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The product structure is a key input to a material requirements planning system. Yet, the effect of alternate product structure designs on system performance is not well understood. Analytical measures are needed to accurately relate product‐structure characteristics to total cost and delivery performance. A new analytical measure of product structure called the degree of commonality index is defined in this paper. The degree of commonality index can be applied to single end items, product families, entire product lines, or to any level of product structure. This study suggests that component part commonality, as measured by the degree of commonality index, has a significant effect on system performance. For example, company standardization programs that increase the degree of component part commonality result in manufacturing cost reductions. The degree of commonality index provides a way to directly relate the degree of component part commonality to various dependent variables such as total cost, work center load, and delivery performance.
David Collier (Thu,) studied this question.