Churchill Club Discusses Manufacturing
October 2013 – As a change of pace from the traditional electronic systems, communications and software topics that are the subject of discussion at the Churchill Club, the event in early October focused on the changes and transition coming to the manufacturing world. The centerpoint of the discussion was predicated on the advent of 3D printing being generally available and the changes this would make in the ecosystem.
The discussion moved on from this change to discuss the supply chain, software and learning curve aspects, prototype ane production aspects, manpower costs and the new models for manufacturing that will include a per product licensing agreement and various modes of manufacturing that will all be made in a multi-tenant facility similar to the business model for semiconductors. The discussion involved Jason Blessing, CEO of Plex Systems, Rod Brooks Founder and CTO of ReThink Robotics and Mark Hatch CEO & Co-Founder of TechShop. The event was moderated by Michael Chui of McKinsey Global Institute.
The focus on manufactring included the trend towards local manufacturing ragaining prominance. While the idea of lowest cost labor for a manufacturing operation was ta driver in the 60’s-80’s, the logistics cost, and movement costs of building a product with a 10,000+ mile supply chain is losing its economic sense in the current world o high energy costs, tariffs, and TTM. The new factories are based on robotics that will be on the lines with people, rather than in stead of people. This is return manpower to the manufacturing floor, they will not be un-trained entry level positions, rather it will require some knowledge base on how to work with these pieces of equipment, and thus drive a smarter and more educated workforce.
The discussion shifted from jobs and supply chain to the new models fo rmanufacturing. TechShop is a membership based consortium with multiple facilities that support all of the equipment for making prototypes and intital product runs. These include 3D printers, CNC machines for metal and wood, and access to just about any automated tool to cut, drill or shape mechanical components. This is the start of a mainstream multi-tenant manufacturing “cloud” that will be similar to the globalized “data cloud” for business. It will consolidate expertise on building and maintaining a facility with this equipment, provide high utilization through multi-tenancy, and provide the customers a “end use cost” rather than a CapEx and on-going OpEx cost.
These models are being driven by new software from companies like Plex Systems, Autodesk, SAP, Siemens, etc that are in the design & analysis space as well as the ERP/MRP space. These new systems are following open standards that allow for third party development and interoperability. One issue is training the new generation of designers to use these tools. In that respect the free use student model from Auodesk and the free training from TechShop will provide a solution.
The open issue for the evening was on IP and ownership. The feeling of the panel was like what happened with the music industry, what is happening with the video content industry and what is being advocated with the “app” development community of rampant theft of artistic material and reuse without compensation or regard to copyright will be the norm for the manufacturing design market. If the cost is high for something and it required development and artistic care to create, then there is motivation to steal it, copy it, and make it available free on the internet for all to use. The issue of paying for licenses, royalties for design, or meeting levels of design quality were secondary to low price and availablity. The panel & audience mentioned that this is the direction of choice to generate short term revenue and business, and the long term impact on invention and a source of premium to support artistic design will come from someone else who funds it in future generations after they get their one-up-design now, so they can get a product cheaper than IKEA.
