strategy+business Winter 2013 : Page 40

40 specific usage of digital tools later on). One company that has made effective use of CAD software to do 3D digital modeling is Electric Boat, a company with one product and one customer: It builds one nuclear submarine every year for the U.S. Navy, at a price tag of around $2 billion. Most of Electric Boat’s submarine engineering and design work is paid for di-rectly under its contract with the Department of De-fense—in early 2013, for instance, the company was awarded $1.8 billion to begin design work on the next generation of nuclear subs. The company’s own R&D work is performed by a small innovation group that in-vestigates new technologies for designing and building the finished product. For many years, the company built wooden mock-ups of submarines it was designing to make sure the ship could be built as proposed. But the Virginia-class submarines Electric Boat is building today were the first designed almost entirely digitally. “What you see now when you walk through our manufacturing space,” explains Mark Bennett, the company’s R&D program manager, “are 3D isometric pictures that come off of our digital [CAD] database. That’s what tradesmen work from. They’re not solely relying on notes on 2D paper drawings the way they used to. We use the data-base to laser mark on the steel where plates will attach, and provide detail on how big the welds need to be.” The digital files are also used in the company’s elec-tronic visualization rooms. “We can project 3D mod-els of the submarine,” Bennett says, “and that allows us to examine various spaces jointly with our customer.” Electric Boat is now investigating the use of those 3D models to generate holograms of the inside of a subma-rine to improve understanding of the submarine’s de-sign and layout. Rapid prototyping tools such as 3D printing are used by 34 percent of our survey respondents, and they are also ranked as the most effective productivity tools in the ideation phase (and in fact were ranked as more effective than any market and customer insight enabler at this stage). The R&D team at Philips Light-ing, for example, now uses 3D printing to make mock-ups of its lighting fixtures to share new concepts both internally and with customers. In the past, such mock-ups took a great deal of time to produce. Now, says Esmeijer, “we can make a mock-up that people can look at and physically touch. They can make sugges-tions and corrections, and we can make another one in an hour.” Finally, collaborative environments—tools such as messaging, video, file sharing, and Webinars—are used by 45 percent of our respondents, and indeed are criti-cal at many companies with far-flung teams. However, our survey results show that the efficacy of collabora-tion tools is moderate. Their relatively modest effec-tiveness may be attributable to the logistical challenges of connecting people in different time zones around the world. Key to success is sufficient investment in train-ing and design standards, without which the benefits of collaborative environments are illusory. For example, insufficient investment is one of the major barriers to successful engineering offshoring. But for those compa-nies that have mastered their use, these tools can be a powerful means of bringing people together at the de-velopment phase. Caterpillar’s Henricks believes that many of these collaboration tools have significantly improved pro-ductivity. Her company uses tools such as telepresence and Web-based communities to maintain interaction among R&D teams, as well as sales, marketing, and other functions around the world. “We truly can do R&D 24/7,” she says. “Now we can take data in our test labs here in North America or in Europe and send the file to India. Overnight, our engineers in India can analyze it [and] reach some conclusions, and the next morning, engineers in North America or Europe ana-lyze those results and plan next steps.” A Closer Look at Usage strategy+business issue 73 feature innovation Even as companies overall are making significant use of many digital tools, variations among companies in dif-ferent industries remain considerable. Overall, software and Internet companies spent the largest portion of their R&D budget on deploying and operating digital tools, at 15 percent, followed by aerospace and defense companies, at 12 percent. Interestingly, computing and electronics compa-nies invested the smallest percentages of their budget

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