HP Adds Stress Tests to its Supply Chain — and Adapts

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Two years ago, just before the arrival of Covid-19, HP opened a new, 150,000-square-foot  3D Printing and Digital Manufacturing Center of Excellence in Sant Cugat, Barcelona. The new center, expanding the already existing large-format and 3D printing design and innovation facilities the company already had in the region, hosts experts and engineers from 40 countries working in world-class R&D, engineering, co-development, and sustainable innovation for Industry 4.0.

The pandemic has disrupted the operations of most companies worldwide, and HP is no exception. The initial lockdowns stopped research and manufacturing, creating new challenges for the supply chain: production, logistics, and access to necessary materials and components.

Because of the shortage of medical equipment and supplies, HP, like other companies with manufacturing technology, immediately started to design and manufacture critically needed equipment for hospitals and protection equipment. Its 3D printing technology allowed it to share designs and replicate the new parts worldwide, where service providers and manufacturers with HP technology could make locally the parts and products they needed, where needed.

Today, resuming normal operations has been extremely difficult for HP. The shortage of raw materials and semiconductors and challenging logistics disruptions have impacted the production of existing products and the development of new ones.

According to Ramon Pastor, global head and general manager of HP 3D Metal and HP Barcelona site general manager, they have “failed miserably” in resuming operations because of the unprecedented and unforeseen situation. Now, HP is changing its product design process to make it more flexible and adding stress tests to its supply chain.

EPSNews contributor Pablo Valerio had the opportunity to visit the Sant Cugat facilities and talk to Pastor about these challenges, how different industries embrace distributed manufacturing, and what is next for 3D printing technology, including metals.

The following is a transcription, edited for clarity, of the first part of our conversation with Ramon Pastor.

EPSNews:  The supply chain challenges most corporations today: the shortage of materials and semiconductors, logistics, manufacturing.

At the same time, the pandemic has increased the demand for local manufacturing and for reshoring some industries. How is HP responding to this new push for local production of parts and materials?

Ramon Pastor:  For us, the pandemic was probably the first time the traditional supply chains were challenged in such a way. And we have been really fortunate for the last decades to have a very, very stable supply side and a very stable demand side.

But really, what happened in the pandemic, if you really think about this, was the surge of demand in certain areas, for instance, medical supplies. That was a significant, unforeseen demand on certain things and a considerable distortion on the supply chain because of factories shutting down.

We decided in HP, especially in 3D printing, to stop many of our projects and focus on helping the medical supplies situation. We started designing medical supplies where we were not experts, but with the time to create respirators, bifurcators, masks, swabs, etc. We realized that, actually, not only was it much faster to go from design to production, but when we had the design, we could send it to our network of service providers that have our technology, so they could manufacture locally. They could manufacture on the spot what they needed when they needed it.

That was one key thing we learned. The second key learning is how easy it is with 3D printing to shift what you’re doing to something new. We had one customer, for instance, making aligners. In a week, they went from making aligners to making swabs. So, what we learned is that, in distributed manufacturing, it is essential to be aware of the local realities, but also, the flexibility on your production lines is critical.

If you have a tooled injection molding machine and produce one thing, you can only make that. If you have a much more flexible fabrication method, you can produce something one day and another product the next day.

EPSNews:  What about your own supply chain, to make your own products?

Ramon Pastor:  Actually, we have failed miserably— we all had business continuity plans (BCPs), we had BCPs! Everyone had BCPs. But nobody could anticipate what happened.

So, what we are doing right now is to have better stress tests put into our supply chain. We try to mimic what happened after the European debt crisis. Now the banks are required to have their stress tests. We are trying to do the same. We have defined vectors of what could happen, and we are stress-testing our supply chain. We are learning how to add more flexibility, more duplication, more geographical span, much more flexible methods of fabrication, and much better connection on data. So we are involving our thinking, as many, many companies are.

EPSNews:  Following up on the first question, what about other manufacturers looking at 3D printing, for example, car manufacturers?

We’re talking about people making something that requires a lot of parts, some plastic parts, and other materials. Are they more interested in local manufacturing than before?

Ramon Pastor: They are. They are. Now, local manufacturing has its limits. The more parts you can fabricate that are similar to the end product, the more you can do distributed manufacturing.

If you have very complex assembly lines, there are still some economies of scale that you can’t distribute to the stream, but maybe you can, instead of having a central hub, have two or three hubs, but not to the last mile.

So, the decision of whether it is the last mile or it’s region-based, or it’s continuum-based, or it’s a central location, usually in Asia, depends on the economies of scale, what is the complexity, the tooling needed for a quality assembly, and what is the end ratio between the value and the response time. And this is very different across industries.

EPSNews:  Back to your own supply chain, you mentioned before the problem of manufacturing specific products because of the lack of materials and semiconductors. There are many challenges, and it’s going to take some time to go back to regular forecasts and delivery times. How are you handling this situation for your new products?

Ramon Pastor:  It’s a great question. First, because many shortages are in raw materials and certain long lead times, we’re actually changing new product development processes. We are starting not where we traditionally begin, which is basically doing first the brick board to demonstrate the viability of or feasibility of the technology, then a first prototype, then iterating.

Now, from the beginning, we are starting to think: what are the long lead time parts? What are the long lead time subsystems?

Usually, we start designing the most critical one, the harder to do. Now, we’re also starting with the long lead time part. Also, a bit of how we think about the ramp-up. We are doing more and more rich production strategies.

In many cases, especially when we go to high volumes, we do a lot of investment, millions of dollars, on hard tooling. Now, we can start earlier with the bridge production, either with soft tooling or 3D printing, knowing that maybe this doesn’t make economic sense in the future but allows us to save time and reduce time to market.

In Part 2, Pastor discusses metal 3D printing and customization.