Skip navigation
2017

3D printing, or additive manufacturing, is well known for being used to make prototype parts, especially in the automotive industry, but its use in other applications is growing quickly. For example, the technology is also being tested to produce satellites, spare and hard-to-source parts for U.S. Coast Guard ships, and infrequently requested replacement parts, special parts and other parts for small quantity and classic model automobiles.

 

Now it seems the technology may be poised for even more widespread use. Executives from computer and printer supplier HP and consulting firm Deloitte say recent advances in the technology will prompt manufacturers to adopt it as a more economical alternative to injection molding. Toward that vision, the two companies recently announced a joint effort to develop 3D printing systems to support large-scale production.

 

“What we have, is an opportunity to disrupt a $12 trillion manufacturing industry,” HP President and CEO Dion Weisler said at a press conference. “The Fourth Industrial Revolution is upon us. No sector of the global economy is undergoing more radical transformation than the manufacturing market. Companies investing in digital reinvention are poised to outpace their peers. Building on our disruptive 3D printing technology, together with Deloitte, we are focused on helping customers transform and win in this new era.”

 

HP introduced a 3D printer for industrial applications last year, and Weisler noted that 3D printing is already more cost-effective than injection molding for a limited number of manufacturing goods. He predicts that improved materials science, however, would make that number significantly larger. Indeed, HP researchers are already working with different colors, textures and conductive materials in the company’s labs.

 

The alliance will combine HP’s Jet Fusion 3D Printing solutions and tools, partner ecosystem and experience driving digital industrial transformations with Deloitte’s global client reach and manufacturing relationships, extensive digital operations experience and proven success in supply chain transformation for some of the world’s largest companies. The plan, execs from the two companies say, is to help companies accelerate product design and production, create more flexible manufacturing and supply chains, and enhance efficiency across the manufacturing lifecycle. Consequently, they say, companies will increase innovation, accelerate time-to-market, and reduce waste and curb excessive inventory—leading, in turn, to reduced warehouse space requirements.

 

“All of those things, when you combine them, enable manufacturing to happen anywhere in the world,” Weisler said. “It democratizes manufacturing.”

 

Officials said that although manufacturers are generally a risk-averse group, the advantages of 3D printing would become too big to ignore.

 

“I believe you’ll see 3D printing at scale operate, sort of like a lot of the technologies we’ve seen over the last several years, on an exponential curve,” says Deloitte Supply Chain Principal Doug Gish. “So, over the next three to five years, we really expect to see this take off.”

 

3D printing appears to have the potential to lower costs, increase production speed and flexibility, and, perhaps, minimize distribution borders. Do you believe, like HP and Deloitte executives, that 3D printing will help “unlock the promise” of a new global industrial revolution?

As Hurricane Harvey continues to dump rain on Southeast Texas—particularly in and around Houston—our thoughts and concern are first and foremost with the residents of those areas and the first responders and volunteers helping in the storm’s aftermath.

 

Our thoughts do also turn to supply chains, as the seaports in Houston and Corpus Christi closed last week in advance of the storm, and rising waters from days of heavy rains and catastrophic flooding have closed long stretches of highways and railroad tracks. The result is that freight transportation in a major American hub has slowed to a virtual standstill.

 

Houston is a key consolidation point for imports of vehicles and appliances made in Mexico. What’s more, the city’s port is an early stop for ships passing through the Panama Canal, which was widened last year to allow bigger vessels to pass through. Many retailers and manufacturers of all types now import goods from Asia through Houston’s port instead of through West Coast ports. Since large container ships typically make multiple stops, several days’ delay in dropping off cargo in Houston will have a cascading effect on stops at ports in Savannah, Ga., New York and even the Dutch port of Rotterdam.

 

Railroad lines are seeing an impact as well. For instance, Union Pacific Corp. has halted all freight rail traffic bound for Houston and surrounding areas, and BNSF Railway also sent a notice to customers, saying that trains destined for Galveston would be held at other locations until further notice. Railcars were being moved away from the lowest-lying areas, according to the notice, and rail crews were on alert for any needed track repairs.

 

Trucking fleets are naturally effected as well. Indeed, the number of Houston-area trucking runs requested fell 80 percent, according to the most recent data from DAT Solutions, an online load board. All told, the storm effected up to 10 percent of the U.S.’s trucking capacity, according to Noël Perry, chief economist with Truckstop.com, another online load board. Consequently, companies around the country may struggle to line up enough trucks to ship goods. Compounding matters, albeit in a good way, many trucks that are available are being turned over to relief and rebuilding efforts. Wal-Mart, for example, has sent more than 1,000 big rigs to hard-hit areas and evacuation centers, with most carrying water.

 

The impact means that shipping costs could rise anywhere from five percent to 22 percent, Perry says, based on the market’s response to past natural disasters such as Hurricane Katrina and the “polar vortex” that hit the Northeast in 2014. Many freight companies say they have no idea when they will resume operations. Even after the weather clears, it could be days before floodwaters recede enough to allow dockworkers back into ports, or trucks to resume routes.

 

“This may be unprecedented when all is said and done,” Mark Rourke, chief operating officer at trucking company Schneider National, says in a Wall Street Journal article. He said it could be three days before Schneider employees can access some terminals in the city and potentially two weeks before normal operations resume.

 

Has your company or its suppliers seen an impact from Harvey’s rain and flooding? Were plans made last week to change shipping and transportation strategies to mitigate risk? Finally, is your company involved in relief efforts?

Putting concerns about the manufacturing skills gap aside, I was interested to read a new report which explained how future manufacturing and supply chains will require new types of jobs—and people with new skillsets. Indeed, the descriptions for jobs such as collaborative robotics specialist, manufacturing cybersecurity strategist and enterprise digital ethicist explain how a workforce with advanced skills and knowledge will be needed for companies to remain competitive globally.

 

The “Digital Workforce Succession in Manufacturing” report, based on research conducted by UI LABS and ManpowerGroup, is intended as a resource of sorts companies can use to begin developing a talent pipeline for future jobs. The workforce analysis, which identifies 165 data-centric jobs, also describes the type and level of educational degree associated with each position, ranging from an AAS in Robotics Technology to a Ph.D. in Mathematics or Engineering.

 

“Digitization is transforming the job market, creating a need for people with more advanced skills in manufacturing, and our work with UI LABS is evidence of this,” says Jonas Prising, Chairman and CEO of ManpowerGroup. “By mapping the digital roles and skills of the future, our research will help companies and schools upskill today’s manufacturing workforce for the connected, smart machine and augmented-technology jobs of an increasingly digital enterprise. This will help bridge the skills gap and highlights the advanced and attractive jobs emerging on the forefront of the manufacturing sector.”

 

I was interested to read about a few new jobs in particular. For example, the report explains that as the executive advocate for the growth and profitability of digital strategies and business opportunities, the Chief Digital Officer will orchestrate the collective pace of digital consideration and integration in both the customer experience and the company operations and cultural orientation. Taking into account the specific needs of the organization, the CDO will be tasked with identifying areas of improvement and implementing digital solutions, such as IIoT and automation, the report explains.

 

Then there are Virtual Reality/Augmented Reality System Specialists, who, according to the report, will work to apply VR/AR systems which support a product through its lifecycle. VR/AR systems offer the opportunity to engage the environment, product and peripheral support media in new ways that enhance the productivity of a workforce and create new value in products for customers, the authors note.

 

I was also interested to read about a growing need for Predictive Maintenance System Specialists, who use sensing, analytic and diagnostic systems on existing assets and infrastructure to monitor and predict performance and maintenance requirements. Their role primarily focuses on the application of sensor and real-time data-driven predictive maintenance, driving toward reduced asset downtime and reduced operations interruptions, however they also may work with more traditional preventative maintenance systems to gain an understanding of an asset’s prescribed maintenance requirements and estimated maintenance intervals.

 

Finally, I am intrigued by the role of Manufacturing Cybersecurity Strategist, who will manage the overall risk assessment, set cybersecurity goals, determine cybersecurity strategies and actions to achieve those goals, and set direction to ready and/or mobilize the resources to guard access and integrity of the digital data bank and networks of connected production assets. The Manufacturing Cybersecurity Strategist will be responsible for customer and corporate data privacy, designing a program that proactively reduces risk, maintains defenses and security, is operational, and is ready for disruptions.

 

These roles aren’t necessarily the most critical or highest value, but they do represent the types of changes the workforce is experiencing, the researchers emphasize. They also demonstrate the opportunities for manufacturers and the workforce alike—and represent targets for educators and workforce development programs, the report explains.

 

What are your thoughts on these future jobs? Secondly, how can educators and workforce development programs better train people for these jobs?

Some of the most popular industrial and consumer robots are dangerously easy to hack and could be turned into bugging devices or weapons, according to researchers from IOActive Inc.

 

Researchers from the cybersecurity firm found major security flaws in industrial models sold by Universal Robots, a division of U.S. technology company Teradyne Inc., a Bloomberg article reports. They also cited issues with consumer robots Pepper and NAO, which are manufactured by Japan’s Softbank Group Corp., and the Alpha 1 and Alpha 2 made by China-based UBTech Robotics. These vulnerabilities could allow the robots to be turned into surveillance devices, surreptitiously spying on their owners, or enable them to be hijacked and used to physically harm people or damage property, the researchers wrote in a report.

 

The larger cybersecurity concern, however, may not be robots, but enterprise-wide threats stemming from the proliferation of devices on the Internet of Things. Speaking at the Gartner Security and Risk Management Summit, Toan Trinh, consulting systems engineer at Fortinet, said that rather than simply focusing on protecting new devices from the outside world, enterprise cybersecurity must also focus on connecting new devices to older, existing devices, which are most probably running old code, and protecting the entire network that such devices run on, a ZDNet article reports.

 

Gartner forecasts that 8.4 billion connected things will be in use worldwide in 2017, up 31 percent from 2016, and will reach 20.4 billion by 2020. The consumer segment is the largest user of connected things, 63 percent of the overall number of applications, however businesses are on pace to use 3.1 billion connected things in 2017, the firm forecasts.

 

“One of the issues of IoT is that there’s a lot of legacy systems and devices out there and [when people designed them] they never thought about the security aspect,” Trinh said. Compounding the situation, he continued, is that many of the businesses that manufactured or sold the devices to organizations 10 years—or more—ago are out of business, which results in the inability to patch or request support. What’s more, the prevalence of legacy systems which the rest of the organization depends on is quite heavy — something the recent WannaCry ransomware brought to the forefront, Trinh says.

 

“Everyday IoT—especially consumer IoT—is really designed to be useful, fun, convenient and cheap, but when you look at the manufacturing or thought process for IoT, designers must come out with a device very quickly, cheaply and easily accessible. When things are made so inexpensively, they often don’t envisage the device sitting there for five or 10 years,” he explained. Consequently, security always becomes an afterthought, he said.

 

According to Trinh, there are four key elements to look at from an enterprise point of view when thinking about the IoT: The device itself; the network it uses; the platform it connects to, such as the cloud; and the data that it transfers. “All of these elements need to be secured in some fashion,” he said.

 

“[It’s about] providing the network with the smarts to protect yourself from these devices. When a device gets introduced, that opens up your attack surface. You have to build a security fabric that controls your access layer … because today’s network is borderless,” Trinh said. “Before jumping on the IoT bandwagon, think about your network and its current status … and determine how well you can handle these devices coming on.”

 

What are your thoughts on enterprise cybersecurity threats stemming from IoT devices? What about your company’s suppliers and partners? Does their cybersecurity plan, or lack of a plan, introduce supply chain risk?

These are interesting times for 3D printing because recent developments further demonstrate how the technology can not only be used to quickly produce parts rather than face long lead times, but also produce parts able to be used in extreme environments. What’s more, the technology also has the potential to change how manufacturers operate by creating new manufacturing strategies.

 

For example, the Associated Press reports that spacewalking cosmonauts released five nanosatellites by hand from the International Space Station this week. What’s intriguing is that the little satellites, no more than one to two feet in size, were produced almost entirely with a 3D printer, although they do contain regular electronics. The experiment is intended to show researchers how 3D-printed parts weather the space environment.

 

The U.S. Coast Guard also announced it’s using 3D printers to create spare parts on-board ships. Although the technology has already been used on-board ships to produce spare parts, it’s now being trialed more widely to print parts which aren’t normally kept on vessels and which may be difficult to source. The Coast Guard says this will improve mission readiness and logistical support.

 

“Sometimes those parts have lead times of weeks…maybe months,” Captain Joseph Dugan, program manager for the National Security Cutter Program, wrote on the official Coast Guard blog. “Sometimes manufacturers no longer make the parts, and need to retool a production line in order to make us the part we need.”

 

Finally, Mercedes-Benz Trucks announced recently that it’s printing metal spare and replacement parts. This is a continuation of the company’s plan to begin 3D printing plastic or composite spare parts for certain European market trucks in late 2016. It may have seemed the plan would have limited applications or advantages, but the company’s expansion into new materials could open the door for new markets.

 

For example, Mercedes-Benz noted that the first metal parts it’s printing are aluminum, and “these excel with almost 100 percent density and greater purity than conventional die-cast aluminum parts,” an article in Fleet Owner reports. The 3D printing process could deliver items with a material/structural advantage, which has also been touted as a reason for using the technology to make parts from plastic and similar materials.

 

3D printing—especially if it can be used to successfully produce items from a wider range of materials—can offer an improved method for providing spare parts and faster service for older model vehicles. After all, older vehicles are a diminishing fraction of companies’ business, and, while necessary, maintaining parts inventory can tie up significant capital for manufacturing; shipping, distribution and storage of parts; and maintaining and storing production tooling to make those parts.

 

“Especially when they have complex structures, 3D-printed metal parts in small numbers can be produced cost-effectively as infrequently requested replacement parts, special parts and for small and classic model series,” a Mercedes-Benz spokesperson says in the article. “Conceivable areas of use are peripheral engine parts made of metal, in-engine parts and also parts in cooling systems, transmissions, axles or chassis.”

 

Although 3D printing is mostly known for applications using or when traditional production and distribution is slow and costly, I was also interested to read about its possible broader use in manufacturing strategies. Writing recently on IndustryWeek, Kent Firestone, COO at Stratasys Direct Manufacturing, which offers 3D printing and custom manufacturing solutions, contends that the technology can be used to break down manufacturing silos because using 3D printing in conjunction with traditional manufacturing allows users to realize the benefits of both types of production. For example, he explains, companies can use 3D printing to build jigs and fixtures, validate tools, and for bridge production, helping reduce production costs and lead times for large-volume production jobs using traditional manufacturing processes.

 

Does your company used 3D printed parts? If so, is the process part of a larger, overall manufacturing or supply chain strategy?

As new developments are made in Artificial Intelligence, conversations often turn to concerns about potential threats to humanity—and rightly so. At the same time, however, it often seems too little attention is paid to the possible benefits for manufacturing and the supply chain, where there is potential to change the way we work by improving processes ranging from material requirements planning and capacity planning, to reducing a plant’s energy consumption as part of Green initiatives.

 

You may have seen a back-and-forth exchange in recent weeks between Tesla and SpaceX CEO Elon Musk and Facebook CEO Mark Zuckerberg. It began at the annual meeting of the National Governors Association, where Musk said that even though we may not fully grasp the “real threats in front of us”, we all need to be “quite concerned” about unregulated AI research. He later doubled down on earlier warnings about the threat posed by AI.

 

“I have exposure to the most cutting-edge AI and I think people should be really concerned about it. I keep sounding the alarm bell about it, but until people see robots running down the street killing people, they don’t know how to react, because it seems so ethereal,” Musk said. “AI is the rare case where we need to be proactive in regulation, instead of reactive, because by the time we are reactive in AI regulation, it’s too late. AI is a fundamental existential risk for human civilization.”

 

Later, during a “live” Facebook discussion from his backyard, Zuckerberg said he doesn’t understand people who are “naysayers” and try to “drum up” doomsday scenarios.

 

“I actually think it’s pretty irresponsible,” said Zuckerberg, who also added that he believes people “can build things and the world gets better.”

 

With that type of exchange in mind, I was interested to read an opinion piece on manufacturingglobal.com. There, Jane Zavalishina, CEO of Yandex Data Factory, points out that while people focus on talking and emoting robots when discussing AI, there is also a so-called “narrow” AI, which is very good at specifically defined, constrained tasks, where it can deal with uncertainty better than humans, such as in evaluating a manufacturing process over time.

 

In the real industrial world, nothing is ever fully known, Zavalishina says. For example, the exact composition of raw materials vary, as do external conditions, and multiple fluctuations occur in every process. What’s more, classic science can only describe the physical or chemical processes happening inside the equipment with a degree of certainty, she writes.

 

“Process control is never precisely accurate: the operations happen within a permitted range and a great deal of variability, which results in inefficiencies,” Zavalishina observes. “This can come in the form of the excessive use of a certain raw material, suboptimal energy consumption levels, scrap due to defected production, or poorly planned logistics. These inefficiencies are as equally as bad for environment as they are for the bottom line.”

 

What makes AI especially attractive, Zavalishina says, is that manufacturers can use AI to drive improvements—such as consistently reducing variability—without changing the process itself or requiring significant capital investment. That’s because AI enables more precise decision-making for each individual process iteration, having learned from previous cycles, she writes.

 

For example, Zavalishina says AI can precisely model the expected output of a process, thereby allowing more precise identification of raw material requirements. It also can recommend the best operating parameters to reduce energy consumption without affecting throughput, she continues. Another example is to use AI to detect hidden product defects early on to prevent further processing bad lots.

 

What do you think of “narrow” AI and its ability to help solve manufacturing challenges or those in the supply chain? What types of “What-if?” analysis would benefit from the use of AI?

As companies apply digital transformation to the enterprise, many executives are surprised at the impact on procurement. Indeed, typical procurement organizations can substantially narrow the gap between their cost levels and that of top performers, and top performers can become even better by leveraging digital transformation, according to new research.

 

Consider, for instance, that “world-class” procurement organizations operate with 22 percent lower labor costs than their peers, and have 29 percent fewer staff, while demonstrating improved effectiveness and better performance across a number of key metrics, according to world-class procurement research from The Hackett Group. For a typical company with $10 billion in revenue, attaining world-class performance in procurement can represent as much as $6 million in potential annual functional cost savings, the research firm explains. World-class procurement organizations also generate more than twice the ROI of typical procurement organizations—generating more than $10 in savings for every $1 of procurement operating cost.

 

The research also found that in addition to reduced cost and fewer staff, world-class procurement organizations are significantly more effective than their peers in how they operate and deliver services. For example, transactions require discrepancy resolution two to three times less often, and annual procurement staff turnover is also 45 percent lower—an indication that staff are given opportunities for professional growth, the research shows.

 

The firm’s research identified six digital accelerators necessary to improve an organization’s procurement performance and support business strategy over the long term: digital tools to enhance customer engagement; robotic process automation to perform rules-based activities; the use of big data and advanced analytics to drive insight and bolster decision making; cloud-based applications; digital workforce enablement to maximize productivity; and the use of cognitive computing to simulate human thought and increase the ability of a procurement organization to run models, make predictions and analyze large data sets.

 

“Technology has always played an important role in enabling performance, but procurement has reached an inflection point,” says Christopher S. Sawchuk, a principal & global procurement advisory practice leader for The Hackett Group. “Today, digital business tools are converging with employees and consumers who are increasingly comfortable with new mobile technologies and business models. This has created tremendous opportunities for procurement organizations to transform service delivery, reduce errors, make information easier to access and even deliver a whole new class of services.”

 

I was also interested to see that the firm’s research indicates e-sourcing software can cut overall cycle time by 30 percent, and that use of contract lifecycle management software can reduce the time required to find a contract by nearly half and reduce the number of lapsed contracts by nearly 40 percent. That said, Robert Derocher, a principal at The Hackett Group, also explains that the use of technology alone will not deliver results.

 

“[Technology] must fit within a larger strategy, one based on a well-designed service delivery model that looks at not just technology, but also processes, information, talent and organizational redesign,” Derocher says. “But the promise of digital, in the context of a well-rounded transformation effort, is tremendous.”

 

What are your thoughts on digital transformation? Specifically, do you think some companies place too much of an emphasis on technology and consequently neglect other parts of the overall digital transformation strategy?

Last week, Toyota and Mazda signed an agreement to enter a business and capital alliance to further strength their partnership. The outcome is expected to either significantly impact an existing automotive supplier network or prompt manufacturers and suppliers to move or begin operations.

 

Specifically, the companies agreed to establish a joint-venture plant which produces vehicles in the U.S., jointly develop technologies for electric vehicles, jointly develop connected-car technology, collaborate on advanced safety technologies, and expand complementary products. As might be expected, it’s news of the joint-venture plant that is attracting attention, especially since the companies announced the plant would have an estimated annual production capacity of approximately 300,000 units, will require a total investment of approximately 1.6 billion U.S. dollars, and will create up to 4,000 jobs.

 

At the new plant, Mazda expects to produce cross-over models which Mazda will introduce to the North American market, and Toyota plans to produce the Corolla for the North American market. By producing vehicles in the U.S., Mazda aims to build a production structure to further grow in North America, allowing the company to more quickly respond to its customers’ needs depending on the region and model. By further increasing its production capacity in the U.S., Toyota will be better positioned to respond to the growing North American market.

 

The Wall Street Journal reports that at least 11 states are in talks to land the manufacturing plant. Besides Texas—Toyota’s new North American headquarters—other states on the companies’ shortlist are Alabama, Florida, Kentucky, Illinois, Indiana, Iowa, Michigan, Mississippi, North Carolina and South Carolina, WSJ reported, citing unnamed sources familiar with the potential investment. Those sources also said the manufacturing facility would require at least 1,000 acres of land.

 

Some auto industry analysts believe Mississippi may have an edge because it’s already home to a Toyota Corolla factory which has been producing the compact car for almost six years. Locating the plant near Toyota’s existing manufacturing site would enable the two companies to source parts from companies nearby that supply components for Corolla production. What’s more, a head-start on a supplier network would be particularly attractive for Mazda, which doesn’t have a U.S. plant.

 

“We do have supply lines in the U.S. that are pretty extensive, particularly for the Corolla,” Scott Vazin, a Toyota spokesman, says in an article on Bloomberg. “We hope these supply lines can be used for this new entity, because there are clearly some efficiencies in it.”

 

Needless to say, other states’ governments are very interested in the possibility of gaining the plant. For instance, Kentucky Governor Matt Bevin told a group of automotive suppliers and industry officials gathered in Lexington on Monday that the state will pursue the proposed factory and mentioned a 1,550-acre site in Glendale, Ky., as a prime location, a USA Today article reports.

 

The [South Carolina] Post and Courier reports that the Toyota-Mazda partnership may very well make its plant-location decision based on labor force and government incentives, which were key factors in recent decisions by Mercedes-Benz Vans and Volvo Cars to build manufacturing plants in the Charleston region. In addition to Volvo and Mercedes-Benz Vans, each of which are building $500 million manufacturing campuses, South Carolina is home to the world’s largest BMW manufacturing site, the article continues. The state’s automotive industry includes more than 400 suppliers and other companies which employ about 66,000 people.

 

One would think that locating a new plant near an existing facility may be the most appropriate decision, especially if there is an opportunity to leverage a pre-existing supplier network, along with a labor force and government incentives. Then again, there is always risk in location-sourcing decisions, such as whether the skilled labor pool is large enough to support continued growth and whether suppliers can accommodate a demand for increased capacity.

 

What are your thoughts on location decisions, and in particular, the potential impact on existing supplier networks? What supply chain risks do you see?