Government must support SMEs says RMIT’s Aleksandar Subic

The Future of Manufacturing in Australia Forum will be part
of Convention 2014 in Melbourne – touted as the “largest engineering event ever
held in the southern hemisphere”.

Facilitating the Forum will be RMIT University Dean of
Engineering Professor Aleksandar Subic, who believes integrating Australian
manufacturing into the global value chain will help stimulate growth.

He recently spoke to Manufacturers’ Monthly about the challenges facing the local manufacturing sector and
outlines possible solutions.

What are the skills and technologies needed to transform
manufacturing in Australia?

That is a broad issue because the manufacturing industry
sector is very broad. It means different things to different people. We need skills
in industrial automation and robotics – skills in advanced materials, skills in
new advanced
methods such as 3D printing and additive
and many other digital technologies.

These are basically driven by design and innovation,
targeting the creation of high value-add products that are really in demand or where
there is customer interest in the international marketplace. 

This means skills,
technologies and capabilities that would position Australia more strategically
to benefit from integration with a global value chain.

In what industry sectors do you see this happening in

If we look at aerospace
manufacturing in Australia
, a very good example is Boeing
in Victoria. Why does it have 1500 people working in manufacturing?

Boeing has made significant investment and effort to develop
unique intellectual property (IP) in composites and the design of composite
structures and integrating these within the global value chain.

The components produced in Melbourne go on every Dreamliner
or every 777 Boeing or every Boeing that leaves Seattle. The design of those
composite structures is coupled with unique manufacturing processes that also
contain unique locally-developed IP.

So the design and manufacturing IP are interwoven. That
shows how manufacturing can be successful for example in Australia. Aerospace
manufacturing is one such example.

Then we have medical manufacturing which is also a high
value-add industry where – you know, unique medical devices and implantable
medical devices that are manufactured using advanced technologies, advanced
materials and advanced design paradigms, coupled with medical

We have one of the largest hospitals and medical research
precincts in the world. It also shows how this industry is growing and has the
capacity to grow. It is based on those same paradigms.

Another one is for example defence industry where
organisations tap into global cooperative projects sometimes involving the
Department of Defence.

Within those cooperative large-scale programs are local
suppliers that get opportunities and grow like Marand
in Melbourne. There are others who have been able to successfully win such
contracts or be part of such international defence cooperative projects.

We have to develop unique skills that are grounded in
quality, grounded in advanced precision accuracy in high level capabilities but
delivered at an acceptable cost that is perhaps lower than that offered by
other high cost economies such as the US and Scandinavia.

Australia has a very innovative and creative environment because
of our education system and our lifestyle. That could be furniture design or
jewellery, for example.

Do you know Austria’s biggest exporter is Swarovski?

When we think about advanced manufacturing more broadly –
design driven, innovation driven, advanced material driven, advanced process
driven, high value add oriented – you start creating opportunities and finding
opportunities because you’re no longer distracted or confused by the noise out
there in the manufacturing domain.

Some of these things can be successfully grasped by SMEs as
well. We know that in Australia a very large portion of our manufacturing
sector are SMEs. They perhaps lack the hardware and the capabilities required
to transform and that’s certainly where the government must play a much more
proactive and supportive role. It must.

But there is also an opportunity because SMEs
can be nimble and more flexible
. But it’s really about doing the right

What are the key materials of the future that will help
transform manufacturing in Australia?

It’s not really about a wish list – we need to look at our
strengths and where there’s some track record and capability development.

There are some obvious ones – for example, carbon
composites and composites
in general. Australia – and in particular Victoria with a number of
universities, CSIRO and DSTO – is one of the areas of excellence in the world
in carbon fibre composites.

This is a technology that goes in aerospace, in automotive,
in sports – you know, in a whole lot of industries. In the future, possibly
more in the furniture and construction industry as well.

So carbon fibre composites is an area of real excellence
here, both from the design, structural and material science point of view – but
also from the manufacturing point of view.

Australia also has a very strong capability in titanium
. Titanium powder is required for additive manufacturing and 3d

That’s a material used in biomedical appliances as well as in defence
as well as in aerospace, in other applications in the future – a lightweight,
high performance, functionally advanced material.

There’s another one – light metallic alloys for

Lightweighting is a very important paradigm that is now in
demand around the world in automotive, in aerospace, in construction.

Another area is high performance textiles, especially with wearable
sensors and wearable technology
– smart technology textiles.

Now, we have turned our back on the textile industry. But we
need a more strategic focus on high
performance textiles
because it’s about high performance materials and high
performance technologies that are integrated and wearable with new textiles and
materials that are used in sports, in lifestyle – high value add products

To make a lot of this happen, what changes are required in
terms of government policy?

We must have a strategy. The strategy for the manufacturing
industry in Australia is still evolving.

With the new industry growth centres and innovation strategy
that’s just been released, there is a recognition that a strategy is needed.
There are some initial moves in that direction.

Also, I think that we need to realise in this country that
some strategic areas in the manufacturing industry or industry per se in this
country, need
to be subsidised
. This is contrary
to the current
government opinion.

Industries are subsidised by government in many other
advanced economies in areas that are of national significance. These are areas
that create wealth, that create significant employment opportunities and that
provide opportunities to grow industry sectors in particular areas of focus
that allow us to integrate into the global value chain.

So I think that strategy, policy as well as subsidies and
investment are required. It’s very difficult if you just leave all these SMEs –
thousands of SMEs in industry sectors – just to work it out on their own.

Strategy must be coupled with investment and with support.
If you look around in advanced economies around the world, including Germany, the
US, Sweden, Switzerland, France and many others – you will see governments that
have a strategy around manufacturing and around technology. In fact they provide
strategic investment and strategic subsidies in areas of their choice – areas that
they deem are of national significance.

That’s required. That’s absolutely required, especially in
Australia where you will find many, many of our companies – SMEs, in fact
hundreds of them – do not have the hardware and do not have the technologies or
the capabilities that are required in the global marketplace to compete successfully.

Is our education system geared up to provide adequately
skilled graduates who can deliver what’s needed by industry?

Absolutely. The tertiary
– despite the reducing federal funding – is highly competitive in
the international marketplace. Our universities are in the top 100 in the world
when you have tens of thousands of universities competition for ranking.

I send 200 students to Germany and Western Europe for paid internships
every year. Our tertiary system and our graduates are of world leading calibre.

But unfortunately the rest of our industrial and
manufacturing community is not aligned with this for many reasons.

Increasingly, our graduates will seek opportunities
internationally – which is our loss. It’s our loss if we do not provide
opportunities in our industry and our community for those young talents. Because
they’ll go to Boeing, Airbus, BMW, Bosch and other such companies around the

And they are.

[More information on Convention 2014.]

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