over another departments and even processes have been isolated by buffers and
semi finished work in process. This WIP between departments such as SMT – PTH Auto
insert, manual insertion & selective soldering – electrical and functional test – final assembly,
and so on serves to increase lead times and costs. The ability to optimize one subsystem
such as SMT to a batch size approaching one (due to mixed model production, and single minute
changeovers) sometimes can have minimal overall effect if the other dependant subsystems
can not match this level of performance.
It is therefore important when considering optimizing the manufacturing system to map all
linked processes and consider the existing interactions and constraints. The BTO systems in
SMT can be comprehensive and cover all products. Or they can be targeted only at a group
of products or product families that perhaps can leverage their BTO capabilities over other
processes, such as products that do not need Auto PTH but rather manual PTH. With a well
organized agile system in manual PTH and selective soldering utilizing Lean process
designs, team working & empowerment techniques, huge improvements over the norm in
productivity – quality – and agility are possible.
Progress can be made system wide through a series of coordinated improvement steps.
This is magnified if these upstream and downstream interactions and constraints are
analyzed and targeted by a coordinated improvement effort. Fortunately many of the
techniques we will discuss in future articles are applicable to all manufacturing processes,
and through a coordinated improvement strategy you may be able to maximize the benefits
of your BTO journey. However, it is always good to start such a journey with some quick and
easy wins in order to energize and motivate the improvement program. SMT is an area that
can act as the leader and initiator of the BTO journey since many of the constraints have
already been targeted and neutralized through readily available concepts and solutions. We
stand ready to provide you with advice and support in those first steps.

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Over the coming months we will explore these best practice topics and explain how they
relate to electronics manufacturing and BTO strategies. Just as it is possible to benefit from
the implementation of some six sigma methodologies without having to become a six sigma
organization, in the same way it is possible to improve your production system by
implementing one or two of these best practice areas.
It has been said that such improvement programs are a journey and not a destination, and
that even the longest journey starts with one step. But even that single step is a worthwhile
journey in itself. We hope you find this information and the following articles a useful
inspiration and welcome you on this shared BTO journey.

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Appendix 01
A Historical Outline of the evolution of today’s manufacturing best practices
• In the early days manufacturing was performed by artisans who hand produced
entire products one at a time.
• With the advent of the industrial revolution and the contributions of such people as
F. W. Taylor on division of labor in the 1880-90’s mass production was enabled.
• As early as 1925 R. Flanders published papers on Group Technology as the
classification of manufactured parts in order to allow grouping of similar parts to
optimize the flow and production through a manufacturing system.
• In 1959 S. Mitrofanov of the Soviet Union published a paper on the scientific
principles of Group technology and outlined the principles of Cellular
manufacturing. (Cellular manufacturing was a means of arranging work stations and work flow to
maximize the benefits in Group technology, but now can be implemented in isolation of GT)
• As a result of Mitrofanov GT and cellular manufacturing were widely adopted as a
means of achieving low production costs in the Soviet and European markets,
particularly since the high volume production techniques that were adopted in the
USA to satisfy the mass market in the Americas could not be used.
• As part of the “Marshal” plan for Japan post WWII, many renowned experts in
scientific management in manufacturing, supported the development of Industrial
engineering & quality management techniques to help rebuild the Japanese
economy.
• These initiatives and techniques no doubt were a major factor in the Genesis of
what was to become the Toyota Production system.
• In the 1960’s & 70’s many of the techniques championed by Taiichi Ohno, Shigeo
Shingo and their contemporaries went on to become the TPS, TQM, SMED, Pull
system manufacturing, Kanban control, etc..
• In the 1990’s the European automotive industry took these techniques and
implemented versions of Build to Order Manufacturing based on the work of the “3
day car manufacturing logistics study”.