February 4, 2015
by David Burg
Guest post by Quentin Orr
Since the invention of the hammer, the anvil, and, more recently, the assembly line, manufacturing has relied on an array of specialized knowledge, equipment, and materials. Luckily, that varied and valuable information is often difficult to steal. But 3D printing has the potential to change that, and manufacturers need to prepare for the risks ahead.
In today’s complex manufacturing environment, trade secrets are stored in a diffuse manner. Some information is outlined in product-specification documents or CAD drawings, and some is included in equipment configurations. But much of this intellectual property is downright tribal knowledge that is stored in the heads of experienced engineers and managers.
To gain access to a company’s secret sauce, thieves must patiently collect trade secrets from a variety of sources as well as try to reverse engineer products through trial and error. But that hasn’t stopped product pirates. Too often, we’ve seen companies in emerging economies release products that are remarkably similar those that have already been developed. Lower-level manufacturing companies are most frequently the victims.
Enter the 3D printing boom
Advanced manufacturing remains viable in the United States and Europe due to the specialization and knowledge required. Advanced manufacturing often requires special equipment and either must be calibrated to the micron or the materials must be carefully mixed at a certain temperature or in a particular sequence. Until now, the role of 3D printing in manufacturing has been to make simple shapes for things like replacement parts. While we are beginning to see adoption of 3D printing for low-volume, specialized purposes, businesses have not yet embraced the technology on an industrial scale for higher-volume manufacturing.
Before you dismiss 3D printing’s potential, however, consider how few companies were using the Internet in 1994. A decade later, businesses had integrated the Internet into most of their operations. We believe that 3D printing has similar potential to transform business in the next 20 years. In fact, according to a PwC survey of US manufacturers, two of three companies are already adopting 3D printing in some way. In our survey, we estimated that the global 3D printer market will soar to $6 billion by 2017, from $2.2 billion in 2012. From the printing of jet engine parts to soccer cleats, the technology is being hailed by some as a revolution in how more and more products will be developed, produced, and even sold.
Why 3D printing is the perfect portal for cyberthieves
To realize the transformational benefits of 3D printing, you must encode the 3D printer with explicit instructions on how to design the product, including what materials to use, and when and how to use them. Today, intricate trade secret knowledge that took many years and millions of dollars to develop is typically scattered across the organization. As 3D printing is adopted, that information will be housed and concentrated in digital files that, like any other digital document, can be hacked.
Manufacturers considering adoption of 3D printing need to get a better handle on trade secret protection. Most lack an accurate inventory of trade secrets that are core to their competitive advantage. This is a problem for two reasons: First, the law affords trade secret protection to companies only if they treat them as such. It’s hard to demonstrate you’ve imposed heightened protections on your trade secrets if you don’t know where they are and how your employees are using them. Second, irrespective of legal concerns, recent experience has shown that nearly every company in every industry is vulnerable to a breach if targeted by advanced adversaries like nation-states.
Manufacturers need to take a focused approach to protecting trade secrets. They need to know which information assets provide the most competitive advantage to their business today (and tomorrow), and then thoughtfully impose both advanced protections and careful monitoring throughout the value chain.
Like it or not, 3D printing provides the perfect portal for cyberthieves and exposes manufacturers to a level of risk that most are simply not prepared to deal with right now. The projected boom in 3D printing is a great reason for manufacturers to get serious about protecting their trade secrets today.