From ETO to CTO

From engineer-to-order to configure-to-order

Start with a product you already sell often. Sales and dealers can quote that product through RulePro. Other product lines remain ETO for now, while engineering gradually adds more products and variants to the product model.

Engineer-to-order means every order costs engineering hours again, even the enquiry that closely resembles last month's. Configure-to-order means the thinking is done up front and the order merely selects. In logistics this is known as moving the customer order decoupling point. This page describes the route that actually works.

Where engineer-to-order holds you back

Two routes, and only one arrives

Comparison of the textbook route (modularise everything first, 18 to 24 months) with the sales route (live in weeks)
Whoever wants to finish everything first never goes live. Whoever is live finishes what demonstrably sells.

The textbook route, modularise the entire portfolio, perfect the catalogue, then build the configurator, sounds sensible but often gets stuck in analysis and elaboration, while custom work keeps growing. The sales route inverts it. Pick one product, point the configurator at what you want to sell, go live, and modularise what sells. Every sold order makes the next one cheaper.

Smart tip

For your starter product, pick not your prettiest or newest but what sells most often. That is where every module pays for itself fastest.

Sixty to eighty percent is already identical

Look at your order history. In the companies we see, 60 to 80% of every order turns out to be the same. This too is a rule of thumb from practice, not a research figure. Feel free to check it against your own orders. Beware. Much of what looks like variety is accidental variety, three engineers who solved the same problem three ways. That is not customer demand; that is history. Real customer variety lives in a handful of positions, and a variety analysis points them out. Build choices there; the rest becomes standard.

The shift in engineering (and why it is not free)

The shift in engineering: from every order a work of art to building blocks with an owner, with hours moving from order work to product work
The hours do not disappear, they shift from repeat work per order to the product itself.

This takes time and attention from engineering. Done means done (module with drawing, BOM, interface and documentation), reuse becomes the norm, every module gets an owner, and it costs months of capacity alongside running orders. Fail to plan for it and you get good intentions instead of modules. The reward is that pride shifts from the clever exception to the building block built a hundred times.

The bottleneck can be in engineering and sales

Engineering and sales can both determine lead time. A sales career is built on saying yes, and configure-to-order can sometimes feel like selling no. Ignore that and custom work returns outside the configurator. The answer lives on the sales & dealers page. The configurator gives sales the fastest yes in the market.

What does it deliver? The honest numbers

30 to 80%
shorter quote lead time
from days to minutes
20 to 30%
fewer engineering hours
on quotes, changes and repeat work
50 to 90%
fewer errors
reaching production

Ranges from public CPQ and modularisation research. Every source is on the numbers page. CPQ can free up time in quotes, changes and recurring ETO work. Engineering can use that capacity for product improvement and to further standardise products that sell often. Building up costs capacity first, and the gains land where the configurator is live.

What you make does not change. How much you can sell with it does.

Frequently asked questions

What is the difference between engineer-to-order and configure-to-order?
With engineer-to-order (ETO) every customer order is engineered again. Investigating, drawing, calculating. Sometimes you copy an earlier order. That is quicker, but it also copies old exceptions, errors and agreements. With configure-to-order (CTO) the thinking is done up front in a product model. The order selects from checked options. The customer order decoupling point moves. Engineering happens before the order instead of after it.
Why do so many modularisation programmes fail?
Because they follow the textbook route. Modularise the whole portfolio first, then go live. In our experience such a programme easily takes 18 to 24 months. That is a rule of thumb from practice, not a research figure. What we do see time and again, the programme gets stuck in analysis and elaboration while custom work keeps piling up. The route that works is inverted. Bring one product live, then modularise what sells.
What does a configurator give engineering?
You do not save engineers, you buy back capacity. CPQ can free up time in quotes, changes and recurring ETO work. That capacity can be used for product improvement and further standardising products that sell often.
Which product should I start with?
Pick the product that sells most often, and one whose standardisation engineering can handle alongside running orders. Volume means every module pays for itself fastest. Early on, every sold order still costs engineering hours. Do not start too broad.
What does the customer notice?
More predictable quotes. Choice, price and technical feasibility are checked while the product is being configured.

The route starts with a product, not a programme.

Your team sets up a first product line and lets the first orders come in, with guidance from RulePro. From there, sales decides which module engineering standardises next.