Configure-to-order (short: CTO) refers to a production process in which a product is manufactured on the basis of prefabricated modules or Components is configured and assembled according to customer specifications.
Instead of producing the complete product in advance, the company waits for the customer's order. The desired product is then put together from a modular system - similar to configuring a car: colour, rims, engine - everything can be selected, but from predefined options.
Relevant context and area of application:
CTO processes are typically used in mechanical engineering, the electronics industry or in the manufacture of complex products. They are particularly suitable for companies that want to offer flexibility but do not require complete customisation (make-to-order).
In ERP systems such as SAP Business One or SAP S/4HANA CTO processes can be mapped by compiling variant configurations, parts lists and work plans with system support and automatically transferring them to production planning. The challenge lies in the clean integration of sales, configuration and production planning, logistics and manufacturing.
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