Assessing the potential of additive manufacturing for the provision of spare parts

Abstract

Spare parts are a particularly interesting application for switching production from traditional manufacturing (TM) to additive manufacturing (AM). Research assessing AM has primarily addressed cost models centering on the production process or the operations management of separate spare parts. By combining case study, modeling, and design science elements, we adopt a holistic perspective and develop a design to examine the systematic leverage of AM in spare parts operations. Contextually grounded in problems faced by a leading material handling equipment manufacturer that is challenged by common characteristics of after‐sales operations, we engage with practice to propose a portfolio level analysis examining the switchover share from TM to AM. Using a data set of 53,457 spare parts over 9 years, we find that up to 8% of stock keeping units (SKUs) and 2% of total units supplied could be produced using AM, even if unit production costs are four times those of TM. This result is driven by low demand, high fixed costs, and minimum order quantities in TM. Finally, we present the evaluation by the case company's management and highlight five areas of opportunity and challenge.

The digitalization of operations and supply chain management: Theoretical and methodological implications

“…In “Assessing the potential of additive manufacturing for the provision of spare parts,” Heinen and Hoberg () use data from an industrial‐equipment manufacturer to examine the potential impact of an incremental switchover of spare parts inventory to additive manufacturing on demand. They find that the encapsulation of design and manufacturing data into a unique digital artifact enables the organization to revisit the role of inventory in high‐variety, low‐volume settings: Incremental replacement of high‐variety, slow‐moving spare parts produced via batch manufacturing processes, with on‐demand production of parts via additive manufacturing can lead to significant cost savings, without sacrificing customer service.…”

“…Heinen and Hoberg () describe how digitalization allows a firm to move away from scale imperatives, while questioning of what scale considerations—if any—are present with digitalization. In their article titled “The economics of additive manufacturing,” Baumers and Holweg () use a series of experiments to assess the relationship between quantity, quality, and cost in an AM setting.…”

“…Roscoe, Cousins, and Handfield () address the challenges of aligning process and organizational architectures as AM capabilities are developed at an aerospace company. Baumers and Holweg () use a series of experiments to investigate the role of scale in AM, while Heinen and Hoberg () explore opportunities created by the digitalization of spare parts and its implications for inventory management and after‐sales operations.…”

New Business Models for Sustainable Spare Parts Logistics: A Case Study

“…In this article, we focus on the additive manufacturing of spare parts. The production of spare parts using traditional supply chains involves many challenges [9,10]. Manufacturers need to ensure the availability of spare parts for their customers, but demand for spare parts is erratic [11].…”

“…In fact, a few years later, an article published in Forbes magazine stated that "3D printing is already starting to threaten the traditional spare parts supply chain" [13]. More recently, several studies have analyzed the positive impact of additive manufacturing of spare parts on reducing production costs [10] and dealing with new approaches for spare parts management [14][15][16]. Indeed additive manufacturing is currently being used to supply spare parts in such diverse fields as the maritime industry [17], the automotive industry [18], and the aeronautics sector [19].…”