Competing to win with Industry 4.0

Image: Bosch

Image: Bosch

Spreading the adoption of Industry 4.0 technologies among Australian manufacturers is vital to lifting their international competitiveness, according to the Australian Manufacturing Growth Centre. Brent Balinski spoke to the group’s chair, Andrew Stevens, about a new partnership aimed at encouraging this adoption.

In Germany, the United States and elsewhere, policy-makers, business leaders and others are promoting the adoption of Industry 4.0 technologies as a way to increase industrial competitiveness.

Within Australia the same thing is being seen, through recent initiatives such as the Prime Minister’s Industry 4.0 Task Force, announced late last year.

Companies are at the early “exploring and absorbing” stages if they are considering the concept at all, with levels of interest best described as variable, according to Andrew Stevens, Chairman of the Advanced Manufacturing Growth Centre. The growth centre last week announced a partnership with Swinburne University aiming to speed things along.

“Given our whole reason for existence is about enhancing the competitiveness of the manufacturing sector, we see that industry 4.0 is a key element of maintaining and increasing that global competitiveness,” he told Manufacturers Monthly before the signing of an MoU with Swinburne, providing $250,000 in funding for collaborative Industry 4.0 projects.

“Adoption is one of the issues that the Task Force and indeed our approach is looking to progress, through greater awareness, initially, greater application, secondly, and greater benefits and competitiveness, at the third level.”

Projects supported at the TestLab at Swinburne’s Manufacturing Futures Research Institute would be geared towards getting SMEs to explore “Industry 4.0-type processes”, with an emphasis of high-value, custom products, integration with global value chains, and of a developmental and commercial – rather than experimental – nature. These would be undertaken with the university’s researchers.

According to the university, this will include the automated production of composites.

There are Australian companies using digital technologies related to I4.0, such as flexible robotics, 3D printing and other methods of enabling greater customisation. There are leaders in the local aerospace industry, serving primes and doing what it takes to integrate and respond to their supply chain needs. At the other end tend to serve a solely domestic market, said Stevens.

Aerospace procurement managers interviewed for the growth centre’s Sector Competitiveness Plan – delivered to the government this month – valued suppliers that could be flexible and adapt to changed delivery schedules.

swinburne

“People that we spoke to around the world rated [highly] that ability to be flexible, to adapt the delivery schedule, the design components all towards a common goal in the value chain without sacrificing productivity,” explained Stevens.

The group’s competitiveness research has made for some fascinating findings. One of these, reported by The Australian Financial Review this week, was that Australian aerospace manufacturers enjoyed a labour cost advantage of 38 – 40 per cent over those in the United States.

Their research also recently compared the emphasis on competitiveness by cost, performance differentiation and value, and market focus.

For all of the Australian manufacturers leading globally in a niche, such as Noja Power, not one favoured a cost-driven strategy.

The best of the best focussed on performance differentiation and value. Every single one of them.

This was an area where there was the most room, overall, to increase the competitiveness of the sector in Australia.

“Nearly half of the potential is in that area,” said Stevens.

“Those value differentiation strategies are about the technical leadership in their products, the performance of the thing itself, and the service that goes around it to understand how the product will be used to make sure it will deliver exactly as they say – plus a feedback loop back into R&D.”

This value-based strategy was relevant to the adoption of Industry 4.0, and what it could offer manufacturers serving and responding to a global customer.

Companies looking to move from awareness to trialling of such technologies were encouraged to consider projects at the TestLab, suggested Stevens.

“If you look at value differentiation, differentiating projects that will enable companies to deliver that value in an integrated value chain, then we are very interested to fund those projects to make sure that we can understand not only the benefits of Industry 4.0 thinking and processes, but also thinking who’s involved in moving from less than Industry 4.0 to Industry 4.0,” he said.

Image: Swinburne University