Why is On Demand Manufacturing Suddenly Being Talked About?

Earlier in 2020, when the COVID pandemic was still in its infancy, manufacturing experienced one of its most prolific and high-profile stories ever. In response to lightning quick reduction in supplies such as PPE and ventilators, several manufacturers answered the call by leveraging their plants to create and donate more supplies. Many of these companies employed technology like 3D manufacturing hardware and industrial grade computers in order to responsively answer the call for help as soon as it was heard. 

What these responses from companies like Isinnova’s revealed to manufacturing wasn’t simply the importance of 3D manufacturing. We’ve known for years that alternative modes of manufacturing would be the future. Rather than alternative manufacturing, what these stories showed the industry was the importance behind on demand manufacturing – the ability to create products and equipment as soon as its need is made clear. After all, in many cases, this current PPE shortage included, customer demand is variable and difficult to predict.

How is this responsiveness defined and how does it differ from current modes of manufacturing? Even more importantly, now that we’ve defined this as the next step for manufacturers, how is one to start implementing on demand manufacturing in their own plants?     

What is on Demand Manufacturing?

On demand manufacturing is exactly what it sounds like, a mode of manufacturing that focuses on creating products as soon as they become required. This is in stark contrast to the standard means of manufacturing that focuses predominantly on creating large quantities of product, storing them, and then having these products on hand for when they are ordered. 

Why on Demand Manufacturing and Why Now?

On demand manufacturing hits on two pain points that are incredibly common for manufacturers: un-optimized inventory and inaccurate demand forecasting. One of the hardest parts about manufacturing a product, especially for those serving average consumers and not other manufacturers, is predicting supply and demand.

When your only option is creating in bulk preemptively, you need to carefully consider how much demand you think is out there for your product and create a yield according to those predictions. And while there are tools that help make predicting that demand easier, that doesn’t change the fact that demand forecasting is still, at its core, guessing (albeit more educated guessing). And in cases such as today’s outbreak, demand can prove to be wholly unpredictable and these guesses can often be wrong. What happens if your demand forecasting is wrong? In short, you take a massive bite out of your profits as resources are poured into product that gathers dust on shelves and either expires or is sold at a loss.

What we’ve learned is that, since demand can change on a dime, manufacturers need to be able to change their supply on a dime as well. And this can only be done by switching from a preemptive manufacturing process to a responsive one –  by switching from standard manufacturing to on demand manufacturing.    

Leveraging Supply Chain Resiliency for On Demand Manufacturing Solutions

Now, we’ve established that the best way to save on excess inventory and wasted products is to only create the products that have been ordered. Embracing this philosophy without the technology needed to speed up your production, however, will result in insane lead times and dissatisfied customers. Thankfully, many initiatives taken up to enhance on demand manufacturing efforts are closely tied to another tenet of smart manufacturing many are already familiar with: supply chain resilience.

By improving your chain’s ability to adapt to surprise situations (such as a sudden shift in demand) without skipping a beat in production, you can better reactively respond to orders that are placed and turn those products around in a timely manner. Sounds much more effective than running the risk of storing several extra products that may just be wasted in the long run. 

As far as building that resiliency with on demand manufacturing solutions in mind, there are a few key implementations to consider.

Alternative Manufacturing

Starting with the innovation that started the whole conversation of on demand manufacturing solutions, alternative manufacturing, specifically 3D printing, vastly improves your supply chain resiliency by allowing you to create intricate parts and products internally.

One of the reasons on demand manufacturing is often neglected is because supply chains aren’t self-sufficient in all of their operations. Many times, they rely on other partners from which they order specific parts they need to create their end product. 3D printing allows these manufacturers to create those parts internally and without reliance on another provider with nothing more than an industrial all in one PC with the proper software and some 3D printing hardware. 

What’s even more convenient, because the process of 3D printing is often passive, usually requiring someone to set the blueprint onto their device, start the print, and move on with other tasks, the creation of parts can be set in motion as the need for them becomes known. No timing of part orders and potentially flawed demand forecasting necessary.

Instead of waiting on tooling companies and partners that are often headquartered overseas and planning stock and production around those and other variables such as demand, manufacturers can simply receive orders from their customers and start printing parts, fixtures, molds, and more for their production in response. This will in turn lead to sped up lead times, elimination of wasted product, and increased profitability.    

Warehouse Management

In conjunction with 3D printing, warehouse tools such as inventory management can ensure you’re never left without the raw materials needed to fulfill a customer’s order. As soon as an order is placed, there needs to be assurance that the products needed to create it are present. Thankfully, inventory management solutions don’t need to involve massive investment in new programs. 

Inventory that is labeled with barcodes can be scanned in and out by a rugged industrial tablet equipped with the proper hardware as it’s brought in or expended, giving you real-time insight into your stock so you’re never caught off guard by a surprise order. Once a certain part or product is running low, more of it can be ordered or even 3D printed as soon as it’s needed.     

Order Fulfillment and Shipping

There’s more to just creating the product when it comes to on demand manufacturing. The entire cash to order process isn’t complete until your customer receives their product. It doesn’t matter how fast you are in creating the product. If the customer doesn’t receive it until 2 months later because your order fulfillment programs are lacking, they might as well have not worked with an on demand manufacturer in the first place. 

With that in mind, having an order picking method as well as an inventory replenishment method selected that best fits your particular business and lends itself to faster order delivery will be essential in maintaining the speed on demand manufacturing is known for.

Depending on the size of your operation, you may find either batch picking or “pick to order” processes to be best for your order fulfillment and shipment preparation. The same can be said about how you replenish inventory. Regardless of whichever processes you pick, the same scanning hardware and real-time data analytics we mentioned earlier with warehouse management will come into play. 

On-Site Diagnostics

Lastly, as far as resilience and making sure you’re constantly at the ready to produce, on-site machine diagnostics can be essential in making sure stops in the production line don’t hinder your ability to perform.

Building off of our focus on self-reliance, investing in Edge Computing solutions can ensure all data gathered from your IoT sensors and hardware is processed in-house, making it much easier to run preventative maintenance algorithms that can help you catch breakdowns before they happen, eliminating downtime and lowering lead times. Several manufacturers are beginning to observe the benefits of this self-reliance computing as is evident in projected growth rates of the industry by Grand View Research. 

On Demand Manufacturing Solutions Aren’t Just for On Demand Manufacturing

The perks of on demand manufacturing solutions aren’t strictly limited to just responsive product production. Investing in on demand manufacturing opens your facility up to many of the industry 4.0 core principles that have been proven time and time again to result in success, especially during these times of heightened self-reliance and alternative manufacturing methods. These tenets of resiliency, visibility, and flexibility will only continue to grow in importance as time goes on. Starting your journey with these tenets now can only result in expounded results later. For more information on how you can get started with a more self-reliant, on demand approach to your manufacturing, contact an expert from Cybernet today.