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Top1. Introduction
One production system which has recently attracted researchers’ and practitioners’ consideration is hybrid MTS-MTO (Rafiei & Rabbani, 2012). The MTS production system can meet customer orders fast, but confronts inventory risks associated with short product life cycles and unpredictable demands. In contrast, the MTO producers can provide a variety of products and custom orders with lower inventory risks, although they usually have longer customer lead times. Moreover, in MTS production, products are stocked in advance, while in MTO production, a product only starts to be produced when an order of demand is received. The MTS-MTO supply chain is appropriate where common modules are shared by various finished products through divergent finalization. The MTS-MTO supply chain inherits two key characteristics. First, it can lower the cost by taking advantage of economies of scale during the MTS stage for the production of standard modules. Second, it can concurrently satisfy the requirement of high product variety by taking advantage of the MTO stage’s flexibility (Wang et al., 2011). The Order Penetration Point (OPP) specifies where the customer’s desired specifications influence the production value chain (Hoekstra et al., 1992) and the customer’s specifications are considered in different places along the production systems in MTS, MTO and MTS-MTO.
The positioning of OPP is a challenging area that has received increasing attention in the manufacturing strategy literature (Hallgren & Olhager, 2006). According to Teimoury and Fathi (2013), OPP is taken into consideration in different locations along the production systems in MTS, MTO and MTS-MTO. Accordingly, we consider three environments MTS, MTO and MTS-MTO for positioning OPP in supply chain networks as the analysis of the problem is different for each environment. By bringing Table 1, we prefer to display a general overview of our developed OPP models for readers in this section. As shown in Table 1, our developed OPP models in Teimoury et al. (2010), Teimoury et al. (2011) and Teimoury et al. (2012), Teimoury and Fathi (2012), Teimoury and Fathi (2013), Teimoury et al. (2013), current research) are in MTS, MTO, and MTS-MTO environment, respectively.