Understanding Value in Additive Manufacturing

By Scott DeFelice, CEO & Chairman of the Board, Oxford Performance Materials, Inc.

Scott DeFelice, CEO & Chairman of the Board, Oxford Performance Materials, Inc.

Additive manufacturing has been hailed as a world changing technology that in time will be ubiquitous and alter the way we make things and live. Futurists, technologists and self-proclaimed evangelists have all proclaimed this impending revolution. Corporations and equity markets have responded with investment and for a time robust valuation of additive manufacturing public companies. Like many bold claims there is an element of truth to these proclamations. However, they were also inadequate to fully understand additive manufacturing’s true impact and value creation.

The additive manufacturing industry evolved from the prototyping industry. Consequently, it was both machine centric and shape focused. By shape focused I mean that the fundamental utility of what was purchased by the end user was non-functional shapes. The true performance of the shape in terms of its actual material properties and dimensional properties was always a secondary consideration at best. The legacy machine technologies to make these shapes were also not designed and engineered for consistent high quality performance in order to deliver components with repeatable performance. Thus, began the evolution of a manufacturing and materials ecosystem that was originally designed for nonfunctional prototypes toward a robust mature production hardware manufacturing ecosystem. As of this writing this remains a work in progress as materials, additive manufacturing systems, software and automation continue to advance. Some additive manufacturing systems have great potential to advance into true production systems and some will simply never make the journey as they are inherently limited by the material systems, process technologies or the combination thereof.

"Until you quantify the performance to the industry standard and know what comes off the printer relative to the market of interest, your additive manufacturing initiative is aspirational"

In public talks on additive manufacturing that I have given I like to reset the audience with the bold claim that “no one cares about your 3d printer, your 3d printing materials or your software”. To an audience of people who makes these things this is generally discomforting. However, it is profoundly true. Additive manufacturing is simply a process. It is a potentially profoundly enabling process, but alone only a process. The materials, machine and software alone are also only part of a manufacturing value chain. What end customers care about are the utility and benefit of what comes of the printer.

The irreducible minimum of an additive manufacturing system is the materials of construction. To folks in manufacturing I don’t expect this is new. If you start with a high performance polymer like we do with our OXPEKK polymers you have a range of potential results depending upon the printing technology. If you are working with a photopolymer or metal, you have a totally different range of part performance results. The material performance properties in bulk form need to be suitable for the end use. So for example our biomedical implants the material of construction needs to be biocompatible, mechanically like bone, radiolucent, gamma stable, steam stable and pure. Then the additive manufacturing process method needs to form the material and continue to retain the desirable properties of the bulk material.

At OPM, we developed a PEKK polymer and additive manufacturing technology to produce structures for biomedical and industrial uses. In our biomedical business our end customers are patients who have a bone defect in part of their skeletal structure. What they care about is that this bone defect is repaired in a way that allows their life to proceed in a healthy and productive way. The hospital that buys that implant wants a product that has that offers greater clinical efficacy at lower cost compared to incumbent technology. The key point here is that demand is not created because an additive manufacturing technology is on offer. Demand is created because the product that comes off the printer has tangible benefits compared to incumbent technologies.

How one ascertains product benefits relative to incumbent technologies has not changed with the advent of additive manufacturing. At OPM we say material + process = a quantified result. For each industry or application in certain cases the quantification is done to the accepted standard. So for example in our aerospace business where we successfully sold 600 parts on the Boeing crew capsule (We recently sold this business to Hexcel) we quantified what comes off the printer via a traditional B basis that has been the industry standard based upon mil-17 handbook. In our biomedical business we quantified the performance according to various ISO and ASTM standards that have long existed. The interesting point here is that until you quantify the performance to the industry standard and know what comes off the printer relative to the market of interest your additive manufacturing initiative is aspirational. Once you have this data and understand the true production economics you are then finally in position to see how you compare to the competition and to truly know if you have a business. The cost of these quantification efforts can easily run into the millions of dollars and it is certainly the case that after this effort the data may reveal that in certain markets and use cases that the business case does not exist. But that has always been the case when evaluating new manufacturing technologies. Along with great promise there is always risk!