Pushing forward: helping manufacturers embrace change

Manufacturing & Innovation in Western Sydney

A business event organised by Western Sydney Business Connection in Sydney brought together more than 200 manufacturers, technology experts, local government officials and finance and banking specialists. Tara Hamid reports.

From 3D printers that can print bones, muscles and cartilage using the patients’ stem cells to printable solar cells and bioprinting with seaweed, breakthrough technologies are opening new doors for industrial development in all sectors, as it was demonstrated at a recent event organised by Western Sydney Business Connection (WSBC) in Sydney.

With the fast-growing developments in areas of artificial intelligence, the internet of things (IoT), and robotics, more and more businesses are finding it essential, even vital, to come out and take advice from technology experts to find out how they can keep up with the changes and to benefit from their opportunities.

It was in this spirit of collaboration that local manufacturers, scientists and technology experts, local government officials and finance and banking specialists came together at WSBC’s business leader luncheon, titled “Manufacturing and Innovation in Western Sydney” on May 3. The program was designed to help attendees – some 200 to 250 participants – examine how manufacturing in Australia and Western Sydney competes and how effective the current strategies are in ensuring that manufacturers in western Sydney remains competitive. The ideas discussed provide lessons for manufacturers across the country.

St.George Bank was one of the event sponsors, with the University of Wollongong’s industry matchmaker, Advantage SME, and William Buck chartered accountants and advisors as the other partners.

Matthew Kelly, head of Manufacturing and Wholesale for St.George’s NSW division, told Manufacturers’ Monthly how St.George has adopted a unique industry model that helps manufacturers take the most benefits from new innovations in their respective industries.

“It’s not just about banking, it’s about bringing value-added solutions to manufacturers. These solutions are in the areas of energy efficiency, energy assessments, research and development (R&D) reviews, and discussions around government grants and other opportunities that are available.

“St.George Banking Group is collaborating with its partners to help bring new innovations to the manufacturing sector across Australia through its family of brands, including St.George in NSW, ACT and Queensland, Bank of Melbourne in Victoria and Bank of South Australia in South Australia,” Kelly said.

While the details of these programs aren’t announced yet, Kelly says manufacturers have already welcomed the support offered by the bank. “We are the only bank in Australia that’s focused on the manufacturing industry and we plan to remain in this sector for the long term to see manufacturing businesses in Australia grow and prosper.”

Helping manufacturers take advantage of technological advancements to come up with innovative sales models and to add value in their respective sectors was a major theme in the programme.

“While it is widely suggested that manufacturing is dying, many would argue that manufacturing is in fact not dying, but that all industries around the world are undergoing a period of change, and that they are evolving. That’s where innovation comes in. As disruptive technologies and economic realities give rise to emergence of new markets, [remaining competitive] requires innovation,” WSBC president, Brenden Noney, said in his opening speech.

David Chuter, CEO and managing director of the Innovative Manufacturing Cooperative Research Centre (IMCRC) spoke to participants on how local manufacturing companies need to think differently, adapt and invest in order to maintain a competitive edge.

He emphasised the importance of investing in R&D by manufactures to help bridge the gap between fragmented sectors.

“Only 4 per cent of companies in Australia are currently engaging with universities for R&D. This means that 96 per cent of manufacturers have a golden opportunity to change the way they think or how they collaborate,” he said.

He also urged manufacturers to diversify their services sector – a process he referred to as servitisation.“Servitisation is a buzz word in manufacturing today. It simply states that when you provide a service that is fundamentally enabled by what you make, that service is also what you sell to your customers.

“Less than 30 per cent of manufacturers are actually in the business of selling services. These services could be design, engineering, logistics or after-sales. It could also be in the IoT, which allows you to connect the devices to be able to collect and share data.”

“If you are a manufacturer or retailer and you have a product that’s a one-off, you compete either on your price, quality or features. But what the IoT allows you to do now, is to look at how you can create smart equipment, understand how the customer is using the product in the field, and deliver solutions that help make the customer financially more successful,” he said.

Citing examples of selling models designed by Rolls-Royce, Microsoft, Apple and Michelling tyres, he demonstrated how international companies are coming up with selling models that enable them to sell services rather than simply selling products, thereby maintaining an ongoing relationship with their clients.

“This is the concept of servitisation: Service for sale, enabled by manufacturing products. This is where the future of opportunity is for Australian manufacturing,” he said.

Bringing focus to the fourth industrial revolution, known as Industry 4.0, he invited manufacturers to invest their resources on innovation, collaboration, global focus, sustainable relevance and leadership capabilities to be able to benefit from transformations in their respective industries.

To help manufacturers in going through this transition, the IMCRC has come up with a pioneering program, the FUTUREMAP, which was put into motion at interactive workshops during this year’s National Manufacturing Week (May 9-11).

A business diagnostic tool specifically developed for Australian small to medium (SME) manufacturers, FUTUREMAP enables participating manufacturers, through either one-on-one structured discussions or as part of interactive group workshops, to map the current state of their business and identify where they can lift their awareness, competitiveness and build resilience against 13 key areas of industrial and advanced manufacturing competitiveness.

As an example of manufacturing companies benefiting from innovation and collaboration, managing director of NowChem, John Lamont talked about how his traditional chemical manufacturing company sustained a period of change and transformation.

Established in 1977 in Sydney, NowChem (Nowra Chemical Manufacturers) found itself at the risk of closure in the 1990s, when many chemical manufacturers in the region were shutting down at the face of global competition.

NowChem’s survival strategy was a mix of moving to higher-value productions and mechanisation. The company expanded into pharmaceutical manufacturing since 2003 and through collaboration with Advantage SME they managed to mechanise their processes and educate their staff.

“Fifteen years later, we still have our traditional chemical manufacturing sector, but we have also added pharmaceutical and the high-value products. We have added a child-care product line that has grown from a $50,000 business to a 700,000 business in just 5 years, all of which is generated from exports to China and other countries,” Lamont said.