Month: February 2017

There is a role for the manufacturing sector in Australia. Through interviews with 56 stakeholders, three workshops and a survey of industry and government organisations, as well as leading researchers, CSIRO identified major growth opportunities and what the manufacturing sector needs to do to achieve them. Currently Australian manufacturing contributes 6.05% of GDP, exports $96.1bn of goods and employs 856,000 people. This has fallen from a high in 1995, when it contributed to 14% of GDP and employed more than a million people. High wages, geographical remoteness and a small dispersed local market are some of the reasons for these changes. However consumers are also changing what products they buy which then impacts the type of products made. Major companies like Boeing and General Electric now look to the world using global supply chains for components for their final product, so Australia has to compete globally. The innovation resulting…

Since the late 1700s, industry and the activities integral to industry have undergone significant changes, driven broadly by the desire to increase efficiency and output value, while reducing capital invested and effort required per output. This desire has seen numerous transitions towards more innovative processes and technologies, taking place over many years. For expediency, we group these transitions into stages, or revolutions. The first industrial revolution (Industry 1.0) saw the introduction of mechanisation, replacing man (or animal) power with machinery driven by water or steam. The second revolution (Industry 2.0) leveraged the division of labour, along with the benefits of electricity, to facilitate mass production (assembly lines). Industry 3.0 harnessed electronics and technology to automate production. The key drivers and advances pertinent to each revolution were crucial for disrupting the market status quo of the day. It is important to acknowledge that each revolution was driven by the preceding one, with key advances driving each revolution forward,…

Three of the seven sub-indexes in the Australian PMI expanded in January, with the continued expansion of new orders (down 6.9 points to 53.7) a positive indicator for near-term growth. Supplier deliveries (down 5.4 points to 47.0) and sales (down 11.2 points to 47.6) contracted in January, suggesting softer demand coming into 2017 – perhaps rebalancing December’s robust growth. “Conditions for Australia’s manufacturers remained positive in January despite easing from December's end-of-year surge,” said Ai Group Chief Executive Innes Willox. “While domestic sales slipped and there was a build-up of inventories, exports grew further in January and production was held at December's levels. The near-term outlook for the sector as a whole was boosted by another lift in new orders.” In trend terms, four of the eight manufacturing sub-sectors expanded in January, with machinery & equipment (up 0.4 points to 57.5) and…

From 21 October 1998 until 14 December 2011, a period of just over 13 years, we had three Federal Industry Ministers – Nick Minchin, Ian Macfarlane and Kim Carr. Notwithstanding the fact that this was a time before the global financial crisis and the automotive closures, this era saw growth in our manufacturing outputs, and full-time employment in the industry was constant at around $1m employees. On 24 June 2010, when Julia Gillard took over as Prime Minister from Kevin Rudd, Kim Carr was Minister for Innovation, Industry, Science and Research. In December that year, Greg Combet replaced Carr in the revised Industry and Innovation portfolio. When Rudd came back into power, so did Carr, and the portfolio reverted back to Innovation, Industry, Science & Research. With the change to the Liberals in September 2013, the incoming Prime Minister Tony Abbott appointed Macfarlane to another revised portfolio – Macfarlane was simply the Minister for Industry. In…

Clynton Jaffray and Michael Bonney grew up in the rural north west of Tasmania, and as local lads they learnt to care for the place they love to call home. They met while both working as tradesmen at Caterpillar Elphinstone in the 1990s, and progressed to become 6Sigma Black Belts in the early 2000s, travelling to Japan to ‘learn Lean’. This mind-changing trip changed their life’s journey and how they viewed the world – a familiar story for Lean practitioners. In early 2013 they started Productivity Improvers, a Lean consultancy business that has now engaged with more than 100 Tasmanian firms. The company has developed and delivered a suite of sought-after university and VET training programs, with more 500 people completing these programs in the last three years. Jaffray and Bonney love helping improve Tasmanian people and businesses and are passionate about a Tasmania that continually improves its economic and social standing. In 2016,…

The KM system from Kennametal  has been a top performer in this area for over three decades, and is known throughout the industry for its high clamping strength and consistent accuracy in both spindle-mounted and static tooling applications. According to Kennametal, the bending moment of KM4X is substantially higher than any tooling interface available on the market today, superior even to its own KM design When aerospace giant Boeing came to Kennametal with a request for a heavy-duty spindle connection capable of outperforming traditional CAT and BT-style adapters, tooling engineers turned to this robust and well-established platform as a starting point. The result was a 100mm spindle connection with four ball tracks instead of two and up to 40% greater clamping force than comparably-sized KM tooling. That was 15 years ago. KM continues to thrive, and was adopted in 2008 by the International Organization for Standardization (ISO) as ISO standard 26622. The original Boeing-inspired design has been renamed as well, and marketed for the past several years as…

The Invoice Market’s SME Cash Flow Crisis Report shows that small and medium enterprises (SMEs) in the manufacturing sector are perpetually owed on average $35,833 each, with corporate customer excuses ranging from ‘lost in the system’ and ‘in dispute’ to ‘being reviewed internally’ and ‘being processed offshore’. Alarmingly, 37% of manufacturing SMEs have no strategy in place to manage their company cash flow, which impacts their ability to pay their housing and other living expenses. This in turn creates a disincentive to hire new staff, and makes it harder to pay existing workers. The Invoice Market CEO, Angus Sedgwick, said the findings had important implications for the manufacturing sector, which employs 856,000 people across Australia. “One of the most striking findings of this report is that while late payments cost companies money, it is the hidden cost in time that is the most revealing,” Sedgwick said. “On average, 60% of manufacturing companies have to ask twice or three times for their bills to be paid by…