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 / Autumn 2011 / Issue 64(originally published by Booz & Company)


A Strategist’s Guide to Digital Fabrication

Rapid advances in manufacturing technology point the way toward a decentralized, more customer-centric “maker” culture. Here are the changes to consider before this innovation takes hold.

At a research meeting in late 2010, a primatologist studying monkey genetics took a tour of a university’s digital fabrication shop. She mentioned that her field research had stalled because a specialized plastic comb, used in DNA analysis of organic samples, had broken. The primatologist had exhausted her research budget and couldn’t afford a new one, but she happened to be carrying the old comb with her. One of the students in the shop, an architect by training, asked to borrow it. He captured its outline with a desktop scanner, and took a piece of scrap acrylic from a shelf. Booting up a laptop attached to a laser cutter, he casually asked, “How many do you want?”

This question is central to most manufacturing business models. Ten units of a comb — or an automobile component, a book, a toy, or any industrially produced item — typically cost a lot more per unit to produce than 10,000 would. The price per unit goes down even more if you make 100,000, and much more if you make 10 million. But what happens to conventional manufacturing business models, or to the very concept of economies of scale, when millions of manufactured items are made, sold, and distributed one unit at a time? We’re about to find out.

The rapidly evolving field of digital fabrication, which was barely known to most business strategists as recently as early 2010, is beginning to do to manufacturing what the Internet has done to information-based goods and services. Just as video went from a handful of broadcast networks to millions of producers on YouTube within a decade, and music went from record companies to GarageBand and, a transition from centralized production to a “maker culture” of dispersed manufacturing innovation is under way today. Millions of customers consume manufactured goods, and now a small but growing number are producing, designing, and marketing them as well. As operations, product development, and distribution processes evolve under the influence of this new disruptive technology, manufacturing innovation will further expand from the chief technology officer’s purview to that of the consumer, with potentially enormous impact on the business models of today’s manufacturers.

Some early signs of change are visible in the development and use of relatively low-cost digital fabrication devices. The leading producers of these tools are firms like 3D Systems (a US$51 million maker of 3-D printers founded in 1986 and based in Rock Hill, S.C.), Stratasys (a $117 million printer-maker founded in 1986, based in Eden Prairie, Minn.), and Epilog Laser (a privately held company founded in 1988 in Golden, Colo.). Their products were originally used for rapid prototyping, giving mainstream manufacturers and university researchers the means to test concepts and identify problems early in the design cycle. Now, the devices are being applied to end-product manufacturing by a burgeoning number of small-scale manufacturers and one-person factories. In mid-2010, 3D Systems and Stratasys reported on the information site that more than 40 percent of their customers used digital fabrication tools to manufacture not just prototypes, but end products and parts. These tiny companies are often started with little or no external funding; the proprietors tend to work from plans encoded in software that are often openly available for download on the Web.

Digital fabrication also continues to attract press attention — in part because of stunts designed for that purpose. For example, in 2009, Stratasys teamed up with a Canadian automotive company called Kor Ecologic Inc. to announce the hybrid Urbee, the first automobile with a body fabricated by 3-D printers; in 2010, the laser-sintering company EOS (a privately held business founded near Munich in 1989) manufactured a violin within just a few hours. In the long term, many aspects of today’s conventional supply chain are likely to change. But even in the next few years, digital fabrication technology — and the way it is used — will pose new and unusual challenges for conventional manufacturers, both large and small. It also represents enormous opportunities for brand building, cost saving, consumer outreach, innovation, and global competitiveness: in short, for a manufacturing business model that no longer depends only on economies of scale.

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  1. Limor Fried and Phillip Torrone, “Million Dollar Baby,” 2010 (PDF): Overview presentation of open source hardware companies by Adafruit.
  2. Phillip Torrone, “Open Source Hardware 2009,” 2009, : List and overview of open source hardware projects in existence in 2009.
  3. Edward Tse, Kevin Ma, and Yu Huang, “Knockoffs Come of Age,” s+b, Autumn 2009: Introduction to China’s shan zhai companies and their transition from piracy to competitive innovation.
  4. Eric von Hippel, Jeroen De Jong, and Steven Flowers, “2010: Comparing Business and Household Sector Innovation in Consumer Products: Findings from a Representative Study in the UK,” 2010: Survey of the development and modification of consumer products by product users in a representative sample of 1,173 U.K. consumers age 18-plus.
  5. Wohlers Associates, “Wohlers Report 2011,” 2011: Yearly in-depth analysis of the additive manufacturing industry worldwide.
  6. For more on this topic, see the s+b website at:
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