Posted By Jeff Moad, July 30, 2012 at 12:19 PM, in Category: The Innovation Enterprise
INDIANAPOLIS—There’s little doubt that digital manufacturing tools and technologies have made huge strides over the past 25 years or so. Tools such as Siemens PLM Software’s Tecnomatix products allow manufacturers, from within a single, consistent software platform, to plan, model, and validate parts and assemblies as well as the production systems that will be built with those parts and subsystems. Integrated quality and production management tools help manufacturers quickly optimize product designs and production processes.
It’s ironic, then, that even as such digital manufacturing tools have matured, the manufacturing companies that could most benefit from them—small and midsize manufacturers—don’t have access because they can’t afford them.
Not long ago, large OEM manufacturers conducted and paid for the bulk of new product research and development. According to research cited last week by Jon Riley, vice president of digital manufacturing at the National Center for Manufacturing Sciences, large OEM manufacturers accounted for 72% of private R&D spending as recently as 1982.
But those days are gone.
Today, Riley says, large manufacturers account for only about 28% of R&D spending. The rest is now done by and paid for by suppliers, most of which are among the estimated 300,000 small and midsize manufacturers in the U.S. (defined as companies with fewer than 500 employees).
As large OEMs such as Boeing have looked to reduce costs and increase flexibility, they have pushed more and more of the burden of new product R&D and engineering onto their suppliers, most of them SMBs.
The problem is that many small and midsize manufacturers are constrained by very tight budgets. Many haven’t invested in or gained experience with even early generation simulation and other digital manufacturing tools. Paying for the IT infrastructure upgrades, training, and software licenses that would be required to adopt the latest digital manufacturing tools is simply beyond the means of many SMB manufacturers.
According to Riley, NCMS research shows that the investments of 84% of SMB manufacturers haven’t gone beyond basic CAD tools. Only 12% have deployed software for even rudimentary things such as linear stress analysis. And only 4% have implemented advanced simulation capabilities.
The implication is clear: The trends in R&D spending are creating a technology investment gap that threatens to undermine the innovation productivity of the manufacturing industry.
The answer, Riley says, is that technology providers, industry, and government need to come up with new models for how SMB manufacturers can gain access to digital manufacturing and other advanced technologies.
NCMS has some ideas. For the past three years, Riley says, the organization has been working to create a national network of Innovation Centers that SMB manufacturers can use to access digital manufacturing tools and high-performance computing platforms.
Similarly, the recent report of the President’s Council of Advisors on Science and Technology recommended establishment of 15 regional Institutes for Manufacturing Innovation where SMBs and other manufacturers could access advanced manufacturing technologies and expertise.
At the same time, digital manufacturing technology providers such as Siemens PLM are getting more serious about coming up with new models that could make it easier for SMB manufacturers to access advanced manufacturing tools. At its Digital Manufacturing Symposium held in Indianapolis last week, for example, Siemens PLM Senior Vice President of Manufacturing Engineering Software Zvi Feuer said his company is developing a series of cloud-based analytic applications aimed at optimizing processes at the plant-floor level. The applications, for things such as line balancing, time analysis, and dimensional analysis, could be available within 12 months, Feuer said.
Such steps should eventually help SMB manufacturers access the advanced manufacturing tools they need to drive innovation and become more productive. But more needs to be done, and faster, if SMB manufacturers are to fulfill their new role as R&D innovation leaders.
Jeff Moad is Executive Editor of Manufacturing Executive.
Written by Jeff Moad
Jeff Moad is Research Director and Executive Editor with the Manufacturing Leadership Community. He also directs the Manufacturing Leadership Awards Program. Follow our LinkedIn Groups: Manufacturing Leadership Council and Manufacturing Leadership Summit