Moving Beyond ROI: Total Lifetime Value Is the New Metric That Matters in Additive Manufacturing

ABI Research introduces the Additive Manufacturing Total Lifetime Value Calculator

Oyster Bay, New York - 12 Jun 2019

For manufacturing and industrial companies, Return on Investment (ROI) has long been the metric used to set budgets and drive business decisions. However, in today’s Industry 4.0 environment, companies must look forward – not backward – when investing in technologies like Additive Manufacturing, and ROI can’t measure up to the task. To help, ABI Research, a global tech market advisory firm, announces the release of its Additive Manufacturing Total Lifetime Value Calculator (TLVC), which provides a more comprehensive, future-focused criteria for driving smarter investments. 

The Additive Manufacturing TLVC is an in-depth and detailed tool for comparing the potential costs and savings of implementing an Additive Manufacturing (AM) platform at various levels of scale or for potential projects. The AM TVLC empowers manufacturing leaders to research and compare the best AM platform investment strategies and understand the overall impact of investment throughout its lifetime, as well as any savings that will continue to recur after use/production ends.

Total lifetime value reflects the overall impact of a potential investment decision—the cost of acquiring a market position and its longer-term upside. Additive Manufacturing, much like generative design, AI, 5G, robotics, and IIoT platforms, is one such area where we need to think more in terms of lifetime value than ROI. Companies cannot make AM platform investment decisions in isolation,” says Ryan Martin, Principal Analyst of the Industrial Solution at ABI Research.

The TLVC has over 40 inputs that address all the considerations that must be taken into account when making an AM platform investment decision. The outputs provide the total implementation costs over the selected period, total material savings, total engineer time savings, supply chain and maintenance-related savings, payback period, production capacity, cost-per-part, and production comparison by metal AM technology process. The final output is the total lifetime value, which shows the sum of all the savings minus all the costs from implementing AM for various potential deployment strategies.

“Clearly, one of the biggest costs to consider is a cost that can’t truly be accounted for until it starts to unfold: opportunity cost. AM allows companies to develop new products and, with a systems approach, pioneer new markets. Most companies get started small—as they should—but quickly see the benefit and want to scale. The difference today is that technologies like binder jetting, when combined with generative design software and part nesting, make metal AM a true production-level candidate in the manufacturing arena. It doesn’t matter if you are an automaker, aerospace provider, MIM supplier, or otherwise—now is the time to evaluate the potential impact of these decisions, before they are made. This is why ABI Research developed its Additive Manufacturing Total Lifetime Value Calculator,” Martin concludes.

The Additive Manufacturing Total Lifetime Value Calculator is part of the company’s Industrial Solution, which will help manufacturers digitize operations to create better quality products at lower costs. Total Lifetime Calculator spreadsheets allow companies to specific information on the short-and long-term value they can expect for their situation, product, and strategies.

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