Strategic selection of core components

Since product innovations are imitated immediately, competitive advantage of product innovations does not last very long whereas the process of gaining competence and experience in development and production requires great efforts for all competitors. International competition forces European production enterprises to decide about their future manufacturing strategy. This decision turns out to be of vital importance. The strategy for European manufacturers has to be putting focus on producing only a carefully selected spectrum of strategic products and components. The decision whether to keep a component or an assembly that has to be produced in-house is a strategic decision and cannot be dealt with as an operative question. The division Systems Planning at the Fraunhofer Institute for Production Systems and Design Technology (IPK), Berlin/FRG has developed a method for enterprises of production industry to maintain and even improve their market situation and their corporate value by s electing the company's core assemblies and core components.