{"id":23781,"date":"2017-11-15T16:39:22","date_gmt":"2017-11-15T21:39:22","guid":{"rendered":"https:\/\/digital.hbs.edu\/platform-rctom\/submission\/the-impact-of-3d-printing-on-innovation-and-supply-chain-logistics-at-medtronic\/"},"modified":"2017-11-15T16:39:22","modified_gmt":"2017-11-15T21:39:22","slug":"the-impact-of-3d-printing-on-innovation-and-supply-chain-logistics-at-medtronic","status":"publish","type":"hck-submission","link":"https:\/\/d3.harvard.edu\/platform-rctom\/submission\/the-impact-of-3d-printing-on-innovation-and-supply-chain-logistics-at-medtronic\/","title":{"rendered":"The impact of 3D printing on innovation and supply chain logistics at Medtronic"},"content":{"rendered":"

\"\"3D printing, or \u201cadditive manufacturing\u201d, is rapidly advancing\u00a0manufacturing and could potentially transform innovation and supply chain logistics for the medical device industry. 3D printers leverage digital profiles to print materials in successive patterns creating finished products. The tech allows for fast and efficient production of customized products significantly reducing production costs. Additionally, placing 3D printers\u00a0close to customers could remove the need for complex distribution networks reducing overall logistics\u00a0costs. Within healthcare, additive manufacturing is already leveraged in the production of prosthetic implants, artificial limbs1<\/sup> and pharmaceuticals2<\/sup>. This technology should concern a company like Medtronic. As the world\u2019s largest medical device supplier, its portfolio leverages complex production processes and a vast distribution network. 3D printing offers an opportunity to streamline these processes and increase future profits but also opens up Medtronic to disruption.<\/p>\n

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With personalized care increasingly becoming a priority for Medtronic, there is an opportunity to drive innovation through rapid prototyping and production of complex products that could not be produced through traditional manufacturing. It is estimated that by 2019, 3D printing will be leveraged in 35% of all surgeries that require prosthetic and implant devices and 10% of people in the developed world will live with a 3D printed implant3<\/sup>. Additionally, some experts believe that revenues from 3-D-printed biomedical products could reach $5 billion by 2020. 3D printing could allow Medtronic to produce custom built implants based on unique digital patient profiles. Additionally, while mostly leveraged as a rapid-prototyping tool, 3D printing\u2019s greatest opportunity lies in the mass customization space4<\/sup>. Personalized implants can be priced higher and production equipment does not require retooling to produce additional products. For incremental units, suppliers simply need to upload new specs to the printer. Currently, the 3D printing market is dominated by Stratasys and 3D Systems who control ~75% of the market with the remainder split across 35+ smaller players5<\/sup>. Several of Medtronic\u2019s competitors have already invested in this technology and Medtronic should position themselves to have a dominant position in a commercially viable additive manufacturing platform to gain a competitive advantage6<\/sup>.<\/p>\n

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Currently, Medtronic is investing heavily in additive manufacturing to allow their scientists and engineers to continue the work on customized devices. In the long term, Medtronic is also positioning themselves to capitalize on technology that might allow for damaged human organs to be repaired with living tissue or replaced with new organs produced through 3D printing7<\/sup>.
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\u201cWe are thinking that far ahead, but it\u2019s going to take time and determination. It’s one thing to do a prototype, it’s another thing to say we’re actually going to do it for the long haul.\u201d<\/em><\/strong><\/p>\n

Michael Hill, VP Corporate Science, Technology and Clinical Affairs at Medtronic<\/em><\/p>\n

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Medtronic has not publicized any significant investments or partnerships but they continue to leverage this technology within prototyping and innovation. However, unlike many competitors, they have not invested in long term partnerships that could lead to the development of a strong platform. While this is concerning, it is possible that a more strategic investment could be made if Medtronic waits for further technology advancements.<\/p>\n

While is it unlikely that additive manufacturing will completely replace traditional manufacturing in the future8<\/sup>, Medtronic should take action to prepare for a future where additive manufacturing is a core technology driving competitive advantage:<\/p>\n