Roger Spielman is something of a folk hero in the rapid-fabrication industry. Spielman spent more than 20 years at the Rocketdyne Division of The Boeing Co., where he came to oversee its rapid prototype operations. Among his many noteworthy accomplishment, Spielman and his team used SLS to create hundreds of parts for the International Space Station Program and the Space Shuttle Main Engine Program.

Twice since 2000, Spielman has been a keynote speaker at EuroMold, the annual trade fair for moldmaking and tooling, design and application development. This year’s fair will be held in Frankfurt, Germany from December 5, 2007 to December 8, 2007.Ahead of EuroMold, Dean Rotbart, director of the Low-Volume Manufacturers Association, conducted a telephone interview with Spielman, asking him what he would tell EuroMold if he were a speaker this year.What follows is an edited transcript of that interview. It is reprinted with permission of the Low-Volume Manufacturers Association, www.l-vma.org. Read the rest of this entry »

 

One of the most exciting growth areas for rapid-prototyping, rapid-manufacturing (RP-RM) is in the medical and health field, where physicians, surgeons and dentists are teaming with imaginative companies to create customized medical models, prostheses and implants that are saving lives and restoring quality of life to many patients.

A recent article in the Virginian-Pilot cited a 2004 study showing that the “modeling and simulation sector pumped more than $400 million and 4,000 jobs into the local economy.”  And these were not run-of-the-mill jobs, either.  “The high-paying jobs are the kind city leader salivate over — an average salary then of $59,405, nearly two-thirds more than the region’s $34,918 average.”

One of the companies at the forefront of this field is Medical Modeling LLC, based in Golden, Colorado.  The company’s president, Andy Christensen, joins US Reliant’s Dean Rotbart on this podcast.  The full interview runs 18:52.  Listeners can play, fast forward or rewind the interview by using the orange buttons above.For more information on Medical Modeling LLC, visit the company’s web site at http://www.medicalmodeling.com or contact Christensen at info@medicalmodeling.com.

Today’s headline in USA Today, “UAW Strike Comes as a Shock”, underscores the importance of U.S. manufacturers to rethink the way they mitigate risks in their supply chain. Today, GM faces production problems because 73,000 workers at 82 U.S. plants walked off the job. Imagine for a moment a climate where we are not facing the prospect of 73,000 striking workers but an entire country on strike.

Given the impact that the GM/UAW strike with have on the U.S. economy we should think of the consequences to production as we continue our push towards globalization with its current drumbeat of outsource, outsource, outsource –especially given today’s volatile geopolitical climate. I am not against globalization by any means. I think a healthy global economy benefits not only U.S. interests but helps lift up developing countries. My concern is that we need to inject some sanity back into our thinking. We cannot afford to continue the unchecked outsourcing of production. What does our continued outsourcing of manufacturing mean for U.S. companies? Allow me to speculate.

1. We become a country with a diminishing middle-class leaving a wider chasm between high-wage earners and low-wage service providers and retailers. A healthy U.S. based manufacturing sector is a vital to a healthy middle class. Upward mobility of lower income workers is wholly dependant on our ability to expand opportunity in the middle.

2. We lose our ability to create. There is a magic that happens when engineers and product development teams are locate closer to factors of production. As we move production offshore it follows that our engineering and design teams—both valuable assets and higher-wage positions—will move offshore too. What’s left? Let me posit a list; Lawyers, marketers, media, Wal-Mart greeters, hamburger flippers…is this what we want for the future of the U.S.?

3. Exposure in volatile geopolitical markets. As we outsource more of our production we hamper our ability to make geopolitical decisions based on other factors other than economic grounds. It is not prudent to be living in a world where we cannot produce our own manufactured goods where supply chains are interrupted.

These are just a few things that keep Alex and I motivated on a daily basis. We are building a company. We are entrepreneurs seeking to make a profit. However, we want to do so in a way that is socially responsible. We believe that fractional manufacturing interjects some of the sanity to reverse these negative trends.

Either we can enhance ours country’s competitive ability and create new and innovative ways of keeping a balanced working economy or we will lose our country’s working class to a strike…a strike on working in America.

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Todd A. Grimm has a clear vision of what it will take for the rapid-prototying, rapid-manufacturing (RP-RM) industry to realize its true — and vast — potential.

Ultimate success, says Grimm, a widely respected RP-RM consultant, speaker and author, rests with the potential for new, innovative uses of RP-RM, such as those embraced by the hearing aide industry.

Grimm is interviewed by US Reliant’s Dean Rotbart.  The full interview runs 19:37. Listeners can play, fast forward or rewind the interview by using the orange buttons above.

For more information on Grimm and his firm, T.A. Grimm & Associates, Inc., visit http://www.tagrimm.com.

One of the major goals at US Reliant is to promote asset ownership, particularly in the USA. While outsourcing is a valuable tool in many circumstances, it should not be the answer every time. I believe frequently manufacturers choose to outsource due to lack of other alternatives. US Reliant’s fractional asset ownership program provides an innovative solution for a company to consider when weighing whether to outsource or purchase manufacturing equipment.

There are so many benefits to fractional ownership of manufacturing assets. One of the biggest advantages is not having to deal with the hassles of ownership including maintenance, operations of the equipment, downtime, facility requirements and more. All of those annoyances are taken care of by US Reliant. What accrues solely to the fractional owner are the financial benefits associated with fractional asset ownership.

In order to demonstrate the financial benefits I will have to get a little technical. First, consider why a company would ever purchase a manufacturing asset. The decision is usually intended to lower cost of production, increase capacity, or gain control of the manufacturing process. Most often, I believe, companies seek to lower cost of production per part and increase net profit. Assuming this to be the case, I will focus on that.

There are two main reasons to outsource. 1) Your company needs someone else to take care of the process, you just want the output. This maybe because you don’t have the expertise or the time. 2) The cost of ownership is too steep to justify the amount of production needed from the asset. An example would be that the machine could produce 30,000 units, but you only need 1,000. Fractional ownership solves both these problems.

Illustrated below are the financial advantages associated with fractional asset ownership.

First, here is the data that provides the assumptions we make for the examples:

Here is a simple profit-and-loss statement to show what profit and cost per unit outsourcing provides:

Here is an example using the same data if the company decided to purchase the whole machine with production capacity of 30,000 units a year:

Comparing the two, it is easy to see why companies favor outsourcing. Many companies don’t have a need for all of the capacity of the machine, therefore, why incur the expenses unless they need the full capacity? This doesn’t mean asset ownership is wrong. It is only detrimental if you don’t use it all. This is why fractional ownership has an important place in manufacturing.

Here is an example of what the P&L looks like when a company only buys the amount of production capacity needed:

Notice that the gross margin increased 47%, net profit increased 44%, and cost per unit decreased $20. Now you may be thinking, “What about the balance sheet?” There was no change on the balance sheet. The only thing that happened was that cash was converted into a long-term asset. Assets didn’t decrease one penny. The value of the company didn’t decrease at all from a balance sheet perspective.

The reason that all this is possible, despite another company managing and hosting your asset, is because you only purchase what you need and you also enjoy economies of scale because the assets are all shared by other owners.

There are also key financial ratios that are instantly enhanced, such as earnings per share ( (Net Income minuspreferred dividends)/shares outstanding) and return-on-equity (Operating Income/Average total assets)). These are key ratios for shareholders and investors.

There are other tax advantages that can be used in this model that I haven’t discussed here such as taking Section 179 depreciation for the full value of the fractional ownership all in one year.

The financial benefits for fractional owners are clear, well established and founded in simple principles. For many companies, fractional asset ownership is a better alternative than outsourcing or full ownership. If you’d like to see how fractional ownership can significantly boost your bottom line, call us and my staff and I will run your company’s numbers for you.

America is rife with business owners and visionaries who are innovating our manufacturing base and through their actions defending our nation against the loss of jobs and infrastructure that result from offshoring.

These U.S. manufacturing heroes don’t get nearly the credit – or the press – that they deserve.

Which is exactly why we were so heartened to read a positive news item appearing in the Corvallis Gazette-Times on Saturday, September 1, about one company that is keeping manufacturing jobs right here in the good ole U.S.A.

Now the Corvallis Gazette-Times is not exactly The New York Times in terms of reach and influence, but the story is better-written and more insightful than much of what we do read in the Old Gray Lady.

Gazette-Times Business Editor, Bennett Hall, does a standup job telling the tale of Covallis-based Korvis Automation Inc. and its CEO Rich Carone.  Korvis is a privately owned integrator and manufacturer that serves global markets including rapid-prototyping, semiconductors, flat panel displays, disk drives and inkjet manufacturing.

Carone has successfully resisted the trend of shipping his production work overseas and in doing so has generated a ripple-effect in supporting other Oregon-based companies that are his suppliers and subcontractors.

“This part here I could buy cheaper in China,” Carone tells the Gazette-Times’ Hall, referring to a steel component used in one of Korvis’ products.  But – and the “but” is all important – Carone goes on to note that to work with China on short-run manufacturing requires months of advance planning and then still leaves open the question of whether he’ll receive products that meet his exacting specifications.

“It’s just never been clear to me how I can control quality overseas,” Carone tells the Gazette Times.

Corvallis, itself, has proven more resistant than many areas of the country to losing its manufacturing base.  Home to Oregon State University and able to boast a high-quality lifestyle for its residents, the city boasts that “more inventions pour out [of]
Corvallis than most other cities in the nation.”

One byproduct is that Corvallis has shifted a significant part of its remaining manufacturing capacity from the high-volume commodity arena to a lower-volume specialized focus, such as that provided by Korvis.

Beyond the jobs Korvis generates directly in manufacturing, it also provides quality assignments – and hence employment opportunities – for its corporate neighbors.  Companies such as Korvis “tend to use a lot more local goods and services than if another AM-PM minimarket comes to the area,” explains a regional economist quoted by the Gazette-Times’ Hall.

One example provided by Hall is Korvis’ work building the Viper Pro stereolithography machine for 3D Systems, Inc.  Oregon companies that serve Korvis so that it can serve 3D Systems include MAK Metals (sheet metal fabrication for the cabinet); MEI (powder-coating); Griffo Brothers, West Coast Machine and Katen Machine (large machine parts); CG Industries (anodizing the aluminum parts); Lytech (electronic control panel); Hanard Machine (steel frame); Chemwest (cabinet doors and plastic pieces); ESAM (electrical cables); and ATS Systems Oregon (sandblasting of welded parts).

When Hall wrote about Korvis in 2005, the company – then three years old – was forecasting 2005 revenues of $15 million.  In his most recent article, Hall says Korvis is “on pace to bring in sales of $30 million this year.”

Between August 2003 and August 2005, the number of Korvis employees has risen from 30 to almost 50, according to the paper.

Carone and Korvis, alone, won’t undue the damage to the Corvallis area economy done by those local companies that shifted their large-scale production overseas.  But Carone and Korvis do serve as important examples of the many ways by which the U.S. stands to benefit from keeping high-end production assets and capacity here.
“It’s a lot more comfortable for us to buy from local people,” Carone tells Hall.  “If something doesn’t work, it’s a lot easier to drive to
Albany [Oregon] and say, ‘Can you please fix this?’”

Photo:  Rich Carone/Korvis Automation Inc.

The September issue of Popular Mechanics features a special section gazing 50 years ahead to imagine colonization of the moon and Mars.

Editor-in-Chief James B. Meigs and a team of respected staff and outside experts explore the topic and make their best predictions of what is to come.

The one forecast that most caught our attention came from Dan Bursch, an astronaut who shares the U.S. spaceflight endurance record of 196 days in orbit and Robert Zubrin, the president of the Mars Society.  

Bursch, a space shuttle veteran, tells PM that one of the greatest challenges facing those on a Mars mission will be fixing broken parts when they are 18-months away from Earth.  “There were many times on the space station when we didn’t have the right spare part on board and had to wait for the shuttle,” he notes.

Zubrin thinks the answer will be to send multiple unmanned craft ahead of any manned mission in order to haul spare parts and the like.  But Bursch, himself, suggests guessing which parts to include is not a science, more of an art.  “Even though the engineers do a great job at trying to guess what parts you’ll need, that’s a huge issue,” he says. 

Whoa, gentleman!

The answer, of course, lies in rapid-prototyping and rapid-manufacturing (RP-RM) of parts directly on Mars (or the moon).  The concept of placing a RP-RM fabricator in space goes back at least to the 1970s, and if often credited to Marshall Burns, Ph.D., who is also credited with coining the term “fabber” for digital fabrication.

Rather than transport replacement parts in anticipation of what may be needed on Mars, RP-RM would allow astronauts and colonists to build replacement parts on demand.  Indeed, in Burns’ vision, done properly, Mars colonists would be able to take along RP-RM machines sophisticated enough to replicate themselves, to create more capacity when necessary or to supply a steady supply of replacement parts. 

An unmanned payload of ‘guesstimate’ parts is the wave of the past.  For long-term colonization of space, PM should know the answer lies with digital fabrication, or RM-PM.   

That’s one small step for digital fabricators, one giant leap for mankind.

Author Vince Poscente doesn’t mention rapid prototyping or rapid manufacturing once in his book, The Age of Speed.

Yet the newly released business book, from award-winning publisher Bard Press, makes clear why the technologies surrounding 3-D printing are destined to revolutionize design and manufacturing in the United States and around the globe.

Poscente’s basic premise is that in a world where time is the most valuable of all commodities, there remain only 24 hours in a day and 7 days each week. Since no one has yet invented a way to change the speed at which time passes, the only way to squeeze more quality and quantity out of life is to be more efficient – i.e. faster – in achieving results in the time we are allotted.

Poscente draws a clear distinction between being busy and being fast. Being busy means that you are occupied or over-occupied with tasks. Being speedy means you have a keen focus on what you wish to achieve in life and tailor your life to maximize your pursuit of those goals.

Early in the book, Poscente demonstrates how technology has created the expectation of speed in our lives. American consumers and businesses demand rapid results. If we order a product today over the Internet, we expect it to be delivered tomorrow, or increasingly, the same day.

Google, for example, discovered that for consumers, even fractions of a second count. Its tests found that users of its popular search engine were put off by changes that produced better search results, but took ever-so-slightly longer to load.

In this age of speed, where faster is a clear competitive advantage, the time-laden process of new product design and machine-tool prototyping seems downright prehistoric.

Poscente spends an entire chapter arguing that faster needn’t mean costlier or inferior in quality. That is exactly the benefit of rapid prototyping and rapid manufacturing. Moreover, Poscente is an advocate for getting products out of the laboratory and into consumers’ hands, where they can be truly tested and quickly revised. Once again, his model screams rapid manufacturing – even if it doesn’t mention it by name.

Those who wish to understand why The Age of Speed is also the age of 3-D printers and all their related technologies are well advised to breeze through Poscente’s book. As you might expect, it is a quick and valuable read.

Go ahead. Mess up. It’s good for your business and it is good for your customers.

That is the underlying message of Todd Grimm’s compelling article in the current edition of Tooling & Production (T&P), where Grimm spells out the many financial and strategic advantages that accrue to companies that aren’t enfeebled by the rigidity of machine tooling.

In his article, “Rapid Prototyping Heralded as Next Industrial Revolution,” Grimm describes the many benefits that RP (rapid prototyping) offers when compared with traditional molding, casting and/or machining. Most notably, Grimm writes, “With rapid manufacturing, there is no penalty for error correction and no barrier to fine-tuning a design while it is in production.”

Grimm is the author of User’s Guide to Rapid Prototyping (Society of Manufacturing Engineers — Feb. 2004) and founder and president of T.A. Grimm & Associates, Inc. in Edgewood, KY. He has spent 17 years in the product development industry.

Tooling is commitment,” says Grimm. “The moment the order is released for tooling, the design becomes frozen.”

Not so with rapid manufacturing (RM).

With RM, Grimm notes, there is no penalty for imperfection. “In fact, the process can facilitate rampant redesign that caters to rapidly changing customer desires or counteracts competitive maneuvers,” he writes.

Because injection molds for small-to-moderate sized parts can cost as much as $75,000 and tooling rework can easily add on another $5,000 to $20,000, Grimm explains that many companies wind up sticking with a flawed production mold, because the cost in money and time to change it is prohibitive.

The large upfront investment in traditional machine tooling further prevents companies from demonstrating flexibility after receiving feedback from their customers. In contrast, with RM, continuous product improvement translates into happier customers, who in turn buy more products and make more referrals. Customers, effectively, become design partners.

Grimm predicts that RM is leading to a new industrial revolution that will “infiltrate all processes and every discipline within a company.” Existing manufacturing processes, he believes, will be displaced.

One of the more important and appealing benefits of fractional ownership of manufacturing equipment is for low-volume runs to become cost effective while maintaining ownership and building an asset base. Let me break it down.

In the past, a low-volume manufacturer’s typical cost effective solution is to outsource to another company. While this is a viable solution, the company is not able to invest into asset ownership while building its inventory. In fact, when a company outsources, it is helping to pay for the assets of another company, much like renting a house pays the mortgage of the actual home owner. US Reliant has created another cost effective solution that is an alternative to outsourcing. Through fractional ownership, businesses have found that it can build its inventory and acquire assets for about the same cost as outsourcing. The reason this works is because you only invest in the amount of the machine that is needed to produce the volumes required. Fractional Ownership particularly makes sense for low volume runs. There is no need to waste money on inventories for high volume runs, however, the same cost efficiencies of high volume runs are achieved.

Here is a simple graph to illustrate this effect.

In this case, breakeven quantity on the cost per part is 566 using fractional ownership, whereas breakeven quantity with full ownership is 10,800. The only variable that changes these two quantities is the initial investment into the asset. While the data is fictional, the principle is not. The model is currently being used at Tangible Express with rapid prototyping equipment with great success.