Design for manufacturing is changing how companies approach
medical device manufacturing. This is the second of a three-part series about
design for manufacturing and its effect on different teams in the product
development process. Click here to read part
one.
Design for manufacturing (DFM) is a team approach to
efficient, effective manufacturing. In the medical device industry, this is an
important method for controlling costs while ensuring functionality.
A device’s development starts with the
technical team, then moves to the commercial team once the CAD model and
drawings are completed.
By examining the costs to make the product, the commercial
team can identify ways to reduce expenses to improve a product’s development
and future sales.
The role of should-cost
modeling in DFM
The commercial team is responsible for should-cost modeling,
also called cost modeling. Strategic and technical sourcing, commodity
specialists, purchasing, buyers and planners may all be involved in this process.
The initial should-cost model is based on the drawings from
the technical team. The model outlines how much a product should cost based on
materials, machine time, machining capabilities, overhead, profit margins and a
number of other categories.
Once the initial model is developed, the commercial team
will begin to adjust numbers and inputs to determine how different features
impact the overall cost of a product.
This process involves a series of what-if questions to
determine potential cost savings. If a company has its own manufacturing
capabilities, it may explore the cost difference to make a product in house
compared to using a contract manufacturer.
Balancing excitement
features and Voice of the Customer (VOC) with the bottom line
One of the biggest challenges for the commercial team is
striking a balance among cost, excitement features and VOC research. The latter
two are often high priorities for the marketing team, but may create manufacturability
issues or increase production cost.
For instance, it only takes one excitement feature to make a
commodity component into a specialty component – and have a corresponding
increase in price.
In one customer example, a plate drawing included a complex cutout
in the center for aesthetic purposes. The should-cost modeling exercise examined
the cost difference of including or omitting the shape. The analysis revealed a
price jump when the shape was included because the number of radii increased,
which would require both additional machining and inspection time.
Thanks to should-cost modeling, the commercial team was able
to identify potential savings on the cost of this product’s development. It flagged
the cutout for further discussion with the technical and marketing teams, to
determine if the feature was worth the added cost in terms of customer need.
Contract manufacturers
can help identify cost savings
With the increasing interest in DFM, contract manufacturers
are partnering with clients on their should-cost models. The manufacturer’s
first-hand experience with machining technology, inspection data and associated
costs is often a benefit to the commercial team’s process.
If you’re working with a contract manufacturer to machine
your medical device, ask if they can help identify opportunities to save on
production costs.
Lowell’s experienced engineers and machinists can offer
insights into how different features may impact the cost of the product. To
discuss your project and how we can help, contact us at (763) 425-3355 or requestinfo@lowellinc.com.
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