manufacturing

How Mass Customization is Changing the Manufacturing Industry

July 14, 2014 By Barb Schmitz 1 Comment

Henry Ford, once rather famously said, “The customer can have it painted any color he wants, as long as it’s black.” Back in 1909 that type of business model worked. Customers clamored for the low prices offered by economies of scale, rather than a more expensive product that fit their unique needs.

Ford was able to meet this demand for affordable cars with a mass production business model that minimized variation, while maximizing efficiency. Today, however, the rules have changed.

Customers demand personalized products

Customers today want products tailored to their specific needs and personal tastes. Enter the era of mass customization. One definition of mass customization is developing a product architecture, within which an indeterminate number of products variants can be configured dynamically by the customer at the point of sale, and with minimal engineering intervention.

Demand for configurability and personalization presents a threat to traditional mass production techniques. According to the Smart Customization Group at MIT, by the year 2020, 15% of the clothing Americans buy will be customized for fit, color and style.

Nike and Puma websites enable users to create customized shoes using a variety of exotic materials and bold patterns.

It’s not just highly personal products, such as clothing however. Automotive customers can mock up their dream ride using a simple design application on the company’s website or a smart phone app. Desktop and notebook computers are highly customizable for features and appearance.

It’s easy to see that customer collaboration in the design process is quickly becoming the norm, but manufacturers today still face a difficult conundrum: how do they improve their focus on customer demands by offering highly customized products, but still maintain the efficiencies of a mass-production model?

Different approaches to customization

Companies have taken a number of different approaches to solving this problem. Some negotiate contracts, estimate cost and effort, and assign engineering resources to develop products directly for customers. This model, known as Engineer-to-Order (ETO), is prevalent today in construction, aerospace and defense.

While this approach works for many companies, ETO falls short for a number of reasons. Since these products are unique to each order, the engineering processes used to develop these products are also unique as well. This lack of predictability is heavy on operating costs, and usually requires extensive engineering attention on a per-order basis, limiting time spent on innovation and new product development.

Other companies attempt to tweak the mass production model by pre-configuring a set of product variants, and mass-producing each variant. This model is not without its shortcomings. To produce predictably and efficiently, the number of variations must be strictly limited.

A company whose customers’ needs are unpredictable, or require a substantial number of product variations, may find that pre-defining a massive number of bills of material (BOM) combinations can be difficult or impossible.

Benefits of a modern mass customization model

As the product of a marriage between mass-production and ETO, mass customization allows businesses to inherit the dominant traits of each: high efficiency paired with a high degree of customer focus. The following are some of the business opportunities inherent in this approach:

Customer satisfaction. Delivery times are shortened, extraneous features are reduced, and the utility offered to each individual customer is maximized. A mass customization strategy can help to ensure accurate quotes, lead times, and interpretation of customer requirements.

Business value. Products that are configured to meet unique customer needs have the potential to reach a wider audience, and have a greater range of application than those that are mass-produced, offering companies the chance to increase the footprint in their respective markets. Also a company optimized for mass customization minimizes the costs of order fulfillment.

Innovation. By solving order fulfillment problems, engineers can focus on new product development, innovative R&D projects, and designing new configuration options for the products in existing portfolios. Mass customization also creates an interface between the manufacturer and the customer, enabling collaboration and open innovation.

Mass customization presents an enticing promise, but as a manufacturing trend it is still in its infancy, and companies may find that the availability of industry testimonials and academic research is under-developed. The bottom line, however, is that all companies must find out how to make some type of mass customization work for them.

Mass customization has the potential to help companies increase revenue and gain competitive advantage, improve cash flow, and reduce waste through on-demand production. Mass customization can also generate valuable data that may be used in the development of standard products and in online marketing and public-relations campaigns.

Barb Schmitz

Tech Innovations Spurring Revival of U.S. Manufacturing

July 7, 2014 By Barb Schmitz Leave a Comment

A lot has been written in the press lately about the comeback of U.S. manufacturing. Several factors come into play here. Cost creep in China–due to rising inflation and wage expectations–means that as soon as 2015 the U.S. could be in cost parity with Chinese manufacturing.

Fears regarding IP security have also forced manufacturers to rethink offshoring strategies that once promised competitive cost advantages. Both of these trends are fueling what’s being called the “nearshoring” or “inshoring” trend, that is, companies bringing manufacturing back to the U.S.

Major companies, such as Ford, Apple, Caterpillar, and GE have moved nearly 20,00 manufacturing jobs back to the U.S. from Asia and Mexico with the last couple of years.

Another advantage of having of onshore manufacturing is that having the capability to manufacture close to where customers are located can increase customer responsiveness and decrease turnaround times, making the supply chain more predictable.

GE's Appliance Park in Louisville, KY, is being revamped, thanks to an $800 million investment in jobs, products, and manufacturing to build better, more efficient dishwashers. — GE’s Appliance Park in Louisville, KY, is being revamped, thanks to an $800 million investment in jobs, products, and manufacturing to build better, more efficient dishwashers.

Another factor contributing to an uptick in U.S. manufacturing is that the fact that natural gas prices have been reduced by two-thirds since 2008, making the U.S. more competitive for gas-intensive industries, such as petrochemicals and fertilizers.

U.S. Manufacturing Benefits from Tech Innovations

Perhaps the biggest factor, however, is the wave of technology advancements (digitization, data analytics, advanced automation, Internet of things and additive manufacturing) that are changing the landscape for U.S. manufacturers. Many of these advancements are driven by software innovations.

CAD and simulation software continue to improve manufacturers’ ability to create high-quality products faster than ever, cutting out expensive physical prototyping that in turn reduce design costs.

New additive manufacturing and 3D printing applications are making it easier for more players to become innovative manufacturers without the traditional constraints of high-volume manufacturing. Crowdsourcing and crowdfunding sites and platforms are also encouraging more would-be inventors to enter the market.

Robotics are reducing the need for labor, again reducing the cost of manufacturing products. The ability to embed sensors through the whole system, link them through the “industrial Internet,” and extract insight from the data means that U.S. companies are now leading the world in accelerating product development cycles and delivering on the promise of mass customization.

What is the result of all these innovations? According to Mark Muro, senior fellow at the Brookings Institution, it means, “The game is now being played on American terms. Software and brilliant machines are erasing U.S. cost deficits and giving it a shot at lasting production leadership,” says Muro.

Barb Schmitz

Siemens Forms Partnership to Help Customers Automate Engineer-to-Order Processes

June 27, 2014 By Barb Schmitz Leave a Comment

Manufacturers are under the gun increasingly today to develop more customized products for customers. Also referred to as “mass customization,” creating products with specific functionality for special niches of customers is at odds with traditional mass production methods that have been in place for years. In order to respond, companies must adapt and change both their internal design processes as well as the way in which they manufacture products.

Siemens and Tata Consultancy Services, a leading IT services and consulting company, have joined forces to create a new joint software and services solution for automating complex Engineer-to-Order (ETO) processes. The solution will be called ETO2Win and it leverages TCS’s domain expertise and Siemens’ Rulestream software.

ETO2Win is designed to capture, manage and reuse corporate intellectual property to automate engineering processes for manufacturers. ETO2Win addresses business challenges faced by ETO manufacturers by streamlining business processes associated with custom-built products, improving proposal accuracy and win rates, and enhancing the predictability of costs, margins and on-time delivery.

Siemens forms an alliance with TCS, an IT consultancy, to create a joint solution for Engineer-to-Order processes.

“Siemens’ powerful ETO software technology, combined with TCS’ proven ETO process framework, provides our customers with an enterprise-level solution for accelerating sales and order engineering processes for custom products,” said Caroll Jarvis, vice president, Global Alliance Sales, Siemens PLM Software. “This innovative software and services approach has created a comprehensive solution that reduces implementation time and risk, ultimately yielding a faster return on our customers’ PLM investment and helping to improve the bottom-line.”

A large and growing number of manufacturing industry segments, including power generation, HVAC (heating, ventilation, and air conditioning), fluid flow technologies, heavy equipment, machinery, and the automotive and aerospace supply base employ ETO business processes.

The increasing demand for customized or customer-specific product configurations creates a common set of challenges for these companies. There is constant competitive pressure for ETO manufacturers to increase the number, accuracy and win rate of their bids, while reducing order engineering lead time and optimizing resource utilization in manufacturing.

Rulestream addresses the unique challenges faced by ETO manufacturers with a comprehensive solution spanning sales, engineering and manufacturing. By capturing engineering knowledge and using it to automate key business processes across the enterprise, ETO2Win, with Rulestream and TCS’ ETO process framework and best practices, streamlines the inquiry-to-quote and order-to-release processes for even the most complex products, enabling manufacturers to sell according to their engineering and manufacturing capabilities.

To find out more on the Siemens PLM Software and TCS alliance, click here.

Barb Schmitz

Dassault Releases SolidWorks Inspection App

April 29, 2014 By Barb Schmitz Leave a Comment

Manufacturers today must grapple with meeting a host of international standards. Regardless of whether a company does business locally or globally, it has to submit early design and manufacturing reports, such as a First Article Inspection (FAI) report, inspection report or ballooned drawing (where dimensions for inspections are drawn in a balloon or bubble shape).

These reports measure the property and geometry of a product before it is built – and are critical for organizations who must meet the stringent requirements and safety regulations of the transportation and mobility, aerospace and defense, energy, process and utilities and life sciences industries.

A recent survey of CAD users found that while many are creating FAIs, inspection reports, or ballooned drawings, just a small percentage are using software for their creation. Instead, users are manually entering data into ballooned engineering drawings and hand-keying inspection reports into Excel, an error-prone process.

Automated inspection app facilitates creation of inspection documents

Today, Dassault Systèmes announces the release of an automated inspection tool called SolidWorks Inspection. This new ap will help manufacturers by completely automating the creation of inspection documents, which are now required in many industries for regulatory compliance.

SOLIDWORKS Inspection is a First Article Inspection (FAI) and in-process inspection software that streamlines and automates the creation of ballooned inspection drawings and inspection reports.

With the SOLIDWORKS Inspection application, companies can quickly re-use existing design data and content to create highly accurate inspection reports, such as AS91002 or PPAP forms, helping to accelerate the time to regulatory approval.

With SolidWorks Inspection, users are given multiple ways to automatically enter values directly into an inspection report. SOLIDWORKS Inspection also helps eliminate errors and inconsistencies that come from entering data by hand. Using this application enables quality inspectors to easily identify problematic parts or manufacturing processes. By regularly creating inspection reports and conducting in-process inspections, scrap costs are reduced, product quality is improved and problematic machines or calibration issues can be detected earlier.

SOLIDWORKS Inspection consists of a stand-alone application and a SolidWorks add-in that enables users to leverage their legacy data, regardless of whether they are SOLIDWORKS files, PDFs or TIFFs.

Extended functionality offered in Professional edition

The SOLIDWORKS Inspection Professional edition extends SOLIDWORKS Inspection capabilities by providing users with multiple ways to enter measured values – manually typing them in, using a digital caliper or importing CMM results.

The dimensions in the drawing are automatically highlighted in green, red and yellow to instantly provide information on which dimensions are within the design’s tolerance budget. This helps ensure parts are within specification for perfect fit and function, as well as improved quality and reliability.

For more information on SolidWorks Inspection, which can be purchased through SolidWorks resellers, read more here.

Barb Schmitz