How General Electric Company Challenges Conventional Wisdom and Wins

Because GE doesn’t subscribe to conventional wisdom, it's now in a position to gain a considerable competitive advantage in the coming years.

Jun 28, 2014 at 12:00PM

"3-D printing will never replace traditional manufacturing."
--Conventional wisdom

General Electric (NYSE:GE) apparently never got the memo on 3-D printing's supposed shortcomings, because the company has been busy proving that 3-D printing is an extremely capable technology, well suited for mission-critical and highly complex manufacturing applications. By challenging the conventional wisdom that 3-D printing is primarily a prototyping process, GE has put itself many years ahead of its closest competitors in terms of 3-D printing manufacturing expertise. And because 3-D printing has the ability to create fundamentally better products, GE has the potential to gain a considerable competitive advantage in the coming years.

When two great stories come together
Nearly a decade ago, General Electric began looking for ways to bring products to market faster and turned to Morris Technologies, a leading 3-D-printing manufacturing company in terms of expertise, to better understand how 3-D printing could be used to iterate products more quickly and cost effectively. Around the same time, a group of GE Aviation engineers was designing a next-generation jet engine fuel nozzle and realized that 3-D metal printing isn't just great for iterating designs more quickly -- it's also capable of creating products that conventional manufacturing simply couldn't. The following video outlines 3-D printing at General Electric and the essential role it played in creating the world's first 3-D metal printed jet engine fuel nozzle that's expected to take to the skies in 2017.

Source: GE Aviation.

On a high level, 3-D printing is a layer-by-layer additive manufacturing process, meaning parts are literally built up one layer at a time. Because 3-D printing requires no tooling, it's more cost effective than traditional mold making and invites an entirely new design freedom and level of complexity than conventional manufacturing could ever offer. To illustrate the power of 3-D printing, General Electric consolidated a conventionally manufactured jet engine fuel nozzle from 18 parts into one 3-D printed part. Not only is the 3-D printed fuel nozzle more efficient to manufacture from a resource standpoint, but it's also five times more durable and 25% lighter than its predecessor. In other words, 3-D printing is delivering on its promise to make fundamentally better products than conventional manufacturing.

As these benefits became increasingly apparent, General Electric acquired Morris Technologies in 2012, and the company now has plans to 3-D metal print 45,000 leap fuel nozzles a year by 2020, marking the largest scale, mission-critical manufacturing run in the history of 3-D printing.

The view from 35,000 feet
Today, General Electric is pioneering the use of 3-D printing for real-world, mission-critical manufacturing applications. It has a substantial lead over the competitors, which haven't put nearly as many resources behind 3-D printing. This competitive gap will soon be realized in the coming years, when roughly a decade of work will show the world that 3-D printing is no longer just suited for prototyping, but also the next great leap in manufacturing advancements.

Twenty years from now, General Electric intends on having 50% of its products "touch" 3-D printing in some way -- whether it's the product itself, the prototype that becomes the product, or the tool that makes the product. No matter how you cut it, 3-D printing is poised to become an increasingly important technology in end-use manufacturing, and General Electric is the company currently enacting this fundamental change to the manufacturing industry and the world at large.

As we investors know, anchoring on past conventions is dangerous, largely because investing is a forward-looking mechanism, and the world has never experienced any great achievement without challenging conventional wisdom -- and winning.

Warren Buffett: This new technology is a "real threat"
Warren Buffett just called this emerging technology a "real threat" to his biggest cash cow. While Buffett shakes in his billionaire boots, only a few investors are embracing this new market, which experts say will be worth over $2 trillion. It won't be long before everyone on Wall Street wises up, and that's why The Motley Fool is releasing this timely investor alert. Click here to learn more about what's keeping Buffett up at night and the one public company we're calling the brains behind the technology.

Steve Heller has no position in any stocks mentioned. The Motley Fool owns shares of General Electric. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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