{"id":32843,"date":"2018-11-13T15:43:21","date_gmt":"2018-11-13T20:43:21","guid":{"rendered":"https:\/\/digital.hbs.edu\/platform-rctom\/submission\/for-ge-to-convince-the-world-of-the-benefits-of-additive-manufacturing-it-must-first-convince-itself\/"},"modified":"2018-11-13T15:45:19","modified_gmt":"2018-11-13T20:45:19","slug":"for-ge-to-convince-the-world-of-the-benefits-of-additive-manufacturing-it-must-first-convince-itself","status":"publish","type":"hck-submission","link":"https:\/\/d3.harvard.edu\/platform-rctom\/submission\/for-ge-to-convince-the-world-of-the-benefits-of-additive-manufacturing-it-must-first-convince-itself\/","title":{"rendered":"For GE to Convince the World of the Benefits of Additive Manufacturing, It Must First Convince Itself"},"content":{"rendered":"<p>Additive Manufacturing (\u201cAM\u201d) broadly describes technologies that build 3D objects by adding layer-upon-layer of material [1].\u00a0 Though potentially revolutionary, companies across industries have taken different approaches to the application of this breakthrough technology. In 2015, Deloitte outlined four paths companies take in leveraging AM [2]:<\/p>\n<ul>\n<li><strong>Path I:<\/strong> Improve value delivery, product set and supply chain are unchanged.<\/li>\n<li><strong>Path II: <\/strong>Improve economies of scale and revolutionize product supply chain.<\/li>\n<li><strong>Path III: <\/strong>Enable top levels of performance across the product set.<\/li>\n<li><strong>Path IV: <\/strong>Alter supply chains and products in pursuit of new business models.<\/li>\n<\/ul>\n<p style=\"text-align: center\"><strong><em>Deloitte\u2019s Framework for Understanding AM Paths and Potential Value<\/em><\/strong><\/p>\n<p><a href=\"https:\/\/d3.harvard.edu\/platform-rctom\/wp-content\/uploads\/sites\/4\/2018\/11\/Framework.png\"><img loading=\"lazy\" decoding=\"async\" class=\"aligncenter size-large wp-image-32820\" src=\"https:\/\/d3.harvard.edu\/platform-rctom\/wp-content\/uploads\/sites\/4\/2018\/11\/Framework-1024x994.png\" alt=\"\" width=\"640\" height=\"621\" srcset=\"https:\/\/d3.harvard.edu\/platform-rctom\/wp-content\/uploads\/sites\/4\/2018\/11\/Framework-1024x994.png 1024w, https:\/\/d3.harvard.edu\/platform-rctom\/wp-content\/uploads\/sites\/4\/2018\/11\/Framework-300x291.png 300w, https:\/\/d3.harvard.edu\/platform-rctom\/wp-content\/uploads\/sites\/4\/2018\/11\/Framework-768x745.png 768w, https:\/\/d3.harvard.edu\/platform-rctom\/wp-content\/uploads\/sites\/4\/2018\/11\/Framework-600x582.png 600w, https:\/\/d3.harvard.edu\/platform-rctom\/wp-content\/uploads\/sites\/4\/2018\/11\/Framework.png 1283w\" sizes=\"auto, (max-width: 640px) 100vw, 640px\" \/><\/a><\/p>\n<p>&nbsp;<\/p>\n<p>Though industrial conglomerate GE is typically thought of as a slow mover in innovation, its Aviation division has been an early adopter of AM technology, taking a Path IV approach to revolutionize the full-scale manufacturing of parts for its airplane turbine business.<\/p>\n<p>In 2017, GE enjoyed 70% share in engines that power narrow-body jets, the world\u2019s most widely produced airplanes [3]. The company is investing heavily in AM to expand its dominant market position by widening the moat afforded to it by its production capabilities. As an example, in 2012 GE created a new, more fuel-efficient jet engine. In doing so, they had to overcome a key engineering challenge related to the engine\u2019s fuel nozzle. The nozzle required 20 individual components to be welded together. After repeated failures, the team turned to AM to prototype a single piece of equipment that combined all 20 parts into one unit while weighing 25% less and being 5x more durable. In describing the technology, GE\u2019s head of AM noted \u201cThe technology [is] incredible, in the design of jet engines, complexity used to be expensive. But additive allows you to get sophisticated and reduces costs at the same time.\u201d By 2014, GE printed half of its engines with AM, reducing 900 components to 16 while delivering a product that is 40% lighter and 60% cheaper. Further, GE Aviation improved its supply chain by reducing reliance on sole-source suppliers and shifting production costs in-house. [4]<\/p>\n<p style=\"text-align: center\"><strong><em>The Advanced Turboprop: Stronger, More Durable and Cleaner<\/em><\/strong><a href=\"https:\/\/d3.harvard.edu\/platform-rctom\/wp-content\/uploads\/sites\/4\/2018\/11\/Engine.png\"><img loading=\"lazy\" decoding=\"async\" class=\"aligncenter wp-image-32827\" src=\"https:\/\/d3.harvard.edu\/platform-rctom\/wp-content\/uploads\/sites\/4\/2018\/11\/Engine.png\" alt=\"\" width=\"505\" height=\"520\" srcset=\"https:\/\/d3.harvard.edu\/platform-rctom\/wp-content\/uploads\/sites\/4\/2018\/11\/Engine.png 870w, https:\/\/d3.harvard.edu\/platform-rctom\/wp-content\/uploads\/sites\/4\/2018\/11\/Engine-292x300.png 292w, https:\/\/d3.harvard.edu\/platform-rctom\/wp-content\/uploads\/sites\/4\/2018\/11\/Engine-768x790.png 768w, https:\/\/d3.harvard.edu\/platform-rctom\/wp-content\/uploads\/sites\/4\/2018\/11\/Engine-583x600.png 583w\" sizes=\"auto, (max-width: 505px) 100vw, 505px\" \/><\/a><\/p>\n<p>Though the recent wins in Aviation demonstrated AM\u2019s potential within GE, former CEO Jeff Immelt\u2019s ambitions for the technology were much greater. In 2016, GE acquired two AM companies. In tandem with the acquisitions, GE opened the Additive Training Center to teach engineers across its end market platforms how to apply AM technology in their respective businesses. Further, Immelt noted in the 2016 Annual report that GE aspired to reach $1 billion in AM sales by 2020, believing the technology would become a $75 billion market over the long-term. Immelt further believed GE would be at the forefront of this industrial revolution by selling AM technologies as a standalone product, estimating only 10% of long term sales would go to GE internally. [5]<\/p>\n<p>Though progress to date has been impressive in Aviation, the company has offered few details of the technology\u2019s applications across its other businesses, aside from traditional Phase I-III applications primarily dealing with rapid prototyping [6]. Given GE management aims to scale this business by selling its AM capabilities across industries, it must first focus on applying the technology across its own businesses. The reasons for this are threefold. First, given GE\u2019s expansive end market coverage (Healthcare, Oil &amp; Gas, Power, Aviation, etc.), the company has an unrivaled testing ground for how the technology can be applied across different use cases. Second, AM applications are generally quite customized, requiring knowledge of materials, long-term production targets, and supply chain dynamics which must be iterated on throughout the manufacturing process. Thus, GE must first become a true expert in the technology and its application within its own portfolio, so it can approach clients with a more credible value proposition. Lastly, given GE\u2019s current financial challenges and restructuring efforts, the company is in desperate need of cash. Leveraging AM to drive efficiencies across business units will allow them to climb the learning curve without having to invest capital dollars to scale a largely unproven technology outside of its core businesses to serve outside customers.<\/p>\n<p>Though GE has demonstrated the potential of AM in Aviation, the company has not meaningfully adopted the technology in its other product lines. This lack of adoption internally will make it challenging to sell the service to outside clients who are likely skeptical of the technology\u2019s benefits and broad applications beyond prototyping. The main question left unanswered is how can GE drive adoption of AM technology across its platforms internally, so it can convince others of its merits and attempt to compete in this emerging industrial category?<\/p>\n<p><strong>(Word Count: 769)<\/strong><\/p>\n<p><strong><u>\u00a0<\/u><\/strong><\/p>\n<p><strong><u>References<\/u><\/strong><\/p>\n<p>[1] \u201cWhat is Additive Manufacturing?\u201d (2018). <em>Additive Manufacturing. <\/em>Retrieved from: \u00a0<a href=\"http:\/\/additivemanufacturing.com\/basics\/\">http:\/\/additivemanufacturing.com\/basics\/<\/a><\/p>\n<p>[2] Michalik, Joyce, Barney, and McCune (2015). <em>Deloitte University Press. <\/em>\u201c3D opportunity for product design Additive manufacturing and the early stage.\u201d Retrieved from: \u00a0<a href=\"https:\/\/www2.deloitte.com\/insights\/us\/en\/focus\/3d-opportunity\/3d-printing-product-design-and-development.html\">https:\/\/www2.deloitte.com\/insights\/us\/en\/focus\/3d-opportunity\/3d-printing-product-design-and-development.html<\/a><\/p>\n<p>[3] Josephs, Leslie (2018). <em>CNBC<\/em>. \u201cHere\u2019s why GE is holding on tight to its aviation business.\u201d Retrieved from: <a href=\"https:\/\/www.cnbc.com\/2018\/06\/26\/why-general-electric-is-holding-on-tight-to-its-aviation-business.html\">https:\/\/www.cnbc.com\/2018\/06\/26\/why-general-electric-is-holding-on-tight-to-its-aviation-business.html<\/a><\/p>\n<p>[4] Kellner, Tomas (2017). <em>GE Company Website.<\/em> \u201cAn Epiphany Of Disruption: GE Additive Chief Explains How 3D Printing Will Upend Manufacturing.\u201d Retrieved from: <a href=\"https:\/\/www.ge.com\/reports\/epiphany-disruption-ge-additive-chief-explains-3d-printing-will-upend-manufacturing\/\">https:\/\/www.ge.com\/reports\/epiphany-disruption-ge-additive-chief-explains-3d-printing-will-upend-manufacturing\/<\/a><\/p>\n<p>[5] General Electric (2016). 2016 10-K and Annual Report. Retrieved from: <a href=\"https:\/\/www.ge.com\/ar2016\/assets\/pdf\/GE_AR16.pdf\">https:\/\/www.ge.com\/ar2016\/assets\/pdf\/GE_AR16.pdf<\/a><\/p>\n<p>[6] General Electric (2017). 2017 10-K and Annual Report. Retrieved from: <a href=\"https:\/\/www.ge.com\/investor-relations\/sites\/default\/files\/GE_AR17.pdf\">https:\/\/www.ge.com\/investor-relations\/sites\/default\/files\/GE_AR17.pdf<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Can GE get divisions outside of Aviation to adopt the Additive Manufacturing technologies it is trying to sell to customers as a standalone product?<\/p>\n","protected":false},"author":11602,"featured_media":0,"comment_status":"open","ping_status":"closed","template":"","categories":[],"class_list":["post-32843","hck-submission","type-hck-submission","status-publish","hentry","hck-taxonomy-organization-general-electric","hck-taxonomy-industry-industrial-products","hck-taxonomy-country-united-states"],"connected_submission_link":"https:\/\/d3.harvard.edu\/platform-rctom\/assignment\/rc-tom-challenge-2018\/","yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.3 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>For GE to Convince the World of the Benefits of Additive Manufacturing, It Must First Convince Itself - 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