Moldmakers' Catch 22

Moldmakers are increasingly finding themselves trapped in a technology circle. More and more often, customers are sending information in an electronic format, assuming - hopefully correctly - that the receiving end has the capability to handle this information. In addition to that, the customer also expects to receive the final product in a shorter leadtime than dreamed possible several years ago. The general assumption is that since the technology exists, moldmakers should have it. And if one company isn't prepared, the customers will move on to the next one.

As a result of this attitude, price and delivery have replaced quality as the basis of competition among moldmakers. According to a new report, The Worldwide Moldmaking Environment and How to Compete, written by Alan Chirstman and Jeann, Naysmith of CIMdata, Inc. (Ann Arbor, MI) - a consulting firm that helps companies develop innovative and profitable products in the evolving global e-business environment - price and delivery combined represented around 58 percent of the responses worldwide, and approximately 60 percent in North America, with the two categories split evenly at 30 percent (see Figure 1). Quality came in third, garnering only 17.1 percent of the responses in North America. In comparison, Japanese moldmakers rate price as significantly more important than delivery. Additionally, the study notes that 22 percent of Japanese moldmakers chose quality as their basis of competition, while others mentioned that they compete on the basis of the size of a production mold that can be produced and integrated with technology to organize the products.

Basis of Competition	N. American Firms, %	European Firms, %	Worldwide Firms, %
Price	30.0	27.6	29.6
Delivery	30.0	27.6	28.7
Quality	17.1	24.1	19.4
Service	7.1	6.9	7.4
Capacity	4.3	0.0	3.7
Costs	4.3	3.4	3.7
Experience/Expertise	4.3	3.4	3.7
Innovation	2.9	0.0	1.9
Technology	0.0	6.9	1.9
Total	100.0%	100.0%	100.0%
Figure 1: Basis of competition among moldmakers.

What also stands out is that moldmakers have placed technology at the bottom of the list as to how they compete. So while they believe that they don't compete on a technology basis alone, the importance of technology as part of their business has emerged in the faster delivery times on which they rely.

The report also shows that moldmakers believe that their job is becoming more challenging. In fact, 76.4 percent of North American respondents believe that molds are becoming more difficult to build. Worldwide the tally is 65.5 percent, with 52.9 percent of the European and half of the Japanese moldmakers surveyed agreeing. According to CIMdata, there are three main reasons for this attitude:

• Parts are more complex because product and mold design resources continue to become more capable in modeling and simulating the most complex components and mechanisms.
• Molders are requiring moldmakers to build a single mold to produce a part that formerly required several parts from separate molds.
• Molders continuously attempt to reduce or eliminate post-molding processes by incorporating more detail in the mold itself.

What it comes down to is the faster that moldmakers can create a product, the faster the molders want them.

A Quick Inventory

A good way to gauge technology's progress is to see what moldmakers currently have on their shop floor - and what they plan on adding in the future. According to the CIMdata report, the average North American shop surveyed has 32 machines, while the average European shop has 23 machines. Japanese shops - the largest shops - have an average of 50 machines installed.

It is interesting to note that nearly half of the respondents (47.1 percent) own CNC machines, followed by three-axis milling machines at 35.7 percent (see Figure 2). At the other end of the list, only 2.9 percent of the respondents worldwide have purchased five-axis positioning machines, and 0.6 percent have purchased a five-axis simultaneous machine, with the majority being located in North American shops. No five-axis machines were installed in the Japanese shops surveyed. Looking to the future, 50 percent of the respondents worldwide are planning on increasing their budgets for machine tool purchases; one-third expects spending to stay the same and the rest are anticipating a decrease.

Type of Machine Tool Installed	Average in North American Firms		Average in European Firms		Worldwide Average
	Number	% of Total	Number	% of Total	Number	% of Total
CNC Tool	16.3	53.8	11.8	43.5	14.6	47.1
3-axis Milling Machine	12.1	39.8	8.6	31.7	11.0	35.7
Plunge EDM Machines	3.8	12.7	3.6	13.3	3.5	11.6
High-speed Milling Machines	3.4	11.2	1.1	4.4	2.6	8.6
Turning Machines	1.9	6.2	1.9	7.0	1.8	6.0
5-axis Positioning Machines	1.2	4.0	0.5	2.2	0.9	2.9
Wire EDM Machines	0.6	1.8	1.8	6.6	1.7	5.5
5-axis Simultaneous Machines	0.3	1.0	0.0	0.0	0.2	0.6
Other Machines	8.7	28.6	6.1	22.4	88.6	27.6
Total Machine Tools	32.1	100.0%	23.2	100.0%	32.0	100.0%
Figure 2: Number and types of machine tools installed in moldmaking shops.

The question, then, is what are the moldmakers planning to purchase with their expanding budget? CNC machining centers and three-axis mills top the list, according to 36.9 percent of worldwide respondents, while 17.7 percent plan to purchase CNC high-speed three-axis mills. However, the majority of those responses came from North America - almost 20 percent of North American respondents anticipate purchasing the high-speed machines, as compared to 8.3 percent of European firms (see Figure 3). The North Americans also are lead-ing the purchasing on five-axis machines, as 16 percent predict buying them, compared to 8.3 percent of Europeans. It appears that in order to remain competitive, moldmakers worldwide are beginning to stock an arsenal of more cutting-edge equipment.

Type of Machine Tool to be Purchased	Tools in N. American Firms, % of Total Tools	Tools in European Firms, % of Total Tools	Tools in Worldwide Firms, % of Total Tools
CNC Machining Centers and 3-axis Mills	38.6	29.2	36.9
CNC High-speed 3-axis Mills	19.8	8.3	17.7
EDM Machines	15.1	20.8	16.2
5-axis Machines	16.0	8.3	14.6
All Other Machines	10.5	33.3	14.6
Total	100.0%	100.0%	100.0%
Figure 3: Machine tool purchase plans by type of tool.

The Need for Speed

To keep up with the increasing demand for shorter leadtimes, moldmakers are turning to technology for help. And the technology that they seem to be relying on more and more often is high-speed machining for several reasons, such as a reduction in machining time as well as less time needed for such things as hand polishing.

Worldwide, 70 percent of respondents claim to be taking advantage of high-speed machining. The results are basically even between North America and Europe. Approximately five percent of the Japanese machine tools are considered to be high-speed. In addition, just about all respondents believe that high-speed machining is a necessity to remain competitive in today's - and tomorrow's - marketplace.

Almost 42 percent of North American respondents believe that high-speed machining usage will increase dramatically throughout the next few years, while 58.3 percent only believe that it will increase moderately. But no respondents claimed that it would not increase at all. All Japanese moldmakers surveyed responded that usage of high-speed machines will increase moderately or dramatically, with the majority believing that the increase will be moderate.

Why the increase? Because all of the respondents believe that high-speed machining will help moldmakers cut production time - be it by five or 50 percent. Of course, those numbers cover both ends of the spectrum. The majority of respondents (41.7 percent) anticipate that high-speed machining will reduce overall production time between 16 and 25 percent - which can translate into a significant amount of cost savings.

Remaining Competitive

How do moldmakers plan to remain competitive? According to CIMdata's respondents, decreasing delivery time appears to be the primary technique. Approximately 34.2 percent of respondents worldwide list faster delivery as the main goal, followed by increased service to more markets at 21.1 percent and quality in third place with 21.1 percent as well. Worldwide, only 13.2 percent planned to use price to remain competitive, and only 10.5 percent planned to use cost control.

When asked how they will implement their plans to improve delivery, the majority responded that enhancing technology is the way to go. Worldwide, 53.2 percent of respondents answered in this way, with North American shops ranking at 50 percent and Europeans at 65 percent. In addition, approximately 40 percent of Japanese respondents agreed. A distant second was improving or changing processes (26 percent worldwide), followed by improving training (15.6 percent) and increasing motivation (5.2 percent).

However, more than 30 percent of Japanese respondents considered motivation to be the method needed to remain competitive. The Japanese respondents also noted that establishing seamless processes between tasks and greater information sharing of goals and roles to be of some importance.

According to CIMdata, "Technology's contribution to moldmaking has evolved from a tool necessary to achieve quality objectives, to a tool that improves profit, price, margin and delivery." Technology's role in moldmaking has increased in importance exponentially as the demand for shorter leadtimes and more complicated parts from customers has increased. However, it is important to remember that this isn't a bad thing. While the demands on moldmakers may be increasing, those that can step up to the plate and take on the new challenges will be successful in the long run.