Top 5 Manufacturing Challenges For Large Hardware Businesses
Large players within the hardware world have a unique set of challenges they must overcome in order to ensure their long-term success. KREATIZE can help address these unique problems. Allow us the opportunity to show you how!
Innovation and grit are what got every large business to its privileged position.
This is particularly true in the hardware business where success is heavily tied to a deep understanding of technology, product development methodologies, and supply management. However, maintaining that sense of innovation can be hard for large businesses, whose structured approach tends to get sturdier with time.
Traditional manufacturing is an expensive process that requires heavy investments and a high-operating cost. It also requires a large group of trained interdisciplinary teams to manage and execute the manufacturing systems in place. Because of the complexity, and capital-intensive nature of the business, risk, and change are often not well embraced within large hardware companies.
Large hardware businesses face distinct challenges when it comes to growth, digitization, and maintaining a competitive advantage. KREATIZE was created to help both small and large hardware businesses with a platform that allows them to pursue a more agile product development process, by digitizing the way custom parts are procured and manufactured.
Essentially, we provide agile solutions to critical issues for businesses that want to modernize their manufacturing supply chain to better meet the demands of the time. We help them drive innovation by bringing better products to market faster, more sustainably, and with a lower cost of entry. KREATIZE’s platform improves price transparency, removes bottlenecks that get in the way of product development, provides flexibility in adapting to market demand shifts, and guarantees quality control.
Here are the 5 main challenges that we often see established hardware companies face, and the solutions KREATIZE has developed to address them.
1. Agile Product Development:
Large hardware companies have firm deadlines and processes for delivering products to market. This rigidity makes it difficult for them to adopt agile product development practices for prototype and low-volume manufacturing. It also makes it difficult for them to shed traditional design and procurement processes, as missed deadlines and delays have financial ramifications.
This strictness inhibits them from making enhancements to their products while they are still in development, which has a massive impact on their time-to-market. This results in a longer production schedule for new products, slowing the pace of innovation and limiting their chance at quick optimizations to meet market demands. By failing to properly introduce agile product development practices into their organizations, large hardware businesses put at risk their leadership positions by failing to create innovative products fast-enough.
For example, none of this is perhaps more obvious than with 17-year old Tesla’s agile product development strategy of making cars with less parts. Tesla’s have significantly fewer parts per vehicle — around 20 – in comparison to those with internal combustion engines, which have about 2,000. They are able to do this with the help of software on their exclusive hardware. This combination helps Tesla develop their cars faster, but also improve them with software updates every few weeks like a smartphone. Tesla’s are unlike traditional car-markers where their product does not upgrade or change for as long as it is being used.
Because of agile product development practices, Tesla is not tied to the standard minor vehicle upgrade product life cycle of 2 to 3 years, or the new car model introduction average of 4 to 7 years. Tesla can make changes to their current and future cars faster because of its strong agile product development practices. Tactics that have allowed it to build cars that can be more easily manufactured, and simultaneously improved.
Part of the problem that large businesses have is the ability to properly inject a new way of thinking in the organization, and resources for training employees in novel systems and processes.
They suffer from a legacy dilemma and are more focused on what has worked in the past, and have systems in place to ensure their legacy systems remain. However, large hardware companies can successfully integrate agility into their structured system over time. The trick is to do it incrementally by introducing intuitive technologies that foster agile product development gradually with specific new products at the prototype stage to ensure business continuity, and successful adoption.
How can KREATIZE help?
KREATIZE enables large hardware companies to immediately benefit from a platform that gives them the flexibility necessary to be more agile, by freeing them from an early design commitment and providing access to a large network of vetted suppliers with a plethora of manufacturing services.
In other words, it gives product designers and engineers an opportunity to adjust or enhance their products throughout the development cycle. Thereby removing some of the rigidity around traditional development processes that require an early commitment to a specific design trait (e.g. material, post-process).
KREATIZE customers do not need to completely overhaul their systems or build anything from scratch. In fact, new product development teams can easily start using our platform for specific parts, and can slowly integrate our services for other customized parts in their companies over time.
For example, engineers from large hardware businesses that are working on a new prototype can immediately begin to work with KREATIZE’s supply network, and receive their desired quality parts at the click of a button. They can skip the slow procurement processes meant for high-volume manufacturing and can quickly start to build their product. Allowing them to introduce design for manufacturability and assembly (DfMA) practices early on, which can speed up the production of their product as it goes from small to high volume. KREATIZE can substantially lower the time to market for a product, and provide engineers with an agile platform that allows them to make enhancements.
Our system is also highly intuitive, and we will not only help businesses set it up, but we will also work with them to ensure they get the most out of it. It’s an easy way to inject agility into development processes without completely overhauling current systems, and creating a space for innovative teams to cut their time to market, by having the tools and space to work on their prototypes.
2. Procurement Bottleneck:
Large companies have a tendency to treat small orders just as they would big orders. This is a problem from a product development standpoint. Procurement professionals spend a disproportionate amount of time negotiating small purchase orders for a prototype and treat it much in the same way as they do the parts of an established high-volume product. The approval processes and workflows for large orders are not well suited for new product development. They might require several rounds of paperwork and dozens of calls with potential suppliers to determine who can meet the small-batch prototypes at a competitive price. These cumbersome procurement processes chip-away at valuable product development time, and are costly from a resource standpoint. To unblock procurement processes companies should consider using a digital platform that offers access to a network of manufacturers who can meet bespoke demands for custom parts without the back-and-forth of traditional procurement methods.
How can KREATIZE help?
KREATIZE gives engineers access to a network of capacities through a one-stop digital platform. It allows them to skip the sluggish procurement process entirely by providing immediate access to quality suppliers who can meet their product specificities and quantities. There is no time wasted on finding a supplier who can fulfill small batch sizes, negotiating a proper price, or ensuring quality. KREATIZE offers large businesses a way to quickly alleviate procurement bottlenecks with access to an agile network of suppliers who meet the demands for more flexible product development.
As stated before, large businesses have well-defined processes for product development. Each phase of the process is typically handled in silos by certain departments, which can jeopardize effective communication and decision-making. This causes problems when there’s a gap in the information chain that impacts the entire supply chain. Silos restrict knowledge sharing, as goals for each department differ in terms of objectives, budgets, and responsibilities. By not understanding the goals of other departments, a silo is likely to dilute the common vision within the organization. This in turn can cause a series of systemic problems that affect all members of an organization and weaken the position of a company.
Large hardware organizations have siloed procurement and product design development. Engineers are unable to discuss their prototypes or early product iterations in real-time with suppliers. This slows down the product life cycle, as procurement teams are bogged down with quotes and price negotiations that may not be necessary in the early product development stages.
This prevents engineers from attaining proper feedback, and from making quick adjustments to their product (for instance, changing a material or post-process) as they develop them. A platform that can provide engineers with access to seamless custom part ordering would be an ideal solution. This would provide them the feedback necessary to make adjustments more quickly and speed up the early development process.
How can KREATIZE help?
By working with KREATIZE, engineers can benefit from a one-click ordering platform for their specific custom parts. They will also get expert feedback on the drawings of their customized parts from our talented KREATIZE engineers, who will help them take advantage of new manufacturing technologies to produce these parts. They will be able to make adjustments throughout the entire development process, freeing them from early design commitments and from cumbersome procurement processes that are not tailored to prototyping or small-volume manufacturing. Our suggestions will help teams save money and speed up their go-to-market timelines, always with sustainability in mind.
Hardware businesses in today’s competitive environment face rapidly decreasing product life cycle timelines. As a result, handling production ramp-ups for new products efficiently is crucial for the long-term success of a large hardware business. Ramp-ups are an increase in production ahead of an anticipated uptick in demand for a product. In order to do this, hardware companies traditionally have to face high upfront investments to purchase their own machines.
As a result of this, large hardware businesses might face situations where the reality of the step function puts them in the difficult position of having to consider buying additional machinery that is hardly utilized, and in turn makes little financial sense. This makes it difficult for large hardware businesses to go from small batch to large series. Scaling basically becomes a much more difficult process as a result of all the investment required to meet the uptick in demand.
What could be a solution to this challenge is making use of a cloud manufacturing network that has the capacity to deal effectively with small batches and the ramp-up demand at all times. A platform that allows large businesses to instantly grow when necessary. One that is ready to meet any type of demand, as it has many suppliers at its disposal, and that can offer efficient use on demand.
How can KREATIZE help?
By working with KREATIZE, large hardware businesses benefit from our platform’s supply network and ability to meet both small batch and high-volume manufacturing simultaneously. Our large cloud network of manufacturing partners have enough machines to satisfy any volume of required seamlessly.
Large hardware businesses do not need to invest in expensive machinery, or run into step function issues, when working with a well-made cloud manufacturing network. With KREATIZE companies gain access to a global supplier network high-caliber standards on an on-demand basis, which means that they will pay per usage, and not have to be concerned with issues of capacity and growth.
5. Blackbox Pricing:
When it comes to ordering customized parts, lack of transparency in pricing is an ongoing issue. Large hardware businesses typically order parts in bulk, meaning they likely do not have insight into the individual cost of each component, and ways where they could improve design or sourcing. Small incremental expenses from parts can really add up and have a serious impact on their bottom line. A solution to this problem would be to utilize a platform that provides clarity on cost calculations for each customized part purchased.
How can KREATIZE help?
KREATIZE offers full pricing transparency to our clients via open book calculations. This means that process and setup times for each individual component are clearly stated and available in the KREATIZE database. Businesses will also find the fixed hourly machine rates for their orders. KREATIZE bundles its orders to further ensure a lower price for each of our customer’s parts. Bundling also provides us with better customer service to address issues, and ensure access to the best resources from our manufacturing partners.
Are you a large hardware business that needs to overcome these challenges? Do you need immediate and actionable solutions?
KREATIZE would love to work with you to ensure that your business maintains its leadership position. We understand the problems you are going through, and want you to benefit from the very best of today’s technology without having to completely overhaul your business.
KREATIZE provides manufacturing the world loves. We want to help your business enter the next generation with new tools, show your engineers the latest manufacturing innovations, and help you deliver your beloved products to the world with ease. KREATIZE’s patented and proprietary software leverages the power of cloud manufacturing to give you access to a large network of first-rate global suppliers.
Start now with your free account by making an appointment with one of our cloud manufacturing specialists today, and allow your business to enter the future of manufacturing. Or by creating your account for KREATIZE Manufacturing Services today, and allow your hardware business to make a leap into the future of manufacturing.
Are you a startup in need of solutions to your challenges? Please read our article for startups to see how we can help you as well.