After a generation of capital and resources flight to cheaper manufacturing centres around the world, one Aussie metal fabricator, the Sevaan Group is doing better than ever. Drew Turney reports.
Plants and factories from automotive to apparel closed up in the globalisation age, and the narrative ever since has been of an industry that’s long since fled to the third world in search of cheaper prices, never to return.
But some local players are bucking the trends, and just one is the Sevaan Group, a Sydney-based metal machining company that’s going from strength to strength.
Established in 1997 as Proline Technologies, owners and proprietors Jim and Artemis Tzakos built the business up strategically, surrounding themselves with a small team of manufacturing experts and acquiring a company in 2011, re-christening itself The Sevaan Group.
Supplying Original Equipment Manufacturers (OEMs), The Sevaan Group produces metal components for a range of industries including defence, mining, agriculture and gaming to aerospace, robotics, electronics and transit.
Today the company has around 50 people and is in the throes of planning an advanced new facility to open late in 2023. But as CEO David Green explains, it’s still a family-owned business in practice as well as spirit, and that might just be the secret to The Sevaan Group’s success.
The localisation movement
Sevaan’s business actually grew during COVID and the company has a strategic business plan in place that takes into account the onshoring taking place, and the opportunities this will present. Delivery times have been extended and transport cost increases are reflecting the plug-ins and workarounds the pandemic economy has wrought. Green says the return of many manufacturing customers to Australian providers is ‘encouraging’.
But it’s not enough to just be there when customers turn their back towards home. Local manufacturers still can’t really compete on price (more below), but Green says the uncertainty has made his customers more comfortable sourcing products from down the street instead of across the water.
So as things improve (current recession jitters notwithstanding), how do we stop jobs, tools, expertise and cost-conscious users going back overseas when supply chains settle down?
“If you ask if we’re always going to be the cheapest provider like-for-like against overseas suppliers, the answer’s no,” Green says. “But when you look at the overall cost from a long-term view, one that incorporates a life cycle and quality control, we become very competitive.”
Quality control has always been a USP of Sevaan. It’s not new. When the choice is between variable quality from a far-flung plant where delays might hold delivery up for weeks versus a partner across town you can visit to collaborate with on quality and which keeps delivery promises, the choice is obvious.
Green thinks such quality control is assured over the long term because The Sevaan Group has a continual commitment to stay ahead of the curve. “We alway invest in the latest technology every 3-5 years to improve capacity and throughput. It’s about having a forward-thinking philosophy in technology and training.”
The Sevann Group 4.0
A cornerstone of that effort is the adoption of Industry 4.0 practices and tools – in The Sevann Group’s case, investing in a lot of equipment that’s digitally controlled, programmed and operated.
“The other side of that is big data,” Green says. “It lets us monitor production to ensure the best use of machinery and that productivity across the company improves, increasing capacity and capability.”
A recent move in that direction is the adoption of the ZOOMFAB platform, a system that monitors manufacturing and plant machinery, collects and synthesises the data from the performance of individual components in a workflow and presents analytics to let operators make the relevant changes and improvements proactively when and where they’re needed.
So far, Green and his team are big fans. “From equipment set up through to when it’s in operation, ZOOMFAB lets us monitor power usage, productivity and returns.”
The company is planning to extend the ZOOMFAB deployment further across the operation, and Green adds that staff love the immediacy and mobility of viewing and actioning what comes out of it. “The guys operating the equipment have iPads that show the results from their operation and their interaction with the equipment, so they’re aware of exactly how things are going on a day-to-day basis.”
Of course, there’s a trap awaiting any company trying to stay at the bleeding edge of process management, and it’s because technologies are coming along faster than the industry can absorb them – we simply can’t train engineers, managers and technologists fast enough.
As a statistic from Deloitte claims, talent shortages will result in two million unfilled manufacturing jobs globally by 2030. [https://www2.deloitte.com/us/en/insights/industry/manufacturing/manufacturing-industry-diversity.html]
How will The Sevaan Group overcome such a challenge, especially in Australia where it seems we’re constantly battling a brain drain? “I’ve seen this across many companies,” Green agrees. “There’s so much fluidity in people on the shop floor you can be left with technology you don’t understand or know how to deploy.”
The academic approach
The solution is a program called The Sevaan Academy. Originating with co-founder Artemis Tzakos’ background in organisational development and training, it’s a formalised process to understand, document and – when necessary – transpose skills and knowledge as things shift.
“Every position has established competency, experience and task requirements which are tested and adjusted when things change,” Green says. “It very effectively keeps people in front of the tasks they have to do.”
That means when a new technology is deployed in the company, having such a prescribed framework for skills and procedures lets operators upskill as much as necessary quickly to start using it. “Team leaders define the knowledge and skills required to be competent with new equipment or processes as well as the training needed to get staff there, and that’s written in to the overall Sevaan Academy profile,” Green says.
But beyond the expertise needed today, it also informs on the company’s recruitment needs because managers are aware of exactly the skills they’re looking for in candidates. And while you might think we’re just talking about job descriptions, The Sevaan Academy goes much deeper than that – right down to the nuts and bolts, in fact.
“Many organisations of course have their own training systems but sometimes they’re quite generic,” Green says. “What we’re trying to do is get down to the nitty gritty of operating every piece of equipment or technology effectively and thoroughly.”
In fact, Green and his team are already looking at process certifications at the micro level – each component of each job given a micro-credential to establish every skill requirement transparently.
But there’s been a deeper and very human impact that’s had a quite different effect. “The focus on processes is allowing us to redesign or re-engineer what we do and consider how we can do it more effectively,” Green says. “There’s more spontaneous discussion going on about improvements. It’s having a huge impact because it’s not something you do one day and then stop the next.”
And the effects so far have been tangible. In just one example, Green says The Sevaan Group’s structured approach to task and skills curation has made the company better at predicting market conditions.
“If there are delays in our processes, we pick them up much quicker, which lets us keep the customer informed instead of taking them by surprise and more importantly, taking the necessary actions to accelerate a fix and get things back on track.”
One stop shop
The Sevaan Group can work with stainless steel, aluminium, bronze, brass, copper and more. Just some of its finishing services include cutting, folding, welding and powder coating.
All of which means that – just as unusual as being located in Australia and being in such rude health – every step of the process from initial design to final delivery is managed and performed under one roof.
And because the company executes a project from end to end, its designers and engineers have deep and thorough experience in what customers want (and need), a business model Green describes as ‘integrated’. “If a customer goes somewhere else they may be looking at two or three separate suppliers to achieve what we can. Multiple processes contributing to a finished product is much more competitive under one roof.”
One of the primary reasons for that is that adhering to quality standards is much easier when applied only to your own operation rather than third parties whose company or regulatory standards might be vastly different from yours.
And, perhaps most crucially of all, Green says the people under that single roof care enough about quality to make the company a compelling choice. “It’s very much a family-owned business,” Green says. “Quality control happens because of our processes but also very much because of our people. We have a very human-centred culture and the expertise in the organisation speaks for itself.”
The future
We’re through the worst economic ravages of the COVID pandemic and global manufacturing has a strong incentive to get back to normal. But while some of the effects of the pandemic (like the international supply chain crisis we’re still in the grip of) have been good for companies like The Sevaan Group, how is it going to weather the storms to come, like if customers do flee back to China or the US in search of cheaper prices?
When AMT talks to Green, the company is putting the finishing touches on a five-year plan. A large part of it will be further developing business with existing clients, but an important lynchpin will be increasing capacity.
“Thankfully, the business didn’t really slow down much during COVID,” Green says. “In fact we actually grew on paper, again because of supply chain issues and people buying locally. We’re hoping that habit sets and continues to grow, and our plan is to match that increase in demand in the next couple of years.”
The new premises is one part of that plan, offering more space and easier industry 4.0 integration. More acquisitions are also on the cards as a way of boosting staff numbers, technology and resources.
“Several customers have told us they’re expecting demand increases of up to 5,000% in some cases based on them opening up new channels in overseas markets,” Green says. “We want to be alongside them when that happens, so we’re talking to them all the time about their needs so we can make sure we have the capacity to absorb that demand.”