FlexFactory: Digital Production-as-a-Service from a Single Source
By: Porsche Ag
Tags: Industry, Production, Manufacturing, Digital Transformation, Innovation

How does the future of manufacturing look like? With an increasing demand for individualization and customization, manufacturing companies need to become more digital and flexible as well as to transform financially in order to stay competitive. Porsche, MHP, and Munich Re founded a joint venture that enables customers to do so: the FlexFactory. Here, Managing Directors Dr. Phillipp Hypko and Philip Plattmeier introduce the concept of digital production-as-a-service from a single source.

The newly founded FlexFactory offers digital production-as-a-service from a single source.

As the demand for individualized products and greater customization continues to increase, so does the need for flexible production and state-of-the-art digital technologies. But how can manufacturers better tailor their products and services to the requests of individual customers while managing increasing manufacturing complexity and rising costs? Companies with variant-rich, complex products often face specific challenges that prevent them from scaling up their business: Flexibilization of production processes requires significant investment in technological innovation, in many cases making it initially more difficult to achieve financial aspirations or even acquiring the required funds in a first step. In addition, the brave decision to transform business models to keep up with customer demands causes significant uncertainties in outcomes.

To stay competitive and drive resilience and innovation, companies must look beyond traditional manufacturing and explore new strategies and technologies. Porsche, MHP, and Munich Re have founded a joint venture that focuses on exactly this challenge — helping clients to safely and confidently take the step into the future: FlexFactory GmbH.

Our mission at FlexFactory is to enable clients from the manufacturing industry to overcome these hurdles and make small-batch or at least variant-driven production of all kinds of different products more flexible and cost-efficient. We empower them to enhance product innovation and deliver individualized and variant-rich products at greater speed, smaller lot sizes, as well as higher efficiency and support optimizing investment in fixed assets. To do so, we offer fully digital and flexible production concepts including readily implementable strategies to minimize production risks and to optimize financing — what we define as our mission: digital production-as-a-service from a single source.

Go digital, act flexible, transform financially

Digital production-as-a-service encompasses three dimensions: the digital value chain, flexible production concepts, and financial transformation. The first dimension, the digital value chain, is currently driven by the digital transformation of almost all manufacturers and will significantly change how manufacturing is done in near future. The second dimension, flexible production, has been making inroads into manufacturing for several decades now, driving significant productivity and efficiency improvements. The third dimension, financial transformation, makes our offering complete and unique: manufacturing and financial flexibility in one go — this is a key success factor, also when compared to first performance-based contracting offerings from previous years.

“The FlexFactory shows the way to a more flexible and digital production environment. We now have the opportunity to realistically scale the business model innovation ‘digital production-as-a-service’ more broadly to lift performance-based contracting in manufacturing industries to the next level.” — Phillipp Hypko

Indeed, what defines FlexFactory and makes its approach so distinctive is the combination of these three dimensions.

Digital value chain: We empower our clients to implement scalable product strategies through individualization and derivative efficiency: digitizing the value chain from design to production, streamlining of product creation process, as well as individualizing products and parts. Flexible production concepts: We enable clients to design, build, operate, and maintain production technologies at any scale: designing flexible, multi-variant production concepts, execution services for building production projects, as well as access to operating and maintaining services. Financial transformation: We facilitate the transformation of business models by bridging uncertainties in business outcomes and expected returns, through guaranteeing performance and bespoke financing solutions: de-risking to facilitate access to external capital, optimizing capacity usage to enable stable cashflows, as well as reducing risk.

By bundling the expertise of Porsche (flexibilization and manufacturing know-how), MHP (digital process optimization), and Munich Re (financial transformation and performance guarantee solutions), FlexFactory bridges the gap between individualization on the one hand and automation on the other, while backing up our promise with a corresponding performance guarantee cover. We see ourselves as a consultancy and business enabler that provides tailored solutions for various manufacturing industries, offering advice and guidance around how to set up a more flexible, economically calculable production landscape in cost-efficient structures.

FlexFactory aims to enable clients from the manufacturing industry to make small-batch or at least variant-driven production more flexible and cost-efficient.

“We are complementing the implementation of production processes’ digitalization by offering far-reaching performance guarantees. This enables customers to better address production risks and thus to implement innovations faster and more efficiently than in traditional production processes and with less capital investment needed.” — Philip Plattmeier

A new chapter in industrial production

Transformation isn’t easy, but change is inevitable. Traditional manufacturing will no longer suffice in many cases. Porsche, MHP, and Munich Re are responding to the demand for greater individualization by founding a joint venture that offers digital production-as-a-service. FlexFactory, with its offering, is a new opportunity for businesses to tailor their products and services to the specific needs of their customers in a cost-efficient and risk-optimized way. Last but not least, FlexFactory does not exclusively focus on clients in the automotive industry — it addresses clients across the whole spectrum of the manufacturing industry. Beyond that, in the medium term, the integration of further technology partners on the FlexFactory platform is conceivable and desirable to develop a production ecosystem, especially for digital production-as-a-service.

If you’re interested in more detail or maybe joining our mission or even team, explore our website and contact us: www.flexfactory.tech/