Exploring the “mid office” concept as an enabler of mass customization in services

Abstract

Purpose – Mass customization (MC) is a well-established strategy for providing high levels of customization while achieving the scale economies of high volume production. The purpose of this paper is to explore a new service design configuration, the “mid office,” as a service interface which may support front office customization capabilities while protecting the back office from disruption. The authors posit that it may facilitate MC by enabling product/service and organizational modularity. Design/methodology/approach – The research is based on a single case study of a large European bank’s payment services, traditionally high volume, low variety operations. The bank adopted a MC strategy which involved the creation of a mid office. The analysis spans product/service and organizational design. Findings – When combined with menu-driven customization and reuse modularization, the mid office appears to support partial rather than full MC. It facilitates postponement of customization to the assembly stage through service coproduction, organizational decoupling, and the streamlining of employee adaptive behaviors. Research limitations/implications – The study bears the limitations typical of case study research; however this was appropriate given the exploratory nature of the research into a nascent concept. Practical implications – The paper identifies a series of design decisions to enable practitioners to choose between full and partial service MC, ensuring design coherence through a mirror effect of service modularity and organizational modularity. Originality/value – It is argued that the mid office is a service interface which facilitates partial MC by enabling service and organizational modularity. The paper reinterprets the archetypes of full and partial MC in service terms, and proposes a contingent approach to service MC implementation based on service value.