Tra­di­tional man­u­fac­tur­ers put on no­tice

DEMM Engineering & Manufacturing - - 3D TECHNOLOGY -

Three-D print­ing, or ad­di­tive man­u­fac­tur­ing,has as come a long way from its roots in the pro­duc­tion of sim­ple plas­tic pro­to­types. To­day, 3D print­ers can not only han­dle ma­te­ri­als rang­ing from ti­ta­nium to hu­man car­ti­lage, but also pro­duce fully func­tional com­po­nents, in­clud­ing com­plex mech­a­nisms, bat­ter­ies, tran­sis­tors, and LEDs.

The ca­pa­bil­i­ties of 3D print­ing hard­ware are evolv­ing rapidly, too. They can build larger com­po­nents and achieve greater pre­ci­sion, and finer res­o­lu­tion at higher speeds, and lower costs.

To­gether, these ad­vances have brought the tech­nol­ogy to a tip­ping point – it ap­pears ready to emerge from its niche sta­tus and be­come a vi­able al­ter­na­tive to con­ven­tional man­u­fac­tur­ing pro­cesses in an in­creas­ing num­ber of ap­pli­ca­tions.

Should this hap­pen, the tech­nol­ogy would trans­form man­u­fac­tur­ing flex­i­bil­ity – for ex­am­ple, by al­low­ing com­pa­nies to slash de­vel­op­ment time, elim­i­nate tool­ing costs, and sim­plify pro­duc­tion runs – while mak­ing it pos­si­ble to cre­ate com­plex shapes and struc­tures that weren’t fea­si­ble be­fore. More­over, ad­di­tive man­u­fac­tur­ing would help com­pa­nies im­prove the pro­duc­tiv­ity of ma­te­ri­als by elim­i­nat­ing the waste that ac­crues in tra­di­tional (sub­trac­tive) man­u­fac­tur­ing, and would spur the for­ma­tion of a ben­e­fi­cial cir­cu­lar econ­omy. The eco­nomic im­pli­ca­tions of 3D print­ing are sig­nif­i­cant: McKin­sey Global In­sti­tute re­search sug­gests it could have an im­pact of up to US$550 bil­lion a year by 2025.

The ad­van­tages of 3D print­ing over other man­u­fac­tur­ing tech­nolo­gies could lead to pro­found changes in the way many things are de­signed, de­vel­oped, pro­duced, and sup­ported. Here are five 3D print­ing dis­rup­tions that se­nior ex­ec­u­tives should be­gin pre­par­ing for.

Prod­uct de­vel­op­ment cy­cles

Re­duc­ing time in prod­uct de­vel­op­ment was a key ben­e­fit of the first 3D print­ing ma­chines, which were de­signed to speed the cre­ation of prod­uct pro­to­types (and in some cases helped re­duce turn­around times to a mat­ter of hours, from days or weeks). Now many in­dus­tries are poised for a sec­ond wave of ac­cel­er­a­tion as the line be­tween ad­di­tive and con­ven­tional man­u­fac­tur­ing blurs.

For ex­am­ple, ad­di­tive man­u­fac­tur­ing is al­ready be­ing used to get pro­to­types into the hands of cus­tomers faster. The abil­ity to make pro­to­types with­out tool­ing let’s com­pa­nies quickly test mul­ti­ple con­fig­u­ra­tions to de­ter­mine cus­tomer pref­er­ences, re­duc­ing prod­uct-launch risk and time to mar­ket.

Com­pa­nies could even go into pro­duc­tion us­ing 3D printed parts and start sell­ing prod­ucts while the tra­di­tional pro­duc­tion tools were still be­ing man­u­fac­tured, or be­fore the de­ci­sion to pro­duce them had been made. When com­pa­nies did or­der those tools, they could use ad­di­tive-man­u­fac­tur­ing tech­niques to make them, sav­ing even more time and money.

We ex­pect these tech­niques will con­trib­ute to sig­nif­i­cant re­duc­tions in prod­uct-de­vel­op­ment cy­cle times over the next decade. (For ex­am­ple, 3D print­ing makes some as­pects of day-to-day R&D work, such as pro­duc­ing sim­ple lab ap­pa­ra­tus, vastly more pro­duc­tive.)

Over time, 3D print­ing will be­gin to af­fect how com­pa­nies think about R&D more broadly, given how the tech­nol­ogy en­hances the abil­ity to crowdsource ideas through re­mote co­op­er­a­tion. For some com­pa­nies, that crowd­sourced brain­power might one day be­gin sup­plant­ing R&D ac­tiv­i­ties, mak­ing its man­age­ment a new pri­or­ity.

New man­u­fac­tur­ing strate­gies

As of 2011, only about 25 per­cent of the ad­di­tive-man­u­fac­tur­ing mar­ket in­volved the di­rect man­u­fac­ture of end prod­ucts. With a 60 per­cent an­nual growth rate, how­ever, that is the in­dus­try’s fastest­grow­ing seg­ment.

As costs con­tinue to fall, and the ca­pa­bil­i­ties of 3D print­ers in­crease, the range of parts that can be eco­nom­i­cally man­u­fac­tured us­ing ad­di­tive tech­niques will broaden dra­mat­i­cally. Boe­ing, for ex­am­ple, al­ready uses print­ers to make some 200 part num­bers for 10 dif­fer­ent types of air­craft, and med­i­cal-prod­ucts com­pa­nies are us­ing them to cre­ate hip re­place­ments.

Nonethe­less, not ev­ery com­po­nent will be a can­di­date for the tech­nol­ogy and reap its ben­e­fits (cost re­duc­tions, per­for­mance im­prove­ments, or both). Com­pa­nies should un­der­stand the char­ac­ter­is­tics that help de­ter­mine which ones are. These in­clude com­po­nents with a high labour­cost el­e­ment (such as time-con­sum­ing as­sem­bly and sec­ondary ma­chin­ing pro­cesses), com­plex tool­ing re­quire­ments

or rel­a­tively low vol­umes (and thus high tool­ing costs), or high ob­so­les­cence or scrap rates.

Ad­di­tive-man­u­fac­tur­ing tech­niques also have im­pli­ca­tions for man­u­fac­tur­ing­foot­print de­ci­sions. While there is still a mean­ing­ful labour com­po­nent to 3D printed parts, the fact that it is lower than that of con­ven­tion­ally man­u­fac­tured ones might, for ex­am­ple, tip the bal­ance to­ward pro­duc­tion closer to end cus­tomers. Al­ter­na­tively, com­pa­nies could find that the fully dig­i­tal na­ture of 3D print­ing makes it pos­si­ble to pro­duce com­plex parts in re­mote coun­tries with lower in­put costs for elec­tric­ity and labour.

A re­lated area that ex­ec­u­tives should watch with in­ter­est is the de­vel­op­ment of the mar­ket for print­ing ma­te­ri­als. The cost of fu­ture ma­te­ri­als is un­cer­tain, as to­day many print­ers use pro­pri­etary ones owned or li­censed by the man­u­fac­turer of the print­ing equip­ment. Should this change and more uni­ver­sal stan­dards de­velop – thus low­er­ing prices – the im­pli­ca­tions for ex­ec­u­tives de­vis­ing man­u­fac­tur­ing strate­gies and mak­ing foot­print de­ci­sions would be­come very sig­nif­i­cant very quickly.

Shift­ing sources of profit

Ad­di­tive-man­u­fac­tur­ing tech­nolo­gies could al­ter the way com­pa­nies add value to their prod­ucts and ser­vices.

The out­sourc­ing of con­ven­tional man­u­fac­tur­ing helped spur com­pa­nies such as Nike to rely more on their de­sign skills. Like­wise, 3D print­ing tech­niques could re­duce the cost and com­plex­ity of other kinds of pro­duc­tion and force com­pa­nies to dif­fer­en­ti­ate their prod­ucts in other ways.

These could in­clude ev­ery­thing from mak­ing prod­ucts more eas­ily repara­ble to cre­at­ing per­son­al­ized de­signs.

In­deed, re­duc­ing the re­liance on hard tool­ing cre­ates an op­por­tu­nity to of­fer cus­tom­ized or be­spoke de­signs at lower cost – and to a far broader range of cus­tomers. The ad­di­tive man­u­fac­ture of in­di­vid­u­al­ized or­thodon­tic braces is just one ex­am­ple of the po­ten­tial of these tech­nolo­gies.

The com­bi­na­tion of mass cus­tomiza­tion and new de­sign pos­si­bil­i­ties will up the ante for many com­pa­nies and could prove very dis­rup­tive to tra­di­tional play­ers in some seg­ments.

In cer­tain parts of the value chain, the ap­pli­ca­tion of ad­di­tive man­u­fac­tur­ing will be less vis­i­ble to cus­tomers, al­though its im­pact may be just as pro­found. A key chal­lenge in tra­di­tional af­ter­mar­ket sup­ply chains, for ex­am­ple, is man­ag­ing ap­pro­pri­ate in­ven­to­ries of spare parts, par­tic­u­larly for older, legacy prod­ucts. The abil­ity to man­u­fac­ture re­place­ment parts on de­mand us­ing 3D print­ers could trans­form the eco­nom­ics of af­ter­mar­ket ser­vice and the struc­ture of in­dus­tries.

Rel­a­tively small fa­cil­i­ties with on-site ad­di­tive man­u­fac­tur­ing ca­pa­bil­i­ties could re­place large re­gional ware­houses. The sup­ply of ser­vice parts might even be out­sourced: small fab­ri­ca­tors (or

More­over, the avail­abil­ity of open-source de­signs for 3D printed firearms shows how such tech­nolo­gies have the po­ten­tial to cre­ate eth­i­cal and reg­u­la­tory dilem­mas and to dis­rupt in­dus­tries.

fabs) lo­cated, for ex­am­ple, at air­ports, hos­pi­tals, or ma­jor man­u­fac­tur­ing venues could make these parts for much of the equip­ment used on site, with data sup­plied di­rectly by the man­u­fac­tur­ers.

New ca­pa­bil­i­ties

De­sign is in­her­ently linked to meth­ods of fab­ri­ca­tion. En­gi­neers can’t de­sign ma­chines with­out con­sid­er­ing the ben­e­fits and lim­i­ta­tions of cast­ing, forg­ing, milling, turn­ing, and weld­ing.

While there is a wealth of knowl­edge around de­sign for man­u­fac­tur­ing, much less is avail­able on de­sign for print­ing. Our con­ver­sa­tions with ex­ec­u­tives at man­u­fac­tur­ing com­pa­nies sug­gest that many are aware of this gap and scram­bling to cat­a­logue their de­sign know-how.

Get­ting the most out of ad­di­tive­man­u­fac­tur­ing tech­niques also in­volves tech­ni­cal chal­lenges, which in­clude set­ting en­vi­ron­men­tal pa­ram­e­ters to pre­vent shape dis­tor­tion, op­ti­miz­ing the speed of print­ing, and ad­just­ing the prop­er­ties of novel ma­te­ri­als. In­deed, tun­ing ma­te­ri­als is quite a chal­lenge. While plas­tics are rel­a­tively straight­for­ward to work with, metals are more dif­fi­cult.

The most suc­cess­ful play­ers will un­der­stand these chal­lenges. Some are al­ready cre­at­ing cen­tres of ex­cel­lence and hir­ing en­gi­neers with strong ex­pe­ri­ence in ad­di­tive man­u­fac­tur­ing.

Dis­rup­tive com­peti­tors

Many ben­e­fits of 3D print­ing could cut the cost of mar­ket en­try for new play­ers: for ex­am­ple, the use of the tech­nol­ogy to lower tool­ing costs makes it cheaper to be­gin man­u­fac­tur­ing, even at low vol­umes, or to serve niche seg­ments.

The di­rect man­u­fac­tur­ing of end prod­ucts greatly sim­pli­fies and re­duces the work of a de­signer who would only have to take prod­ucts from the com­puter screen to commercial vi­a­bil­ity. New businesses are al­ready pop­ping up to of­fer highly cus­tom­ized or col­lab­o­ra­tively de­signed prod­ucts.

Ini­tially, these new com­peti­tors will be niche play­ers, op­er­at­ing where con­sumers are will­ing to pay a pre­mium for a be­spoke de­sign, com­plex ge­om­e­try, or rapid de­liv­ery.

Over the longer term, how­ever, they could trans­form in­dus­tries in un­ex­pected ways, mov­ing the source of com­pet­i­tive ad­van­tage away from the abil­ity to man­u­fac­ture in high vol­umes at low cost and to­ward other ar­eas of the value chain, such as de­sign or even the own­er­ship of cus­tomer net­works.

More­over, the avail­abil­ity of open­source de­signs for 3D printed firearms shows how such tech­nolo­gies have the po­ten­tial to cre­ate eth­i­cal and reg­u­la­tory dilem­mas and to dis­rupt in­dus­tries.

The au­thors would like to thank Michael Chui and Markus Ham­mer for their con­tri­bu­tions to this ar­ti­cle. This ar­ti­cle was orig­i­nally pub­lished in McKin­sey Quar­terly, www. mckin­sey.com/in­sights/mck­in­sey_quar­terly. Copy­right (c) 2014 McKin­sey & Com­pany. All rights re­served. Reprinted with per­mis­sion.

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