A fuzzy-based decision-making method for evaluating product discontinuity at the product transition point

Abstract Companies have been striving to achieve product innovation and cost savings to keep up with a rapidly changing manufacturing environment, as well as to deliver new products just in time and earlier than their competitors. Their strategic goals include effective decision making with regard to product life cycles, predicting market demand, and timing new product launches through the optimization of demand and supply of products. However, most products that enter a decline stage experience a decline in sales, which in turn causes an increase in warehouse costs, and a decline in competitiveness, owing to a delay in the release of new products. In this paper, we propose a fuzzy-based decision-making method to effectively evaluate products to be discontinued at the product transition point after taking into account market uncertainties and characteristics of businesses in companies. Therefore, we conduct the matrix analysis and the Pareto analysis for quantitative evaluation of four stages of the product life cycle based on market demand information for target product groups, apply the results of this analysis to the fuzzy-based qualitative evaluation model, and subsequently infer the discontinuity priority for product models that are expected to be replaced by new products. Furthermore, we develop the PTP portfolio system to identify a list of product models to be discontinued, as well as to review their percentage of sales contribution with respect to the overall product sales of the company.