How 3D Printing is Revamping Supply Chains and Operationsby
Joseph Kissinger
The purpose of this position paper is to provide insight as to how 3D printing will impact supply
chains through reduced lead times, leaner inventories, lower costs, and increased effectiveness mass
customization. Some consider 3D printing to be a technology that could lead to localized manufacturing
and simpler supply chains. “IBM researchers believe 3D printing can change the classic mass-production
paradigm that bigger is better, production is global and supply chains are highly complex” (Biederman,
2013). IBM formed this belief after conducting a study to show the potential impact of 3D printers on
supply chains.
Industries already taking advantage of 3D printing include the medical field, aerospace, and
automotive sectors. These industries use 3D printing for rapid prototyping and to manufacturing
specialized parts. IBM went outside of this realm a bit and disassembled three items during their study –
a cell phone, a hearing aid, and a washing machine. What researchers found was that 3D printing could
reduce lead times and lower costs through the elimination of investments in machine tools, casts, and
molds. For example, the washing machine used in the study was made up of 63 mechanical parts. These
parts were estimated to be supplied by 30-60 different companies and included molding parts, stamping,
and a production line. IBM found that each of the mechanical parts could be made with a single 3D
printer. Thus, the supplier base could be significantly reduced making for a shorter and simpler supply
chain (Biederman, 2013).
From this study, IBM concluded in its executive report titled, “The New Software-Defined
Supply Chain”, that 3D printers “[free] companies from the need to build standardized parts and pursue
economies of scale” (Brody and Veena, 2013). 3D printers do so by eliminating the need for an
intermediary step to purchase metals and plastics typically used to create molds. “With 3D printing, you
can go directly from a design to a part” (Brody and Veena, 2013). This allows for enhancements in
accuracy which leads to on demand manufacturing and an increased potential for customization. Free of
the requirement to pursue economies of scale, risks in the supply chain and manufacturing process will be
reduced. This will be driven by leaner inventories allowing for more accurate demand forecasts and
shorter product design cycles made possible through rapid prototyping.
Another advantage of utilizing 3D printers is its cost effectiveness, proven by its ability to
produce relatively large product volumes of hearing aids and dental crowns. Further, these products are
able to be customized to fit individual customers through the use of dental CAD software (Research and
Markets, 2013; New trends in 3D printing, 2013). According to IBM’s study, it is already cheaper to
make significant components of hearing aids using 3D printers. IBM also estimates that by 2022,
“hearing aids made with […] 3D printers will be up to 65% cheaper than with traditional manufacturing
approaches” (Brody and Veena, 2013). The use of 3D printers to manufacture components as well as 1
finished products will reduce the need for large supplier networks, providing an opportunity to bring
production to a regional or local level, rather than the global level it presently operates in due to the need
to achieve scale. With localized production sites comes easier and cheaper distribution and
transportation.
Despite the aforementioned advantages of utilizing 3D printers, manufacturing leaders remain
“ill-prepared” for their impact (Brody and Veena, 2013). Many consider the buzz surrounding this
innovation as “hype”, as Amy Machado, senior research analyst at IDC, claims that “3D printing is
unlikely to ever revolutionize manufacturing” (Biederman, 2013). However, others view the introduction
of 3D printers to manufacturing processes as “game changing” for industries with high-value and
customized parts. For example, NASA tested and compared the performance of printed and
manufactured parts for its heavy-lift rockets and found that printed parts could be made in three weeks for
less than $5,000 whereas traditional parts were made in six months at a cost of more than $10,000 each
(Biederman, 2013).
3D printing has increased the possibility of customization and proponents for digital printing
believe the technology could be used effectively in mass customization. This can be seen in the apparel
industry, where mass production often leads to a significant amount of waste as every consumer is unique
and clothing will not fit or be valued by everyone. Joseph Pine, co-founder of Strategic Horizons LLP
and co-author of the book “Mass Customization: The New Frontier in Business Competition”, suggests
that 3D printing makes the process even easier than using modular equipment, a common feature of mass
customization. Further, Dr. Frank Piller, co-director of the Smart Customization Group at MIT, suggests
that 3D printing and digitalization may change the need for modularity, in the future, and allow for truly
unique solutions for the consumer.
To illustrate his point, Dr. Piller considered the purchase of shoes. 3D printing will allow the
customer to choose the model, size and color of their shoe from a manufacturer’s “menu”. The real
customization is in the possibility of 3D printers to customize the fit of the shoe for each individual.
Though this would require consumers to have their foot scanned, a whole collection of shoes could be
manufactured in the future by using the same scan. Here is where we will see mass customization, as
consumers will be able to choose the color, model, and size of their shoe as well as which material they
would like it to be made out of and how they prefer their shoes to fit. “Instead of pushing what you have,
the consumer pulls what he wants,” says Joseph Pine. Producing on demand reduces waste and
eliminates shipping costs for products that won’t be sold by retailers (Bolgar, 2014).
To show the impact 3D printers are already making, consider the following statistics, found in an
article dated 2013: “The 3D printing industry has grown at a 274 percent compound annual growth rate
over the past three years. In 2012, the worldwide market for all 3D printing products and services was
$2.2 billion, up from $1.7 billion in 2011. Revenue is expected to reach $10.8 billion by 2021, according
to 3D printing consultants Wohlers Associates” (Biederman, 2013).
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Though 3D printing has not yet been captured on a global scale, there is an opportunity for
manufacturers of high-quality products to act proactively and lead the change that is sure to be seen in the
future, especially since many manufacturers are “ill-prepared” for this technological change.
Manufacturing with 3D printers can help a firm build flexibility into their supply chains, reduce costs, and
provide customers with customized products manufactured on mass scales, thus making products
affordable but of high-quality. 3D printing has the potential to reduce the necessity to achieve scale, and
to therefore ease barriers of entry to the competitive landscape, change the current thinking that “bigger is
better”, in terms of scale, as production can be localized and components can be manufactured and
assembled by a sole printer, thus ultimately reducing the complexity of manufacturing supply chains.
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Works Cited
Biederman, D. (2013, Oct 24). 3D printing transforming the way companies think about supply chains.
Journal of Commerce Retrieved from
http://search.proquest.com.jproxy.lib.ecu.edu/docview/1444693757?accountid=10639).
Bolgar, C. (2014, September 8). 3D Brings Mass Customization Closer. Retrieved May 30, 2015, from
http://perspectives.3ds.com/manufacturing/3d-brings-mass-customization-closer/
Brody, Paul, and Veena Pureswaran. The New Software-defined Supply Chain. Rep. July 2013 ed.
Somers: IBM Global Services, NY. Print. Electronics Industry. Retrieved from http://www-
935.ibm.com/services/multimedia/The_new_software-defined_supply_chain_Exec_Report.pdf
New Trends in 3D Printing - Customized Medical Devices. (2013, May 30). Retrieved May 30, 2015,
from http://envisiontec.com/trends-in-3d-printing-of-customized-medical-devices/
Research and markets: Low-volume manufacturing: Mass customization markets for the 3D printing
industry 2013-2022. (2013, Nov 26). Business Wire Retrieved from
http://search.proquest.com.jproxy.lib.ecu.edu/docview/1461731346?accountid=10639
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