10/01/2025. The Key to Unlocking Modularisation and Manufacturing Efficiency

Consider this scenario: a customer orders a machine that precisely meets their requirements. Your sales staff provides a timeline, but you know the schedule is high-risk; most projects finish late.

Engineering starts designing from scratch. Manufacturing tries to keep up, putting together a one-of-a-kind product that is excruciatingly inefficient to make.

Finally, you deliver. The customer is satisfied—until the next machine arrives late. Meanwhile, your margins are gone, your crew is fatigued, and you wonder if things will always be this hectic.

This is the reality for many low-volume, high-mix (LV/HM) producers. Customisation is unavoidable in our environment, yet most businesses handle it poorly. The true problem is that they don’t comprehend modularisation or how to do it properly to unlock modularisation and manufacturing efficiency.

The Myth of Modularisation

To be honest, modularisation has a bad reputation with some people. Many companies attempted to set up their modular portfolios, but most implementations fell short of their objectives and failed to deliver on their promises. Perhaps you’ve even tried it, only to wind up with a jumble of incompatible systems and dissatisfied staff.

Here’s the truth: modularisation does not mean diminishing variety. It is about handling it.

If you’re in the LV/HM market, variety is key. Customers come to you because they want something unique and fit for purpose. However, it can be challenging to determine how to provide that variety without reinventing the wheel every time.

Modularisation is seen as a design philosophy, and that is where most initiatives take an early wrong turn. By not considering the influence the change in the product portfolio has on other departments and how these departments can support or derail the product restructuring, the initiative is doomed to struggle or even fail.

A New Look at Modularisation

Consider building a house. If every feature had to be designed from the ground up—every wall, pipe, and wire—it would take decades and cost a fortune. But that is not how houses are built. They’re built with a mix of conventional components and personalised touches that make each one distinctive.

The same idea applies to manufacturing. Modularisation isn’t intended to kill creativity. It’s about setting the framework for creativity to thrive in the appropriate environments.

When done correctly, modularisation completely transforms your business, turning you into the champion of your market.

Engineering teams devote less time to repeated activities. Production operates smoothly, with fewer surprises. And you deliver precisely what the consumer needs, on schedule and within budget.

The Turning Point: An Account of Two Approaches

Allow me to tell you about two firms. Both operate in the same market, providing identical products to comparable clientele. Both are under enormous pressure to produce customised solutions quickly and profitably.

The first manufacturer views each order as if it were a blank slate. Engineers start from zero and solve the same issues over and over. Manufacturing struggles to keep up, adjusting methods to each product.

What was the result? Costs rise, lead times lengthen, and the team burns out.

The second producer takes a different approach. They’ve established a framework—principles that govern all aspects of their operations. Their engineers do not start from scratch but configure solutions using pre-designed modules. Manufacturing follows precise criteria, with repeatable methods for assembling bespoke products.

It’s not that they don’t customise; they certainly do. However, they have shifted customising to the appropriate stage of the process, where it provides value rather than causing havoc. The result? Faster delivery, lower expenses, and a workforce that excels under duress.

The Foundations of Success

So what is the secret? It all starts with standards—real, meaningful standards, not nebulous suggestions buried in a PowerPoint presentation.

Think of it as a three-legged stool.

  1. System Standards specify what each product must achieve. Consider them the rules of the game: functional requirements, interface guidelines, and compliance metrics.
  2. Engineering standards guarantee components fit together and form a cohesive system. The standardised building blocks are at the core of these handbooks, but they contain more vital rules and guidelines.
    The materials, parts, and equipment catalogue ensures new designs use the available stock-keeping items; this helps to reduce working capital.
    Lastly, the standard engineering solutions to typical design details help standardise the tools and processes in the factory, helping achieve higher productivity.
  3. Manufacturing standards integrate designs into repeatable, scalable, and efficient processes. These describe the construction processes to follow to ensure product quality.
An easy to maintain and update modular architecture is achieved by developing the Functional System Standards, Engineering Standards, and Manufacturing Standards concurrently. The market requirements drive the modular architecture; 80% or more of the functional requirements must be covered by the standard building blocks. 

These standards are the key to unlocking modularisation and manufacturing efficiency. 

The modules are used to configure the client spefic products to order.

When these factors coincide, something miraculous occurs. Your operation moves from reactive to proactive. Instead of fighting fires, your staff can focus on what they do best: providing value to your consumers while reducing the effort needed over time.

Why Do Most Manufacturers Fail?

Here’s where things become tricky. Modularisation is not a quick remedy. It’s not as simple as slapping up a few templates and calling it a day. It is about synchronising all aspects of your business, including engineering, manufacturing, your supply chain, the sales processes, and beyond.

What is the biggest error most businesses make? They attempt to modularise everything at once while focusing only on the design. They leap in without a clear plan, resulting in systems that are too inflexible or complex to be used successfully.

Others fall into the silo trap. They regard engineering, manufacturing, and functional standards as distinct endeavours, ignoring how inextricably linked they are. What was the result? Misalignment, confusion, and inefficient effort. In many cases, the design department benefits from the new product structure while others play catchup.

The Payoff

Let’s go back to the manufacturer who got it right. Consider their business now.

When a new request for quotation arrives, the sales engineer swiftly configures a solution based on current modules, providing the customer with a clear timetable and pricing.

You can read more about how in this article.

Engineering refines the design, emphasising the distinguishing elements that create true value. This article describes the different processes.

Manufacturing is a simplified procedure that involves building the product with precision and assurance. This blog details the effect of modularisation on manufacturing efficiency.

The goods ship on time, and the consumer is happy. What about the team? They’re not burned out; they’re already planning the next endeavour. Best of all, your margin increases with each improvement that modularisation enables.

This is the power of modularisation done correctly. It is not about cutting corners or suppressing creativity. It is about establishing a foundation that will allow your firm to thrive.

The key Modularisation and Manufacturing Efficiency?

A well-setup product structure is easy to maintain and upgrade. In fact, when the structure is well-designed, you can offer clients mid-life updates for their equipment, extending the useful life for a fraction of the CAPEX involved with replacing the asset. This puts your company far ahead of the competition; no one can offer an upgrade that is so appealing.

And guess who clients prefer to design and build their next asset?

The secret sauce is:

  • Establish the right size modules. Too large modules are too complex to make, maintain, and update, while too small modules lead to an overly complex portfolio and low learning effect in the manufacturing chain.
  • Establish standards in the organisation in a coordinated process. Large discrepancies in maturity between different departments inadvertently lead to friction and inefficiencies.

The image below shows the steps Modular5® takes to ensure the portfolio is right-sized and all standards support and strengthen the transformation to a modular enterprise.

Establishing the modular architecture requires a number of consecutive steps:
1) Requirements Management
2) Variety Management
3) Assortment Management
4) Engineering knowledge management. 

The outcome are three separate but closely linked standards: 
A) Functional System Standards
B) Engineering standards
c) Manufacturing Standards

Only by aligning all departments and their processes, can a transition to a modular enterprise be successfully executed.

As you can see, setting up a modular architecture and the associated processes can be a complex project. There are many pitfalls and dead-ends along the way.

Final Thoughts: Are You Ready for Change?

Modularisation is not straightforward. It encourages you to reconsider your operations, question assumptions, and abandon old routines. However, the benefits outweigh the drawbacks: lower prices, shorter lead times, and staff functioning at peak efficiency.

So, ask yourself if your current method is sustainable. Are you ready to go from chaos to clarity?

At Modular5®, we believe in the revolutionary power of modularisation. If you’re ready to leap, let’s start a conversation. Together, we can create a system that works for your company, staff, and customers.

© 2025 Modular5 |
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