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Digital inventories and spare parts
The spare parts management in operations is challenging, due to the need to balance service provision with cost minimization for the full lifecycle of the product. Successful maintenance, repair, and operations (MRO) can significantly reduce customers’ downtime and enable them to meet their goals with higher efficiency. However, performing MRO effectively and efficiently is cumbersome because it requires an ability to deliver the necessary components and skills to the right place promptly and at the lowest cost. To achieve an efficient and effective MRO, any spare parts supply chain manager should overcome three major obstacles; 1. The unpredictability of demand for spare parts, since equipment breakdown, in most cases follows a stochastic distribution, 2. The need for the provision of maintenance service to the previous generations of a product class, 3. Dealing with the combination of skill sets, tools, and spare components that are necessary to resolve a service call (Khajavi et al., 2018).
The concept behind digital inventories and spare parts is that the digital design files of the physical spare parts are stored in a cloud repository, ready to be downloaded and produced on-demand anywhere and anytime a failure occurs. Various direct digital manufacturing technologies such as additive manufacturing, computer numerical control machining (CNC), and incremental sheet forming can be used for digital spare parts production. Digital inventories and spare parts have been field tested in concepts such as the US Army’s Mobile Part Hospital, which is an agile manufacturing cell packed in a 20-foot container (Figure 1).
Figure 1: US Army’s Mobile Part Hospital (Courtesy of Clegg Industries).
Additive manufacturing is one of the main technologies that are making digital inventories and spare parts a reality. The additive manufacturing machines can be positioned closer to the source of demand and produce the spare parts on a manufacture-on-demand (MOD) basis. Based on a survey conducted in 2018, organizations perceive manufacturing decentralization and on-demand production among the most crucial features of additive manufacturing for digital spare parts. This higher flexibility enables lower spare parts inventory, which in turn lowers the inventory carry cost, and parts obsolescence as well as the amount of capital tied to the spare parts stockpile. Another benefit of spare parts digitalization with additive manufacturing is the shortened response time through localized manufacturing, which eliminates the shipping cost and lowers equipment downtime. For these reasons, companies such as Volvo, Daimler AG, Deutsche Bahn, and Whirlpool are introducing additive manufacturing to their spare parts supply chain operations.
To take the full advantage of additive manufacturing technology for spare parts production, it is important to select the appropriate type of parts. In other words, additive manufacturing has the advantage of being toolless but is still significantly more expensive than the traditional manufacturing techniques, therefore, it is considered suitable for low volume, slow-moving spare parts with complex geometries. Specifically, additive manufacturing can be suitable to make the spare parts for old equipment that the tooling for the traditional manufacturing is not available anymore or for current spare parts that consist of multiple components that can be combined into one part with complex geometries (Khajavi et al., 2020).
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With advancements in additive manufacturing technologies, currently, high-performance parts can be produced out of polymer or metal. Additive manufacturing enables part enhancements through weight reduction or consolidation of components. This is important for spare parts application since it allows for parts debugging and improvements without the necessity for retooling. However, one of the challenges that prevent manufacturing companies from an additive manufacturing adoption for digital spare parts is the lack of digital design files for their manufactured physical spare parts. Therefore, the first step towards the utilization of additive manufacturing for spare parts’ inventory digitalization is to analyze the spare parts libraries to identify components that are suitable for additive manufacturing and to recreate the relevant digital design files. Digitalization does not end at the geometric and dimensional aspects and should also include other information related to the part characteristics with regard to the material, surface finish, necessary post-processing, and necessary tolerances.
To further examine the current readiness for digital inventories and spare parts made by additive manufacturing, an empirical study was conducted in Finland by Aalto University in cooperation with the VTT Technical Research Center, and two industrial firms. The research specified the number of spare parts that can possibly and feasibly be produced with additive manufacturing and compared that number with the total number of spare parts for the participating industrial companies. The additive manufacturing possibility analysis was concerned with technical aspects including the part size, raw material, and tolerances, while the feasibility analysis assessed the cost competitiveness of a printed part against a conventionally made one, from a lifecycle perspective. The method used for the parts classification utilizes a top-down approach to rank the spare parts based on a weighted average score to identify the spare parts with the highest potential for additive manufacturing. Out of a starting accumulative number of 215,820 individual spare parts (including polymer and metallic parts) approximately 4200 or 1.9% spare part SKUs had high technical and economic potential to become digital spare parts and be produced by additive manufacturing.
Figure 2: Technical barriers for production of 3D printed spare parts extracted from a survey among the specialists and decision-makers in industrial firms (Salmi et al., 2018).
This study illustrates that additive manufacturing is an emerging production method for the industrial spare parts. Yet, it also suggests that more needs to be done before additive manufacturing can be declared a mature technology. Advancements regarding the production speed and volume, material range and cost, quality assurance systems, and pre- and post-processing automation are still necessary for broader utilization of additive manufacturing in the spare parts operations. Additionally, technological limitations (Figure 2) are not the only hindrances to wider additive manufacturing utilization in the spare parts supply chains. Business practices should transition to a cohesive digital strategy for manufacturing, while engineering education should evolve to educate for thinking and designing for additive manufacturing and thinking beyond the conventional manufacturability limitations. All of these elements together will unlock the full potential of additive manufacturing for digital inventories and spare parts.
Bridge manufacturing
Bridge manufacturing is the practice of deploying additive manufacturing for low volumes production or when the market needs the product promptly. The shift to conventional manufacturing takes place as the volumes increase since the cost of production per part for additive manufacturing, in the majority of cases, is still much higher than of conventional manufacturing (the result of economies of scale). In product supply chains, bridge manufacturing can be used for new product launch and for the cases where the design is not yet final for the conventional tools to be produced. As the design gets closer to finalization and volumes start to ramp up, the switch over to conventional manufacturing takes place. In this case, additive manufacturing smoothens up the transition while accelerating the time to market and eliminates the need for manufacturing tool modifications.
Bridge manufacturing is also known as stopgap manufacturing since one of its applications is during the supply chain disruption or when there is a gap between the time that the product design is ready and the time that the production tools are available for volume manufacturing. A recent example of the stopgap application was demonstrated during the COVID-19 pandemic when the disruption in the supply chain of medical equipment such as test swabs and ventilator valves pushed local companies with additive manufacturing capacity to fill the void and make those parts available rapidly (e.g., ISINNOVA case of 3D printed ventilator valves, and Formlabs case of 3D printed test swabs).
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- Is 3D printing a magic bullet for supply chain at the time of COVID-19 pandemic?
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To examine the economic feasibility of bridge manufacturing, we conducted a case study with a tool-independent digital manufacturing technology with characteristics similar to additive manufacturing for the new product launch. In a scenario with weak market demand which requires tool modification or retooling the bridge manufacturing becomes really valuable because the management team can monitor the demand level for a period of time and act on the issues and modify the product to boost the demand before taking steps to invest in conventional manufacturing tools. In other words, managers can take advantage of affordable market data enabled by bridge manufacturing.
The same study showed that in the market failure scenarios, where the actual demand is way lower than the expected demand for the product, changing the design iteration and even product termination would cost the company significantly lower (up to 82%) if they use bridge manufacturing instead of conventional tooling from the start. The mechanism for the competitiveness of bridge manufacturing in a new product launch is the postponement of tooling investment and batch production, which reduces costs in case of a product flaw, market weakness or failure. Bridge manufacturing enables producers to evaluate the initial market data before taking the costly decision to shift to conventional production methods. Additionally, due to the additive manufacturing capability to produce parts on-demand without the constraints of batch-sizing, the producer gets no or very low inventory carrying costs while having bridge manufacturing in place (before a shift). Therefore, it can also avoid the cost of obsolescence that a product modification in conventional production would result in (Table 1). Finally, the value of early market entry enabled by the use of bridge manufacturing, which cuts through the tooling preparation period of conventional production, is potentially another advantage in favor of bridge manufacturing utilization.
Table 1: Risk/reward comparison of conventional and bridge manufacturing methods (Khajavi et al., 2015).
Conclusions
Improvements in the additive manufacturing process and material technologies allowed for the expansion of its applications in industries such as automotive, aerospace and medical; and with this expansion, new supply chain possibilities are emerging. Digital spare parts are among those possibilities and can be economically feasible for a small portion of companies’ stock keeping units (SKUs) as this practice can reduce firms’ inventory carrying, obsolescence, and transportation costs. However, there are still technical, organizational and educational obstacles in front of the effective implementation of digital spare parts that must be overcome.
Bridge manufacturing is another possibility that has emerged from the wider use of additive manufacturing for producing final parts. the generative mechanism of benefits for the bridge manufacturing method is a shorter time to market and postponement of investment until better market demand visibility is gained. The driver of its disadvantage is more expensive per-part production costs in successful product launches. However, some preconditions for its utilization feasibility are the level of demand, the shape and size of the product, and the material in use. For instance, high production volume, simple product shape, and the necessity to use various materials are the cases in which additive manufacturing-enabled bridge manufacturing might not be currently suitable for.
Words by Siavash H. Khajavi and Jan Holmström, Aalto University, School of Science, Department of Industrial Engineering and Management, 00076 Aalto, Espoo, Finland, siavash.khajavi@aalto.fi, jan.holmstrom@aalto.fi
References:
- Khajavi, S. H., Holmström, J., & Partanen, J. (2018). Additive manufacturing in the spare parts supply chain: Hub configuration and technology maturity. Rapid Prototyping Journal.
- Khajavi, S. H., Salmi, M., & Holmström, J. (2020). Additive Manufacturing as an Enabler of Digital Spare Parts. In Managing 3D Printing (pp. 45-60). Palgrave Macmillan, Cham.
- Khajavi, S. H., Partanen, J., Holmström, J., & Tuomi, J. (2015). Risk reduction in new product launch: A hybrid approach combining direct digital and tool-based manufacturing. Computers in Industry, 74, 29-42.
- Salmi M, Partanen J, Tuomi J, Chekurov S, Björkstrand R, Huotilainen E, Kukko K, Kretzschmar N, Akmal J, Jalava K, Koivisto S. 2018. Digital Spare Parts. http://urn.fi/URN:ISBN:978-952-60-3746-2
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