the software defined supply chain - full study results
DESCRIPTION
For more than a year, IBM has been researching the full impact of the software defined supply chain - 3D printing, advanced robotics, and open source hardware. Now, you can see how all these come together to make products cheaper, faster, and enable a new wave of start-ups.TRANSCRIPT
© 2012 IBM Corporation
The New Software Defined Supply Chain:Preparing for the disruptive transformation of Electronics design and manufacturing
The IBM Institute for Business Value
Paul BrodyGlobal Business Services Vice President and Global Electronics Industry Lead
Veena PureswaranInstitute for Business ValueGlobal Electronics Industry Lead
© 2013 IBM Corporation2
People can have the Model T in any color – so long as it’s black.
HENRY FORD
© 2013 IBM Corporation3
0
100,000
200,000
300,000
400,000
1901 1902 1903 1904 1905 1906 1907 1908 1909 1910 1911 1912 1913 1914
Ford Automotive Output, 1901-1914
Shift to moving production line
$5 Daily Wage IntroducedAssembly time down to 1.5 hours
Model T IntroductionAssembly Time Per Car: 14 Hours
© 2013 IBM Corporation4
875,000
1,750,000
2,625,000
3,500,000
1901 1903 1905 1907 1909 1911 1913 1915 1917 1919 1921 1923 1925 1927 1929
Ford Automotive Output, 1901-1924
© 2013 IBM Corporation5
STANDARDIZATION
0
1,000,000
2,000,000
3,000,000
4,000,000
1901 1907 1913 1919 1925
D I G I T I Z A T I O NMODULARIZATION
TRADITIONAL ASSEMBLY
MODULAR ASSEMBLY
0
300
600
900
TOTAL COST $
NUMBEROF PARTS
ASSEMBLYTIME (MIN)
MASS(KG)
800
686
1041 63 56 22 3
© 2013 IBM Corporation6
PARTSCUSTOM STANDARD
COMPONENTS MODULESASSEMBLY
MECHANICAL DIGITALCONTROLS
3 KEY RULESOF PRODUCT DESIGN
© 2013 IBM Corporation7
3 CHARACTERISTICSOF INDUSTRY STRUCTURE & TRADE
Economies of Scale BIG
Multi-Tier Supply Chains COMPLEX
Low Cost Supply Chains GLOBAL
© 2013 IBM Corporation8
© 2013 IBM Corporation9
3 NEWTECHNOLOGIES3 D P R I N T I N G O P E N S O U R C EINTELLIGENT ROBOTICS
© 2013 IBM Corporation10
STANDARDIZATION
3D PRINTING
NO ECONOMIES OF SCALE
ON DEMAND MANUFACTURING
LOCATION ELASTIC $0
$0.08
$0.15
$0.23
$0.30
2013 2018 2023
COST PER UNIT VOLUME PRINTED$/CUBIC CM - BLENDED AVERAGE
-79%-92%
© 2013 IBM Corporation11
MODULARIZATION
ROBOTICS
HARD AUTOMATION
FLEXIBLE ROBOTICS
INTELLIGENT ROBOTICS
$0
$75,000.00
$150,000.00
$225,000.00
$300,000.00
2005 2012
TYPICAL COST PER ROBOTIC ASSEMBLY STATION
-90%
© 2013 IBM Corporation12
DIGITIZATION
INTELLIGENCE
MOORE’S LAW
OPEN SOURCE
0
7,500
15,000
22,500
30,000
11/1/08 4/1/09 9/1/09 2/1/10 7/1/10 12/1/10 5/1/11 10/1/11 3/1/12 8/1/12
OPEN SOURCE HARDWARE DESIGNS ON THINGIVERSE
© 2013 IBM Corporation13
HARDWARE CONSTRAINED
BUILD A MOLD OR
CAST
HARDWIRE PRODUCTION
LINE
DEVELOP EMBEDDED
CHIP
SOFTWARE DEFINED
PRINT PARTS DIRECTLY BY SOFTWARE
RECONFIGURE ASSEMBLY THROUGH
SOFTWARE
DIGITAL CONTROLS USING SOFTWARE
© 2013 IBM Corporation14
SOFTWARE DEFINED SUPPLY CHAIN
© 2013 IBM Corporation15
WHEN
© 2013 IBM Corporation16
Will be most affected by these technologies?
Strategies should you adopt to be competitive?
Are the best locations to invest going forward?
Will these technologies impact investment decisions?
Do I need to re-engineer my end-to-end business processes?
▶ WHO ▶ WHAT ▶ WHERE ▶ WHEN ▶ WHY
© 2013 IBM Corporation17
4 DIFFERENT PRODUCTS COSTVOLUMESIZECOMPLEXITYPERSONALIZATION
WASHING MACHINE
INDUSTRIAL DISPLAY
MOBILE PHONE
HEARING AID
© 2013 IBM Corporation18
5 GLOBAL LEADERS
IBM RESEARCHJohn Cohn
PLANT LOCATION INTERNATIONALDavid Zaharachuk
Phil Reeves Leo Bonnanni
Mike Watson Alex Scott
EACH PRODUCT INDIVIDUALLY TORN DOWN
EACH PRODUCT INDIVIDUALLY TORN DOWN
EACH PRODUCT INDIVIDUALLY TORN DOWN
EACH PRODUCT INDIVIDUALLY TORN DOWN
EACH PRODUCT INDIVIDUALLY TORN DOWN
EACH PRODUCT INDIVIDUALLY TORN DOWN
© 2013 IBM Corporation25
1 INTEGRATED MODEL
PLANT LOCATION INTERNATIONAL
© 2013 IBM Corporation26
3 AMAZING RESULTS
COSTSCALE
CO2 IMPACT
© 2013 IBM Corporation27
LOWER COST
0
25
50
75
100
2012 Traditional 2012 Digital 2017 Digital 2022 Digital
66
91100100
8391
100100 9899100100
31
8889
100
23%CHEAPER
AGGREGATE NORMALIZED UNIT COST
© 2013 IBM Corporation28
LOWER SCALE
90%LESS VOLUME
REQUIRED
0
25
50
75
100
2012 Traditional 2017 Digital 2022 Digital
1725
100
3
29
100
1724
100
2
24
100
AGGREGATE NORMALIZEDMINIMUM ECONOMIC SCALE
© 2013 IBM Corporation29
NOT NECESSARILY GREENER
0
30
60
90
120
2012 Traditional 2017 Digital 2022 Digital
109120
100 10110010092
99100
33
89100
AGGREGATE NORMALIZED CO2 ANALYSIS
9%HIGHER
67%LOWER
© 2013 IBM Corporation30
BIG
COMPLEX
GLOBAL
SMALL
SIMPLE
LOCAL
© 2013 IBM Corporation31
HEARING AID CASECHEAPER
$0
$125
$250
$375
$500
2012 BASELINE 2012 DIGITAL 2017 DIGITAL 2022 DIGITAL
$132
$370$375
$425
© 2013 IBM Corporation32
HEARING AID CASEGREENER
0
25
50
75
100
2012 BASELINE 2012 DIGITAL 2017 DIGITAL 2022 DIGITAL
33
88
100100
© 2013 IBM Corporation33
HEARING AID CASELOCAL
Traditional Supply Chain Model
Software Defined Supply Chain - 2012
© 2013 IBM Corporation34
HEARING AID CASELOCAL
Software Defined Supply Chain - 2017
© 2013 IBM Corporation35
HEARING AID CASELOCAL
Software Defined Supply Chain - 2022
© 2013 IBM Corporation36
HEARING AID CASELOCAL
© 2013 IBM Corporation37
RECOMMENDATIONSFOR INDUSTRY
IMPLICATIONS
Product design and retailing will be influenced greatly by interactions with customers
Competitive dynamics of the industry will change radically
Supply Chains will become more simple, flexible and localized
Change how you design and sell products1Prepare for the new competitive landscape2Build extraordinary flexibility into your supply chain structure3
RECOMMENDATIONS
© 2013 IBM Corporation38
FULL REPORT AND MODEL AVAILABLE IN JULY 2013
IBM Institute for Business Value
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