Final answer:
Engineer-to-Order (ETO) involves creating custom products from scratch for specific customer needs, resulting in longer lead times, while Assemble-to-Order (ATO) utilizes existing components to assemble products after an order is placed, allowing for quicker turnaround times. ETO is exemplified by specialized equipment manufacturing, whereas ATO is seen in customizable PC production.
Step-by-step explanation:
In the context of manufacturing systems, Engineer-to-Order (ETO) and Assemble-to-Order (ATO) are two distinct approaches to producing goods. ETO refers to a system where the product is designed and built from scratch to meet specific customer requirements. This process often involves a longer lead-time since the product has to be engineered, materials procured, and custom manufacturing processes set up. An example of ETO could be the manufacturing of specialized industrial equipment which is specifically designed to match a customer's unique requirements.
On the other hand, ATO is a system where products are assembled from existing components or modules when an order is placed. The components are pre-made and kept in inventory, allowing for a quicker assembly time once an order is received. For instance, computer manufacturers like Dell invite customers to select specific configurations for their PCs. Once the order is placed, the computer is assembled from pre-manufactured components like hard drives, RAM, processors, etc. This allows for a quicker delivery as compared to ETO.
Both systems reflect the strategy and market that a business is targeting. ETO provides highly customized products at the expense of longer lead times, while ATO offers quicker turnaround times and is often associated with mass customization.