NZ Manufacturer July 2013 July 2013
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The Future of Manufacturing
Analysis Eyeing up the US military health opportunity.
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The internet of things.
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www.solidtec.co.nz
Rear View
Busting Canterbury steel construction myths.
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Page 30
TEDxAuckland Kiwi tech sought after in Indonesia 2013: The Final Countdown D
t’s just under two weeks before 28 inspiring people take to the Aotea Centre stage for TEDxAuckland. So, if you haven’t already, grab some tickets and make Saturday 3 August a day to remember. Following the sell-out success of last year’s event, TEDx Auckland 2013 will again showcase great ideas from across New Zealand’s cultural, social, scientific and creative communities. The quality and variety of ideas is guaranteed to challenge, inform and inspire everyone who attends. Two weeks into speaker rehearsal, TEDxAuckland Content Director Vaughn Davis says it’s hard to pick a favourite talk. “It’s not just comparing apples with oranges… more like apples with quadratic equations. They’re all so different. We’ve got one of New Zealand’s top dentists talking about leadership, a provincial mayor with an idea that could transform small towns all over the world, a revolutionary discovery in brain science – we’ve even got the world’s most advanced artificial brain! Among the day’s 17 speakers will be UNDP Administrator Helen Clark, the creator of the world’s longest waterslide Jimi Hunt, and Wiki NZ founder Lillian Grace. Joining them will be performance artists including poets, musicians and legendary Maori traditional instrumentalist, Richard Nunns.
Richard Nunns, speaker at TEDxAuckland 2013
Fijian and Samoan-raised chef Robert Oliver will be sharing his story of using cuisine to bring about cultural and economic change, while Hawke’s Bay designer David Trubridge will be exploring the connection between art, human culture and the hemispheres of the brain. If you enjoy having your thinking challenged, discovering great ideas or just sharing the day (and the free after-party) with a room full of likeminded people, TEDxAuckland is an event you won’t want to miss.
oing business in Indonesia, a recent trade mission found, can be surprisingly straightforward. On a first visit one delegate chalked up what he’s sure will turn into a million dollar plus order of Kiwi made refrigeration equipment. The contacts made by another are expected to divert ongoing import consignments to an Indonesian supplier. Indonesia’s reputation in New Zealand has tended to focus on perceived obstacles to trade. Its been described as difficult, but that is not necessarily so. The people are low key and friendly. There is plenty of trade to be done without getting involved in anything uncomfortable, and many seem able to avoid it. Our smaller technology businesses found they could interact simply and easily with their Indonesian counterparts even if they were from much larger enterprises. Indonesia’s growth record is well known, and with a population increasing every year by about the same as the total in New Zealand. The economy has been growing consistently at 6% a year. By 2030 a McKinsey report suggests Indonesia will have an affluent middle class of 80-90 million people, on our geographical doorstep. Its true they will certainly look to the likes of New Zealand for quality, high protein food, and its just as true that with Indonesian policy aims to conserve foreign exchange as one way to sustain the pressure to maximize their domestic food production capacity.
sales@plasticweldingtools.co.nz
By Gilbert Peterson
Hon Maurice Williamson gave a brief speech at a reception hosted by New Zealand Ambassador HE Taylor at his residence. The Minister co- led the mission with Sir Ken Stevens.
The archipelago is immensely fertile. The present 248 million people in a total land area about seven times larger than New Zealand attests to that. Their policy objectives are partly to feed more of their people, with western technology adapted to their tropical climate and food production needs. A theme our mission heard often from government officials and private sector people was we want New Zealand’s help to develop systems so we can feed our population, and grow our economy. Continues page 6
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NZ Manufacturer July 2013
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NZ Manufacturer July 2013
CONTENTS Advisors
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DEPARTMENTS
Sir William Gallagher
BUSINESS NEWS
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ANALYSIS
Is the CEO of Gallagher Group Ltd. He is also a Fellow of NZ Institute of Management.
New app tames tax pain. Eyeing up the US military health opportunity.
EXPORT NEWS
• Exporting manufacturers are flying high.. • CBN010 insert grade for turning steels
Page 5 – BUSINESS NEWS – Waterfront building an inspiration for Auckland.
OPINION
Stephen Drain
Crisis – What crisis?
Stephen Drain is a Director at PwC specialising in Leadership Development and Forensics.
MANUFACTURING TECHNOLOGY Delcam leading software specialist.
MANUFACTURING TECHNOLOGY • 3D-Printed battery as tiny as a grain of sand. • OneTouch AT v2 speeds troubleshooting
THE FUTURE OF MANUFACTURING Their new materials.
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Page 10 – MANUFACTURING TECHNOLOGY – FactoryTalk View software enhances operator experience.
Catherine Beard
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Is Executive Director of Export NZ and Manufacturing, divisions of Business NZ, New Zealand’s largest business advocacy group, representing businesses of all sizes.
WORKSHOP TOOLS
• Buying spiral bevel gear drives. • Tough new inspection lamp.
WORKSHOP TOOLS
Brian Willoughby
Fuel funned filters contaminants.
EXPORT NEWS
Take a long term look at Brazil.
THE FUTURE OF MANUFACTURING
Page 15 – THE FUTURE OF MANUFACTURING – Cyborgs, a fusion of man and machine.
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Is president of the NZ Manufacturers and Exporters Association and managing director of Contex Engineers and Plinius Audio.
The internet of things.
BUSINESS NEWS
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NZ business struggles.
Is managing director of Connection Technologies Ltd, Wellington and is passionate about industry supporting NZ based companies, which in turn builds local expertise and knowledge, and provides education and employment for future generations.
FOOD MANUFACTURING
• Lincoln opens food research centre. • Technology meets marketing.
ENERGY REPORT
Raising the bar for energy performance.
THE INTERVIEW
• Mattew Darby, owner of EcoChill. • Noel Davies wins key award.
Lewis Woodward
Page 25 – ENERGY REPORT – Solar energy powers Ricoh staff.
LEAN MANUFACTURING
Professor John Raine ➡ Is Head of the School of Engineering and Pro Vice Chancellor – Innovation and Enterprise at the Auckland University of Technology.
Lean has much to offer.
SUPPLY CHAIN
Hyper-Detect provides stable operation.
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DEVELOPMENTS
• Analysis of the global market. • Collaborative development of water management.
REAR VIEW
Busting Canterbury steel construction myths.
Page 28 – SUPPLY CHAIN – The Great product data revolution is coming.
Bruce Goldsworthy
An advocate for NZ manufacturing for 40 years, he was Chief Executive of the Auckland Manufacturers Association for seven years He has been Manager of EMA’s Advocacy and Manufacturing Services, and lately manager for Export New Zealand in the north.
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NZ Manufacturer July 2013
EDITORIAL
Whatever the mind of man can conceive and believe, it can achieve. Thoughts are things! And powerful things at that, when mixed with definiteness of purpose, and burning desire, can be translated into riches.
Publisher
Media Hawke’s Bay Ltd, 1/121 Russell Street North, Hastings, New Zealand 4122.
MANAGING Editor
Doug Green T: +64 6 870 9029 E: words@xtra.co.nz
CONTRIBUTORS
Sandra Lukey, John Cochrane,Gilbert Peterson, Wolfgang Scholz, John Walley, Catherine Beard.
ADVERTISING
Doug Green T: + 64 6 870 9029 E: words@xtra.co.nz
Design & PRODUCTION
– Napoleon Hill
Trade mission member has early Christmas present
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e are already half way through the year. The momentum, so far, for manufacturers, has been steady and improving. The trick is to keep it going as we look down the road towards Christmas (who would have thought it was creeping up on us so fast?).
WEB MASTER
NZ Manufacturer is pretty much at the fore in fostering, supporting and encouraging the nation’s manufacturers. We constantly report on where the opportunities are for manufacturers and where the vacancies are for those looking to establish a career.
PUBLISHING SERVICES
The job market is still tight and that tightness has something to do with the cost of raw materials, the cost of finished product to local and international markets. Our competitiveness on the world stage.
Karl Grant T: + 64 6 857 7942 E: daylightmarketing@xtra.co.nz Dan Browne E: dan@membrana.co.nz On-Line Publisher Media Hawke’s Bay Ltd
DIGITAL SUBSCRIPTIONS
E: info@nzmanufacturer.co.nz Free of Charge.
MEDIA HAWKES BAY LTD
T: +64 6 870 4506 F: +64 6 878 8150 E: mediahb@xtra.co.nz 1/121 Russell Street North, Hastings PO Box 1109, Hastings, NZ NZ Manufacturer ISSN 1179-4992
And there are plenty of opportunities out there. A recent trade mission to Indonesia, as reported in this issue by Gilbert Peterson, highlights how doing business there can be surprisingly straightforward. One of the mission delegate’s, on a first visit to Indonesia, chalked up what he is sure will turn into a million dollar plus order of kiwi made refrigeration equipment. And Indonesia will look to New Zealand for the likes of quality high protein food as well. 248 million people, certainly a growing market. In the USA there is a massive opportunity for our companies offering health solutions. The US military community is on the lookout for collaboration. This is an exciting development. Catherine Beard also writes on an exporting theme, sharing with readers some recent success stories, while John Walley asks if there is indeed a crisis in manufacturing. Apart from all of this riveting reading we focus on The Future of Manufacturing and the latest innovations and developments to make your workplace today ready for tomorrow and able to meet the challenge.
Vol. 4 No. 7 July 2013 Copyright: NZ Manufacturer is copyright and may not be reproduced in whole or in part without the written permission of the publisher. Neither editorial opinions expressed, nor facts stated in the advertisements, are necessarily agreed to by the editor or publisher of NZ Manufacturer and, whilst all efforts are made to ensure accuracy, no responsibility will be taken by the publishers for inaccurate information, or for any consequences of reliance on this information. NZ Manufacturer welcomes your contributions which may not necessarily be used because of the philosophy of the publication.
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Doug Green
NZ Manufacturer July 2013
There are only two ways to live your life. One is as though nothing is a miracle. The other is as though everything is a miracle. – Albert Einstein
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BUSINESS NEWS
Waterfront building an inspiration for Auckland
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ne of Auckland’s newest buildings on the city’s North Wharf has gained a ‘five Green Star’ rating for excellence in sustainability from the New Zealand Green Building Council – setting the bar for the city’s waterfront development. Owned by Kiwi Income Property Trust, the stunning landmark ASB North Wharf building is tenanted by ASB Bank. From conception to completion, the building has been developed with the highest standards of sustainability in mind. Features that earned it the five star rating include water-efficient fittings and rainwater harvesting for irrigation and toilet flushing; a high performance facade with external screen for solar and wind control; and windows that open to allow natural ventilation. Around 5,000 steel louvres will help collect heat and light for the interior without obstructing views of the harbour. The building will also use substantially less artificial light due to the giant reflector or ‘Helioflek’ on its roof. This reflects natural light from different angles, which is dispersed throughout the structure. Activity-based working has been embedded in the design – with quiet and collaborative spaces scattered through the work floors. The workforce (except for a few key positions) will be mobile, with no assigned desks. The system, which is now commonplace in new corporate fit-outs, aims to reduce paper and electricity use and free up the ability of colleagues to meet, collaborate and boost creativity. NZGBC CEO Alex Cutler says the building is almost a textbook case of how sustainability features and excellent design can combine to create commercial buildings fit for the future. “This building provides a template for other developers and tenants looking at how to create liveable, sustainable buildings that will stand the test of time,” she says. “We hope it inspires other corporates to make the effort to ‘go green’ early in the planning and building process - because it pays off in many ways down the track.” Owner Kiwi Income Property Trust says the investment in creating a sustainable building – and having it certified by the NZGBC – was well worth it. “Achieving excellence in sustainability was part of creating a world-class working environment,” says Chris Gudgeon, chief executive of KIPT. Waterfront Auckland CEO John Dalzell says the NZGBC certification
is great news and all involved should be applauded for setting the bar for others to follow. “We need more buildings like this on the waterfront and in Wynyard
Quarter in particular where we have a strong vision to create an area that will demonstrate a new paradigm of environmentally sustainable mixeduse development for New Zealand.
Whether it’s green building techniques or renewable energy, we all have a vested interest in creating a sustainable Auckland waterfront that is resilient to change.”
Guidance to detect counterfeit substandard materials New app tames tax pain
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he Institution of Professional Engineers (IPENZ) is updating its guidance for engineers to safe guard against substandard and counterfeit products. IPENZ started reviewing its guidance to engineers after concerns were raised about the quality of materials and equipment used in various industries – construction, engineering and machinery – at its annual Engineering Professions Forum earlier this year. The reviewed practice guidance are being distributed to about 14,000 IPENZ Members, associated Technical Interest Groups and Government over the next few days. It is publicly available at www.ipenz. org.nz The updated guidelines promote practical steps and precautions to help engineers detect counterfeit materials and avoid using them. This includes taking precautionary measures such as verifying authentication, scrutinizing labels and packaging and checking for certification marks on products or materials they’ve ordered. In addition, there is advice to avoid products that lack identifying branding, or include additional markings other than from the
original manufacturers, have poorquality labels and out-of-date product codes. “As counterfeiters become more sophisticated, counterfeit products become even more difficult to detect, creating an increasing need for additional scrutiny,” IPENZ chief executive Andrew Cleland said. “Procurement through an unknown website at a price too good to be true should immediately raise concerns, but detection is not always that easy.” These guidelines have been updated to assist engineers, but they include practical steps to safe-guard against inferior products, which could help anyone working with out-sourced products. To date IPENZ has received only anecdotal evidence of sub-standard or counterfeit products in industry but any person including engineers with information on how such materials are arriving has a public duty to notify relevant authorities”, Dr Cleland said. The Institution will monitor the situation through any notifications received from its members and associated industry sector groups, working to assist industry regulators.
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aying your provisional tax is now easier than ever with the new Pay My Tax app from the tax innovators, Tax Management New Zealand (TMNZ). Provisional tax can be a headache for taxpayers because it’s often difficult to predict what your final payment will be – especially for those who work in volatile markets or seasonal industries – like retailing or real estate. If you don’t pay on time, the IRD charges high interest costs and late payment penalties. With the Pay My Tax app, taxpayers can shift the payment dates for their provisional tax to a time that better suits their business - and avoid paying IRD’s interest or penalties. By leaving cash in the business for as long as possible, they can pay for the things they really need to do. When people use the app, they can even pay the cost of financing their tax by credit card. The new app is available for both Android smartphones and iPhones and can be downloaded from August 12. TMNZ will extend its innovative Pay My Tax selfservice channel over the next few months. www.nzmanufacturer.co.nz
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NZ Manufacturer July 2013
BUSINESS NEWSKiwi tech sought after in Indonesia
When we love, we always strive to become better than we are. When we strive to become better than we are, everything around us becomes better too. – Paulo Coelho
From page 1
Food technology education, food safety – New Zealand’s AsureQuality was on the trade mission along with other food related technology suppliers – are part of the scope. Consider the fact that many thousands of the villages in Indonesia rely on bottled water, in a country where water is abundant. They drink bottled water transported to them mostly in trucks to avoid contaminants and illness, with the empties recycled out the same way. With a reliable power supply, ultra violet water purification systems could be established which would free up the expensive resources currently used for transporting water. Reliable power would also make remote telecom access feasible. The approach to be adopted needs to be, not to save labour, but to improve productive capacity. Indonesian aquaculture is well advanced in areas such as shrimp production. A plant we visited employs 6000 people processing farmed shrimp for markets in Europe and Japan, obviously therefore to the most exacting hygiene standards. The appetite for new technology extends well beyond food and food production technology, to aviation, energy, telecommunications, and construction. Transport between their thousands of islands, together with an ambition to rapidly deploy more air linkages presents a further example for our aviation expertise. Forty five new airports are in the planning in this the world’s fastest growing aviation market. The story for telecommunications is similar. The country is leap frogging the legacy telecoms we still use. Indonesia has 135 million internet users and 180 million mobile phone users, with 36% smart phone penetration. The buildings of Jakarta are impressive, a $US20billion market. New Zealand engineers BECA have been part of it for 40 years, as they have for geothermal development. Indonesia’s first geothermal power plant was designed and installed by New Zealanders and today just about all the expertise in the field educated in New Zealand. It’s a record wide open to build upon – Indonesia is hard on the Pacific rim’s volcanic edge with
The visit to a shrimp processing plant in Surabaya naturally required a taste test. From left New Zealand Ambassador to Indonesia, HE David Taylor, Cableways Lance Sheppard, Sir Ken Stevens, co-leader of the mission and Stuart Wallbridge, Chairman of the ASEAN NZ Business Council and a manager of the mission.
“Don’t expect to build business here remotely,” says New Zealand Trade Commissioner Tim Anderson. extensive geothermal capacity available. They want the ‘green’ power geothermal reserves can supply. The potential is said to be for 29GW with only 5% of that installed. “Don’t expect to build business here remotely,” says New Zealand Trade Commissioner Tim Anderson. “Indonesia is a contact market.” He’s been there for several years and is fluent in the language. Indonesia warrants at the very least an exploratory visit. You can’t do it from here, and their markets are crying out for a wide range of New Zealand technology, expertise and knowhow. Gilbert Peterson travelled to Indonesia as a manager of the trade mission organized by Export New Zealand Auckland and the ASEAN
Manufacturers Newsfeed www.nzmanufacturer.co.nz
New Zealand Business Council from May 18 – 31st. Indonesia Mission led by Minister Hon. Maurice Williamson and Sir Ken Stevens, Executive Chairman, Glidepath Group Highlights: • 52 delegates including 20 from an NZTE convened aviation sector group. • 16 major business networking events/activities. • 4 cities – Jakarta, Bandung, Surabaya and Bali – the first NZ trade mission to travel beyond Jakarta. • A major conference in Jakarta on New Zealand was addressed by Indonesia’s Vice Minister Bayu, the chairman of Indonesia’s Chamber of Commerce (KADIN)
Suryo Sulisto, Hon Maurice Williamson and Sir Ken. 200 attended. • Numerous business contacts made
Mission partners
The mission enjoyed the wholehearted support and cooperation from NZ’s Ministry of Foreign Affairs, especially our Ambassador HE David Taylor, and equally from NZTE’s team in Jakarta led by Trade Commissioner Tim Anderson. A big vote of thanks to them. Generous sponsorship from the ASB/Commonwealth Bank in Indonesia covered the major New Zealand Forum in Jakarta and the gala dinner following.
Pacific Place Mall, Jakarta, a BECA project – the floor area of this one mall is greater than the combined malls of Auckland.
NZ Manufacturer July 2013
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ANALYSIS Eyeing up the US military health opportunity There is nothing so useless as trying to become efficient at something you shouldn’t be doing at all. – Peter Drucker
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n recent years the US military medical community has invested nearly US$2B annually in R&D to combat infectious diseases and improve casualty care, operational medicine, bio/ chem medical countermeasures, and clinical rehabilitation. This represents a massive opportunity for New Zealand companies offering health solutions. The US military interested in organisations that are doing something innovative. There is definitely potential opportunity to collaborate with the US military medical community, and it’s exciting. When it comes your market entry strategy, that all depends on the type of company you are and what stage of development you’re at. If you’re developing products, start by doing your homework and finding out as much as you can about the market and other companies already in it. The one pitfall I’ve seen is the lack of confidence to jump in. How you get the confidence to jump in is by doing your homework. Know where you stand relative to other people in the industry and in relation to other companies doing what you do. Nowadays with the internet, it’s really easy to see what other people are doing. Then you can develop a clear point of difference and put together a compelling case showing how and why your product is better. If you’re at the stage of selling a fully developed product or service, and you want to sell it to the US military health market, focus on partnerships. You need to team up with other companies that have access to the channels you want to be in. For example, you may need to work with distributors that are tied into the area you’re interested in because they know the channels; it’s a big challenge to set up a whole, unique distribution channel into the Veteran Affairs hospital system. I don’t think it is essential for a company to be based in the US. The US military medical community
KEVIN KEVANY
is looking for the best of the best, regardless of where it’s from. It’s always helpful to work with someone who is in the US, who understands how to communicate effectively, and who can help you communicate effectively. But you can definitely execute work remotely. If you’re in the research and development phase, then you may want to consider working with someone in the US who can help you respond to the interests of the US military medical community. The US military has done some things to make it easier to get in the game. They have what they call Broad Area Announcements (BAA) and Specific Program Announcements, similar to RFPs or Requests for Proposals. These are broken down into two phases, the pre-application phase and proposal stage. The former is similar to a white paper and includes a narrative on what you’re doing and who you have doing the work. It includes biographical sketches on key people, like your principal investigators, key researchers and key developers. If what you’ve written attracts their interest, then they’ll invite you to submit a proposal. Approximately one in ten gets invited to the next stage. The proposal stage includes preparing a full proposal, possibly similar to ones that have already been prepared and provided for parties in New Zealand. The proposal is a roughly 50-page document that delves into the more technical details of what you want to do, and what you think the associated costs will be to do it. What you write here will vary depending on where you are in the product development lifecycle stage, how much R & D you still need, how much clinical testing needs to be done, the regulatory requirements you need to address, and so forth. Don’t be afraid to try it a few times. Chances are the US military hasn’t heard of you, so don’t just do it once – do what you need to in
09 520 5206 kevwrite@xtra.co.nz
PETER ISSAC
06 340 8134 peter.isaac@xtra.co.nz
order to get on their radar. The perception that entering the market is onerous and challenging is a mistake. Don’t get tied up in the system; it’s easier than you think and you can navigate better than you think. Look at working with good, experienced people that can help you efficiently navigate the market. If you can get something from ideation all the way through to a product and put it in the hands of the caregivers and enable it to have a successful outcome for the patient, then wow! Isn’t that what we do this for? Remember, it’s not just about the business – it’s about providing a better standard of care.
By David Hood,
President, DH3 & Associates David Hood is President of DH3 & Associates, a consulting company focusing on performing technology assessments and developing strategies for product development and business development. David has worked with the US Congress and European governments to sponsor funding for innovative medical products. He recently visited New Zealand to share his market strategy insights with New Zealand businesses as part of NZTE’s Military Health Immersion Programme.
Directory
DAVID BURKE-KENNEDY 09 473 8635 dbk@compublicity.co.nz
SANDRA LUKEY 021 2262 858
sandra@shinegroup.co.nz
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NZ Manufacturer July 2013
EXPORT NEWS
The real act of discovery consists not in finding new lands but in seeing with new eyes.
Exporting manufacturers are flying high
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rom kites to cargo handling equipment, the recent ExportNZ awards have showcased just what a success story many of our Kiwi manufacturers are when exporting their products overseas. Using their passion, innovative thinking and entrepreneurial spirit, these firms do not let challenges stand in their way. Switch Kites, winners of the United Travel Business Emerging Exporter of the Year at the Bay of Plenty awards, was established just two years ago by entrepreneurial brothers Jacob and Daniel Kajavala, and Ralph Von Brause. In a short space of time the trio have built a successful webbased exporting enterprise selling kiteboards online direct to customers. They are now exporting to more than 60 countries. The company’s real success relies on 700-plus ‘team riders’, or brand ambassadors, placed all over the world to promote and help sell the product to kitesurfing enthusiasts. Kitesurfers anywhere in the world can select a model from the website and arrange to trial it with a ‘team rider’ living nearby. Jacob Kajavala says: “We design, make and sell direct to the customer, that is our key point of difference, without it we wouldn’t have a business. “It’s not rocket science, it’s about being out there, being action packed and going for it. It’s what New Zealanders do well.” The company has gained 4 per cent of the global kitesurfing market. To date, 70% of sales have been in Europe, with the biggest single market being in the United States, followed by France, Italy and Germany. Export sales last year topped $1.43 million, with the US heading the list at $268,000 worth of sales, followed by France ($188,000) and Italy ($180,000). Sales in New Zealand were valued at $47,000. Other innovative exporting winners
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include Page Macrae Engineering, which took out the Bay of Plenty Polytechnic Export Achievement Award. Led by Bruce Ennis, the Mount Maunganui cargo handling equipment company has transitioned from a service base to a manufacturing base, thanks to Bruce’s passion for design and desire to sell overseas. Says Bruce, “I don’t talk about it a lot but I really like to see our products overseas, and it’s really satisfying to be able to sell stuff into the Australian market, and others.” When Bruce joined the company in 1991, ship repairs were a big part of Page Macrae’s workload, but the work slowly dried up throughout the 90s. It was then that Bruce designed his first product for the company - a revolutionary log lifter, simpler, safer and cheaper than those used at the time. After this, Bruce was promoted to manager of the cargo handling equipment department and led the design of bulk grabs and hoppers. “I’m shifting into a focus of trying to package some of the products together a bit more and also solve problems for our clients. One of the biggest problems our clients have that I can see when I go around to visit them is dust.” Bruce’s answer to this problem? To design and manufacture a 41-tonne dust-controlled hopper which is a step ahead of anything else on the market. The demand from the Australian market is leading Bruce and his team to consider the possibility of manufacturing them overseas to negate the shipping costs. The company’s reputation for quality products and service has created significant growth in the past two years and the future is looking bright. It’s success stories like these that illustrate what Kiwi innovation is capable of. There couldn’t be a better
time for Callaghan Innovation to be bringing a boost to the high value manufacturing sector. Its mission is to accelerate the commercialisation of innovation by firms in New Zealand, through: • providing ‘near market’ research and technical services to support innovation • supporting and coordinating national technology networks including partnering, collaborating and investing • assisting firms in developing skills and expertise to successfully take ideas to market • awarding and administering R&D grants to firms • fostering a culture of innovation and building excitement about business growth potential among current and future business leaders. As part of this, the old IRL Gracefield site in Lower Hutt is to become an ‘innovation precinct’,
– Marcel Proust
By Catherine Beard with others in Auckland and Christchurch. There are already 14 HVMS (high value manufacturing sector) businesses that have tenancies on the Gracefield site, and Callaghan Innovation will seek out one to three well-regarded successful high value firms who may be willing to relocate parts of their business there as anchor tenants.
CBN010 insert grade for turning steels
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eco has introduced CBN010, a new, uncoated grade designed to provide excellent performance in continuous to moderately interrupted cuts. Offering an extremely homogenous structure, the new grade provides stable performance and consistent tool life to minimise downtime and machining costs. Similar in composition to the existing CBN10 and CBN100 grades, CBN010 incorporates a newly developed manufacturing process to achieve a highly uniform microstructure. The grade features low cBN content with an average grain size of 1.5 ?m and TiC ceramic binder. This improves both wear resistance and toughness, allowing excellent performance in a range of materials. Optimised for case hardened steels and bearing steels,
CBN010 can also be successfully applied to tool steels, high-speed steels, high-tensile steels, martensitic stainless steels, ferrous powder materials and hard facing alloys. CBN010 inserts are available in solid, full face, tipped and multitipped formats. The full face and tipped option features a cBN thickness of 1.6 mm, with the stress free solid tip being attached by a modern brazing technique to give it the strongest possible connection to the carbide blank.
NZ Manufacturer July 2013
OPINION
The greatest glory in living lies not in never falling, but in rising every time we fall. – Nelson Mandela
Crisis – What crisis?
W
hat is going on in manufacturing across New Zealand? Listen to some and there is no issue; listen to others there is a crisis. Who should be listened to? What is the reality? Where is the evidence? What do the numbers say? What we see depends a good deal on where we stand, what we hear and who we talk to, and in politics, the picture that must be painted. All sides of the discussion marshal argument and statistics to bolster their position and the observer is left to choose; one number is much like the next and if bigger is better why not choose the big number? Why not feel happy when misery is the alternative and the choice seems to carry little penalty. Be happy, don’t worry is easier than the other choice. One element of my role is to accurately reflect the experience of our membership, a membership 100% made up of manufacturers and exporters, I look at the numbers and ask: do these accurately reflect the day to day experience of our members, if not I ask what is wrong with the numbers? I don’t look at the numbers and somehow revise the experience to fit. What you see depends on where you look, what you hear and who you listen to. The Manufacturing Inquiry investigated a whole range of concerns, dismissing those concerns underlines the marginalisation as identified by the Inquiry. “Crisis what crisis” with both John Key and Steven Joyce quoting the May PMI results as a clear sign manufacturing is doing well, and using the number
to support the denial of the problem and the Inquiry report. The single PMI result has some validity but like any survey it is subject to sampling error bias, a single point cannot establish a trend and fundamentally the PMI does not measure real sales. Our own survey is biased to exporting manufacturers and does measure real sales across the sample. Measurements at a system level, again subject to sample bias, come from Statistics New Zealand and here we can see high level decline over the long run. At the system or supply chain level current policy settings are threatening the existence of many manufacturing export firms. I want to look at some data series that we believe gives an accurate picture of the manufacturing sector; data that matches our day to day experience built up overtime, talking and interacting with manufacturing export firms. According to Statistics New Zealand data, it appears that manufacturing as a percentage of GDP as well as percentage of people employed in the sector has steadily shrunk in the past 20 years. Some people see this decline is an inevitable development process, and that it can naturally be offset by an expansion in the services sector, we see this as a “post-industrial fantasy”. If we look further into this apparent decline in manufacturing, and separate manufacturing by the level of processing; we can uncover a deeper story as illustrated in the graph belolow. In the last decade, unprocessed and processed primary manufacturing has seen steady growth. In contrast, simply and elaborately transformed manufactures have struggled. But what does this difference mean?
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This paints a picture of increasing reliance on simple, primary production and processing. Simply and elaborately transformed manufactures capture creativity and innovation to add value; ultimately providing more for the economy in the form of economic activity and highly paid, innovative jobs. This is a loss of complexity in our economy that will have negative effects on our future prosperity and quality of life. This effect can be seen in the OECD better life index, which compares various measure of quality of life between countries. New Zealand
John Walley
New Zealand Manufacturers and Exporters Association Chief Executive
scores well in most respects, but scores only 3.3 out of a possible 10 in terms of income. This is due to our average household incomes sitting below the OECD average, as well as having relatively high income inequality. Employment data from the March Household Labour Force Survey showed the number of people employed in manufacturing falling by nearly 11,000, year on year. These are important jobs for our economy, as jobs in the manufacturing sector have higher average and median wages than that for the economy as a whole. The loss of these jobs and output has a high flow on effect to other sectors. Politicians structurally opposed to the Manufacturing Inquiry have said anyone claiming there is a manufacturing crisis, is really manufacturing a crisis. The fact is for those who submitted to this inquiry did so out of passion for their business and the sector, speaking from their own personal experiences, which would be foolish to dispute. It is easy to point out the odd one or two who are currently doing well, but this does nothing for those who are struggling under current policy settings. Would it not be better to engage with the real experience? Leaning on selected numbers will only continue the indifference and push more manufacturers out of business or offshore How can this be positive for the future of New Zealand? www.nzmanufacturer.co.nz
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NZ Manufacturer July 2013
MANUFACTURING TECHNOLOGY
Quality is remembered long after price is forgotten. – Aldo Gucci
FactoryTalk View software enhances operator experience
www.nzmanufacturer.co.nz
For run-time improvements, operators can more quickly and intuitively navigate screens and resolve production issues with a new navigation button that provides functionality similar to the navigation buttons in commercially available web browsers. Client workstations can track each screen the operator opens, and the navigation button allows the operator to quickly display and move through navigation history. Enhanced graphic capabilities in FactoryTalk View 7.0 software also provide operators with a more realistic view of a process, with gradient shading and support for the .PNG graphic type. A new network-scoped option for FactoryTalk View SE Station software allows a single-computer HMI to better integrate with products, such as FactoryTalk Historian SE and ME software. Using the new networked FactoryTalk View SE Station software, users will be able to browse to a FactoryTalk Historian SE server, select tags, and view the historical information for those tags directly on the operator workstation.
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Better device connectivity and diagnostics are available for Allen-Bradley PanelView Plus 6 operator terminal applications with FactoryTalk View ME 7.0 software. PanelView Plus 6 operator stations can now connect directly to and display data from noncontroller devices, such as smart overload
relays or power monitors, saving controller memory. FactoryTalk View also delivers new ActiveX controls and runtime capabilities, allowing operators to view diagnostic information for a PanelView Plus terminal, such as temperature and network IP settings directly on a display.
the launch of translationXPERT in March this year. “myIntercad gets us closer to our customers and gets them closer to us,” says Max Piper, CEO of Intercad. “It was designed to seamlessly integrate with our customers’ workflow, giving them unprecedented access to online technical services and support, along with unique content, all while working in Solidworks.” Once installed, myIntercad gives users access to different resources from four integrated modules: mySupport, myTraining, myContent and myHeadlines. • mySupport gives users a direct line to Intercad’s support team. Support queries can be launched
and tracked directly from Solidworks, with additional functionality – such as live desktop sharing – allowing for real-time problem resolution. • myTraining provides a personalised record of a user’s training history, complete with assessments and interactive training ratings. Users can also book for upcoming training events, and since the module is personalised to individual users, the information follows them as they move from project to project and role to role, all within Solidworks. • myContent gives users direct access to Intercad’s designer’s
myIntercad software portal launched
ntercad has launched myIntercad, a world-first tool that connects its customers to the company’s technical, training, support and update services directly from the Solidworks environment. Available as a free download from www.intercad.com.au/myintercad, myIntercad is aimed mainly at Solidworks customers with active support services agreements, but also makes free content available to all Solidworks users. Intercad recently completed its transition into a full-service mechanical computer-aided engineering solutions provider, and myIntercad is the second solution the company has unveiled following
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anufacturers, particularly those in process industries, can gain increased functionality and an enhanced operator experience with the latest version of FactoryTalk View human-machine interface (HMI) software. FactoryTalk View Site Edition (SE) and Machine Edition (ME) 7.0 applications, released in early 2013, offer more efficient alarm management, simplified installation, improved user experience, and integrated data sharing in a wide range of production environments. To stay competitive, operators need scalable HMI solutions that are easier to install, enable operator productivity, and are more tightly integrated to company control and information systems. FactoryTalk View SE 7.0 software will support larger numbers of HMI clients and servers in a single system, increasing the size of systems that can support the FactoryTalk View SE alarming subsystem, FactoryTalk Alarms and Events. The FactoryTalk Alarms and Events alarming subsystem has been enhanced to align with ISA’s Alarming Standard 18.2., and will now support the shelving state. The subsystem now also allows users to configure remote-alarming commands on display faceplates, saving crucial time when an operator needs to react to device alarm situations. The newest version includes an improved installation process and design environment. The new installation process in FactoryTalk View SE and ME software saves time with a streamlined work flow that automates installation of FactoryTalk View components. From a design-time standpoint, a new find-and-replace for HMI and global-object displays will be available in the FactoryTalk View Studio design environment so the user can locate and replace tags or strings across multiple servers and screens.
NZ Manufacturer July 2013
Your time is limited, so don’t waste it living someone else’s life. – Steve Jobs
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MANUFACTURING TECHNOLOGY
Delcam leading CAM software specialist for 13th year
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he latest NC Software Market Analysis Report from leading US analysts CIMdata shows that, in 2012, Delcam again had the highest vendor revenues and received the highest enduser payments of all the CAMcentric companies. This means that the company has completed thirteen years as the world’s leading specialist supplier of CAM software and services, having first achieved its global leadership in 2000, despite a number of mergers and acquisitions that have created some larger competitors. CIMdata found that Delcam continues to increase its market toolkit, featuring a library of more than 600 components, such as hoses, fittings, piping components, weld symbols, profiles, human figures, macros and drawings, among others. The library is continuously updated with new and relevant content. • myHeadlines is a non-intrusive, user-activated scrolling news feed that provides up-to-date news, training schedules and
Increased sales of the PowerMILL CAM system for five-axis machining helped Delcam remain the world’s leading specialist supplier of CAM software
product information. The feed can be customised to include only the content required, including support information, query tracking and open ticket status. “There’s no reason why, with today’s highly-connected work environment and ultra-highresolution displays, that content and activities related directly to a current Solidworks project, user or team should be accessed from multiple
applications,” says Piper. “myIntercad gives users immediate, live access to the resources they need without having to step out of their workflows or routine. This includes direct support, content downloads and updated information on the products or modules they’re working with, and can only further improve the productivity and efficiency of the Solidworks community.”
share. The company’s share of vendor revenues grew from just over 7% in 2011 to 7.3% in 2012. A further increase in market share to over 7.5% is predicted by CIMdata for Delcam in 2013. The CIMdata report also confirmed that Delcam continues to have the largest organisation in the CAM industry, employing 671 people, by far the largest number of staff devoted to CAM software in any company. No other company employs more than 300 people for its CAM activities. The Delcam staff total includes the largest development team in the industry, with 210 people working on the company’s manufacturing software. The next highest CAM development team comprises 130 people, less than two-thirds of the Delcam total. Total end-user spending on NC software and services is estimated by CIMdata to have grown by 5.9% in 2012, establishing a new record for the industry. CIMdata projects that the growth in the market will accelerate further in 2013 and so estimates that end-user spending for NC software will increase by 7.9%.
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NZ Manufacturer July 2013
MANUFACTURING TECHNOLOGY
Mediocrity knows nothing higher than itself, but talent instantly recognises genius. – Arthur Conan Doyle, Sr.
3D-Printed battery as tiny as a grain of sand
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-D printing can now be used to print lithium-ion microbatteries the size of a grain of sand. The printed microbatteries could supply electricity to tiny devices in fields from medicine to communications, including many that have lingered on laboratory benches for lack of a battery small enough to fit the device, yet provide enough stored energy to power them. To make the microbatteries, a team based at Harvard Univ. and the Univ. of Illinois at UrbanaChampaign printed precisely interlaced stacks of tiny battery
electrodes, each less than the width of a human hair. “Not only did we demonstrate for the first time that we can 3-D print a battery, we demonstrated it in the most rigorous way,” said Jennifer Lewis, PhD, senior author of the study, who is also the Hansjörg Wyss Prof. of Biologically Inspired Engineering at the Harvard School of Engineering and Applied Sciences (SEAS), and a Core Faculty Member of the Wyss Institute for Biologically Inspired Engineering at Harvard Univ. Lewis led the project in her prior position at the Univ. of Illinois at Urbana-Champaign, in
OneTouch AT v2 speeds troubleshooting
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ersion 2 software for the OneTouch AT Network Assistant adds new features making it easier for network technicians to isolate the root cause of end-user wired and wireless problems, fix or escalate those issues and validate performance and SLA (service level agreement) compliance after changes are made. Network technicians are spending 48 to 58 per cent more time dealing with emerging wireless LAN and Bring Your Own Device (BYOD) issues, according to a recent Fluke Networks customer survey*. More than 37 per cent report spending more time supporting VoIP (Voice over Internet Protocol) when compared to two years ago. OneTouch AT has been updated with key features to help meet these new challenges including: • BYOD Management – New automated Wi-Fi discovery capabilities (including 802.11ac devices) and Wi-Fi packet capture simplify smart device management and speed problem resolution • Network Performance Acceptance Testing – New wired and wireless performance tests automate the measurement and assessment of end-to-end path performance to prove that network projects were successfully completed and that the performance meets design objectives • Inline VoIP Analysis – New inline test provides visibility into IP phone initialisation and call control processes, and VoIP conversation quality to simplify troubleshooting of IP phone problems. Today’s network support organisations are being pressured to speed troubleshooting and project www.nzmanufacturer.co.nz
acceptance processes, but to do this successfully they need to standardise these processes and their tools. OneTouch AT provides teams with a portable tool that can not only speed the identification and remediation of network problems so they can meet new emerging challenges, but also provide a means to verify performance and system acceptance.” The OneTouch AT software update also includes a new Path Analysis test, a Multi-Port Statistics test, inline VoIP packet capture, and additional features for enhanced troubleshooting and management.
collaboration with co-author Shen Dillon, an ass. prof. of materials science and engineering there. The results are published online in Advanced Materials. In recent years engineers have invented many miniaturized devices, including medical implants, flying insect-like robots and tiny cameras and microphones that fit on a pair of glasses. But often the batteries that power them are as large or larger than the devices themselves—which defeats the purpose of building small. To get around this problem, manufacturers have traditionally deposited thin films of solid materials to build the electrodes. However, due to their ultrathin design, these solid-state microbatteries do not pack sufficient energy to power tomorrow’s miniaturized devices. The scientists realized they could pack more energy if they could create stacks of tightly interlaced, ultrathin electrodes that were built out of plane. For this they turned to 3-D printing. 3-D printers follow instructions from three-dimensional computer drawings, depositing successive layers of material— inks—to build a physical object from the ground up, much like stacking a deck of cards one at a time. The technique is used in a range of fields, from producing crowns in dental laboratories to rapid prototyping of aerospace, automotive and consumer goods. Lewis’ group has greatly expanded the capabilities of 3-D printing. They have designed a broad range of functional inks— inks with useful chemical and electrical properties. And they have used those inks with their custom-
built 3-D printers to create precise structures with the electronic, optical, mechanical or biologically relevant properties they want. To print 3-D electrodes, Lewis’ group first created and tested several specialized inks. Unlike the ink in an office inkjet printer, which comes out as droplets of liquid that wet the page, the inks developed for extrusion-based 3-D printing must fulfill two difficult requirements. They must exit fine nozzles like toothpaste from a tube, and they must immediately harden into their final form. In this case, the inks also had to function as electrochemically active materials to create working anodes and cathodes, and they had to harden into layers that are as narrow as those produced by thin-film manufacturing methods. To accomplish these goals, the researchers created an ink for the anode with nanoparticles of one lithium metal oxide compound, and an ink for the cathode from nanoparticles of another. The printer deposited the inks onto the teeth of two gold combs, creating a tightly interlaced stack of anodes and cathodes. Then the researchers packaged the electrodes into a tiny container and filled it with an electrolyte solution to complete the battery. Next, they measured how much energy could be packed into the tiny batteries, how much power they could deliver, and how long they held a charge. “The electrochemical performance is comparable to commercial batteries in terms of charge and discharge rate, cycle life and energy densities. We’re just able to achieve this on a much smaller scale,” Dillon said.
NZ Manufacturer July 2013
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www.nzmanufacturer.co.nz
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NZ Manufacturer July 2013
MANUFACTURING TECHNOLOGY
Only those who will risk going too far can possibly find out how far one can go. – T.S.Eliot
The Maturing Kid on the Block: Seas ERP as a Viable Option for Manufacturers
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ver the past few months my NZ Manufacturer articles have focused heavily on the future of ERP (enterprise resource planning) software and the direction software vendors are heading in respect to the manufacturing industry. It would be remiss of me to not approach the topic of Cloud or Seas (software as a service), a topic that merges with both themes. There will always be a place for on premise ERP solutions, however, the Seas market continues to mature and is no longer the new kid on the block. Seas ERP has become a viable, tried and testing option for smaller manufactures. In most cases Seas has made enterprise-grade ERP affordable. Cloud technology continues to go mainstream. Researchers from The University of Auckland are currently developing cloud manufacturing technology to make it easier for New Zealand manufacturing companies to take on bigger projects and to share resources. Initial concerns about security, response time and service availability have diminished for many organisations as SaaS business and computing models have matured and adoption has become more widespread. Vendors must clearly demonstrate the TCO advantages of SaaS, ensure that their products have well-defined data integration and conversion procedures, show price transparency, and have well-articulated security and data protection stories. Manufacturers need to be satisfied that no one is able to access their data which often includes proprietary part and process information that must be protected from competitors, both foreign and domestic. Manufacturers also want assurances that they will have uninterrupted access to their data so there is no disruption in business continuity. It’s crucial for the manufacturing process to not be interrupted. Even a short unplanned outage that keeps a manufacturer from being able to receive, process, track, and ship parts can be extremely expensive. While SaaS ERP has become a viable option for job shops and small manufacturers delivering financial, implementation and operational benefits, only around half of manufacturers with fewer than 50 employees use an ERP system. High initial costs (including software, hardware and supporting www.nzmanufacturer.co.nz
infrastructure), lengthy and complex implementation projects and the staffing necessary to implement and maintain ERP systems all become barriers in implementing or upgrading. These practical concerns are key factors driving the increasing adoption of SaaS solutions within small businesses. In fact, Gartner1 forecasts that the global investment in enterprise SaaS software will grow 17.2% annually through 2015 and that by 2015 16% of all enterprise software will be provided in the SaaS model. While, recent research by Aberdeen2 estimates that nearly 26% of all ERP systems implemented within small businesses are SaaS ERP compared to just 4% within large enterprises.
With traditional on-premise software deployments, customers purchase, install, manage, and maintain the software as well as supporting infrastructure, such as hardware and networks, in house. In a SaaS deployment, the software vendor hosts, manages and provides customers access to the software as a service over the Internet. Rather than pay for the software up-front out of their capital budgets, SaaS customers license it on a subscription basis, usually by per user, per month or a number of transactions. On-going maintenance, upgrades, and support for the software and infrastructure are all the responsibility of the software vendor and are typically included in the subscription fee.
Researchers from The University of Auckland are currently developing cloud manufacturing technology to make it easier for New Zealand manufacturing companies to take on bigger projects and to share resources.
When deciding on their SaaS ERP solution, a manufacturer must weigh up the maturity of the offering against the agility of the vendor. Additionally, there are some economies of scale to be gained through multi tenancy which cannot be achieved via single tenancy. Choosing between SaaS and traditional ERP isn’t always necessary. Many software vendors are providing hybrid options that combine both deployment models by offering customers a single instance with the flexibility of traditional ERP, but hosting those solutions externally to accommodate the desire to outsource their ERP infrastructure. Manufacturers can also choose a single code-line solution allowing them to go from a SaaS-based ERP to on premise
By Craig Charlton,
SVP & General Manager, Asia Pacific, Epicor Software and vice versa more effectively. The solution can scale with the manufacturer unrestricted by deployment models. Manufacturing business requirements are leading many ERP vendors in the delivery of their SaaS-based ERP. Solutions should empower customer choice of on demand or on premise along with the ability to change their choice based on a changing business environment. Having the flexibility to adapt to yet unknown business requirements is one of the key factors in continuing to maintain your competitive edge in the New Zealand manufacturing industry.
NZ Manufacturer July 2013
Life isn’t about finding yourself. Life is about creating yourself. – George Bernard Shaw
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THE FUTURE OF MANUFACTURING
Cyborgs, a fusion of man and machine
yborgs are gradually working their way into our lives. The general representation of a cyborg is that seen in science fiction films of a fusion between man and machine. A direct interface between the brain and the Internet, like the brain-machine interface (BMI) described in the science fiction manga Ghost in the Shell, has been successfully tested in laboratory experiments. That extreme level of manmachine fusion aside, people’s lives would already be compromised by not having a mobile phone or smartphone, and in some cases, when we think about those who lead a life that is dependent on such devices, we can see that the fusion between man and machine is underway with a momentum that supersedes the pros and cons. However, the fusion of humans and machines is not confined to fusion with engineering machinery. Think of machinery as technology in a wider sense. One of the largest modern technological fields is biotechnology. People are helped by biotechnology in the form of medical treatment, but we could be heading toward a scenario in which people are composed of biotechnology. If that is the case, the question must be asked: what are the people who have been integrated with technology in such a way? My background is in western philosophy, which since ancient times has continually asked the question, “What is mankind?” Traditional philosophy was founded on a distinction between human beings and machines (as well as animals), but nowadays technology is beginning to shake this distinction and cyborgs, which are the fusion of man and machine, really have to be
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seen as a fundamental phenomenon in philosophical discussions. The question “What is mankind?” needs to be replaced by the question “What is a cyborg?”
Human beings composed of technology
Let’s move from abstract theory to concrete considerations. I have discussed the above-mentioned BMI elsewhere1, so here I want to focus on biotechnology, and especially iPS cells in regenerative medicine. Technology related to iPS cells has developed so quickly that in recent years hardly a day has gone by without it making the news. iPS cell technology is a field of regenerative medicine in which body cells are reprogrammed into a so-called pluripotent cell state, from which any organ can be created according to plan. Press coverage says that a number of significant breakthroughs will be needed before actual three-dimensional organs can be created, although attempts have already been made. If this creation of real organs does become possible in the future, it will increase the opportunities for human beings to be composed of transplanted organs. More and more people will accept being composed of such biotechnology.
Attempts have already been made to genetically modify iPS cells and to restore ‘sick’ genetic sequences to normal genetic sequences, with some successful cases being reported3. This kind of genetic modification will inevitably raise the issue of enhancement in the future. Enhancement means increased performance: think about the simple
example of doping among athletes. This is, of course, a very problematic topic. In terms of the above-mentioned genetic repair, it means not only restoring gene sequences that cause illness into normal gene sequences, but also going further and creating gene sequences in order to enhance performance as well as health. At the extreme end of enhancement is the extension of the natural limits to our lifespan, or in other words, increasing longevity. A general feature of technology is that it extends or amplifies the natural state. The technology of the automobile, for example, enables us to move at speeds unattainable in our natural state of walking or running, so basically it has extended and amplified our natural state of being on foot. Regenerative medicine can, through organ transplantation, provide patients who are sick or
dying with improved natural health or an extended lifespan. This being the case, people who have been helped by biotechnology such as regenerative medicine, and who are consequently composed of biotechnology, are enhanced by this technology which basically prolongs their life, and are filled with the strength to try to defy death. Western philosophy assumes that all people die one day. Of course it may be impossible to avoid death by regenerative medicine. But technology (or biotechnology) has set itself the target of shaking this assumption, a fact that needs to be included in philosophical discussions. People composed of biotechnology are cyborgs, an amalgam of human being and technology. Cyborgs are truly a fundamental phenomenon in philosophical discussions. What direction are human beings, or should I say cyborgs, headed in?
that provides such an advanced toolbox and Geomagic 2014 builds on those workflows by introducing key new Geomagic® Design™ motion simulation, clash check analysis and Finite Element Analysis (FEA) modules. Geomagic Solutions’ engineering software products include: 1. Geomagic Design for 3D solid modelling design and drawing production 2. Geomagic® Freeform® for CAD and modelling design 3. Geomagic Verify and Geomagic Control for 3D inspection 4. Geomagic Design X and Geomagic Design Direct for scanning and reverse engineering. Cubify is the hobby version. A
very cut-down product capable of basic modeling and drawing production. Geomagic Design Elements is the first of two industrial/commercial versions. Full suite of modeling tools, assemblies , bill of materials and drawings functions. Geomagic Design is the full blown version with all the features of Design Elements plus part and assembly configurations, full suite of sheet metal design and development tools, plus add-ons, Keyshot Photorendering and Dynamics animation. Geomagic’s software and hardware are utilised by world-class customers in a variety of industries. including aerospace, automotive, medical, consumer products, toys,
collectibles, coin design, jewellery, fine art, heritage restoration, research, education, mould making, entertainment and training. In fact, some of the world’s leading companies and research organisations use Geomagic software, including Ford, BMW, Boeing, Harley Davidson, Timberland, Mattel/ Fisher Price, Lego, Pratt & Whitney, NASA, Schneider Electronic, 3M, Danaher and Invisalign. Geomagic Group is represented in New Zealand by Bay CAD Services Ltd, currently agents for Geomagic Design products (formerly Alibre), and are looking forward to being able to supply the full suite of Geomagic Group software.
‘Enhancement’ providing enhanced, extended life
Geomagic Group represented by Bay CAD Services
ast year 3D Systems purchased Alibre Design Inc., and recently rebranded the Alibre product line to fall under Geomagic, a brand that will ultimately represent all 3D Systems software offerings under the new Geomagic Group name. 3D Systems produce the popular Cube and CubeX consumer 3D printers as well as the ProJet range of production 3D Printers. They have also purchased other companies producing software to convert scanned data into 3D models and more to create free-form sculptures, providing a range of integrated software and hardware solutions that cover every stage of the 3D scan-design-print workflow. 3D Systems is the only company
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NZ Manufacturer July 2013
WORKSHOP TOOLS
Yesterday is history. Tomorrow is a mystery. Today is a gift. That’s why it’s called the present. – Alice Morse Earle
Buying spiral bevel gea
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piral bevel gear drives ‚ a refined type of rightangle drive ‚ function as important motion control components of equipment for packaging, food processing, military, textile, agricultural, and a wide variety of material handling and marine applications. These power transmission products play a critical role where motive force within a machine must be transferred around a corner. Spiral bevel gearboxes are often specified in challenging locations such as washdown processing areas, or, conversely, where the end-use environment must avoid contamination from an open drive. How can specifiers and purchasers obtain the most suitable drives for their needs?
1. Are
they suited for use in challenging environments?
Many applications require specialised drive materials, components, or designs to deliver required performance in difficult environments. For best results, designers and purchasers should describe enduse conditions to vendors carefully. Where exactly will the drive be located? Note any possibilities of contamination, either from the environment to the drive or vice-versa. Warn of temperature extremes. Can gearing be open, or are closed housings mandated? Must any special governmental regulations or industry association standards be met? What service life is expected? What’s been the previous experience of similar drives for this use?
Housings and coatings
Food processing presents a number of challenging locales. For example, poultry plants subject drive housings to continually caustic www.nzmanufacturer.co.nz
washdown conditions. Where standard housings may corrode, some vendors furnish extra protection via expensive stainless steel housings. Especially responsive vendors may offer a variety of coatings to increase resistance. Examples: popular hardcoat or hard anodising provides an electrochemical, corrosion-resistant aluminium oxide coating that penetrates outer surfaces. Another option, durable nickel plating, uniformly deposits a specified thickness of nickel phosphorous alloy onto metallic substrates, preventing the environment from reacting with the metal. Finally, powder coating applies a solvent-free, attractive finish for extreme durability and long life. Ask your supplier for your most suitable choice.
Seals
Ordinary elastomer seals provide excellent service for many standard applications. But they may fail under difficult conditions such as the poultry plant example above. Is your product or equipment susceptible to damage by a poorly sealed drive? Does your vendor offer special sealing materials or arrangements that can reduce these risks?
Lubricants
Contamination is also a concern in numerous applications. For food processing, make sure your supplier lubricates its gears with food-grade grease for incidental contact with food products. Similar gearboxgenerated contamination may also be a risk in clean room environments. As a drive turns, it generates heat that may vaporize a small amount
of any lubricant on the gears. This vapour could get past housing seals and escape into the environment, contaminating the room. Only a few spiral bevel gear drive makers offer special clean-room-rated grease to address this concern. Finally, other applications occasionally demand specialized solutions such as dry lubricant coatings, or, in the case of nuclear facilities, grease-free drives.
Bearings
Normally, any contamination concerns can be met with well-sealed drives. However, in a few cases, challenging end-use conditions may actually demand the use of sealed bearings as well. Since this is an unusual requirement, only a few suppliers will be prepared to meet it.
Gears
The majority of drive uses may be handled by gears made of good grades of alloy steel. Only rare circumstances require more exotic solutions. For instance, the extreme regulatory regimen found in nuclear power plants demands gearing materials made of specialised stainless steel. Very few gear makers are equipped to manufacture their products using anything but standard steels. If you require such an accommodation, make that a primary qualification for any prospective vendor. A double-seal approach further extends drive life. Instead of expensive stainless steel housings, aluminium housings and bearing locknuts with hardcoat or powder coating provide similar protection at lower cost.
2. Have
they been designed for field maintenance, repair, and rebuild?
Properly assembled and sized for the application, a well-made
spiral bevel gear drive should last for years in all but the most difficult applications. If a drive develops trouble or fails after warranty, depending on age and condition it is often most cost-effective to purchase a new unit. However, in some cases it may still be worth considering maintenance, repair, or rebuild instead of replacement. Before you buy, ask vendors if such services are possible with their products. How serviceable will the drive be in your plant? Some models are not easily disassembled or adjusted in the field to determine if they are repairable. Are parts readily available? To minimise any machine downtime in your operation, standard parts should be stocked and ready to ship the same day. If service is needed, is technical support available? A person with requisite expertise in the given drive ‚plus its typical applications as well as common problems and solutions, should be available in person for troubleshooting. Whether by phone or e-mail, your questions should be answered within a reasonable time. Does the vendor supply field maintenance installation instructions with every drive? These provide information on topics such as determining the required amount of grease or adjusting the unit for optimum backlash. Good instructions make repairs less frustrating, can extend the life of a rebuild, and may reduce future downtime. Be aware that some vendors don’t supply this documentation, and plan your purchases accordingly. Overall, look for a supplier that’s responsive. This pays off for OEMs with design change flexibility and faster time to market; for MROs with greater asset availability; and for all with reduced risk, greater efficiency and productivity, and right sized inventories. Ideally, you want a gear drive vendor that quotes quickly and accurately, based on the specifications you supply fulfills orders just as fast. Many claim they will assemble and ship a new drive within 24 hours of your order, or get a replacement part out the door the same day. But in practice, some don’t live up to this promise. Keep track of different vendors’ responsiveness until you find one that can consistently meet your needs.
3. How
do they minimise noise and backlash?
Most designers and end users like their gear sets as quiet as possible. Noisy gears actually may signify mechanical deficiencies that
NZ Manufacturer July 2013
We often miss opportunity because it’s dressed in overalls and looks like work. – Thomas Edison
ar drives contribute to poor performance and shortened drive life. Plus even where an unusually hushed environment is not a prime consideration, quiet gears provide a perception of high quality and superior functionality. The type of gear you choose can depend on the gear performance you require. For lower speeds and lighter loads, straight bevel gears may be adequate, although their abrupt transfer from tooth to tooth tends to create higher impact stress and greater noise. By contrast, spiral bevel gears are designed so that their curved teeth come into contact gradually. You get higher tooth-to-tooth contact covering a greater surface area. This allows well-made spiral bevel designs to offer smooth, quiet operation, even at high speeds and greater load capacities. When comparing different spiral bevel designs, complex considerations determine the final amount of noise emitted by any given gear set. One prime factor: backlash. This is defined as the distance between meshing gear teeth. All else being equal, the greater the backlash, the louder the impact when gear meets gear. A critical question: can your drive vendor make the adjustments required to minimise backlash? Most manufacturers assemble their gears to a loose distance. They then close the gap just enough to get minimally acceptable tolerance by locking each gear permanently into place with a shim or retaining ring. However, even a slight variation in the manufacturing process can substantially increase the backlash on an individual gear set.
4. Can they be ordered in sizes and ratings for specific applications?
Different jobs demand different drives. Look for vendors that are
willing to discuss your precise application, and then offer options in terms of sizes and ratings that can deliver high performance and optimized drive service life within the parameters your job generates. Pay particular attention to suggested torque ratios. These ratings are based on revolutions per minute under a given horsepower. In an alltoo-common scenario, a customer may underestimate the amount of torque a drive will routinely encounter on the job. Suppliers sometimes discover that their drives rated for 190 inch pounds of torque are instead running at 400 inch pounds! This is bad news, since each drive is rated for an ultimate static torque. If operation frequently exceeds recommended levels of torque and/ or horsepower, a good drive may still operate acceptably for some time. However, eventually, teeth
Tough new inspection lamp S
hedding enough light on a poorly lit work area makes the task easier and that’s the role of the new ‘See Ezy’ heavy-duty L.E.D inspection lamp. The lamp is ideally suited to the most demanding mechanical and trade applications, the unit is tough and powerful. It is claimed to be significantly brighter than just about any similar lamp on the market thanks to the use of high-powered SMD L.E.Ds that deliver an intense, yet smooth fluorescent style light output. The new ‘See Ezy’ inspection
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WORKSHOP TOOLS
wear; bearings fail; roll pins fatigue, and then shear. Make a preliminary attempt to spec your drive by consulting the vendor’s catalogue or Web site. Then, especially if your requirements seem at all out of the ordinary, contact the vendor or distributor. At a minimum, a good vendor should be willing to work closely with you, ensuring that the drive and components you select match the requirements of the work you want the drive to do.
An excellent vendor may go further, customizing a drive to meet your special needs. For example, standard pins could be replaced by specifying solid roll pins that offer much higher static torque ratios, for better performance and much improved drive life. In many cases, a spiral bevel gear drive is much more than a commodity part. It’s a complex machine that’s precisely engineered for your exact needs.
Videos lamp features a tough, impactresistant polycarbonate and rubber body housing with shatterproof polycarbonate lens that has undergone an impressive test regime. During development the light had to remain fully operational after 8-metre drop tests onto concrete. Also lending to the lamp’s suitability for harsh mechanical and trade workshop environments is its weather resistance (IP65), and nonslip, rubber handle. Another innovative feature of the new lamp is its adjustable light output, which allows the user to choose from either four hours at maximum power, or seven hours at reduced output. The unit comes
with a convenient 240V docking station and employs lithium batteries, which have no memory effect leading to a longer shelf life. When the battery is low, a red indicator light flashes warning the user that a recharge is required, ensuring they won’t be caught without light during important jobs. When charging, a blue light illuminates. Operators can choose between two interchangeable rear covers, a steel belt clip or industrial strength magnet for convenient hands-free operation. For further convenience the unit is fitted with a retractable metal swivel hook allowing the lamp to hang. www.nzmanufacturer.co.nz
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NZ Manufacturer July 2013
WORKSHOP TOOLS
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Try not to become a man of success, but rather try to become a man of value. – Albert Einstein
Fuel funnel filters contaminants
new type of fuel funnel that filters out harmful dirt, particles and water, which could potentially damage any engine, is now available in New Zealand. Just introduced as part of the popular Mr Funnel range, the new Fuel Filter Funnel features spaceage filtering technology that traps a wide range of contaminants from entering the fuel system. The US manufacturer describes it as the “world’s first portable fuel cleaning system” and says it can save thousands of dollars in costly engine or fuel system repair bills. Modern engines fitted to vehicles, garden equipment and boats are highly susceptible to even small traces of particles or water contamination, making them hard to start, as well as causing damage. The Fuel Filter Funnel prevents these contaminants from entering the system without unduly hindering the flow. Filtered fuel flows out almost as quickly as if it was passing through a funnel with no filter. The ‘sump’ area in the funnel collects the deflected water and other contaminants once the fuel has passed through the filter, for easy disposal. It is estimated that 90% of
problems affecting small engines are usually related to fuel issues, often from water or other contaminants, so if you can screen your fuel out in te field it will definitely be better for your engine and pocket, as well as saving time and frustration. Fuel left in containers is especially prone to condensation, which can be extremely damaging if used in diesel engines such as those used in boats, farm and contracting equipment that can be left sitting over long periods, although moisture is bad for engines running on any fuel. Other risks include dirt, sawdust, and even vegetative matter, such as grass clippings/leaves, entering tanks when refuelling motor mowers, chainsaws or other outdoor equipment. The Fuel Filter Funnel removes these risks. The Fuel Filter Funnel can be used with a variety of fuel types, including petrol, diesel, 2-stroke mixes, kerosene and heating oil, and its heavy-duty construction is designed to resist chemical/solvent attack. The special filter material, which can trap moisture and particles down to .005”, was developed initially for military use to protect US Army tanks on dusty battlefields and has also been used in the space programme and is subject to a
pending patent. A demonstration of just how effective it is can be viewed in a video clip on the www.mrfunnel. com website, which shows an experiment where sand, iron filings, grass clippings, woodchips and water are poured into a pail of fuel before passing through the Fuel Funnel Filter, which removes the
contaminants completely. The Mr Funnel Fuel Filter Funnel is available in four different sizes, from the smallest that measures 89mm in diameter and has a flow rate of 9.5 litres/minute, to the largest size, which has a pair of filters and comes with a 216mm diameter and a flow rate of more than 45 litres/ minute.
Mr Funnel Fuel Filter Funnel prevents contaminants entering the fuel system.
Please contact us if you have any questions. Thank you for your business. www.nzmanufacturer.co.nz
NZ Manufacturer July 2013
People who say it cannot be done should not interrupt those who are doing it. – George Bernard Shaw
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EXPORT NEWS
Take a long term look at Brazil
he stats about Brazil are breathtaking. Sixth largest economy in the world, fifth largest recipient of foreign investment in 2012 and a middle class numbering around 95 million that has considerable buying power. It’s not surprising that Brazil is a target market for companies around the world wanting to grow. New Zealand has a growing education relationship with Brazil and investments, many in the dairy industry, that are estimated to be worth over $300 million. But in most sectors, the opportunities Brazil offers New Zealand companies are relatively untouched. That’s partly because Brazil is a protected market with steep tariffs for anything that competes with a locally produced product. It’s also because Brazil is a major producer of some of the same things that we are including dairy products, meat and wood. A simple export model doesn’t usually work. Most companies getting traction have formed a joint venture with a Brazilian company or are getting around tariff barriers by assembling or manufacturing in the market. Manufacturers of equipment and machinery in New Zealand cab find a market in Brazil. Just about all of the world’s biggest companies are there and most of them have global supply chains for items like components, instrumentation, and processing and telecommunications equipment. And unique offerings sometimes hit the spot too if they feature cutting edge solutions. Tait Communications, for example, supplies digital radio solutions to the Sao Paulo Military Police, one of the largest police forces in the world.
Brazil will be getting even more global attention over the next couple of years as it hosts the 2014 FIFA World Cup, followed two years later by the summer Olympics. Large scale public and private investment is going into infrastructure projects
needed to run the events and accommodate spectators. These offer potential for New Zealand engineering and consultancy firms and companies supplying technology and systems for airports, rail networks and the like. But despite the pot of gold waiting in Brazil, it can be a tough and frustrating place to do business. While New Zealand consistently ranks in the top three in the World Bank’s annual study on the ease of doing business around the globe, the latest figures put Brazil at 130 out of 185 countries.
By Ralph Hays, New Zealand Trade Commissioner for Brazil The tax and legal systems are complex, rules change constantly and logistics can be challenging. Companies that are doing well almost always have staff on the ground who speak the language and can navigate the bureaucracy. But for businesses looking long term, it makes sense to be investing in Brazil to tap into the growing consumer demand.
GMP Pharmaceuticals, where it is now and will be in the future
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avinesh Kumaran of GMP Pharmaceuticals recently spoke to NZ Manufacturer about the company and business, generally.
How is Business?
GMP PHARMACEUTICALS is a successful and growing company, specializing in health supplements, nutritional products and infant formula. Over the last decade, the company has grown from around 7 employees to 250 employees, largely due to its success in health supplement business. A number of the products that the company contract manufactures for its customers can be found in local pharmacies and supermarkets both in New Zealand and internationally.
What is your company currently working on?
SINCE 2011, GMP Pharmaceuticals through its dairy division has successfully provided a total contract manufacturing solution for value added formulations using the world’s leading pharmaceutical grade mixing and blending processes to manufacture high quality milk products. The company is currently working on expanding its infant formula business by investing in additional canning line, along with other plant and warehouse extensions. Once completed, the company will have capacities to produce up to 20 million cans of milk powder per year.
Where are the markets for your products?
WE PREDOMINANTLY sell in China, New Zealand and Australia. Other growing markets include Hong Kong, Korea, Singapore and South East Asia. About 60% of the company’s products are directly exported and an estimated 20% indirectly exported.
How does GMP Pharmaceuticals find the current business climate?
THE CURRENT business climate is challenging and unpredictable due to the sensitive nature of infant formula, particularly in China where there is a lot of attention on the topic by the media, consumers
and the government. Recently the Chinese government has announced various regulatory changes to assure consumers that the brands of infant formula sold in China are safe and of good quality and that have been manufactured in highly regulated factories. This requirement has been expanded into imported milk. Government agencies in New Zealand are working closely with Chinese officials to provide assurance that all brands manufactured in New Zealand are safe to consume. GMP views these changes as highly beneficial for the infant formula industry both in China and New Zealand. Continues page 22 www.nzmanufacturer.co.nz
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NZ Manufacturer July 2013
THE FUTURE OF MANUFACTURING
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Chains of habit are too light to be felt until they are too heavy to be broken. – Warren Buffett
The Internet of Things and t
n what’s called the Internet of Things, 1 the physical world is becoming a type of information system—through sensors and actuators embedded in physical objects and linked through wired and wireless networks via the Internet Protocol. In manufacturing, the potential for cyber-physical systems to improve productivity in the production process and the supply chain is vast. Consider processes that govern themselves, where smart products can take corrective action to avoid damages and where individual parts are automatically replenished. Such technologies already exist and could drive what some German industry leaders call the fourth industrial revolution— following the steam engine, the conveyor
A new era for manufacturing and logistics
The Internet of Things has already set in motion the idea of a fourth industrial revolution—a new wave of technological changes that will decentralize production control and trigger a paradigm shift in manufacturing. How will this paradigm shift affect the classic production process and the manufacturing value chain? Given the Internet of Things— or Industry 4.0 as we call it when referring to manufacturing production—it is highly likely that the world of production will
become more and more networked until everything is interlinked with everything else. And logistics could be at the forefront of this shift. And it will make logistics and the supplier network grow enormously more complicated. Although lean manufacturing can certainly reduce inventories, manufacturers will need to coordinate with more and more suppliers—often globally, and with longer transport times, more manufacturing steps, and significantly more parties. If a plant implements lean manufacturing, it keeps stocks to a
www.nzeco.govt.nz www.nzmanufacturer.co.nz
minimum—not one part too many or too few. Components are constantly travelling the planet, often arriving within a day. With the Internet of Things, this system must extend beyond the limits of individual factories to interconnect multiple factories and even regions. Now the questions become who will do this? How do we find an architecture that is stable enough to keep everything networked together? It will primarily require algorithm specialists and software
architects. We will need “steering instruments”—new algorithms and applications that interlink millions of things, that ensure that everything runs stably, and that are synchronized across the entire value chain. So how do we assess our existing logistics systems and identify the gaps? Let’s take container logistics in maritime shipping, which might be considered almost Stone Age in view of what is to come. It will be a tremendous effort to bring container logistics into the next generation of manufacturing.
NZ Manufacturer July 2013
Our business in life is not to get ahead of others, but to get ahead of ourselves. – E. Joseph Cossman
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THE FUTURE OF MANUFACTURING
the future of manufacturing To really drive developments, two competencies must come together. First, we need to recognise the change potential, value creation, and cost reductions we can achieve if we apply what’s actually “new” about new technologies. For example, take cyberphysical systems, which can tell us where every single unit is at any given time. Logistics players often use this tool, but with an old mind-set that fails to exploit the advancements the tool was designed to offer. So the first requirement is that logistics players truly use what’s new. The second competency is finding people who are able to design robust algorithms: those who make the system user-friendly so that the people who use it dayto-day can immediately recognize problems and know how to react without getting tangled up in a web of interdependencies. One core element is the ability to create models. It is essential to translate the physical world into a format that can be handled by IT. This requires mathematical, domain, market, and context know-how. In the connected world, we cannot separate the physical world from business processes. We capture this in the slogan “process2device.” That means a physical device becomes an active part of a business process: delivering data, sending events, and processing rules. This notion is driving us.
Fusing processes and devices
Most companies think of physical flows—meaning the flow of material components through the supply chain—as separate from information flows and then consider how and where to coordinate and synchronize them. After the fourth industrial revolution, there will no longer be a difference between information and materials, because products will be inextricably linked to “their” information. For example, a piece of metal or raw material will say, “I am the block that will be made into product X for customer Y.” In an extreme vision, this unfinished material already knows for which customer it is intended and carries with it all the information about where and when it will be processed. Once the material is in the machine, the material itself records any deviations from the standard process, determines when it’s “done,” and knows how to get to its customer. It might not happen
right away, but things will definitely move in this direction which would mean that mechanical engineering would also be inseparable from IT. The competencies cannot be mixed at will, but we do need new forms of interdisciplinary collaboration. The next big step will be to think through the interdependencies among the machine, the production components, the manufacturing environment, and the IT that connects it all, so that the production technology controlling the machines merges with the technical data of the components. This requires a high degree of standardisation so that the machine knows what it needs to do to any given component, and the components can confirm that the machine has done it. Such IT linkage goes far beyond current manufacturing systems. What happens is a complete consolidation of devices and process management. “Process and device” will be inseparable; physical things become part of the process. What this means for the plant is that machines and work flows merge to become a single entity. The work flow ceases to exist as an independent logistical layer; it is integrated into the hardware. This idea can be taken even further—if existing machine capacities only work through components on order, does it even matter who owns the assets? In other words, will we experience a trend in plants similar to what we have seen in cloud computing, where the customer purchases only virtual capacity?
With these radical changes looming, who has the best chance of controlling the profit pool—those with the production technology or those who own the assets? Who represents the final product? The designer? The manufacturer? Or the person who created the contract with the customer for the final product? Which takes us into the field of contract manufacturing. Design companies have already separated design and production. They create products or solutions for customers but do not produce them; they simply provide the specifications to contract manufacturers, who then handle production. This trend of separating design and production will continue to spread across other industries and sectors. Supply-chain integration: What’s in store? Supply-chain integration will play a decisive role in new operating models. The point is to completely integrate all relevant information into this chain. We are still a long
• • • •
way off, but it will be fascinating to see whether even large supply-chain operators will be able to keep pace with the speed of technology. With all this new information available—about interdependencies, the flow of materials, the cycle time, and so on—manufacturers can lower their inventory costs and reduce the amount of capital required. But don’t forget: this involves huge amounts of data, and the fundamental prerequisite for such a system is that it is stable and reproducible. Common sense won’t help here; this involves rigorous mathematics. And what’s interesting is that the algorithms for this already exist. Mathematics has already solved numerous problems that we won’t encounter in the real world for another 50 years. But analytical talent is becoming increasingly rare in the labour market, so there will be fierce competition for mathematicians and analysts. The opportunities presented by the Internet of Things are clear—but so are the challenges.
Do you have a story you want to share? Developments? New markets discovered? How are you finding business in this challenging economy?
Email Doug Green at words@xtra.co.nz and share your story with readers. www.nzmanufacturer.co.nz
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NZ Manufacturer July 2013
BETTER BUSINESS
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Failure defeats losers, failure inspires winners. – Robert T. Kiyosaki
Business struggles to identify drivers of growth
ew Zealand businesses seem as confused as a losing All Black coach when it comes to identifying factors that would dramatically drive their business forward, according to the recent Grant Thornton International Business Report (IBR). When asked in the survey “what is the one thing that would dramatically drive their business forward in 2013”, the expected responses were the current topical issues such as an improvement in the exchange rate, skilled staff, technology improvements or research and development incentives. Instead, Greg Thompson said that the staggering fact was that there was no consensus as to what makes a difference. Only ‘More Capital’ and ‘A Tax Break’ garnered 8% support for a solution, with all other suggestions receiving less than 5%, and 74% of the respondents
Unfortunately, New Zealanders take their rugby far more seriously than business, otherwise the rudder would now be fixed. From page 19
picking “some other factor” rather than those suggested. “What this really indicates is a country without direction when it comes to building a stronger economy, with businesses’ views being extremely varied. It would appear we are going round in circles rather than forward. “What is drastically needed is strong leadership to define actions that will make a difference, and then make that happen. This is probably a job that should fall to the Government as the one organisation in New Zealand than can galvanise a wide group.
“There was some hope that the last Budget would give that clear direction, but this was not the case. With next year being an election year, there is little chance of improvement in this area. “For the sake of New Zealand’s prosperity and future, leadership and direction has become the number one priority. If the All Blacks were as confused and rudderless as New Zealand business, change would occur quickly. “Unfortunately, New Zealanders take their rugby far more seriously than business, otherwise the rudder would now be fixed,” he said.
Greg Thompson
Entries open for New Zealand Innovators Awards
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hat does the electric fence, the disposable hypodermic syringe, the whistle and the egg beater all have in common? They all shaped the world as we know it today and had an impact on the way we have grown and developed as a country. These are our own kiwi innovations, built and developed in our own backyard. The New Zealand Innovator Awards, which are now open for entries, aims to celebrate and recognise innovations such as these. Awards convener Louise Webster
says “We continually punch above our weight on global stage, yet many of our innovations go unrecognised. That’s why the New Zealand Innovators Awards are so important. We want to recognise not only the innovation but the innovators ‚ the people behind the scenes, and showcase their achievements to the nation.” Bayer New Zealand is once again the main sponsor of the Awards, which are also supported by Idealog Magazine, Ideas Accelerator and the New Zealand Innovation Council. This year’s awards have several
categories across a wide sector of industry and business. There are awards for innovation excellence in industry: Innovation in Design and Engineering (now includes manufacturing) Innovation in Sustainability and Clean-tech Innovation in Environment and Agriculture Innovation in Health and Science Innovation in Hospitality, Food and Beverage. Innovation in Information Communications Technology.
GMP Pharmaceuticals, where it is now and will be in the future
Where are your emerging markets?
INDIA, Singapore, Korea, Taiwan and Vietnam
How do you see the business mood in NZ at present?
CURRENTLY THE business mood in New Zealand is positive and the industry stakeholders clearly realise that there are millions of dollars of unrealised potential within dairy products. Recently, New Zealand and Taiwan have cemented ties by signing a new trade agreement which will be great for exporting dairy products to Taiwan.
Are your staffs dedicated to the cause?
IT IS IMPORTANT to recognise talent and potential. We tend to recruit fresh science graduates into product development and quality teams. With some years of experience, they are able to utilise there tertiary knowledge with the new found skill set to come up with several innovative ideas and www.nzmanufacturer.co.nz
Minesh Patel, General Manager of GMP Pharmaceuticals
product formulations. Consequently we have over 1600 product formulations currently.
How do you reward them?
ALL OUR staff opportunities to work departments and to seek new roles
are given in different encouraged within our
organization and therefore keeping them motivated. We encourage our staff to give valuable suggestions and reward them for providing good ideas.
Do you rely on the latest technology and procedures for success?
IN ORDER to be successful we equip our employees with the latest available technologies. These include providing factory employees with modern plant and equipment, our Research and Development team with accredited laboratory facilities and our sales team with modern tools to facilitate customer contact.
NZ Manufacturer July 2013
Life shrinks or expands in proportion to one’s courage. – Anaïs Nin
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FOOD MANUFACTURING
Lincoln University opens food research centre
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incoln University has launched a new research centre to be known as the Centre for Food Research and Innovation (CFRI). The new Centre aims to promote food science and technology through research, innovation, industry outreach and educational initiatives, and is in many ways an extension of the already well-established Food Science programme at the University. The new Centre’s research capabilities and discoveries will further expand Lincoln University’s relevance and expertise in the field of food science and technology, and go on to position the University as a global leader in the field. With food science, technology and innovation being critical components of New Zealand’s core
commercial activity as a worldleading food producer, the CFRI will align a large part of its activity to the economic interests of the primary sector. “As the global population grows, meeting the challenge of food production while sustaining the finite land resource is vital. The Centre will assist in delivering new techniques, tools and innovations that result in new products and services crucial to the success of New Zealand’s food industry,” says Assistant Vice-Chancellor Scholarship and Research, Stefanie Rixecker. Consequently, while conducting its own independent research, the CFRI will complement Lincoln University’s notable research activity in agricultural science and look to
work in collaboration with current industry partners such as Lincoln Agritech, AgResearch, Plant & Food Research, and Environmental Science & Research. As well as aligning itself with New Zealand’s key commercial interests, the Centre for Food Research and Innovation will also look to undertake research in social considerations associated with food and the food industry. “A key focus of the CFRI will be to utilise the theoretical knowledge of researchers to deliver applied solutions to the problems faced by the food industry, as well as tackle some of the increasing social problems that stem from the food industry as it currently operates,” says the Director of the CFRI and Professor of Food Science at Lincoln
University, Charles Brennan. “One such example of this is a research project to be undertaken in collaboration with the Technical University in Dresden, Germany, and supported by the Royal Society of New Zealand, that looks at how dietary fibres and natural proteinbased sweeteners can be used to reduce the calorie content in carbohydrate-rich foods.” Ultimately this research is designed to produce healthier food and, beyond merely studying the interactions of starch and protein on an individual’s glycaemic response to foods sweetened in this way, the research will explore the consumer’s sensory perceptions to assess a product’s commercial viability. Such research has real value in alleviating the growing global obesity epidemic.
Anchor have worked with the recycling community to ensure that recycling separators are aware of the opportunities to receive high returns for the new bottles by selling to domestic recycling manufacturers, who have more than 100% capacity to use all Anchor bottles, rather than shipping overseas. Recyclers who have put their
hand up to use recycled Anchor bottles in the manufacture of a wide range of products include Astron, Rural Direct, Comspec and Replas. Recycled Anchor bottles have already been used in the production of recycling bins, slip sheets, cable covers, culverts, agricultural pipes and drainage coils. The latest addition to this suite of products is a new Hungry Bin food composting system, which contains 25% recycled Anchor milk bottle material. Four prototype Hungry Bins have just been installed in Auckland marketplace, Ponsonby Central, who will install an entire bank of the bins once they roll off the production lines in August. In October, 50 Hungry Bins will be awarded as prizes to schools who participate in Keep New Zealand Beautiful week. Environmental Manager at Anchor, Nic Bishop, adds that Kiwis can recycle the new bottles exactly how they always have. Anchor will host the first of a
four-monthly forum in October for recycling collectors, separators, product manufacturers and materials experts. The forum’s aim is to foster collaboration and identify opportunities for increased use of recycled content in products manufactured here in New Zealand.
Anchor announces capacity for Light Proof bottles
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nchor has announced its new Light Proof bottles, made of the same HDPE plastic as the previous bottles, are now part of a fully closed loop recycling system within New Zealand. This means that capacity exists amongst recyclers to use 100% of recycled Anchor bottles in the manufacture of new products right here in New Zealand.
Livestock transport assurance programme
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he New Zealand Livestock Transport Assurance (NZLTA) Programme came into effect this month and demonstrates how meat companies have worked together, along with the livestock transport industry, to satisfy their New Zealand and international customer needs. The NZLTA programme was inspired by the meat processors’ need for greater assurance that all livestock are transported safely and efficiently and meet Code of Welfare requirements. At this stage NZLTA membership includes AFFCO New Zealand, South Pacific Meats Ltd, ANZCO Foods (CMP and Riverlands), Ovation New Zealand and Silver Fern Farms, which represents a significant proportion of New Zealand’s processing capacity. The programme covers cattle, sheep, lambs, goats and calves. This initiative is well aligned to the Red Meat Sector Strategy in which recommendations to adopt best practice and for collaboration amongst stakeholders are prime objectives. Over the past two years the companies have been working together with the Road Transport
Forum (RTF) and AsureQuality which will manage and provide third party assessment of the programme. The NZLTA group has established an assurance framework that will support both the meat and livestock transport industries to work in a co-ordinated approach, in what is a highly specialised and critical aspect of the food supply chain. The NZLTA programme is being welcomed by Road Transport Forum Chief Executive Ken Shirley. “One of the major positives is that the NZLTA has been drawn up directly by the parties involved in livestock transport, not by officials, so it has operator and meat processor buy in. The Forum has also had major input into many of its provisions.” There are a whole range of benefits from this approach Shirley says. “Internalising the driver training regime within the industry will substantially reduce costs and streamline processes; it addresses animal welfare concerns through increased training and knowledge transfer.” The programme will cover approximately 390 transport operators and will take six months to fully implement.
www.nzmanufacturer.co.nz
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NZ Manufacturer July 2013
FOOD MANUFACTURING
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You must remain focused on your journey to greatness.
Technology meets marketing
ackaging is about much more than simply the material from which it is made. It also transports emotional messages to the end consumer. An ideal packaging has to be attractive and informative, and it has to be able to carry the desired brand messages. There are many ways of achieving this: through the printing, print-finishing and even choice of unusual shapes – modern technology is making many things possible and giving marketeers a huge range of options for implementing creative ideas. And because the packaging has such a critical role to play in the consumer´s decision to purchase or not, then much depends on the dialog between the technical people and the marketing professionals. drinktec 2013, which takes place at the Messe München exhibition centre from September 16 to 20, has set itself the goal of promoting and facilitating that dialog. Petra Westphal, Messe Minchin’s Exhibition Group Director with responsibility for drinktec, explains just how this is to work: “For networking, dialog and the exchange of ideas, we are setting up the Innovation Flow Lounge at the West Entrance at drinktec 2013. Its motto is: ‘Technology meets Marketing’. But we are not simply leaving that dialog between technicians and marketeers to chance – instead we are providing a structured forum in which this can happen. Among the many events, for example, are chaired panel discussions. In the future it will be even more important for technology experts and product developers to develop a feeling for the needs of marketing – and vice versa.” “Focus on Packaging and Marketing” is the title of a forum event on Thursday afternoon (September 19) in Hall A2. This promises to be an unmissable event for all drinktec visitors who are involved in any way with innovative packaging materials.
Rising trend: QR codes
A key trend that is becoming ever more important in this context is the digitalisation of marketing communication. QR codes on packaging are spreading rapidly. In autumn 2013 drinktec will also be the place for visitors to find out about these new techniques and technologies.
Renaissance of glass
The dominant trends in packaging at drinktec 2013 are: intelligent product protection, consumer convenience and resource-efficient technology, the latter of course including recycling. www.nzmanufacturer.co.nz
Glass packaging has always been a part of the beverages market. For wine, sparkling wine, beer and spirits, almost exclusively glass bottles are used. For this reason drinktec is very important because the customers of the glass-container industry come to this forum. There are currently two main trends in glass packaging: On the one hand there is increasing public focus on sustainability. And on the other, in particular as regards mineral water, there a real renaissance in glass. And in trend beverages, too, glass bottles are being used for new and innovative drinks.
Popularity of cans on the up again
– Les Brown
all the latest developments in the technology and design of packaging.
PET continues to gain ground
Glass and metal are well established, well researched packaging materials. With the tremendous global success of PET bottles, themes like barrier effect have emerged. Much innovative research is being carried out to develop ever more effective barrier layers. This is an important theme, because PET is becoming more and more popular. Of around 785 billion litres of filled beverages in 2010, worldwide around 35% were
filled into PET containers, according to PETnology Europe. That made PET the No. 1 packaging material in the segment of non-carbonated water and it is increasingly being used in the filling of alcoholic drinks like beer, wine and spirits. By 2014, according to the forecasts, PET containers will account for a market share of 43%, beating cans as a packaging material for nonalcoholic beverage refreshments into second place.
Glass is 100% recyclable, and so, too, are beverage cans. In Germany, we are seeing a return to the use of cans as containers for beverages. Since the introduction of deposits on disposable containers in 2003, beverage-can sales have only now broken back through the billion barrier. In 2011 sales of this type of can were at over 1.1 billion, a rise of around 19% or 175 million, over the previous year. Even back in 2006 the three biggest beverage can manufacturers – Europe´s Ball Packaging Europe, Rexam Beverage Can Europe & Asia and Crown Bevcan Europe & Middle East – were seeing an upwards trend. These companies are members of BCME, Beverage Can Makers Europe, and all of them will be at drinktec 2013.
Glow-in-the-dark cans in the shape of an orange
Manufacturers are currently working on functional improvements to cans, in terms of better convenience and reduced material consumption. They are also trying out innovative new looks and even a new feel for cans. One example is the development of thermochromic beverages cans, which change colour as they cool down. Another idea is for fluorescent cans that glow in UV light, for use in particular in discotheques and clubs. Tactile cans feel different because of their raised surface designs and they also have visual appeal. All-round modelling, for example, can be used to suggest to the consumer, both visually and through touch, that he is holding an orange, for example. Consumers at the moment particularly like slim cans, and in 2013 a self-cooling can is being launched, on the market in time for drinktec 2013, which in September offers an ideal opportunity for finding out about
New guide for moisture and water content determination
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he moisture content of a food item is inversely related to the dry matter – hence there are direct economic effects on consumers and processors. Water is a cheap ingredient that increases the weight of the final product: Higher water content thus means that the production cost is significantly lower, and consumers will end up paying more than they would for a product with specified water content. More importantly, the moisture content of a food item also influences its stability and quality. Needless to say that moisture is a topic of many regulations and legislation. To assist those who work with food, both in the laboratory and along the production line, Mettler
Toledo has recently launched a new guide on moisture and water content determination in food. ‘The Ultimate Moisture & Water Guide’ presents and reviews the different methods of moisture and water content determination, which are thermogravimetric, chemical, spectroscopic and other types of analysis. The guide reviews the advantages and disadvantages of the respective methods, offer tips and tricks to enhance the reliability and performance of measurements and offers solutions to common challenges. The guide is a comprehensive source of information about moisture and water content in food and can be downloaded for free at: www.mt.com/moisture-lab.
NZ Manufacturer July 2013
25
ENERGY REPORT
Don’t take life too seriously. You’ll never get out of it alive. – Elbert Hubbard
Raising the bar for energy performance Solar energy powers Ricoh staff
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evelopment of an energy measurement and rating scheme to raise the bar for energy performance in New Zealand office buildings is well underway. Helping to reduce energy costs for tenants and enhance building value for owners, NABERSNZ will measure and rate the energy performance of New Zealand office buildings. Based on the successful National Australian Built Environment Rating System (NABERS), the scheme will be introduced in New Zealand by EECA BUSINESS and delivered by the New Zealand Green Building Council (NZGBC) in mid-2013. EECA Chief Executive Mike Underhill says commercial building owners and tenants have shown a lot of interest in the scheme. “NABERSNZ will be a game changer for the commercial office real-estate market. It will help tenants and owners understand energy performance at a glance. “By looking at a NABERSNZ rating owners and tenants can see how well a building or tenancy is performing, and get an indication of likely energy costs,” he says. NABERSNZ will measure and rate energy performance on a scale of 1 to 6 stars. A 5 star rating is considered market leading performance with a typical office building likely to rate between 2.5 and 3 stars. To achieve a rating, qualified assessors will use 12 months of energy use data, and take into account building area, location,
computer density, and hours of operation to rate performance. NZGBC Chief Executive Alex Cutler says a tool to benchmark energy performance for office buildings is long-awaited. “This is the most exciting development in commercial green building ratings in New Zealand since the launch of the Green Star tool in 2007. “NABERSNZ will enable building owners and tenants to target and share the benefits of improved energy performance. She says the scheme is now in a pilot phase with 11 NABERSNZ assessors trained and working on pilot assessments that represent a cross-section of office buildings. NZGBC and EECA BUSINESS have worked with the Energy Management Association of New Zealand and Australian firm Exergy to adapt the Australian scheme to suit New Zealand conditions. EECA BUSINESS Commercial Programme Manager Karen Chaney says there are significant opportunities to improve the energy performance of commercial buildings in New Zealand, which use around $1.7 billion in energy every year (and account for 9 % of national energy use). “These opportunities are mainly in improved efficiency of heating, ventilation, air conditioning and lighting systems. “NABERSNZ will meet these requirements and add value for tenants, building owners and also help New Zealand address the challenge of climate change through reduced energy demand,” she says.
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icoh New Zealand’s mobile staff members recently received an energy boost to help them go about their daily work. The company has issued all mobile staff with portable solar panels – called Solarizers - which allow them to charge their mobile devices with free solar energy while they’re out on the road. The initiative was launched to mark Ricoh Eco Action day, an annual global event that promotes energy efficiency and conservation. Service technicians and salespeople can use the Solarizer to
harness power while they’re visiting a customer’s premises. They simply place the fold-up solar panels on top of their car dashboard, with the power bank connected. On returning to the car, they connect the power bank to their phone or iPad for charging. The cool device charges phones without plugging into the grid. This saves on power bills...and even lets you listen to sounds while camping up in the high country. Not only does it ensure mobile devices are always available – it also has energy-saving environmental benefits.
WRI unveils latest version of online GHG data tool
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he World Resources Institute has unveiled the latest version of its Climate Analysis Indicators Tool, or CAIT 2.0, which it says will help businesses better benchmark and understand their emissions. CAIT 2.0 should help businesses better benchmark and understand their greenhouse gas emissions. The free tool gives you data on greenhouse gas (GHG) emissions from 185 countries, including 50 US states, enabling you to view, sort, visualise anddownload data sets to carrying out comparative analysis. “Wading through the vast sea of global greenhouse gas emissions data can be a real challenge,” said the WRI in a statement. “By providing comprehensive emissions data in an easy-to-use tool, users from government, business, academia, the media, and civil society can more effectively explore, understand, and communicate climate change issues.”
WRI launched the original CAIT in 2003, but the organisation says the latest version is more user-friendly, allowing users to view data by gas, year or country and produce downloadable data visualizations. “CAIT 2.0 also adopts technological advances to make for a more efficient user experience. For example, with just an internet connection and a few clicks of a mouse (or a few swipes of an iPad), a CAIT 2.0 user can quickly pull up the international GHG emissions data set, narrow it down (by year, gas, country, etc.) for comparative analysis, and create simple data visualizations that can be downloaded or embedded,” said the WRI. CAIT 2.0 is still in its Beta form and the WRI says it will soon offer additional data sets and enhanced site functionality. In the meantime, it is looking for feedback from users. You can try out CAIT 2.0 at wri.org/ project/cait and send the WRI your feedback. www.nzmanufacturer.co.nz
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NZ Manufacturer July 2013
THE INTERVIEW
A man should never neglect his family for business. – Walt Disney
Matthew Darby, owner of EcoChill Noel Davies wins key award
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How’s Business?
GOOD - we are starting to see an increase in plant refurbishments and upgrades that is based around volume increases, so things appear to be improving for the economy In general
What are you currently working on?
RIGHT now we are developing two products for release into the commercial and farming industries.
Do you enjoy what you do?
ABSOLUTELY, I’m lucky enough to work with the best in our industry. Truly dedicated and enthusiastic people who are genuine about making a difference
Most satisfying business decision?
STARTING IT! Our industry has been dominated by big offshore based companies that dumbdown what we do and send all their profits back to their corporate head quarters. We are focused on developing a strong NZ business that trains and grows the best skills and capabilities of its people.
Favourite quote?
I DON’T think I have one specifically. I was extremely lucky to attend the EO University in Queenstown in February last year that had some amazing kiwi business people speaking, Saatchi & Saatchi boss Kevin Roberts, inventor Ray Avery, Google engineering director Craig Nevill-Manning and Gatorade marketer Sarah Robb O’Hagan. All of these people are inspirational kiwis, getting things done, and I take a huge amount from that.
Who is your inspiration?
MY FATHER. He was an industry leader in his time, responsible for
many firsts and someone who has always been very grounded and focused.
How do you see the NZ economy? IMPROVING, slowly.
Do you have a passion for manufacturing? Tell us about it.
I LOVE the mechanics behind the process of refrigeration, and being lucky enough to work with the best in the industry at EcoChill has allowed us to try things with confidence of the outcome that many others wouldn’t be able to.
How do you relax?
I GET great fulfilment out of being with my wife and children. We spend plenty of time outdoors together, and I also enjoy diving.
JULY 2013 ISSUE FEATURES • The Future of Manufacturing • Industrial Motors • Workshop Tools • Manufacturing Technology • Plant Maintenance For further information contact:
Managing Editor: Doug Green P: 06 870 9029 E: words@xtra.co.nz www.nzmanufacturer.co.nz
Advertising Booking & Copy Deadline – 23rd August 2013
t the Metals NZ Industry Awards Gala Dinner held in May at the Classic Flyers Aircraft Museum in Tauranga, a number of awards were presented to an individual and companies in six catergories. Chief among was the Keith Smith Award for distinguished and outstanding service to the New Zealand Metals industry. This Award is made only when a candidate whose services are outstanding has been nominated. The Award started out as the HERA Award for Distinguished Services to Industry and was first made to Keith Smith at the 2004 Metals Industry Conference in Christchurch, largely for his role in creating and governing the Heavy Engineering Research Association, HERA. Before his passing in 2007, Keith made a considerable bequest to the Heavy Engineering Educational and Research Foundation (HEERF), with the money from its investment to be the prize money of this award. The award was renamed the Keith Smith Award for Distinguished Service to Industry. Jean Smith has continued her late husband’s strong support for the New Zealand Metals Industry. This honour fell to Noel Davies, the director, chairman and part-owner of Hydraulink Fluidconnectors. When Jean Smith presented Noel Davies with his commemorative plaque and cheque for $2,000, he promptly said he would match the amount and donate $4,000 to the charitable work of HEERF. Noel Davies is a truly outstanding and enduring contributor to New Zealand’s Metals Engineering Industry. While his contributions to both the industry and New Zealand society are too numerous to be comprehensively listed, some of the key ones include more than 25 years adding value to the New Zealand economy as an entrepreneur with engineering, software, property and trading companies. Hydraulink Fluidconnectors won the Ernst & Young Entrepreneur of the Year in 2003 in the Manufacturing/ Distribution Category. Noel has been on the HERA Executive since 1992 – for the first 14 years as nominated representative of the NZ Engineering Federation and then as HERA Chairman from 2004 to 2006. He has also been a trustee of the Heavy Engineering Educational & Research Foundation (HEERF) since 2004 and its Chairman since 2006. He was instrumental in forming Metals New Zealand in 2011, becoming its inaugural chairman.
However, it is not the number of positions he holds that makes him valuable; rather it is the manner in which he works with others. As a strategic thinker and opinion former on many executive boards, he remains down-to-earth, ready to share his experience and mentor those in need of advice and guidance, and equally ready to go on tour as an advocate of whatever is good for the industry. A true man of influence and a leader, Noel Davies is the living embodiment of the ideals that the very man who founded this HERA award, Keith Smith himself, believed in. Metals New Zealand is a pan-industry body representing the metals-based engineering industry and includes these sector organisations: • Casting Technology New Zealand (CTNZ) • Galvanising Association New Zealand (GANZ) • Metals Roofing Manufacturers (MRM) • National Association of SteelFramed Housing (NASH) • Heavy Engineering Research Association (HERA) • Light Alloy Manufacturing New Zealand (LAN-NZ) • Steel Construction New Zealand (SCNZ) • Titanium Development Association (TIDA)
NZ Manufacturer July 2013
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LEAN MANUFACTURING
A public-opinion poll is no substitute for thought. – Warren Buffett
Lean has much to offer
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ean was developed by Kiichiro Toyoda and Taiichi Ohno in the 1960s for Toyota. They received their inspiration not from the American automotive industry, which at that time was the world’s largest industry, but from visiting an American grocery store, Piggly Wiggly. They were impressed by how the supermarket only reordered and restocked goods once they’d been bought by customers, the precursor of the just-in-time (JIT) inventory system. Toyoda, Ohno, and others at Toyota developed innovations to achieve both continuity in process flow and wide variety in product offerings. They dubbed their method the Toyota Production System or Lean. For distributors, this means having a wide range of inventory while achieving high inventory turns and profitability‚ exactly what wholesalers have been trying to figure out for years.
What Is Lean?
Describing lean is difficult because it is not just a tool, but instead, a culture, philosophy, process and methodology. Lean in its simplest form is turning waste into value. More importantly, it involves getting employees thinking and motivated to make processes better. Kaizen is the Japanese word for continuous improvement. Lean challenges employees to think about kaizen every day in every distribution function, training their eyes to spot waste not previously visible. Lean even encourages employees to compete to identify and eliminate waste, and to halt processes if they detect errors or defects. Lean analyses end-to-end processes and determines how to deliver more to the customer with much less. Lean means being more organised than ever before, to free up capacity that can improve customer value. Lean is a neverending journey, it gets better, but no business can ever be completely lean. Typical improved results from lean distribution include: Increased Profits Higher Sales Revenues Improved Delivery Performance
The use of lean has grown in almost every industry over the past 20 years.
Lower Operating Costs Better Customer Satisfaction Better Supplier Relations Decreased Purchasing Costs Shorter Lead Times Inventory Reductions
Lean Principles
They are the high-level goals that we will strive to attain through the use of kaizen and lean tools. Let’s discuss the five lean principles as laid out by Womack and Jones in the book Lean Thinking, and how they fit into distribution.
Value
This involves identifying what customers see as value. For distributors, the value that they provide is having the right items, at the right time (often now), at the right price. Increasing anything that customers see as important will increase value. For example, if a distributor added an extra morning delivery, customers may see that as value because they may be receiving their items faster, which could be a competitive advantage over other distributors.
Value Stream
The value stream includes the activities that a customer would be willing to pay for. For example, picking, packing or order entry are part of a distributor’s value stream. The value stream is important because it can identify potential waste. Just a note: just because all steps are not deemed as value or value-added does not mean that they can be eliminated. Accounting, for example, is not considered value-added, but is certainly necessary. However, we should look to drive out any waste in accounting, and use those savings to invest in value-added activities such as buying more inventory, investing in a Web site (for order entry), or adding an additional delivery truck. The most common and powerful tool for identifying value in processes is a ‘value stream map’.
Flow
Flow is a logical but slightly less relevant concept for distribution. Flow really refers to continuous flow in very small, or ideally, single piece flow, which means in general, batching, should be avoided when possible. A lean flow means orders should be received, picked, packed and shipped all day long, as opposed to having large batches of picks, items for packing and single large shipments. In general, a lean
distribution flow would purchase smaller quantities, and receive, put away, pick, pack and ship with such efficiency that batching does not save significant time. A lean picking process would be so efficient that picking few or single orders would take about the same or less time than batching orders.
Pull
Pull is a simple but key concept for distribution and supply chain management, outlining how distributors need to plan their inventory and order processing. Pull refers to actual customer usage and replenishing exactly what was ordered by customers. This stands in contrast to most push- type forecasting models. A simple example is if in the last three months, a particular item had the following number of orders: 3, 4 and 5. Many forecasting models would project that 6 would be ordered next month. Pull would say 5 would be used next month (based on actual usage). Pull says to replenish as best as possible to whatever is purchased by customers. Obviously, this can be problematic with minimum buys, quantity discounts and relatively inexpensive items. Inventory levels, safety stock or buffer stock are reviewed periodically (about every 3-6 months) but, except in rare instances, not changed by actual usage until the regular review cycle.
Perfection
Perfection refers to driving waste out of every process and meeting customer expectations in every way. Perfection is elimination of mistakes in every shipment. It would equate to zero late orders, and having every item that customers need, at a price they are happy with, in stock. Obviously, it is not attainable on every order, but it should be the goal of every distributor. Trying to achieve perfection requires metrics to track the journey, such as fill rates, shipping performance to customer promise dates, wrong shipments and lost orders.
Lean Tools
There are many lean tools that can be effectively used in distribution, but tools by themselves provide little value. Lean is more about achieving a culture of improvement in employees’ minds, and building a flexible system to drive out waste and better meet customer expectations. Tools should be thought of as examples of lean activities that may be applied to processes. Many times, the best lean tools are unique to a particular business. Examples can include customer software development, wireless warehouse capabilities, special carts to increase picking speed, moving desks and tables to allow for faster processes, and activating ERP system capabilities not yet utilised. However, basic lean tools are the way to begin a lean implementation; here are several of the best ones that fit well in distribution. 5S - 5S is a way to organise distribution functions to eliminate waste and errors, and increase efficiency and employee morale. 5S is a great tool to start a lean implementation because it is easy to use, makes a visual improvement and is usually successful. 5S stands for Sort, Set in Order, Shine, Standardise and Sustain. The layman’s view of 5S would see it as ‘cleaning up’. However, 5S is much more powerful than first impressions. 5S is about eliminating waste that is slowing processes down. It is about becoming more organised and standardising work areas. Utilising 5S allows distributors to see waste and therefore eliminate it.
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NZ Manufacturer July 2013
SUPPLY CHAIN
Do or do not. There is no try. – Yoda
The great product data revolution is coming!
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ew Zealand’s public healthcare providers are embarked on a revolution in how they procure everything from scalpels and sticky tape, to kitchenware and food items. Every manufacturer should know about it, and sooner rather than later. Within a few years all 20 District Health Boards will do their purchasing from a DHB National Catalogue – a synchronised electronic database containing all the products used or consumed in our public hospitals. Suppliers of those products – and not just medical suppliers – are being urged to gather and load the relevant product information into the National Catalogue as soon as possible. It will revolutionise the way DHBs source the products they need and the way suppliers access the large healthcare provider market. The National Catalogue will replace 20 current purchasing systems with one that is more comprehensive and far more efficient for both DHBs and suppliers. The lead is being taken by Health Benefits Limited (HBL), a Crown-owned company charged with achieving efficiencies and cost savings right across the DHB sector. HBL is creating the National Catalogue using technology favoured by healthcare jurisdictions around the world namely, GS1 identification standards and data synchronisation platform known locally as GS1net™. Since the start of 2012, HBL has been calling for all current suppliers to the DHBs to assemble their product data to conform to GS1
A good business can become even better in so many ways.
identification standards and to use the GS1net platform that is already familiar to hundreds of businesses in New Zealand’s grocery and hardware/DIY sectors. Major retailers in those sectors began promoting GS1net among their suppliers some years ago. HBL determined that many GS1net fields are exactly what will be needed for DHB procurement. The fields include product brand names, product identifiers based on GS1’s Global Trade Item Number (GTINs), weights and measures, packaging hierarchies and pricing information. GS1net enables all this data to be assembled in a standard format and shared in a synchronised and continuous way with information users. The DHB National Catalogue will have three purchaser s in its first roll-out phase, the Capital & Coast, Hutt Valley and Wairarapa DHBs. The others are due to come on board over the following two or so years. All will eventually have a “single source of truth” about the products they look to purchase and that should streamline not only procurement
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www.hiq.co.nz
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processes but tendering processes, other purchasing and reordering with potentially huge savings in time and cost for both suppliers and users. For manufacturers and other suppliers to DHBs, the National Catalogue will radically scale up their access to the DHBs’ buying market. A DHB National Catalogue based on GS1 standards will be a great example of how high quality information made always available can promote trade and business growth. Six months into the National Catalogue-building process, many companies are getting ready for the revolution. In fact, many now
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By Gary Hartley of GS1 New Zealand find that having great data at their fingertips also has great benefits for their internal businesses: New efficiencies arise in inventory management, product dispatch, accounts receivable and other processes. The revolution is starting in their own warehouses and back offices, and in their relationships with other suppliers and customers! That’s the thing about product information – when it is accurate, of high market relevance and readily available, a good business can become even better in so many ways.
Hyper-Detect provides stable operation
he hyper-detect is a nonsymmetrical balanced coil metal detector with a conical aperture into the detector. While conventional ‘throat’ metal detectors have long been used in the industry to inspect the product before it enters the bag to allow the use of metallised film, packaging speeds have been limited until now. The revolutionary integrated design of the hyper-detect allows the metal detector to be positioned much closer to the multi-head weigher, dramatically increasing the speed at which the bagger can produce finished bags. With a high frequency function, the hyper-detect provides stable operation for optimum sensitivity and consistent performance when inspecting products. Able to detect ferrous contaminants from 0.8mm
to 0.9mm, non-ferrous pieces up to 1.0mm and even non-magnetic stainless steel from 1.0mm to 1.2mm, the hyper-detect is extremely sensitive, greatly reducing the risk of contaminants entering the value chain, safeguarding consumer safety and the company’s reputation. The hyper-detect metal detector and bagger integration takes place on two levels. Mechanically, the detector and chute work together to provide a fully optimised path for the product to travel down, offering greater control and repeatability for faster product transfer and reduction in rejects. At the same time, operator control is integrated into the robag product and operational screens allow for a single set-up of the whole system, leaving no room for error, and offering real productivity and cost improvements.
NZ Manufacturer July 2013
Success is how high you bounce after you hit bottom. – General George Patton
Collaborative development of water management technologies
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ndustry and researchers are working to explore water management issues and identify opportunities for new technologies to meet industry challenges. The Water Management Technologies Foresight initiative is designed to encourage collaborative technology development which will lead to the commercialisation of new technologies for industry. The concept was created by The Kiwi Innovation Network (KiwiNet), a consortium of research organisations working together to increase the scale and impact of science-based innovation. KiwiNet business analyst Seumas McCroskery says, “Industry utilises major volumes of water and faces new and ongoing challenges associated with water management. There is increasing pressure to balance improvements in productivity with a reduction on environmental stress. Technology will play a vital role in meeting these challenges.” KiwiNet’s Water Management Technologies Foresight event held recently was the start of a process to identify opportunities for technology to help meet industry challenges associated with water management, and to then commercialise the most promising technologies. The event was attended by representatives from the dairy, horticultural and processing industries, researchers, regulatory agencies and technology development specialists. New Zealand researchers with various projects in different states of development demonstrated their innovative technologies and skills at the event. Business, industry and regulatory representatives highlighted key issues and opportunities on which to build. One opportunity highlighted for researchers is a consortium of 40 Rotorua farmers who pool resources to address water management. They actively look for innovative technology solutions and represent an exciting developing market. Graeme Anderson, Commercial Manager Landcare Research and co-organiser notes, “The event enabled researchers and industry to constructively challenge market assumptions and evaluate early stage technologies in the water management sector. We were able to share a lot of knowledge and make valuable new connections.” McCroskery says, “This new network will be very valuable as we
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EMPLOYMENT Introducing The Manufacturers Trading Post
continue the initiative to identify and explore multiple opportunities for water management in New Zealand. By bringing together key stakeholders we can ensure New Zealand’s science and technology development capability in water management technologies is aligned to industry need.” To progress the initiative KiwiNet has set up an advisory committee on Water Management Technology. The committee aims to support the collaborative connections established in this space. Dr Bram Smith, General Manager of KiwiNet notes, “The workshop has allowed us to gain some insights from the various stakeholder groups. Better understanding the needs of end-users informs and benefits our researchers. “These industry foresighting events are a great demonstration of how KiwiNet can use its collective might in a very practical way to boost commercialisation activity and innovation in key areas. Universities and Crown Research Institutes can really lead the charge to create some positive economic shifts by being practical and proactive like this.” KiwiNet’s Foresighting events, run in conjunction with regional partners, bring together a wide range of industry and research experts within a specific sector. Participants are tasked with identifying key issues affecting the sector in the next 5 years and the opportunities that exist for pre-empting them. Attendees are encouraged to collaborate to leverage their combined knowledge in developing solutions. KiwiNet’s current Foresighting initiatives include robotics, plastics and water care. KiwiNet is working to increase the scale and impact of commercialisation in New Zealand by facilitating a more collaborative and capable commercialisation system. KiwiNet acts as a hub for commercialisation for its member organisations as well as the wider innovation system.
If you are looking to sell cardigans, cutlery, comics or unwanted Christmas & Birthday Gifts don’t visit the Manufacturers Trading Post! However if its something of a manufacturing or industrial nature that you wish to sell then yes you should visit The Manufacturers Trading Post which you will find on the ManufacturersSuccessConnection website. With no success fees payable, just a sellers listing fee at the low end of the scale, The Manufacturers Trading Post can help you sell your new, used, excess stock or cancelled orders even seats at seminars. “We haven’t reinvented the wheel, said Max Farndale the originator of the manufacturerssuccessconnection website, ‘we just want to increase the value a visitor receives from visiting the site. The site is updated regularly during the day with manufacturing related news stories and articles so the addition of the Trading Post portal just adds more value to a visit. To list your items for sale go to The Manufacturers Trading Post and for more information you can contact Max Farndale on 06 870 4506 or email max@ manufacturerssuccessconnection.co.nz www.nzmanufacturer.co.nz
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NZ Manufacturer July 2013
REAR VIEW
Every great dream begins with a dreamer. Always remember, you have within you the strength, the patience, and the passion to reach for the stars to change the world. – Harriet Tubman
Busting Canterbury steel construction myths
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ew Zealand steel construction is a very competitive and cost-effective building system that performed extremely well when it went through its baptism of fire in the Canterbury earthquakes, so it is not surprising that many buildings in the Christchurch rebuild effort are expected to be built in structural steel. For whatever reason this expectation has led to two myths recently circulating in the New Zealand construction industry. The first is that New Zealand steel fabrication will be unable to cope with this “extraordinary” demand. The second myth, builds on this presumed lack of New Zealand based steel fabrication capacity, suggesting that as fabricators reach capacity, there will be reduced competition and hence higher prices. The implication of this is that developers should not bother with New Zealand suppliers and should simply look to overseas from where they can import fabricated structural steel more cost effectively, with large additional profits and minimal risk. The New Zealand steel construction capacity myth can be very easily busted with the graph below that shows the use of heavy sections largely used for steel construction over the last 30 years. The graph shows that our fabrication workshops have steadily built their capacity from a low of 20,000 tonnes per year in 1992, through increases in productive modern equipment and resources, to meet the ever increasing demand which peaked in 2008 at 90,000 tonnes only due to the effects of the Global Financial Crisis (GFC).
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The industry is currently operating some 30% below that level, however the current national industry capacity with nearly 80 steel fabricators in New Zealand is considerably in excess of 90,000 tonnes; for example the capability of the two largest structural steel fabricators in Auckland alone is over 15,000 tonnes per year each. These 80 fabricators competing for work also ensures that the industry is and will remain competitive. However, due to the need for local presence particularly in the rigging stage and for site welding, most out of Christchurch fabricators will engage with local Christchurch companies and my understanding is this is how the bulk of the volume work will be delivered. Another point relating to capacity is that the steel industry will not be the critical part of the Christchurch rebuild. In multi-storey structures
the steel frame generally is only around 7% of the build cost and therefore work-volume and due to its modular bolted connections is able to be erected and decked much quicker that the other trades are able to keep up with their work contents. An important additional factor in the cost competitiveness of structural steel options is the price of steel sections and plate. As shown in the Heavy Steel Import Values Index the landed cost in New Zealand over the last year dropped by about 13% and at this stage there is no indication that we are heading towards another steel cost spike. Busting the myth of just going overseas and importing fabricated steel work as an easy and cost effective alternative business path forces us to go back in history and look at the development of multistorey steel construction in New Zealand.
For those with longer memories, going back to our industry’s crisis in the late 1960’s and 1970’s, they will recall that by the early 1980’s structural steel had zero market share in the multi-storey commercial and residential construction market. This arose from a number of factors, especially union related issues. However, these were largely New Zealand specific, as at that time overseas in seismic regions such as Japan and California, steel construction had a high market share and was a profitable industry. As a result of a parliamentary enquiry into the failures of the heavy engineering industry, HERA was formed in 1978 as an industry funded research association. Supported principally by the heavy steel based levy, industry funded research programs into structural steel design and fabrication were started in the eighties, with their aim to “build the technical foundation on which to promote the efficient and effective use of steel in multistorey buildings”. Key milestones in this development were the 1992 edition of the NZ Steel Structures Standard, NZS 3404, and the publication HERA Report R4-76, Seismic Design Procedures for Steel Structures, which contained advanced design procedures and detailing requirements for steel seismic resisting systems. These and other publications were developed under the oversight of HERA Structural Engineer, Dr Charles Clifton, in conjunction with colleagues from the Universities of Auckland and Canterbury and experienced practicing engineers. This unique research and standards development work was combined with a series of industry related design and productivity actions such as site bolting of the
NZ Manufacturer July 2013
If you don’t do it excellently, don’t do it at all. Because if it’s not excellent, it won’t be profitable or fun, and if you’re not in business for fun or profit, what the hell are you doing there? – Robert Townsend
steel structure rather than the previously used site welding and the development of significant breakthroughs such as all-weather shear stud welding capability. These developments eliminated the industry workforce issues and weather dependence of key aspects of steel framed construction with composite floor slabs and led to the sustained rise of structural steel’s market share in multi-storey construction to over 50% today. Another steel construction game changer was the 1994 Northridge and 1995 Kobe earthquakes. Prior to the Northridge earthquake it was considered internationally that steel framed buildings would perform well in severe earthquakes almost independent of the attention to design and detailing. The widespread failure of the standard USA beam to column connection in rigid moment frames showed how wrong that assumption can be. Although no structural steel buildings collapsed due to these joint failures, extensive and expensive repairs were required to hundreds of steel framed buildings in the USA and this showed steel is dependent on good design and accurate execution for dependable and predictable earthquake performance. These failures raised concerns as to the performance of seismic structural steel frames used in NZ and with substantial government co-funding HERA started a comprehensive research program which led to assurance that NZ systems are safe to design level in earthquakes and to the development of new more effective seismic resisting frame systems now commonly being specified. At the time, I was the Manager of HERA’s New Zealand Welding Centre and responsible for the welding fabrication related research program. We tested literally
hundreds of joint configurations to destruction and well above the required design level maximum credible loads. We used steel sections and welding consumables which were within and just outside specification, which had different degrees of ductility and were fabricated replicating complying and non-complying welded joints. In the process we learned a lot and put the results in our New Zealand structural steel design and fabrication standards and guides. Key outcomes of the research were that for the links in a building resisting seismic forces to work our designs have to fully respond to the seismic design load requirements and we carefully have to balance the yield and tensile strength related elements of the steel section to be jointed, use matching welding consumables, fabricate strictly adhering to imperfection limits and also match the ductility requirements of both steels and welding consumables. If we get this right we can be assured that performance to the expected design level earthquake will be achieved. If we are outside the guidance framework crack development will occur which under continued seismic load will lead to complete joint failure potentially with fatal outcomes. Some examples of poor detailing did lead to failures in the Christchurch earthquakes demonstrating the limits of the carefully balanced steel construction framework, but these failures were limited, readily repairable and also showed the inherent strength reserves of the system. For example steel sections for NZ seismic frames need to have yield/tensile and ductility requirements which need to match specific properties and therefore are categorised in the corresponding AS/NZ standards as seismic (S) – grades. Currently
only three steel mills manufacture to this standard with the bulk of the sections being of Australian origin. The associated welding procedures have to be developed and qualified to corresponding AS/ NZ welding fabrication standards and cannot be replicated without formal qualification processes. This also means considerable fabrication IP is accumulated by fabricators working daily to these NZ specific requirements. The Canterbury earthquake series has confirmed the adequacy of the New Zealand steel construction framework and that the balance between safety and cost effectiveness is good. It has highlighted the importance of good quality design, detailing and materials performance towards robust and dependable seismic behaviour. What has all this got to do with the second myth pertaining to the benefits of imported steelwork? The answer is simple; imported fabricated steelwork does not carry the same assurance of quality control on materials selection and fabrication as does New Zealand made steelwork. In rebuttal of the myth I argue that the New Zealand specific structural steel fabrication requirements cannot be readily picked up by the overseas competition without substantial implementation and quality assurance efforts, which in my view would have to include costly full third party product conformance inspections and the associated costly repairs which may be needed, if indeed they are practical at all without full material replacement. I am going so far to say that if the overseas competition uses complying steels and welding consumables, which they would have to import from the same sources and likely similar cost as the New Zealand fabricators, and if they
NZ MANUFACTURER • August 2013 Issue • Features Opinion Manufacturing Profiles Letters to the Editor Politics of Manufacturing Trade Fair World Diary of Events World Market Report Q/A Export News Machine Tools Business Opportunities Commentary As I See It Business News Appointments Around New Zealand Australian Report New to the Market Lean Manufacturing Equipment for Sale Recruitment Environmental Technology Manufacturing Processes
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REAR VIEW
– Wolfgang Scholz, Director, HERA also follow the required qualified welding fabrication procedures, then the cost will be very close between the New Zealand and the presumably complying overseas offering. Finally, if, based on a fair comparison, should the cost come out in favour of the imported fabricated steelwork, will it be worth the additional risk? This is not only a question for the owner, occupiers, responsible engineer and approving local authorities, but also for the insurers who will be taking on the additional uncertainty of performance associated with imported fabricated structural steelwork. What cost premium will they need to charge to cover that risk? It is not the overseas fabricator who will bear the burden of substandard performance, but the New Zealand people and business associated with the ownership and function of that building. Lives are worth more than a few dollars saved, especially when this saving may be on paper only at the estimating stage.
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NZ Manufacturer July 2013
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