A new deal for manufacturing – a rallying cry to get involved by Grant Anderson

Grant Anderson joins @AuManufacturing’s campaign to crowd source a new deal plan for manufacturing in Australia with this powerful call to action. Send your submission to [email protected].

Never waste a good crisis !

Why is it that we need a crisis to bring about change to policy around manufacturing?

Why is it that most countries are now banning the export of medical supplies manufactured in that country? Why is it that Australia is desperately trying to build capacity in manufacturing supply chains for basic medical equipment and goods?

For far too long we have as a country been relying on an outsourcing model based around price. We have not protected our sovereign capability in our critical supply chains.

Future supply chains will look quite different to our recent past. Future supply chains will be focused around critical supplies and technologies to protect our most vulnerable risk areas.

Executives will have a plan B possibly encompassing a dual sourcing model. This will include material supplies including the conversion of raw materials into processed materials and sub-assemblies.

A new normal around being able to source local in local supply chains. Outside of the medical needs at present for other goods and services we are seeing supply shortages. It is each country for themselves again reinforcing the need to ensure that a country we have the core capability to innovate, design and manufacture.

Of course we do not as a country have the demand to justify super high volume manufacturing. But as a country we can be very good and have a proven capability in niche volumes encompassing the key technologies.

This crisis has enabled greater collaboration amongst the supply chains of manufacturers like nothing we have seen in the last century. Just think if we can build on the collaborative culture even further then we can protect our sovereign needs for any future crisis.

We are now realising the value of local engineering, manufacture and skills. But this alone will not protect our future needs. Innovation, R&D and more collaboration will enable the development of future products, manufacturing technologies and capabilities to secure future supply chains.

Recent proposals to cut back R&D tax benefits mean that innovative companies look to move those these highly valuable attributes overseas loosing the skills capable of developing new products and processes.

Again why do we need a crisis to make us rethink this short sighted approach? Greater innovation and collaboration between Universities and Industry are paramount to building this sovereign capability and the jobs to develop wealth for people in Australia and our future generations.

There are many great examples of companies who have developed new technologies and I am or have been involved with a few of these. The struggle these companies face in the R&D, pre-commercialisation or early commercialistaion stage is funding.

I have seen companies really struggle during a downturn for funding cashflows just like we are experiencing now. These companies had committed to new R&D at a point when markets were strong, and the need to have long term stable R&D tax and early commercialisation tax benefit is critical to ensuring these companies are successful.

With digital manufacturing, agile manufacture including 3D printing we are now far more flexible to adapt to changing situations. The future of supply chains will mean far more “onshoring” to mitigate risk.

So too will the future of work change. the new normal will mean far more working remotely or at home. With our current experience during this crisis proving beyond doubt that we can and are working efficiently and effectively from home the reality can no longer be questioned.

Rather by utilising the digital tool virtual conferencing has just proven that we are now in the new normal. Working from home for many has allowed for far more flexibility in working and sharing work. It has saved all the time spent in driving cars to work, carparks needed, less office spaces needed, less cars and roads needed and it is also better for the environment. All these lead to greater productivity overall.

But many of us are working in the new normal now and our working lives will change profoundly as a result of this event. Beyond the survival phase for many businesses we will need to focus critically on repositioning for future growth.

So as unfortunate as this crisis is there is a silver lining. Many people are suffering because of the Covid-19 crisis and it will remain a powerful reminder to us all.

It is a reminder of what not to do and a reminder of just what we can do when there is no other alternative.

At the end of the day when we have overcome this crisis, and we will, we need very clear vision and policies for Innovation, R&D and manufacturing of the future.

It will need strong Governments to lead this country into the new normal.

Never waste a good crisis!

Grant Anderson is an experienced industrialist who has had leadership roles in numerous companies including ANCA CNC Machines, Sutton Tools, AGSN Group and TECHNI Waterjet, as well as in the Industry Capability Network. Grant is a member of the editorial advisory board of @AuManufacturing news.

@AuManufacturing’s new deal plan for manufacturing is brought to you with the support of Bosch Australia Manufacturing Solutions

Picture: Grant Anderson

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