Hybrid Production Strategy Between Make-to-Order and Make-to-Stock – A Case Study at a Manufacturer of Agricultural Machinery with Volatile and Seasonal Demand

Manufacturing companies want to implement the make-to-order (MTO) strategy to be more flexible and responsive to the volatility of demand and product variability. However, the make-to-stock (MTS) approach is an appealing concept due to its desirable performance properties: high capacity utilization, high availability and short lead times. This paper aims to define a methodology that combines the advantages of MTO and MTS. The evaluation of the production strategies is based on an industrial case of a global manufacturer of agricultural machinery and is accomplished with the help of System Dynamics.