Last week on a beautiful sunny Melbourne
winter morning our Technical & Operations team hosted the latest in
our series of boardroom briefings. Over breakfast, David Chuter, CEO of
Innovative Manufacturing CRC (IMCRC), led the discussion around challenges for
leaders in the sector, Industry 4.0 and its transformation imperative.
Attendees included a diverse range of senior manufacturing
executives; Ruby Heard, recently awarded the Victorian Young Professional
Engineer for 2019 by Engineers Australia, was an active contributor,
especially from a younger person’s perspective.
With the demise of the Australian automotive manufacturing
sector, we are constantly reminded that the manufacturing sector is in decline.
was refreshing to hear David refuting the state of manufacturing in Australia,
providing examples of many of the exciting innovations that are being developed
locally that are at the cutting-edge internationally. David is passionate about innovative
manufacturing and the role that it will play over the next decade. He
transformation will be achieved through “collaboration by inspired leadership”.
Speaking about transforming Australia’s manufacturing
industry, automation and AI (Augmented Intelligence, rather than Artificial
intelligence, in David’s view) the concept of Industry 4.0 is not particularly
new. Such technology, including robotics, has already been in use for many
years, especially in automotive production. The group observed that what has
changed, is that the barrier for entry has dropped significantly, meaning
manufacturing technology is no longer limited to well resourced multi-national
While Industry 4.0 is not limited to a specific sector, one
of the challenges in Australia is our proliferation of small businesses: 90% of
manufacturers employ less than 20 people and only 15% of manufacturers turn
over more than $2M per annum. With so many SMEs invested in manufacturing,
collaboration between companies can be difficult too. IMCRC estimates less than
40% of manufacturers have an appropriate business strategy to meet current and
One of the positive initiatives David has taken with IMCRC is to bring industry, educators (universities) the CSIRO and other resources together to support SMEs in manufacturing and help foster collaboration. CSIRO’s recently released Australian National Outlook showed a massive and unprecedented opportunity for the future growth and prosperity of manufacturing. It predicts manufacturing’s contribution to GDP growth will be more than two and half times that of any other sector.
When looking for transformative projects that will create
commercial outcomes for local manufacturers to take Australian products and
service to the world, we also need to seek out opportunities to develop the
project management, technical and leadership skills that cannot be simply
solved through education. Governments have a role to play in supporting
manufacturing with investment – for example, here in Victoria our trains are
built with 60% local content and some trade-based TAFE courses are government
funded. Industry also needs to lead by providing opportunities for technical
specialists and professionals to further and diversify their experience, which
will upskill its workforce.
Overall, we need to be braver and bolder, if we wish to
become a world leader in advanced manufacturing. We need to change the
perception that we are limited by market size or geographical distance, and
focus on establishing smart tech hubs with a global focus, where the emphasis
is less on production, and more on invention, design and value.
I’m looking forward to seeing what the next generation of
manufacturing in Australia looks like.