Page 55 - The European Business Review

Competitive strategy shifts from defining value before the market knows
what it needs to co-create value in response to actual market needs.

Process manufacturing will coincide with a variety of other technol-
17L RSHQHG WKH ZRUOG·V ÀUVW LQGXVWULDO VFDOH DGGLWLYH RJLHV VXFK DV DUWLÀFLDO LQWHOOLJHQFH URERWV DQG WKH ,QWHUQHW
manufacturing plant in Plattsburgh, New York in the fall of of Things. Adopting digital technologies like additive manu-
2017. Aerospace grade titanium costs up to $20 per pound facturing lowers costs while providing increased levels of
compared to aluminum at $13 per pound and steel at $70 per FXVWRPHU VHUYLFH DQG GHVLJQ ÁH[LELOLW\ &RPSHWLWLYH VWUDWHJ\
ton. In the aerospace industry, the supply chains for the main VKLIWV IURP GHÀQLQJ YDOXH EHIRUH WKH PDUNHW NQRZV ZKDW LW
engines and titanium components have the longest lead times. needs to co-create value in response to actual market needs.
The traditional titanium supply chain consists of seven stages, These technologies further the blurring of the physical and
each potentially carried out by a different entity (see Table 1). virtual worlds, requiring companies to re-invent the tradi-
Additive manufacturing requires a supply chain (Table 2) tional roles of suppliers and customers.
with fewer stages and less complexity. Using wire as the only
feedstock material, raw material inventory is greatly reduced, About the Authors
eliminating the need for various sized bar stock and sheet Michael Gravier is Associate Professor of
material, all of which have long lead times and complex Marketing and Supply Chain Management at
inventories. Norsk reduced the 55 to 75 week average tita- Bryant University with a focus on logistics,
nium lead time to 4 to 6 weeks. supply chain management and strategy and
The additive manufacturing process produces a near-net- international trade.
VKDSH SDUW JUHDWO\ UHGXFLQJ PDFKLQLQJ UHTXLUHG WR ÀQLVK Christopher Roethlein, Ph.D. is Professor of
WKH SURGXFW 7KH EX\ WR Á\ UDWLR IRU DGGLWLYH PDQXIDFWXULQJ Operations Management at Bryant University
ranges from 1.5 to 3.1 times as much raw material purchased with a focus on supply chain management,
WKDQ HQGV XS LQ WKH ÀQDO ÀQLVKHG SURGXFW FRPSDUHG WR D quality and strategy.
ratio of 6 for the traditional subtractive process. Since less
material needs to be removed, downstream machining opera- John K. Visich is Professor in the Management
WLRQ WLPHV DQG PDFKLQLQJ FRVWV DUH UHGXFHG $ IXUWKHU EHQHÀW Department at Bryant University where he
LV D UHGXFWLRQ LQ WKH XVH RI PLOOLQJ ÁXLGV DQG HOHFWULFLW\ ² teaches courses in Operations Management,
positive impacts on sustainability. Supply Chain Management and Corporate
Social Responsibility.
Conclusion
References
The digital trifecta of connectedness, responsiveness and 1. CapGemini, (2016). “The current and future state of digital supply chain
transformation”, GT Nexus, pp.1-12.
SURFHVV UHVXOWV LQ H[SRQHQWLDO HIÀFLHQF\ LPSURYHPHQWV WKDW 2. Andrews, D., C. Criscuolo, and P. N. Gal, (2017), “The best vs the rest: The global
SURGXFWLYLW\ VORZGRZQ KLGHV DQ LQFUHDVLQJ SHUIRUPDQFH JDS DFURVV ÀUPVµ 9R[(8
exemplify the pioneers of digital supply chains. Norsk’s European Union’s Center for Economic and Policy Research, available at http://voxeu.
org/article/productivity-slowdown-s-dirty-secret-growing-performance-gap; Andrews,
success results from simultaneously developing several tech- D, C Criscuolo, and P. N. Gal, (2016) “The Best versus the Rest: The Global Productivity
Slowdown, Divergence across Firms and the Role of Public Policy”, OECD Productivity
nology, process and relationship innovations. The greatest Working Papers No. 5, OECD Publishing, Paris.
3. Dawar, Niraj (2013), “When marketing is strategy”, Harvard Business Review, Vol. 91 No.
impact of digital supply chain advances like additive 12, pp.100-108.
4. Naylor, J. B., Naim, M.M., and Berry, D. (1999), “Leagility: integrating the lean and agile
manufacturing paradigms in the total supply chain”, International Journal of Production Economics, Vol.
62 No. 1/2, pp. 107-118.
5. Mason-Jones, R., Naylor, B., & Towill, D.R. (2000), “Engineering the leagile supply
Table 2. New AM Supply Chain chain”, International Journal of Agile Management Systems, Vol. 2 No. 1, pp. 54-61.
6. Kopp, C. (2007), Assessing the F-22A Raptor. Technical Report APA-TR-2007-0105, Air
Power, Australia.
1. Titanium ore extractor. 7. Airbus (2017), Global market forecast: Growing horizons. Retrieved November 24, 2017,
from http://www.airbus.com/content/dam/corporate-topics/publications/backgrounders/
2. Wire manufacturer. Airbus_Global_Market_Forecast_2017-2036_Growing_Horizons_full_book.pdf ; Boeing
(2017), Current market outlook, 2015-2034. Retrieved November 24, 2017, from http://www.
3. NTi - RPD™ production of part. boeing.com/resources/boeingdotcom/commercial/market/current-market-outlook-2017/assets/
4. Tier 1 Integrator - Finish machining, coating, downloads/2017-cmo-6-19.pdf
)RU H[DPSOH 9LWDVHN .DWH DQG .DUO 0DQURGW ´9HVWHG RXWVRXUFLQJ D ÁH[LEOH
sub-assembly and delivery to final customer. framework for collaborative outsourcing”, Strategic Outsourcing: An International Journal,
Vol. 5 No. 1, pp. 4-14.
5. End Customer - Part gets assembled into mainframe. 9. Arvai, Ernest (2016). “Farnborough 2016 Was Far From Boring – If You Knew Where To
Look”, Air Insight, July 19. Retrieved November 30, 2017, from https://www.airinsight.com/
premium-farnborough-2016-far-boring-knew-look/
www.europeanbusinessreview.com 55