Risk reduction in new product launch: A hybrid approach combining direct digital and tool-based manufacturing

• Published in: Computers in industry Vol. 74; pp. 29 - 42
• Main Authors: Khajavi, Siavash H., Partanen, Jouni, Holmström, Jan, Tuomi, Jukka
• Format: Journal Article
• Language: English
• Published: Amsterdam Elsevier B.V 01.12.2015; Elsevier Sequoia S.A
• Subjects: Additive manufacturing; Aircraft components; Cost benefit analysis; Cost control; Cost engineering; Digital; Direct digital manufacturing; Hybrid production method; Launches; Manufacturing; Markets; Net present value; New product development; Product development; Product lifecycle management; Production methods; Risk; Risk management; Studies; Hybrid production method; New product development; Additive manufacturing; Risk management; Net present value; Direct digital manufacturing
• ISSN: 0166-3615; 1872-6194
• DOI: 10.1016/j.compind.2015.08.008

•The use of direct digital manufacturing (DDM) in product launch is investigated.•We propose a hybrid method combining DDM and conventional tooling based production.•Hybrid method reduces risk and costs in the initial low volume production.•Hybrid method enables a switch-over to conventional methods based on market success. The research contributes to the body of knowledge on new product development by considering the potential use of a major emerging production technology in the early phase of final production. Direct digital manufacturing (DDM) methods such as additive manufacturing (AM) have been introduced as a production method for some small and complicated parts, mostly in the aerospace and medical industries (in batches of one or a few). However, it still is not viewed as a suitable method for producing numerous parts in small batch sizes. In this study, we will utilize scenario-modeling based on real-world case data to illustrate the potential of a novel production method which we call “hybrid production” in new product launch. This production method combines DDM with conventional production methods over the product life-cycle. Our case study data is on a toolless production method called Incremental Sheet Forming (ISF) which is theoretically a DDM method. The cases have been analyzed to understand the economic feasibility and benefits of DDM utilization throughout new product life-cycle. Results of our study suggest, while implementation of conventional production from the beginning does not present a significant cost savings over the hybrid production, when product succeeds in the market, conventional method yields a high cost when the success does not materialize on the first attempt. This directly translates to investment risks (related to the cost of tool modification or replacement and inventory obsolescence), in addition to loss of flexibility to respond to market feedback and consequently lower chance of market acceptance. Additionally, DDM at the beginning of our proposed hybrid production can shorten the products’ time to market which is considered to be an essential factor for success.