What is DTC?

Leah Archibald: If you’re designing in manufacturing today, then you’re designing for something. The most pressing problems facing manufacturers—from shrinking margins to material shortages, to sustainability worries—can either be solved or exacerbated by the designs coming out of CAD programs every day.

How can you harness the problem-solving powers of your design team? My guest says it starts by giving them insight into the cost implications of their designs.

Patrick O’Brien is an expert in this discipline, otherwise known as Design to Cost or DTC. Patrick O’Brien has worked at all levels of the design process, from pumping out parts for custom one-off machines, to designing complete assembly lines for mass manufacturing, to evaluating products from the QA and VAVE perspectives. Today, he’s here to explain the ins and outs of Design to Cost and what DTC can do for you. Patrick O’Brien, welcome to the podcast.

Patrick O’Brien: Thanks for having me.

Leah Archibald: Let’s start at the beginning. Could you describe the average challenges facing designers in their everyday work, and how can DTC help them solve pressing problems?

Patrick O’Brien: For sure. Speaking from experience, as a Design Engineer there is a set of criteria that’s laid on your plate. I starts with fit, form, and function. Something that you didn’t hear in there is cost. Whether I’m working to develop products, parts, or machines, I’m focused on making it do its purpose. Once I have something that meets that criteria, I throw it over the wall. I designed a good part and that’s all that matters to me. Now the cost is up to someone else.

Leah Archibald: But what if you throw it over the wall to Sourcing, and their suppliers say: Actually, we can’t make it. Then they’re going to throw it back to you in Design, and you have to start over.

Patrick O’Brien: Yeah. Having that wall between Sourcing and Engineering, you could be designing a component that the CAD software says is perfect, but the supplier could say: I can’t make this thing. There’s no draft. Or You’ve got sharp corners everywhere. Or You got thin walls that I can’t actually cast. So, all of those little bits and pieces, those now bounce back from Manufacturing. And what’s even worse is if there’s this siloed activity, it doesn’t bounce back to the Design Engineer, at least not immediately. It bounces back to the Sourcing professional. Now Sourcing has to go back to Engineering and say: Hey, by the way, Manufacturing said we can’t do this, so I need you to change that design.

Leah Archibald: This has implications on the time to market of your product.

Patrick O’Brien: Right. Now, let’s say it’s a simple change. You’ve got to add a little radius somewhere, or you’ve got to thicken a wall ever so slightly. You make that change no problem and it’s 15 minutes in CAD and a little bit of paperwork. Send it back out, and they can hit the ground running. Let’s call that the best-case scenario.

Now, there’s another whole level to this that we’re not thinking about. Let’s say the supplier is a machine shop who works with billet machine components. They give the feedback to Sourcing that says: I need you to add a small radius to this corner, or I need you to give me clearance for a tool to get in here. The Design Engineer readjusts that part’s geometry to better suit itself for manufacturability. But manufacturability within what? It’s not within every process group in the world—it’s within that machining process. You’ve got a Design Engineer thinking machining, you’ve got a manufacturing expert providing them a little bit of feedback for machining. But there are all these other ways we could make that part. What if I die-cast it? What if I sand-cast it? What if I look at additive manufacturing? Heck, could I reduce something about this component? Could I change the geometry to promote it to lend itself to plastic? Or some fancy composite material? There are all these different ways that we could technically make that part that the Design Engineer may not even be thinking of.

Leah Archibald: This is where you’re going to tell me that Design to Cost comes in?

Patrick O’Brien: Absolutely. This is really where Design to Cost plays a significant role, and why it’s so important for a Design Engineer to have a tool to help them with this. Imagine that exact same scenario we just painted: Design Engineer makes a part, sends it out, etcetera, gets some feedback. Well, what if right up front when they have a part on their screen, they have a tool that lets them ask more than just: Is it manufacturable for machining? What if they have a tool where they could click a couple buttons and say: I want to see results for casting it, machining it, injection molding it, and 3D printing it.

Now they have a whole other data set to assess that part from an overall success criteria. They can see fit, form, function of the component, but now they can also see a directional cost as well. From a Design to Cost perspective, they can quickly see: Hey, if I’m going to machine this component, I’m going to buy it for 28 bucks a piece. But if I look at die-casting it—Holy smokes—I could make this for as little as $6. That’s a massive gap right there. Now, if I look at additive, the thing’s going to cost $100. And plastic, well, plastic is a stretch. It’ll only cost two bucks to make it, but it’s in a pretty high stress environment—

Leah Archibald: It’s not going to hold up.

Patrick O’Brien: Exactly. But let’s go back to that die-casting example. $28 versus $6, that is a significant gap there.

Leah Archibald: And when you multiply it by the scale at which you’re making your part—

Patrick O’Brien: That’s exactly it. The beauty of the numbers that I’m hypothetically throwing out here is that volume is a factor in the way we calculate cost within our tool. We’re not only going to say: This part’s going to cost $28 versus $6. That’s also going to be broken down by volume requirements. You will immediately see: What do I need for tooling? What does my cycle time look like? My cavity count and my tool can change based upon annual volume. So, with the tool, we’re going to be optimizing cost based upon a bunch of different inputs, one of which is annual volume.

Leah Archibald: Can you give an example from your personal experience where either you used the tool and it was helpful, or you really could have used it and you didn’t have it?

Patrick O’Brien: Yeah, absolutely. My experience comes from the design world, both on the one-off side, designing very highly custom machines, all the way to the mass manufacturing model where we were making hundreds of thousands or millions of parts in a year. One role I had was in the VAVE side of things. I would get a widget, or a part or an assembly and need to look at it from an engineering perspective to see how to make things cheaper.

This particular case was a sand-cast component. It was purchased overseas. We then brought it state side and had to paint it twice. It was a cast iron component that gets buried in a pit, so it’s in a really corrosive environment. Cast iron is not all that great for corrosive environments. So, we would prime it, we would paint it, and we would seal it. But then we also had to do some post-machining. It was very process heavy. The part itself wasn’t all that expensive from a material standpoint, but once you added all those additional steps, it really started to creep up on cost.

My thought was: What if we just looked at changing the process and material entirely? What if we could go to something like a die-cast aluminum? It’s a little bit more resilient, and then we could coat it in one step, right at the supplier, and remove all that secondary processing. Well, I presented the idea to my management, and the answer I quickly received was: Don’t bother with a die-cast component of that nature—the tooling charge is going to be ridiculous. It’s going to wipe out all of the cost savings that are available. Purely because we were going to have to spend $300,000 on a tool, my management said: don’t waste your time. And honestly, that conversation stopped then and there.

Now, fast forward to many years later, here I am working with aPriori’s costing tool. You can bet the first thing that I did was ask myself: Hey, what if I ran that scenario through aPriori? And I did exactly that. I took a very crude example of what that part looked like, and I just ran a sort of directional analysis. I said: Okay, so I’m sand-casting it here, then I’m shipping it over to the States, the I’m machining it and performing all of those secondary operations that I mentioned. Then I ran version B as a die-casting, anodized and painted right at the supplier.

Now, when I moved the part to a die-casting, the tool told me what was wrong with it. There were little bits and pieces that I needed to adjust to make this part appropriate for die-casting.

Leah Archibald: So, without those geometric changes you had to sand-cast it? But if you made those changes it would work in the operational environment? And how much money were you going to be able to save?

Patrick O’Brien: On that part alone, there was like a half a million dollar of savings, on one skew.

Leah Archibald: More than the $300,000 tooling cost.

Patrick O’Brien: And keep in mind, that’s an annual figure. So, you’re going to spend 300K on a tool? aPriori provides the amortization schedule. So you can see that: Hey, my ROI on that tool is going to be six months. And the beauty of that as a Design Engineer is you can run it so quickly. You can see that if you were to take aPriori’s feedback—add some draft here, or maybe change the way this feature fits with the next one—you could die-cast it and I save X amount of money. That process takes minutes. Hours tops, if you’re talking about some complex components.

Compare this to the historical approach of sending this to a die-caster and saying: Can you give me a quote? They’re either going to A) No Quote because it’s a terrible part for die-casting, or B) they’ll give you sort of a directional quote and say: Fix these four different things about this part, and then we can talk. Now, the problem is, even in the best-case scenario, you’re talking about four to six, maybe even eight weeks to receive that estimate.

Leah Archibald: So, what I’m hearing is that a Design Engineer really needs to work these two methodologies side by side, both Designed to Cost and Design for Manufacturability. Because you’re not going to be able to accurately calculate your cost if it’s not manufacturable. And unless you can figure out how to make it manufacturable, all those cost savings don’t open up to you.

Patrick O’Brien: It is a paradigm shift we’re seeing in industry today. Design Engineers are starting to own more of the cost. If we just look at the problem—the problem being getting products to market faster and at better margins—cost is derived at the design step, period. Sourcing’s job is to go get the optimal cost, but they’re basically stuck with whatever they’re handed. Now, if we all agree that the Design Engineer really does own this thing, what can we put in their hands to allow the organization to drive products to market faster at better margins?

The answer is to give the Design Engineers a tool that helps them ballpark their costs right up front. We’re not saying Design Engineers have to go source their own components now. We’re simply saying that you as a Design Engineer should have access to a tool to help you weed out manufacturability issues instantly and to help you ask the question: What if?

Leah Archibald: If we empower designers with all the data they need, they can not only head off costs in the design stage, they can help fulfill the mission of the manufacturer by getting the finished product into the consumer’s hands as efficiently and sustainably as possible.

Patrick O’Brien: That’s 100% the goal. It is everything you just said. We want to empower that Design Engineer to be able to make all of those things possible. Now, if you’re a Design Engineer listening to this, you might be starting to pull your hair out and saying: Don’t put another thing on my plate!

Leah Archibald: I have enough to do as it is!

Patrick O’Brien: I would say that’s the reason we have a platform to do this. We make it as simple as making three picks and clicks. The Design Engineer is developing these products anyway. They’re going to sit in some phase gate or a stage gate review. What if they could just iterate on that process as early in the design phase as possible? Really, it’s in everyone’s best interest from Executives all the way down.

Leah Archibald: If Design Engineers are part of the strategic solution, how can they help the whole organization answer How to make it and Where to make it?

Patrick O’Brien: Let’s take those one at a time. First: How to make it. Having a tool that performs a costing operation, starting from a full manufacturing assessment of the geometry of the part, tells us precisely how that part has to be made. We can tell you how to make it as a die-casting, how to make it as a stock machine component, or how to make it as a plastic part. The digital manufacturing simulation is going to give you the How.

Then there’s another input that allows an Engineer or a Sourcing professional—whoever is initiating that assessment—to ask: Where in the world do I want to make this part? We can look at 80 different regions around the world and run scenario A, B and C. I’m going to make this domestically, versus I’m going to make this with one of my Indian suppliers or one of my Chinese suppliers. Based upon the different options for how I can make it, I can look at those options in different regions. So now I have a matrix of cost. And here we’ve gotten to How and Where as early as a napkin sketch. That’s what we want to enabling Design Engineers to do.

Leah Archibald: Patrick O’Brien, it’s been a pleasure to talk to you today, thank you so much for joining me on the podcast.

Patrick O’Brien: Likewise. Thanks for having me. It’s been fun.