Wednesday, December 05, 2012

Rules of manufacturing changing .. 3D Printing taking over ..

The old rules of manufacturing that calls upon decision makers and planners to seek economies of scale, reduce labour costs etc are being turned upside down .. 3D manufacturing (additive layered manufacturing) is to change the rules of the game.

McKinsey Global Institute has come up with the report on Manufacturing titled, Manufacturing the future, Nov 2012 (180+ pages, pdf) paints indeed a rosy picture for the rich countries, which is true.

Our ancestors survived on subsistence farming, the present generation has moved up the income ladder, to higher standards of living in just one or two generations. Innovations, increased productivity have all resulted from this upward mobility.

The total value add through manufacturing in 2010 was $10.5 trillion.

McKinsey divides manufacturing as it is happening in the world now into five categories

1. Global Innovation for local markets (34%), eg : chemicals, machinery, car making etc
2. Regional processing (28%), eg: fabricated metals, food, publishing etc.
3. energy and resource intensive commodities (22%) eg : wood, paper, petrol etc..
4. Innovative global technologies (9%) eg : chips, computers, medical products etc..
5. Labour Intensive tradeables (7%) eg : textiles, clothes, toys etc.

As countries get richer manufacturing tends to account for a smaller fraction of their GDP, inversion happening at around 20 - 35%. Services then take over ..

Read the interesting article , The new Maker rules, in The Economist Nov 30, 2012.


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