Manufacturers' Monthly February 2013

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ANALYSIS >> TECHNOLOGY >> SOLUTIONS

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February 2013

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INSIDE Motors & Drives >> Innovation In Design >> Exporting Precision Measurement >> HR, Recruitment & Training >> Materials Handling

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Publisher Martin Sinclair martin.sinclair@reedbusiness.com.au Managing Editor Cole Latimer Ph: (02) 9422 2352 Fax (02) 9422 2722 cole.latimer@reedbusiness.com.au Journalist Brent Balinski Ph: (02) 9422 2480 Fax (02) 9422 2722 brent.balinski@reedbusiness.com.au Alex Heber Ph: (02) 9422 2884 Fax (02) 9422 2722 alex.heber@reedbusiness.com.au Vicky Validakis Ph: (02) 9422 2480 Fax (02) 9422 2722 vicky.validakis@reedbusiness.com.au Editor-at-Large Alan Johnson Ph: (02) 9422 2325 alan.johnson@reedbusiness.com.au Graphic Designer Ronnie Lawrence ronald.lawrence@reedbusiness.com.au Creative Director Julie Coughlan Production Co-ordinator Mary Copland Ph: (02) 9422 2738 mary.copland@reedbusiness.com.au VIC/Overseas Sales Michael Northcott PO Box 3069 Eltham VIC 3095 Ph: 0448 077 247 michael.northcott@reedbusiness.com.au NSW Sales Anthony Head Tower 2, 475 Victoria Avenue, Chatswood, NSW 2067. Ph: (02) 9422 2368 Fax: (02) 9422 2722 Mobile: 0414 644 664 anthony.head@reedbusiness.com.au QLD Sales Sharon Amos PO Box 3136, Bracken Ridge QLD 4017 Ph: (07) 3261 8857 Fax: (07) 3261 8347 Mobile: 0417 072 625 sharon.amos@reedbusiness.com.au NSW, SA/NT & WA Sales Reed Business Information Ph: (02) 9422 2368 anthony.head@reedbusiness.com.au

Inside 4 Editorial Q This is the year to bust out of the

6 Comment Q Operational considerations for

offshore manufacturing

12

8 Endeavour Awards Q Nominations are closing soon.

Be recognised today.

10 Analysis News Q Boral cuts jobs Q Pacific Brands advises

manufacturers to accept offshoring

22

11 Exporting Q Fighting the fakes

18 What’s New

22 Gas and Manufacturing

Q Cable hooks Q Electrical safety testers Q Portable PIM analysers

Q No Reservations

Q Test & Measurement

Q Technology advances for 2013

Q Laser label markers Q Data logging

16 Metal Working & Machine Tools

20 Manufacturing in the Asian Century

Q Improved quality through preci-

Q Advancing Australian

12 IT@MM Q Shaping our future with additives

14 Management

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Uplifting productivity without loss of quality.

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slump

sion measurement

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ANALYSIS >> TECHNOLOGY >> SOLUTIONS

February 2013

%7 M XS )XLIVRIX 8SS IEW] [MXL MJQ IJIGXSV W RI[ / QEWXIV

INSIDE Motors & Drives >> Innovation In Design >> Exporting Precision Measurement >> HR, Recruitment & Training >> Materials Handling

25 Product Spotlight 26 Materials Handling Q Warehousing & Distribution

28 Motors & Drives Q Behind the MVSD vs. VFD debate

Manufacturing

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FEBRUARY 2013

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Manufacturers’ Monthly FEBRUARY 2013 3

Editorial

COLE LATIMER – Managing Editor

editor@manmonthly.com.au

This is the year 2013 is the year that manufacturing has to bust out of its slump.

T

his year is make or break for Australian manufacturing. The global downturn shook the entire world; the subsequent mining boom and high Australian dollar pushed manufacturing to the edge, and now it stands on the edge of a precipice. Australian manufacturing found last year that it can not rely on a Federal Government for support when it’s apparently much lauded Manufacturing Taskforce, which took months to put together what seemed to be a comprehensive report on the problems of and solutions for the industry, instead simply rehashed the existing problems and providing solutions which are untenable. Suggesting that the solution is to become more sustainable, but then not providing the groundwork nor support network to do so would be laughable if it wasn’t so sad. I’ve said it before and it has reached a point where it’s beyond cliché, but to put it simply the government has put the manufacturing industry in the ‘too hard basket’. The Queensland Government’s most recent six month plan even appeared to skip over the industry entirely, with AMWU secretary Rohan Webb stating that its plan did

4 FEBRUARY 2013 Manufacturers’ Monthly

Now is the time to act. not address the current challenges faced by the industry and failed “to spell out [QLD premier Campbell Newman’s] policy for the tens of thousands of manufacturing workers across QLD”. So what is the industry to do but handle the problems itself. This year has already gotten off to a bad start

with close to 1000 workers already laid off from a number of businesses within manufacturing. Frankly it is a shocking start, and the widespread disunity shown amongst those in the industry isn’t helping the case either. Bluescope’s decision to cut workers at its Western Port facility being

viewed as a positive for Port Kembla is hardly demonstrative of an industry working towards a common goal. “There will be some positive flowon effects for the Springhill plant here at Port Kembla, which will actually load up more in terms of the volume of throughput through its site,” an unnamed BlueScope spokesman said at the time. Mercenary views like these are one of the reasons that the industry is in such state. Rather than uniting to push a consistent agenda for the industry across the board, many seem to be simply looking out for themselves. Conditions are ripe for the perfect storm to batter Australian manufacturing into submission, but if the sector pulls together it can withstand it and come out through to the other side stronger. As AWU national secretary Paul Howes said in January: “We know that 2013 will be the making or breaking year for the future of Australian manufacturing. “There is no silver bullet for the crisis in manufacturing, but we need a comprehensive plan to take the sector into the future.” The industry needs to be united, before it’s too late.

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Comment

editor@manmonthly.com.au

Operational considerations for offshore As the cost of business rises, Australians need to consider the pros and cons of offshore operations. Brian Le Mon* explains.

I

t is becoming a common fact of many first world countries that domestic manufacture is often an expensive luxury that can be ill-afforded. This is especially true for those industries where there is an influx of less expensive foreign competitive products and where the buy decision is more driven by cost than country of origin. The reality is that the minimum wage is rapidly approaching $20 per hour, factory overheads are increasing due to rising electricity and incidental costs, and the cost to import from another country is often lower due to the strong Australian dollar. Manufacturing industry and product designers are faced with the rapid realisation that this situation is not likely to change and survival means that occasionally tough deci-

6 FEBRUARY 2013 Manufacturers’ Monthly

Know the risks and the benefits before jumping offshore. sions need to be made in order to preserve the future of their company and retain or recover their market segment.

For affected industries, there is little hope of a paradigm shift in consumer or end user behaviour towards supporting a local product

when the alternative is significantly less expensive and often of comparable quality. So companies start to look towards outsourced manufacture models and transfer all or portions of their manufacturing to a LCC (Low Cost Country) where the minimum wage is typically less per day than we pay per hour and in many cases there has been significant investment in equipment and processes to ensure repeatable and economical manufacture of outsourced products. While there is an obvious requirement for industries that are losing their customer base to foreign imports to look towards outsourcing to a LCC, there process of effectively outsourcing all or part of your manufacturing should be undertaken as a strategic move rather than an act of

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PACKAGING + PROCESSING + MATERIALS

desperation and as such should be carefully and diligently monitored and maintained to ensure that your company still retains control of the end product that is being manufactured and submitted to your customers. This article looks at operational issues in establishing and maintaining a partnership with an offshore manufacturer to ensure you will experience the benefits while avoiding many of the well published pitfalls. 1. Know who you are dealing with. This comes down to due diligence and ensuring you are dealing with the company that is going to be manufacturing your products and not a loosely associated “representative” or reseller. Do research on the company. Visit them IN PERSON. Talk to someone other than the sales representative. Find out about their standard process for introduction of new products to their facility. Know exactly who you need to contact should there be a problem and what processes they will employ to resolve any problems that have been raised to ensure you don’t experience ongoing repetitive failures until the entire project is written off as a bad idea. 2. Size Matters. Leave your ego out of the equation. Every executive would love to be able to boast that they have their products being manufactured at Foxconn alongside Apple or another well-known facility. The truth is that often this is not a good idea even if you have acceptance from the facility. In essence it comes down to how your business is regarded within their facility. If you have $500K of product being assembled per year and your target facility boasts annual revenue around $500M then they will see your business as opportunistic to be undertaken during low season rather than important and to be concerned with your mutual success. Alternatively if you have $500M of manufacturing and your target facility currently only has revenue of $500K there should be serious concerns about their ability to adapt to a sudden increase in workload due to your contract. You offshore partner should be sufficiently large to be able to accept and undertake your work but not manmonthly.com.au

too large that they see your work as an inconvenience and you are given excessive lead times to allow them to “fit your work in” and junior support staff to manage your project. This comes back to knowing who you are dealing with. If you have never visited the actual facility that will be undertaking your work and entrust everything to a sales representative who advises you they will take care of your project then you are asking for problems. 3. Know EXACTLY what it will cost. When you receive your quotation from your potential outsource partner make sure you are comparing this fairly with the domestic costs. Ensure you take into consideration the extra costs and time involved in offshore manufacturing. Shipping costs, customs clearance, failures / BER product, MOQ, holding costs, order levels required to accommodate shipping lead times. All financial aspects of the supply of your products ready for sale need to be included otherwise you are using a flawed financial plan and will be wondering why your profit levels are not meeting forecasts. 4. Specifications The majority of issues at early stages of a manufacturing contract with a LCC supplier can usually be pin-pointed to issues with the documentation provided rather than incapability on the behalf of the supplier. In essence any requirements that have not been explicitly documented will likely not be met by the LCC supplier, even if those requirements would seem to be a common sense requirement from the perspective of the OEM designer. Put simply if it is required make sure it is documented right down to packaging and labels. While this article does not propose to be a comprehensive guide, some of the most common issues are highlighted and explored. If you are considering offshoring, one of your first actions should be to engage a professional who has done it before. Whether it is via employed, contract or consulting professionals, exploring the mysteries and rewards of outsource manufacturing is best undertaken with an experienced guide. *Brian Le Mon is a principal consultant at GBOS.

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Manufacturers’ Monthly FEBRUARY 2013 7

AnalysisNEWS Endeavour Awards deadline extended By Alan Johnson

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PON the request of several readers, the team at Manufacturers’ Monthly has decided to extend the nomination deadline for the 2013 Endeavour Awards two weeks, to the end of this month; February 27. The 2013 Endeavour Awards program, proudly sponsored by BlueScope Steel, is Australia’s only national awards program designed to recognise excellence in local manufacturing. Now in its tenth year, the prestigious Endeavour Awards program offers an unequalled occasion for manufacturers to demonstrate their successes to customers and peers alike. The Endeavours offer manufacturers the ability to showcase their business successes and enhance the company’s reputation both locally and overseas, be it as a finalist or taking out an actual award. As well, the Endeavour Awards celebrate and recognise the achievements of industry leaders in their drive to achieve best practice and excellence in manufacturing. With twelve categories plus an overall Manufacturer of the Year award, the free-to-enter program is open to all manufacturers, regardless of size, who have a manufacturing presence in Australia, including engineering and process companies. There are 12 categories for 2013 covering almost every aspect of the manufacturing sector. Manufacturers are urged to enter without delay, this is your opportunity to get involved in this exciting program and maybe become Australia’s Manufacturer of the Year for 2013. The Endeavour Award categories for 2013 are: The Technology Application of the Year Award, sponsored by SMC, is for successful applications of technology in manufacturing processes. The Exporter of the Year Award, sponsored by EFIC, is for manufacturers who have successfully entered or are developing an export market with a new or existing locally-made product. 8 FEBRUARY 2013 Manufacturers’ Monthly

Now in their tenth year, the prestigious Endeavours offer an unequalled occasion for manufacturers to demonstrate their successes to customers and peers alike. The Environmental Solution of the Year Award, sponsored by Atlas Copco, is for the successful implementation of solutions designed to reduce the environmental impact of manufacturing operations. The Australian Steel Innovation Award, sponsored by BlueScope Steel, is for new products or projects using Australian made steel. The Global Integration Award, sponsored by ICN (Industry Capability Network), is for companies who are engaged in global supply chains. The Safety Scheme of the Year, sponsored by Sick, is for the successful implementation of a scheme, or schemes, to improve safety in manufacturing plants. The Australian Industrial Product of the Year Award, sponsored by BOC, is for new, innovative Australian made products designed for industrial applications. The Australian Consumer/Trade Product of the Year Award is for new, innovative Australian-made products designed for consumer or trade applications. The overall Manufacturer of the Year Award, sponsored by BlueScope Steel, will be chosen from among the winners of the above categories. The Lifetime Achievement Award, sponsored by IFM Efector, recognises a person who has made a significant individual contribution to Australia’s manufacturing industry. The Young Manufacturer of the Year Award is for the rising stars of Australia’s next generation of manufacturers.

The Most Innovative Company Award recognises Australian manufacturers who have looked ‘outside the box’ to implement new business ideas.

The Significant Achievement Award, sponsored by Enterprise Connect, recognises manufacturers who have made a significant achievement in productivity, competitiveness or innovative capability since completing their Enterprise Connect Business Review and Tailored Advisory Service project(s). (This award is for Enterprise Connect clients only.) Readers are reminded that as well as the prestige involved with entering the Endeavour Awards, all finalists will receive two complimentary tickets (valued at $150 each) to the outstanding Endeavour Awards presentation gala dinner to be held in May. For more information on the categories, and an application form visit www.manmonthly.com.au or call Brent Balinski on 02 9422 2480.

Celebrating manufacturing excellence Colin Isaac, Managing Director of BOC South Pacific, says the company is extremely pleased to be participating in the 2013 Manufacturers’ Monthly Endeavour Awards. “These awards are very much in keeping with BOC’s own core values of recognising excellence and innovation in manufacturing and industry, which is why the company is delighted to be continuing its support as a sponsor of the 2013 event.” Isaac said the company aimed to be admired for its people, who provided innovative and sustainable solutions that made a difference to the world. “These awards reflect and promote the same kind of spirit, and we acknowledge the terrific efforts of all entrants who share our passion to excel,” he said. BOC, who sponsors the Australian Industrial Product of the Year Award, is a world leading manufacturer of products including hydrogen, LNG, oxygen, nitrogen and argon at its bulk tonnage sites around Australia and the South Pacific. Isaac said the pioneering spirit on which the company was born as a small gases business more than 100 years ago has been a hallmark of BOC throughout the generations, allowing for strong growth and diversification into many specialty fields. “BOC has supported significant industry growth and sustainable manufacturing through diverse projects including the development of LNG highways, Darwin Helium Plant, Air Separation Unit at Karratha, Hydrogen Steam Methane Reformer at Altona, Victoria and a $70 million ASU investment at Glenbrook, New Zealand in the last few years alone. He explained that BOC is a member of The Linde Group, a world-leading gases and engineering company with 50,000 employees working in around 100 countries worldwide. “This means that BOC customers enjoy local service, whilst also benefiting from the extended support, expertise and buying power that come with being part of a major international business. Isaac went of to wish all entrants the very best of luck in the tenth annual Manufacturers’ Monthly Endeavour Awards and encourages all businesses, big and small, to strive for continuous improvement with commitment, courage and creativity.

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AnalysisNEWS EVENTS February 2013 26-28 February: Project Scheduling. There are lots of definitions to try and breakdown exactly what it is that a Project Scheduler or Project Manager does. It’s a multi faceted, multi disciplined role that is ever evolving and can take on different levels of success and failure. But no matter what the budget of the project is, the pressures are always there and world of a Project Scheduler can be unforgiving but also extremely rewarding when it comes together. So sharpen your skills, talk to leaders in the field and bounce ideas of each other at Tonkins Project Scheduling Conference. For more information call 02 94224 6000 or go to www.tonkincorporation.com

March 2013 8 March: Flexible Packaging and Bioplastics half-day training course. Flexible packaging is a complex and dynamic area of packaging. . The aim of the course is to provide attendee’s with an introduction to polymers used in flexible packaging;flexible packaging manufacturing processes; films and their properties;market applications for flexible packaging structures, properties and pack formats; emerging materials for flexible packaging; compostable and degradable flexible films; and sustainable packaging opportunities for flexible packaging. The aim of the course is to give attendees an introduction to flexibles, an ability to understand flexible film applications and to more confidently define or select flexible packaging. To find out more call 07 3278 4490 or go to www.aipack.com.au

May 2013 7-10 May: AUSPACK PLUS. The largest biennial packaging and processing machinery and materials exhibition in Australia, AUSPACK PLUS, will be heading to the Sydney Showgrounds, Sydney Olympic Park. AUSPACK PLUS is owned and presented by the Australian Packaging and Processing Machinery Association (APPMA), Australia’s only national packaging and processing machinery organisation.For information about AUSPACK PLUS 2013, please log on to the newly-designed website www.auspackplus.com.au

10 FEBRUARY 2013 Manufacturers’ Monthly

The latest manufacturing news Boral announces 700 redundancies Building products supplier Boral has announced that it is shedding 700 jobs, following a 100-day review by CEO Mike Kane. Slightly over eight per cent of the company will lose their jobs in a restructure that is hoped to make the company more competitive. Of the 700 jobs cut, 200 have already been announced and the rest are expected to be gone by March. “The restructure I am announcing will transform the group into an organisation that is more responsive to the realities of a cyclical marketplace and one that remains competitive not just during the cycle highs but when conditions are challenging, as they have been for the past few years,” Kane said. A significant number of the jobs lost will be in Victoria. This follows December’s announcement, reported by Manufacturers’ Monthly and others, that Boral was closing its clinker factory at Waurn Ponds, with 90 jobs cut. “Around 20 per cent of the roles will come from Victoria, or about 150,” a spokeswoman said.

Pacific Brands boss advises manufacturers to accept offshoring The CEO of Pacific Brands, John Pollaers, has spoken in favour of outsourcing, claiming some manufacturers should accept it as necessary to remain viable. “You can have a successful manufacturing industry and still outsource the physical production,” Pollaers said. “If we recognise those companies that are investing in added value, it is a more exciting and viable industry,” he added. Pollaers, a former Foster’s Group chief, was announced as Sue Morphett’s replacement last August. The company posted losses of over $400 million for the last two financial years. The chief’s comments in favour of outsourcing are in line with those made by former federal treasury secretary and recent Asian Century

white paper author Ken Henry. “Instead of making the same products that we were making 140 years ago, that capacity can instead be used to make and do things that only we can do, or that Australia can do better than people in other countries,” said Henry last year. Pollaers lauded Pacific’s controversial decision announced in February 2009 to outsource its manufacturing. He admitted that Pacific had “a couple of challenging years ahead,” but the company had a stable of strong brands and outsourcing held the company in good stead.

Aussie scientists develop groundbreaking new electronics product Australian scientists have developed a new material they say could be a game changer for the future of electronics manufacturing. Researchers at RMIT University and CSIRO say the new conductive nano-material they’ve developed could help push electronic performance beyond the range of silicon chips. The new 2D material is made from layers of crystal known as molybdenum oxides, and could allow for the transfer of electrons at much faster rates than is currently possible. “Quite simply, if electrons can pass through a structure quicker, we can build devices that are smaller and transfer data at much higher speeds,” CSIRO researcher Dr Serge

Zhuiykov said in a statement, going on to add that “while more work needs to be done before we can develop actual gadgets using this new 2D nano-material, this latest breakthrough lays the foundation for a new electronics revolution and we look forward to exploring its potential.”

Darrell Lea releases limited edition Australia Day products Darrell Lea marked Australia Day with green-and-gold versions of two of its best-known products and a world record attempt. The company offered limited edition takes on their Soft Eating Licorice and Rocklea Road products, featuring apple and pineapple pieces and lime and banana-flavoured marshmallow respectively. To celebrate being Australian owned and Australian made, this Australia Day we wanted to do something special – so we created ‘green and gold’ liquorice and Rocky Road, available in Woolworths,” said marketing manager Nicole Waters. “Australians have been enjoying Soft Eating Liquorice and Rocky Road for more than 50 years – but this year we’ve taken firm favourites and given them a fresh twist.” On January 24, the company also made a Guinness World Record attempt, attempting to create a rocky road slab measuring 5.5 by 2 metres. manmonthly.com.au

EXPORTING Taking a stand Manufacturers are fighting back against cheap copies.

C

ounterfeit products are becoming an increasing problem for manufacturers who make high-end or specialised equipment and can cost companies millions of dollars in lost revenue. Exporters along the logistics chain also suffer as they have to check the goods for quality assurance. Ensuring products that are exported overseas maintain their integrity by making it harder for them to be counterfeited is becoming a focus for many manufacturers. Codan, an Adelaide-based electronics company that develops, manufactures and markets Minelab handheld metal detectors with sales in over 60 countries worldwide, recently discovered that counterfeit Minelab GPX Series gold detectors, originating from China, had made their way into the African market. Realising the huge impact the fake products could have on their business, Codan turned to Fujifilm’s unique ForgeGuard anti-counterfeiting labels so that throughout the supply chain, originals could be distinguished from the counterfeits, and logistics companies can ensure the integrity of their supply chain. Codan’s Peter Charlesworth explained that a solution was

Counterfeiting is an almost unavoidable issue for high end manufacturers. required which would enable customers to realise they were dealing with a lesser product. “Many of the Chinese counterfeit products look cosmetically identical to genuine Minelab products, to the extent that dealers and customer cannot visually tell the difference,” he said. “However, these copies do

not perform anywhere near as well as genuine Minelab metal detectors.” “While Codan has registered trademarks in place for Minelab and GPX, this alone does not stop counterfeit products entering the market. Therefore other practical solutions were also required to reassure dealers and customers that they were

buying genuine Minelab products, with high performance and the ongoing service and warranty back up that Minelab provides. That’s where Fujifilm and ForgeGuard came in.” ForgeGuard true colour hidden image labels provided a solution for Codan which could be applied quickly and effectively to their products. The labels work by making it harder for a counterfeiter who is trying to copy and export the true colour hidden image, which identify the products as genuine Minelab. “We restricted the distribution of ForgeGuard viewers to only our authorised Minelab dealers and added an additional level of verification by cross matching the hidden image against the product’s serial number. This verification process operates through a password protected webpage that only authorised Minelab dealers can access.” Charlesworth said the technology gives his company greater protection against counterfeiters, and ensures the quality of Codan products are no longer being compromised. “The ForgeGuard labels give our customers the reassurance that they’ve bought a genuine Minelab product. This gives us a significant advantage against counterfeiters.”

“ EFIC DID MORE THAN SUPPLY WORKING CAPITAL. THEY PUT US ON TRACK FOR GROWTH.” Hugo Davidson, CEO, Knog

Find out more at efic.gov.au/mm Overcoming financial barriers for exporters

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Manufacturers’ Monthly FEBRUARY 2013 11

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Shaping our future with additives Additive manufacturing/3D printing looks set to change the face of manufacturing, but which system is right for you? Alan Johnson reports.

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N recent years additive manufacturing and 3D printing have been described on many occasions as the greatest thing since sliced bread, but what many don’t realise is that it’s not a one type fits all applications technology. There are a number of technologies available for making cheap three dimensional prototypes through to high quality finished products using materials such as thermoplastics, and metal and ceramic powders. To guide Australian manufacturers in the right direction, the CSIRO has recently established an Arcam additive manufacturing facility, the first in the southern hemisphere, to provide industry with access to advanced technologies for 3D printing of metals. The CSIRO has identified additive manufacturing as a key opportunity for the manufacturing sector in Australia and has considerable expertise in titanium manufacturing including electron beam melting (EBM), coldspray and thermally assisted machining.

Arcam EBM technology, which can be used with metals including titanium, titanium alloys and speciality steel alloys such as nickel and cobalt chrome, uses an e-beam to melt and fuse the metal powders, layer-bylayer, into 3D parts. According to Swee Mak, Director of CSIRO’s Future Manufacturing Flagship, the resulting quality is high, as the process is conducted in a vacuum and held at high temperatures during the entire build. He says additive manufacturing is an emerging technology capable of changing the future of manufacturing in Australia. “And we are keen to facilitate the adoption of this new technology for the benefit of Australian businesses. “We have invested in a suite of technologies and research, which combined with our links with RMIT and Monash University, provide industry a unique opportunity to explore and engage in forwardthinking design and production techniques,” Mak said. Services available to manufacturers include trials of parts manufacmanmonthly.com.au

yIT@MM tured using Arcam EBM technology, assistance in finding and converting the design of existing parts to one optimised for the process, and prototyping parts or tooling with short lead-times and rapid design changes. Mak says the organisation has a high number of Australian manufacturers looking at the technology. “With our machines, manufacturers can get a true sense of what is commercially viable and what is not. Our research is on production scale machines, they are not just little prototyping type machines. “With our high Australian dollar and high manufacturing costs here, manufacturers should be looking at this technology for low volume manufacturing of highly specialised products, especially for high value products that can’t be made using conventional methods. That’s where the importance of design comes in. “There’s no reason Australian manufacturers can’t do extremely well using this technology, additive manufacturing allows companies to manufacture in a more efficient way than conventional techniques,” Mak

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told Manufacturers’ Monthly. John Barnes titanium research leader in the Future Manufacturing Flagship said additive manufacturing can been used for rapid manufacture of prototypes where its speed of production is advantageous. “It can also be used for the manufacture of complex, high-value components for industrial applications, and is especially useful for short production runs,” he said. However Barnes warns companies that want to take on additive manufacturing that they face a number of practical challenges. “But we are here to help them, and have been providing technical advice to solve problems and helping businesses to access these technologies for nearly ten years now,” Barnes said. While the aerospace and medical industries are arguably the biggest users of advanced manufacturing, Barnes says he is receiving a lot of interest from Australia’s automotive industry. “Not for making 100,000 piston rods, but for making the first few

rods maybe or for making custom parts for high end models, customised parts that catch the eye, and that’s where the importance of design comes in . “While we don’t want to be seen as a manufacturer, in the interim we might have to, especially with our cold spray technology, which is a form of additive manufacturing. “Manufacturers are coming us to get the first few parts made, however it is possible for three or more manufactures to get together and buy an EBM machine. We see if evolving that way,” he said. Barnes explained that the machines are very sophisticated with very sophisticated algorithms, and cost over $1m. “But before manufacturers rush off and buy a tool like this, they need to know if it’s viable. “One of the first things we did was develop an external based tool that allows a manufacturer to come in and work out costings with various labour rates on products they might like to make. “We are working with large and

small companies, and our mission is to help people get smart on how the process works. “At the moment we are working with titanium, mainly because that is the name of the group, but the machine is capable of working on other materials. “This is an exciting technology and has huge potential for Australian manufacturers. It often offers manufacturers a different way of manufacturing, with the potential to save a lot of assembly work, making it much cheaper,” Barnes said. Mak says manufacturers need to take a close look at this technology for the future. “While we have an Arcam machine here, we won’t be driving everyone to that solution. We have vast experience in all types of additive manufacturing and we will advise people on what will work for them,” Mak stated. For more information and to organise a visit go to www.csiro.au/ en/Organisation-Structure/Flagships/ Future-Manufacturing-Flagship/ Ti-Technologies/Arcam.aspx/

Manufacturers’ Monthly FEBRUARY 2013 13

Management Managing effectively in 2013 Effective management is critical to the success of manufacturing companies, both internally and externally. Alan Johnson reports.

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HILE the effectiveness and efficiency of the production process is vitally important to all manufacturers, readers are advised to never neglect the effectiveness and efficiency of its management. According to Greg Lourey, a director with The Leadership Circle Asia Pacific, many senior managers make the mistake of thinking: ‘What I do is who I am’. “However, the moment we associate our sense of self, our worth, our security with external conditions, we sentence ourselves to a roller coaster experience in which we never quite catch up because of the prevailing anxiety that exists.” According to Lourey, one of the most significant transitions managers must attempt is reframing the belief that they need to please and be respected by those around and above them to be effective and successful. “We may develop many competencies and a solid track record of success along the way, but to the extent that we assign approval of ourselves to others, we’re essentially playing to avoid losing respect. Most organisations have a set of leadership competencies and measure against these with various 360-degree assessments, peer reviews and customer feedback. We seldom look more deeply at the assumptions and the mental operating system that drives our behaviour,” he said, adding: “We ask leaders to change aspects of their behaviour, like delegate more effectively, without looking at the assumptions that create the old behaviour, if I want the job done properly I must do it myself. “This is a very common problem, and it’s no wonder we revert to the old ways so quickly,” Lourey told Manufacturers’ Monthly. Instead, he says, people should ask themselves why. “Is it because I don’t trust the person or the process?” He also says it is important, especially for newly promoted middle 14 FEBRUARY 2013 Manufacturers’ Monthly

(it1.lourey) My advice for managers is to always pause before they respond - Lourey.

managers, to be aware of the bigger picture, even when they are feeling the stress of having production or quality problems for example. “If they let these problems affect the decisions they make, they will start to make short term decisions, which might solve the present problems but won’t address the root cause. My advice for managers is to always pause before they respond; take a breath, or even sleep on it, and in that pause they often decide to say something different. “I also advise manufacturers to take note of the old engineering term ‘Structure determines performance’ which is really important. “If I have a badly designed process or system I only get the outputs I deserve. Managers need to continually look at the processes or systems to make sure they still serve the company and to hold on to the big picture, it is easy to get caught up in the detail instead look for the root cause.” Lourey says innovation is very important in the manufacturing industry. “But if managers are so busy doing all the work themselves, rather than seeing the big picture, stepping back and delegating, it’s really hard to innovate”. Interestingly he says age is not an issue. “You can have mature people at a young age and people of mature years who should know better, plus there are many people out there who have been promoted beyond their capability. Often people with great technical abilities get promoted with more leadership responsibilities, when they don’t really want that,” he said.

(it1.beasley) Cultural understanding is more than jsut chopsticks and manners - Beasley.

Lourey says there are three selflimiting assumptions or mind-sets that can reduce the effectiveness of managers. He says readers might be surprised to find even the toughest sounding leaders can struggle with approval seeking. “We may achieve a level of excellence in our leadership results for a period of time, sometimes years. “However, until we can identify and address our self-limiting assumptions and mind-sets we will miss higher, more elegant levels of leadership where we can achieve more with much less effort and strain. Transformation happens when leaders see their own mental software,” Lourey said.

Dealing with Asia While the story regarding Bob Hawke’s first trip to Japan as prime minister is not new, it is still worth repeating, to highlight the problems of ‘lost in translation’ when working in the Asian region. Hawke was asked by Japanese journalists whether union action at the time would harm Australia’s reliability as a supplier of raw materials and exports. He responded by saying ‘Australia is a reliable supplier for Japan. You’ve got no worries in discussing this and I’m not playing funny buggers with you’. However, the response was translated that the Australian PM was reassuring them that ‘we’re not playing laughing homosexuals with you’. There was nothing wrong in what Hawke had said, he just didn’t take into account whether the way Australians speak, and do business,

will translate in Asia. According to Tamerlaine Beasley, Managing Director of Beasley Intercultural, this is a common problem for people new to working in the Asian region. “The laid back, easy going culture of Australia endears us to many, but this informal behaviour especially when doing business with people from more hierarchical cultures, such as those in most of Asia, can have unforeseen consequences. “Our reluctance to use titles, and our desire to refer to everyone on a first-name basis, is valued in our culture. We prefer to treat everyone equally. “However in Asian cultures, where it is important to treat everyone according their position and status, our behaviour is perceived as disrespectful,” Beasley told Manufacturers’ Monthly. She says that while classic Australian humour is laconic, selfdeprecating, and full of banter and ‘put-downs’, to people from hierarchical cultures, this behaviour is curious, ‘why do we choose to insult people in order to show we respect them?’. But rather then understanding everything about the country, Beasley advises to people to focus mainly on what is different. She says the key point of difference is our attitude towards hierarchy: “Australians operating right across the Asian region, tend to have a lack of respect towards hierarchy. Our management tends to be open and relaxed while in Asian cultures it is far more closely monitored, micro managed in fact. She warns that our way of developing relationships and establishing an equal playing field through the use of humour, first names and informal English, can create unnecessary barriers and hinder success. “The keys to Australian businesses being successful in Asia are perseverance, patience and building relationships. Viewing a company’s business culture ‘from the outside’ will assist manufacturers in the Asian region.” manmonthly.com.au

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Metalworking& MACHINE TOOLS Improved quality through precision The drive for increased output and high quality in shorter timeframes is growing the contribution of coordinate measuring machines. Hartley Henderson writes.

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Measuring tehcnology will be vital in future manufacturing.

ontinuing advances in precision measurement through coordinate measuring machines (CMMs) can provide a significant contribution to lean manufacturing through better quality control.These machines can enable faster and more accurate inspection of parts, as well as quicker feedback and processing of throughput. Time and manpower required for quality control can be significantly reduced. Hi-Tech Metrology supplies a wide range of CMM equipment. The company’s

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managing director, Ian Martin, says the current challenging economic conditions are resulting in an increasing drive for improved quality and reduced costs in Australian manufacturing industry. “The demands of global markets are resulting in a greater focus on improving the competitiveness of Australian manufacturers including through the use of CMMs to increase product quality and reduce rework and rejections,� he told Manufacturers’ Monthly. Recent CMM product launches in Australia

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+61 3 9305 2555 www.profilecuttingsystems.com

16 FEBRUARY 2013 Manufacturers’ Monthly

manmonthly.com.au

include the world’s first portable measuring arm with a fully integrated and certified laser scanning system. “This 7 axis arm with integrated laser scanner enables rapid inspection of complex organic shapes as well as providing massive efficiency gains for anyone with a need to re-engineer tooling or products,” he said. “With a modular high-end scanning platform, this portable measuring arm does not require referencing before measurement. Versatility is provided because the machine can easily switch from conventional touch probe measurements to high speed laser scanning without downtime for unnecessary calibrations.” Business development manager industrial metrology division at Carl Zeiss Australasia, Thomas Wegmueller, believes that global industrial challenges demand a wide range of enhancements to production methods, machines and equipment, particularly in relation to quality and measuring technology. “Now and increasingly in the future, measuring technology will be vital in maintaining the competitiveness of manufacturing companies. The enormous growth rates in the Asian and South American markets mean that advanced quality measuring technology is essential for enterprises striving to enter and compete in the global market,” Wegmueller told Manufacturers’ Monthly. “With a view to meeting the challenge of ensuring maximum precision in all areas of measuring, we have launched the new compact MICURA CMM which comes with an attractive measuring range of 500 x 500 x 500 millimetres. This CMM is designed to meet user demands for small machines that are as accurate as their larger relatives but offer a price advantage. Parts in industrial manufacturing are becoming increasingly compact while accuracy requirements are rising. The measuring accuracy of MICURA is less than one micrometre.” Wegmueller advises that with the optional VAST navigator scanning technology, MICURA adapts the scanning speed to the measuring job. He says that where a simple contour and less precision are required, MICURA moves faster, but when manmonthly.com.au

high precision is needed the machine moves somewhat slower. “Length and form measuring technology are also moving closer together, such as with the PRISMO navigator where the new RT-AB rotary table provides even greater productivity.” MTI Qualos supplies the Mitutoyo range of CMMs, from the manual Crysta Plus-S to the high-end Legus CMMs which offer 10nM resolution, with many options in between. The company’s senior technical advisor, Morrie Wyatt, says that as a result of improvements in machine accuracy and sensor technologies it is becoming possible to integrate the use of scanning probes for roundness testing, and surface roughness sensors for analysis of workpiece finish, where traditionally separate dedicated machines would have been employed. “This is bringing to the CMM the types of flexibility benefits that CNC machining centres have been bringing to manufacturing over lathes and milling machines. “Key considerations when purchasing a CMM are always going to be defined by the job that the customer is trying to achieve. Don’t be trapped into under specifying the machine size. Customers should always take care to factor the motions of the probe system, as the swivel length of the probe system, type and angles of extensions etc will all impinge on the working envelope of the CMM. “Environmental concerns also need to be taken into account, including shopfloor conditions such as temperature variation and vibration sources that can have a huge impact on measurement accuracy. There is no point in trying to manufacture parts to micron level tolerances when the material temperature is allowed to fluctuate greatly. “CMMs often have temperature compensation capabilities but they can typically only cope with a delta of +/- 1 degree C per hour.” Wyatt emphasises that while a good quality CMM will perform high accuracy measurement, user expectations also need to be realistic. “For example, you can’t reliably measure the location and diameter of a circle when there are only a few degrees of arc to work with, or where features are too small to physically access.” Manufacturers’ Monthly FEBRUARY 2013 17

What’sNew See more new products at manmonthly.com.au

Cable hooks Swift metal Services have expanded their range of cable and hose brackets. According to the company this new range now includes the fixed cable and hose retainers. “From working with site managers and project co-coordinators at large infrastructure companies Swift Metal Services identified a need to suspend larger diameter (and heavier) hoses, cable and pneumatic lines on building sites, energy infrastructure, mines and machinery workshops. “This has resulted in the Swift Retainer Bracket which has an innovative design allowing for multiple mounting positions including hooked or bolted configurations,� the company said. While the brackets have been

For lifting compressed air cables.

designed primarily for the power and energy industries, “Swift Cable Brackets can utilized across a broad spectrum of applications and industries – really any area that requires hooks or brackets to lift cables, power leads or hoses out walkways, or traffic areas,� it said. It produces a large variety of brackets, hooks and retainer brackets for hoses, cables and pneumatic lines and manufacture custom retainer brackets to suit any size hose or cable. Typical sizes hold up to 50mm cables with custom designs available. Swift Cable Hooks are available in 304 Stainless Steel, powdercoated or hot dip galvanised finishes. Swift Metal Services 1800 626 525 www.swfitmetal.com.au

Laser label markers Laser Resources presents a compact range of Rofin laser systems designed for label marking applications. The compact label markers have an integrated cooling

system. The compact laser system class 1 offers everything required for efficient label marking. They have a 17 x 108mm marking field, and are capable of printing

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onto 120mm wide labels, it says. Laser Resources 1300 259 398 www.laserresources.com.au

High frequency accelerometers Metromatics now supplies Dytran model 3220M27 accelerometers, a range of low profile, ring shaped IEPE accelerometers designed for use in various vibration control and measurement applications. Weighing just 2.7 grams, the miniature accelerometers offer a sensitivity of 1 mV/g and frequency response of 0.6 to 10,000 Hz, and feature a quartz shear sensing element encased in a lightweight titanium housing. Electrical connection for the accelerometers is achieved via a specially designed coaxial glass-to-metal shield 5-44 connector, which can be positioned in any desired radial direction. A miniature through-hole mounting configuration allows the sensor to be turned 360° prior to securing for ease of installation. The accelerometers are hermetically sealed for reliable operation in high humidity. Metromatics 1300 589 932 www.metromatics.com.au

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18 FEBRUARY 2013 Manufacturers’ Monthly

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The testers feature a colour touch screen for visualisation of test results and control Available now from Westek Electronics, the new Vitrek V7X Hi-Pot testers and ground bond testers are designed for safety tests in accordance with IEC, TUV, CSA and UL regulations. Two models in the range include insulation resistance measurement between 20 volts and 5000 volts DC, and all models feature resistance measurement to 60k Ί with a resolution to 0.001 Ί . They are designed for both AC and DC Hi-Pot testing to 5000 volts, and there is one tester, the Vitrek V70, suitable for

5000 volts AC testing only. The Series can directly control up to 4 high voltage scanners for ATE systems, and all the safety testers are provided with USB 2.0, RS232, and digital I/O Interfaces as well as a safety interlock. There are six models featuring AC and DC Hi-Pot testing to 5KV, leakage current measurement to 100 nano-amps, and insulation resistance to 450GΊ and ground bond testing to 30 amps rms. Westek Electronics 1300 171 403 www.westek.com.au

Battery operated portable PIM test analysers Anritsu has expanded its line of Passive Intermodulation (PIM) test solutions with the PIM Master MW82119A, high-power, battery-operated, portable PIM test analysers. One quarter the size and half the weight of alternative PIM test solutions, all models in the series offer PIM Master, including 40W testing and Anritsu’s patented Distance-to-PIM. They have been designed with a compact housing to make them suitable for difficult to access sites, such as remote radio head installations and indoor distributed antenna systems. Six models are available to address major frequency ranges, including the upper and lower 700 MHz bands, 850 MHz, 900 MHz, 1800 MHz, 1900 MHz, and 1900/2100 MHz. All six incorporate DTP technology. This allows tower contractors, maintenance contractors, and wireless manmonthly.com.au

systems from MadgeTech, ultra-low temperature measurement systems created specifically for the monitoring of temperature sensitive substances that need to be preserved at cryogenic temperatures. The LNDS systems include the TCTemp2000 data logger with thermocouple probe, and 9 volt AC wall mounted power adaptor. They can be mounted to the top or outside of a cryoshipper or freezer with the probe sheath inserted into the tank. The LCD on the logger displays the internal temperature. Probes are available in various sizes. They are designed for both AC and battery-powered operation, and can be easily programmed by the user, with preselected sample rates from 2 seconds to 24 hours.They also feature an 8-button membrane keypad, and large LCD that displays current reading, minimum, maximum, and average statistics in realtime. Pacific Sensor Technologies 1300 746 694 www.pacificsensortech.com.au

Push pull force gauge Bestech Australia now offers the Aikoh 9800 digital push/pull force gauge. This instrument provides force measurements and complex force analyses for low range load measurements. The push pull force gauge is available in measuring ranges of between 500 gf and 50 kgf, and comes complete with hook, probes, and other adaptor tips. The unit has built in memory as well as analog and digital outputs. The gauge is portable and works with a NiCd battery, with built in memory backup in the case of power shortage. As well as being able to display the measurement values on the force gauge’s LCD, load graphs can also be plotted on the LCD screen and extracted onto PC with the RS232 interface. Bestech Australia 1300 209 261 www.bestech.com.au

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WWW.BOKERS.COM/MANM Manufacturers’ Monthly FEBRUARY 2013 19

ManufacturingIN THE ASIAN CENT U

High end niche goods are the future.

billion to establish a health care network for people that didn’t have access to medicine. “Of about the 1.3 billion people in China there was about a billion that didn’t have access to regular medicines and this broad market approach was to establish networks of hospitals throughout the western, northern and southern areas of China to start to establish universal healthcare for the Chinese. “What that has led to is the establishment of respiratory clinics, and in these clinics are nebulisers; this product is used in those,” Anderson said. He told Manufacturers’ Monthly that around 70 million people have asthma in China and because of the government’s healthcare reforms these people are finding it easier to access medicines. “The numbers of patients that are using these products have dramatically increased and we’re trying to meet that demand. “I think that now because of the

Advancing Australian manufacturing Changes to Chinese regulations is opening new doors for Australian manufacturers. Alex Heber reports.

A

ustralia’s car industry is faltering and our wine sector is facing increasing competition in Asian markets from its European and American counterparts. However, there is a good news story out there when it comes to Australian manufacturers, it is our advanced manufacturers and pharmaceutical companies that are holding the torch. Pharmaceuticals are now firmly established as the number one “substantially transformed” manufacturing export, beating the car industry in 2011-12 with $2.5 billion in exports and the wine sector with $2 billion, according to data published by the Australian Bureau of Statistics (ABS). Manufacturers’ Monthly recently investigated how Australian manufacturers are overcoming the high Australian dollar and increasing labour costs to take on the world, and it was found that pharmaceutical and advanced manufacturers 20 FEBRUARY 2013 Manufacturers’ Monthly

although dealing with the same pressures, are doing particularly well. Asia, with its rapid urbanisation and rising living standards, has pushed pharmaceuticals to a huge extent and serves as a massive market for advanced health-care products and other medicinal drugs. Speaking to Stuart Anderson, the director of manufacturing and supply at pharmaceutical company AstraZeneca he said changes to regulations in China has opened up a wealth of opportunity for the global prescription medicine based company. Its Australian operations, located on the aptly named ‘Pill Hill” in North Ryde, New South Wales, employs around 1000 people, made up of four hundred in manufacturing and six hundred in sales and marketing. “In North Ryde we have a very specialised and advanced sterile manufacturing plant, here we use a particular technology that manufactures sterile plastic bottles that are formed, filled, and sealed in a single process.”

AstraZeneca also manufacture their Pulmercort respules at the factory, which consists of a 2mm container that includes a steroid in it to prevent asthma. “We are the sole supplier to AstraZeneca and we send them into Asia, Europe and even into Canada,” Anderson said.

China came calling The growth of the Asian market is where AstraZeneca sees the hottest opportunities for their repules, prompting the company to invest approximately $80 million over the next three years to increase capacity and meet the demands of their Asian customer base. “We export into China and Japan; China is where the growth is for us and to meet the demand in China we’re investing about $80 million over the next three years,” Anderson said. The opportunity arose in 2009 when the Chinese government announced a broad market strategy, making an investment of US$125

healthcare reforms and the increased access to medicines these people that previously wouldn’t have been treated are now being treated,” Anderson said. The Australian made respules are targeted at the very young and very old as they are delivered through a nebuliser which creates a mist ultrasonically, allowing the patient to breathe the medicine in through a facemask, Anderson explained. Homart Pharmaceuticals is another Australian manufacturer operating from Sydney who is taking advantage of the Chinese market. The company’s exports have been growing at a breakneck speed of 850 per cent in the last three financial years since July 2008 due to its export to Greater China Countries project, despite both the GFC and high Australian dollar.

Lack of talent A downturn in the manufacturing sector has caused a skills shortage within the industry Anderson said. manmonthly.com.au

URY “In the external environment my biggest concern at the moment is the lack of good manufacturing talent. “I’m finding it really hard to find good engineering and quality assurance staff, production staff is not so much of an issue. Anderson is particularly concerned about the experience the industry is losing; this loss has forced the company to cast a wider net when recruiting and look at alternative avenues. “Because of the general decline in manufacturing in the last five to ten years we’re losing the skills in that area and that’s a little worrying. We’re having to look a little wider then just pharmaceuticals so we’re looking at food and FMCG [Fast Moving Consumer Goods] and then have to try and create the skills internally whereas before we could just buy them. It’s not the case now,” Anderson said. Anderson added that to overcome such a skill shortage the sector needs to go right back to schools and demonstrate to the next generation the importance of studying science and engineering. “We can offer a great career in either of those disciplines here. The work that our engineers do, they work with really interesting technologies and good equipment. “We have an apprenticeship program which we focus at school leavers and mature aged students for retraining,” he said. AstraZeneca is also making a conscious effort to tap into the graduate market as they begin their expansion plans. Discussing the increasing adoption of global supply chains, Anderson said the company imports a lot of the raw materials including the active pharmaceuticals from Sweden and the plastic from Europe and then fills, packs and exports from Australia. “We have a goal to source as much as we can within Australia, we work very carefully with the suppliers of packaging materials, in particular the foil that we use to wrap the product in, it’s a very specific specification and we need to have very tight control over the types of inks and adhesives used so we could buy that from Europe as well but we’ve manmonthly.com.au

Expanding a company’s base skills is crucial to development. taken the time and effort to meet that specification here in Australia,” he said. The equipment used to make the respules is a standard form, fill seal machine from a German supplier, all of the vessels and pipe work for the formulation suites are sourced in Australia and New Zealand. “The packaging equipment is sourced here in Australia, we have a long term relationship with a particular company in Melbourne called ADBE and they make this equipment for us. “I’m proud to say that the combination of the way we manufacture these lines makes us the most efficient manufacturer of these in the AstraZeneca network,” Anderson said.

A lasting legacy ABS figures show that the medicines industry exported more than $4 billion worth of pharmaceutical and medicines products in 2011-12, up from $3.7 billion the year before. “These numbers underline the significant contribution Australia’s medicines industry continues to make to the economy,” Brendan Shaw, chief executive of Medicines Australia, stated. Shaw added “the Australian medicines industry has continued to export more goods around the world than any other hi-tech industries. “This reaffirms the pharmaceutical sector as one of the unsung heroes of Australian industry. It is a real export success story.” The pharmaceuticals sector

currently exports more than wine and motor vehicles combined; however without clever investment and strategies now this could easily change. “We’ve got a really good base here with good capability and if we don’t continue to nurture and invest in that then we could well lose it,” Anderson said. AstraZeneca’s plant is located in the outskirts of Sydney’s North West, the location choice is an example of government legacy, Anderson said. “There are lots of reasons why plants are where they are and sometimes plants are where they are because of good fortune. I guess the reason we are still here in Australia goes back to the Factor F scheme in the late 80s/ early 90s.” Anderson is referring to the Factor F scheme implemented in 1987 by Senator John Button who at the time was the Industry minister in the Hawke government. Factor F was introduced in an effort to boost the level of R&D investment in the pharmaceuticals industry. According to a spokesperson at the Department of Industry, Innovation, Science, Research and Tertiary Education it was never considered by the Pharmaceutical Benefits Pricing Authority (PBPA) in the pricing of Pharmaceutical Benefits Scheme (PBS) medicines. In order to establish manufacturing capabilities in Australia, Button subsidised the manufacturing of local products that were previously imported so these companies subse-

quently became an exporter of those and then in turn engaged in R&D, making big headways in pharmaceutical developments. “We became part of that program and we developed our facility in North Ryde. “The scheme only finished 15 to 17 years ago and the local economy is still reaping the benefits of that scheme as we continue to grow and maintain this facility. At a time when Australia is debating manufacturing’s future Anderson thinks “there’s real opportunity for another scheme like Factor F. If properly run it has such a big multiplier in the environment”. A spokesperson at the Department of Industry said that evaluations of past pharmaceutical industry support programs indicate that they had little continuing benefit to the Australian taxpayer and that current Government policy and programs are designed to support the whole economy rather than being sector specific. Discussing the health and medical sciences sector, the spokesperson said the Australian Government strongly supports R&D projects in the health and medical sciences through the Australia Research Council, the National Health and Medical Research Council (NHMRC), CSIRO and the Science and Industry Pharmaceutical’s future The future of exports in Australia’s pharmaceutical industry needs to be played to the sector’s strengths which according to Anderson is in the “complex niche device type manufacturing because we have a good infrastructure to do it very well and that is an area that could be used elsewhere”. “I think there is a good basis for innovation here in Australia, and we have the basis for making complex things very well and very efficiently and I think that’s where our niche should be developed.” Tim Oldham, president of Hospira Asia Pacific and representing Australia’s Generic Medicines Industry Association said Australia’s pharmaceutical manufacturing industry is a high value-add sector and one which other countries and manufacturing sectors look to for its high production standards, innovation and quality assurance. Manufacturers’ Monthly FEBRUARY 2013 21

Gas& MANUFACTURING Not without reservations… Manufacturers and gas companies at odds over exporting our energy. Brent Balinksi writes. Australia is set to become a world leader in gas production.

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hen the non government members of the prime minister’s manufacturing taskforce delivered their report last August, all bar two recommendations were given in-principle support. A sovereign wealth fund and a gas reservation policy were two possible ways that the beleaguered manufacturing sector, suffering under high energy and labour costs and the strong Australian dollar, could be offered relief; both were immediately dismissed. Neither side of politics currently supports a reservation scheme. Kicked along by high-profile manufacturing executives (especially those with high energy needs), union leaders and others, arguments regarding a reservation policy came up regularly in the second half of the year. The low gas costs in the US, pushed down by the boom in shale gas exploration, and the corresponding resurgence in the country’s manufacturing industry, were often

22 FEBRUARY 2013 Manufacturers’ Monthly

cited by those in favour of cheaper gas for industry. Gas developers – who had roughly $200 billion worth of LNG projects in development at the end of 2012 – understandably were less enthusiastic about the idea. As soon as manufacturers and others suggested something be done about the price of gas in Australia, gas and oil companies would dismiss this as a retrograde step, not just for them, but for every gas user, who would ultimately be forced to pay more as the price of exploration became uneconomic. Both sides of the argument acknowledge the benefits of Australia’s rich supply of gas. This country has, on some estimates, reserves that on projected demand could last another 50 years. And that’s not including its shale gas reserves, the world’s sixth-largest. Manufacturers’ Monthly has investigated the issues around the argument about gas.

Exporting away our wealth? According to a report released by the Plastics and Chemical Industries Association and the Australian Industry Group last October, Large scale export of East Coast Australia natural gas: unintended consequences, the coming export boom in LNG might forfeit more wealth than it could earn if the gas was used by industry. The PACIA and AiG-commissioned research suggested constraints to domestic supply were in our future, and “East coast gas prices will rise, potentially to as much as triple the current $3-$4 per gigajoule.” One of the most unsettling suggestions by the report – which was not an explicit plea for a reservation policy – was that each petajoule of gas exported surrendered over a quarter of a billion dollars’ worth of industrial output. “That is, for every dollar gained $21 is lost – a worrying figure,”

wrote the Ai Group’s CEO Innes Willox in Manufacturers’ Monthly in November. Other comments about the valueadd potential around different policy settings for gas use have been made by executives at companies, notably Dow, Incitec and Alcoa. “Without the economies of scale that come from large export volumes, Australia’s gas resources would remain uneconomic and unavailable to Australian industry and consumers,” a Santos spokesperson told Manufacturers’ Monthly.

Cheaper gas? Free market advocates support the argument that regulating the supply of gas would ultimately cause the resource to become more expensive. Less incentive to sell to markets that would pay a higher price equals less gas about equals a higher price for what a customer has to pay. “What you’re actually saying manmonthly.com.au

to the developer is ‘we want you to set aside gas for sale domestically,’” Alan Moran explained to Manufacturers’ Monthly. Moran is an economist and the director of the deregulation unit at the Institute of Public Affairs, a free market think tank. “Now the implication is that the reason you’d say that is that you want to sell it cheaper, otherwise you wouldn’t bother saying it at all. And one of the real problems is that if you sell gas, say at 20 per cent gas at 10 per cent below the level, the export level price… “The problem is that the way industry operates is that it doesn’t operate by saying a two per cent reduction. It operates with profit as a driver. And so if you’re earning 15 per cent of your revenue goes to profit, that 10 per cent reduction in profit goes straight off the bottom line, which then becomes quite a significant motivator in terms of whether the project will be viable… So it can cruel a budget.” On the other hand, those seeking to limit exports argue that there are restrictions across the world, and the United States – enjoying a gas boom and prices as low as $2.50 per gigajoule, spurring what some have called a “manufacturing renaissance” – LNG exports are approved on the basis of ensuring affordable local supply. The DomGas Alliance – WA’s peak user group – highlights the lack of attention given to local energy users compared to the rest of the world in its 2012 report in a section headed Australia is the only country that allows gas exports without prioritising local supply. Its essential thrust is easy to guess.

Protectionism Another aspect to the debate is that a gas reservation policy is the contention that it would be a step towards protectionism. Those in favour of government action to make gas more affordable suggest that Australia’s market is uncharacteristically free (see above) and needs a little manmonthly.com.au

Manufacturers are seeking to ensure a reliable supply of gas. intervention. Misha Zelinsky, the Australian Workers Union’s national policy and economics adviser, told Manufacturers’ Monthly every other nation uses its natural resources to promote its economic interest, yet Australia decides that we’re going to let the market decide for us, and that as a result we’re paying higher gas prices in Australia than we should be.” “Why Australia doesn’t favour its national interests [but] the interests of multinational energy conglomerates is an argument that should be had in the public arena.” Moran believes that putting gas aside for local use would be getting government involved in a place where it doesn’t belong. “It’s a regression to protectionism which some people would like to be cured of, although this present government and indeed the opposition is sort of flirting with that with things like anti-dumping legislation, which is a regression to protectionism,” he said. Some industrial users have also pointed to the difficulty securing a long-term supply, which seems strange in a country with abundant

gas supplies. “It’s becoming a tightening market – previously there would have been perhaps a bit more diversity,” Miles Prosser, the executive director of the Australian Aluminium Council, told this magazine. “If you were a large customer you’d be treated in the way you’d expect a large customer to be treated – as someone of interest and worth talking to – but now it becomes harder to get potential suppliers to even be willing to talk about terms and conditions and prices in contracts.”

Other issues As in the case of the Aluminium Council above, a gas reservation isn’t always put forward as a solution by those with concerns over the energy market. “A national gas reserve… is a hard option, but all options should be on the table,” Willox wrote in these pages last November. Others, such as Andrew Liveris, CEO of Dow Chemical, have suggested that the current supply infrastructure isn’t developed enough to serve industrial energy users effectively. “We have to create an infrastructure such that we can have gas-on-

gas on competition domestically,” he suggested last year, comparing a possible solution to having the private sector build a broadband network. “The term reservation doesn’t tend to quite cut it.” Prosser knows his group’s members are especially concerned about the situation – alumina refineries are some of the biggest gas users there are – but concedes they are not experts on how the market works. All the same, issues like pipeline capacity and anything else affecting the price of what they use are worth putting on the table. “These are the things that we should be considering and someone with greater expertise than me needs to be working through these things and identifying what the key bottlenecks are,” he said, adding “if we can increase the diversity and quantity of supply to domestic markets by investment in pipeline infrastructure or by changing the regulations of infrastructure, then that would be a positive thing.” Likewise, the AWU is not wedded to a specific solution but thinks a discussion is long overdue. “I think what we need is a national conversation on the best way to use our energy reserves,” said Zelinsky. The gas industry thinks the worst approach for those wanting affordable energy would be to interfere in the market. “Interventionist policies that artificially create a separate domestic market will have a significant impact on Australia’s ability to attract the billions of dollars of international capital required to develop the next wave of unconventional natural gas resources,” said Santos’s spokesman. Users feel cheated: their access to an essential input is being tightened while a boom in exports looms. To them it doesn’t make sense. To those who stand to profit (after investing billions and billions, of course) from increased Asian urbanisation and the resulting increased demand for energy supplies, any discussion on how to secure a better deal for users is a plea for subsidies. Manufacturers’ Monthly FEBRUARY 2013 23

Product FOCUS: TEST & MEASUREMENT PALM Probe Radiometer

Lead screw assemblies

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aydon Kerk has expanded the abilities of its precision lead screw products. Its “Micro� Series lead screw assemblies are 2mm (5/64-in) diameter screws with available standard leads ranging from 0.3mm (0.012-in) to 2mm (0.079-in) per revolution and in a variety of nut configurations manufactured using self-lubricating acetal. This product line is an enabling technology, opening up a broader range of designs. The Micro Series allows for the miniaturisation of products, reduced power consumption, and weight reduction without sacrificing performance or reliability. With the introduction of the Micro Series, anyone can take advantage of standard designs, existing tooling, and quick delivery to bring their products to market swiftly and cost effectively. Kerk Brand Micro Series lead screws are available as stand-alone

Allows for precise motion control machine miniaturisation. components or integrated into the high-performance Haydon can-stack linear actuators. Manufactured from premium grade 303 stainless steel, the lead screw assemblies provide high performance, long life, and require no maintenance. High-accuracy threads with superior

uniformity deliver precise motion, and reduce noise and vibration. An optional Kerkote TFE coating, a permanent dry lubricant, extends nut life while reducing friction and drive torque requirements. Haydon Kerk www.haydonkerk.com

The Production Ambient Light Measurement (PALM) device from Novasys Group features a wide dynamic range for reading UV levels emitted by low-powered and high-powered UV sources. It is a process control instrument designed for measuring UV energy within inaccessible environments. It is intended to provide a safe, reliable measurement solution for UV-web and other applications. It has a wide dynamic range allowing it to measure very low (i.e. fluorescent bulbs) and very high (i.e. powerful UV curing systems) levels of UV. As the harsh physical conditions inside a UV curing chamber include extreme temperature variations, it is designed to withstand these conditions as well as protect the operator and instrument from damage or electrical shock. The user simply needs to hold the base of the instrument and position the light guide under the UV source. Novasys Group 1300 256 768 www.novasys.com.au

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Manufacturers’ Monthly FEBRUARY 2013 25

Warehousing& DISTRIBUTION Handling the job Plastic cribs are set to replace the traditional wooden crib boxes on the warehouse floor.

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The plastic cribs are able to support up to 90 tonnes in three-box cribs.

ifting and shifting heavy loads in a factory or warehouse is a commonplace sight

on site. However, the dangers associated with this practice are also well known. The potential for this relatively straightforward process to go awry is high. With this in mind CablePrice NZ, a subsidiary of equipment manufacturer Hitachi and a distributor of the Japanese company’s machinery in New Zealand, introduced new safety measures when stabilising heavy loads after they have been lifted for maintenance and access. According to the company it had initiated a new system of plastic cribbing blocks which are designed to optimise safety during this process. The Enerpac plastic cribbing system - which was developed as a more stable, longer lasting, and easily cleaned alternative to the traditional wooden blocks, was provided by Jonel Hydraulics. The company explained that the blocks, which are available both in Australia and New Zealand, feature an aggressively patterned slipresistant pyramid locking surface for superior stability in cribbing, chocking and shoring. Unlike wood, plastic offers a stable, predictable and high load capacity which ultimately deforms only slowly under extreme load because of the homogeneous material used

“We have had up to 30 tons sitting on them – we use them for everything. It is all about safety,” CablePrice’s Rotorua equipment workshop team leader, Chase Murphy said. “Previously we used wooden blocks, but this is the way of the future for an industry leader. Sometimes we could hear wooden blocks cracking under load. We are always obsessed with safety, so we sought a better way to ensure it when lifting up machinery for service inspection and maintenance.” Enerpac NZ Territory manager Neville Stuart said that after he went on-site to demonstrate the blocks, CablePrice ordered 24 x LPC6701-B, six by seven inch blocks, which can support up to 60 tons (54.43 tonnes) in two-box cribs and 100 tons (90.72 tonnes) in three-box cribs. “They were very impressed with the block’s safety, performance and versatility and ordered more for themselves and another 100 for other branches. This product, like other Enerpac globally proven technology, is extensively proven and backed in the field by companies such as Jonels with strong expertise in lifting and safety.” He added: “Enerpac’s cribbing system won’t splinter [like wooden blocks do], doesn’t absorb most fluids (subject to chemical compatibility tests) and can be used for interlocking box cribs, parallel cribs and triangle cribs”.

sales

26 FEBRUARY 2013 Manufacturers’ Monthly

manmonthly.com.au

Picking a winner Torpedo7, a New Zealand-based online retailer specialising in bikes, parts and accessories, is expanding into other areas including snow, fishing, motocross and adventure gear. The business has recently launched a new online discount store featuring shoe and clothing brands Urbandaddy.co.nz and com.au. Co-founder and joint managing director, Guy Howard-Willis, explained that “making sure the supply chain can keep up with the growth and diversity of the business is an on-going challenge,” for many businesses, citing the increasing demand for rapid delivery and high-quality service. Working in conjunction with Torpedo7’s logistics consultant, Scott Kerr from Kerrect Logistics, Dematic has developed a distribution solution for the online retailer’s new Distribution Centre at Titanium Park to solve its warehousing and logistical issues. Dematic’s Sales Manager, David Penny, said, “Our threephase solution will provide Torpedo7 with the logistics infrastructure it needs to support its constantly expanding customer base in NZ and Australia.”

A new Dematic logistics systems will assist rapid delivery and efficient storage for Torpedo7 The first phase is due to be installed early this year, and will significantly enhance storage and order picking capacity in the centre. Dematic’s storage solution includes the installation of a new ColbyRACK storage system with a 5000-plus pallet capacity, with a custom-designed shelving system providing 2000-plus highlevel order picking locations. A space-efficient 2000-metresquared raised storage area will provide close to an additional

2000 shelf locations, with orders to be transported to the DC’s shipping area by integrated conveyor. The second and third phases of the project will follow the introduction of a new warehouse management system and will include the introduction of RF and voice-directed picking, smart conveyor zone routing and Dematic’s PickDirector order fulfilment system. Dematic Pty Limited www.dematic.com.au

Versatile lifters Robotunits has designed a new a range of lifters that combine the company’s proven linear motion units with its conveyors. Completely customised and tailor made to meet the operators’ specific user specifications and application requirements, the lifters help overcome height differences in production and warehousing environments, allowing for the easy transfer of goods to different heights in the warehouse. According to Robounits the complete utilisation of the available warehouse height is a major benefit of the units, manmonthly.com.au

The lifters help overcome height differences in production and warehousing environments allowing for greater warehouse usage as they are designed to integrate with complete modu-

lar automation systems, resulting in substantial cost and time savings for customers. The new lifters are built by combining aluminium extrusion and fastening as well as conveyor and linear motion technology. The lifters can be produced very quickly to an operators’ specific working requirements, saving time and money for the customer. The aluminium lifters can be built with either single or double guiderails depending on load needs. Robotunits 1300 163 402 robotunits.com.au

Manufacturers’ Monthly FEBRUARY 2013 27

Motors& DRIVES Behind the MVSD vs. VFD debate The decision whether to use mechanical variable-speed drives or variable frequency drives should always be based on the optimisation of the total purchase-operation costs, writes Amin Almasi.

MVSD are complex mechanical systems.

T

HE mechanical variable-speed drives (MVSD), particularly the hydrodynamic torque converters, could dampen pulsations generated by the connected machines (such as the synchronous motor produced pulsation torques). It is particularly true for large dynamic torques in transient situations such as start-up or the shortcircuit transient excitations. This mechanical “soft” start and the

28 FEBRUARY 2013 Manufacturers’ Monthly

dampening effects could provide a positive impact on a rotating machine train. Sometimes, an MVSD could be a cost effective and compact alternative to an electric VFD (variablefrequency drive) system. However, the behaviour of an MVSD system is very difficult to properly model or predict. The MVSD system is obviously one of the current biggest unknowns in

the rotating machine industry. The examples of available mechanical drive options are: o The MVSD speed-control and speed-increase for high output speeds. This is useful in relatively high power applications, say up to 18 MW. • The geared variable-speed coupling. This is cheaper than the option above, however delivers lower efficiency at part-loads, usually less than 10 MW. • The variable-speed coupling. This offers speed control, no speed increase, is relatively cheap and relatively less efficient. For example, in a case study for a middle size compressor train, dynamic torques are reduced by a MVSD from around 210 percent of the nominal torque (at the electric motor driven shaft) down to around 95 percent of the nominal torque at the compressor-to-MVSD coupling. A short-circuit (transient) torque is also dampened through the MVSD from an excitation above 380 percent down to around 155 percent of the

nominal torque (on the compressor shaft). Because of the design of the MVSD packages there are some special (and unique) features in the alignment procedures for this equipment that should be understood prior to the order placement. An MVSD could also need some special requirements in the commissioning works. The MVSD systems (particularly the hydrodynamic torque converters) require a large amount of oil for the operation. The special oil skid provided by the MVSD manufacturer is usually an integral part of MVSD system base-plate/package. The main oil pump is most often a shaft driven pump. This pump should be sized properly to handle all operational situations (an ample margin and a proper match with the oil requirement cases). There should also be a fullsized, second start-up (and stand-by) oil pump. Sometimes, a rundown tank or a (third) emergency DC electric motor driven backup oil pump system could be required. A combined oil system with other equipment in the train is a compact option, which requires an excellent coordination between the MVSD manufacturer and the rotating machine vendor(s). It may not be a popular option for some operators (since usually a manufacturer-standard combined oil skid is offered), but if implemented properly it could result in a considerable saving. The MVSD manufacturer usually specifies a typical mineral oil suitable for gear units/ machineries.

Complex gear system Another feature is the planetary gear of a MVSD (which is usually a very complex gear system). The gear system itself is a compact unit and the drive and driven shafts are usually on the same planes (horizontally and vertically). manmonthly.com.au

However, the planetary gear unit (that is usually used) can offer some complex behaviour. An MVSD, because of its complex nature, is a nonlinear system and should be linearised for the modelling (such as the torsional vibration study, and other studies). The efficiency at a part-load is relatively low. MVSD options are manufactured by a few vendors. Sometimes, very limited options for some components (such as the instruments, bearings, or mechanical parts) are used by the MVSD manufacturer, which means some deviations on the project specifications. Usually, a relatively long list of deviations should be accepted for an MVSD system. MVSD systems are very special and complex mechanical systems (with many manufacturer standard components), which need

For the right application, MVSDs can be up to 20 per cent cheaper. a large amount of oil and special oil system accessories. There could be some design, commercial and operational advantages for an MVSD compared to other options. Less space is required

for an MVSD compared to a VFD system. An MVSD does not generate harmonic pulsations (a problem of some VFD systems) and it offers some vital mechanical dampening effects to some disturbances. However, for an MVSD, some unknowns are expected, special commissioning (and alignment) procedures are required, and there are very limited options available to the user. Considering all these factors, the reliability of an MVSD cannot be higher than a certain level. The run time before an unexpected shutdown could be around one-two years. Unexpected shutdowns are mainly oil-related (the bearing related or the oil system related). An overhaul interval could be three-to-six years.

The reference check is extremely important. MVSDs could be used for middle size applications (say 1 to 16 MW).

Planetary gear MVSD The most common type of MVSD is a combination of a torque converter and revolving planetary gears. This MVSD comprises a torque converter and two sets of planetary gears: • A superposing planetary gear for the speed variation. • A fixed planetary gear for the reduction of the superposing speed. The planetary gear is usually of the helical design for smooth operation and superior running properties. The hydrodynamic torque converter is a combination of the hydraulic pump impeller, the hydraulic turbine

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Manufacturers’ Monthly FEBRUARY 2013 29

>>

Motors & DRIVES wheel and adjustable guide vanes. The hydraulic pump impeller is connected to the input shaft and the hydraulic turbine wheel to the output shaft. The fluid (oil) is accelerated in the hydraulic pump impeller and transmits the energy to the hydraulic turbine wheel. The fluid flows through the adjustable guide vanes, where the flow and the flow angle are adjusted. Based on the position of the guide vanes (ranging from the fully-closed to the fully-open), the torque and the speed of the turbine wheel can be adjusted. The actuator can open the guide vanes and accelerate the turbine wheel to properly control the torque/ speed of the MVSD system. The variable-speed planetary-gear type MVSD requires oil for two oil circuits: • The power transmission oil system (hydraulic or working oil). • The lubrication oil system which can provide lubrication for the train (including the bearings). The MVSD is based on the principle of power splitting. The majority of the power is directly driven through the input shaft to the revolving planetary gear (driving the

annulus gear with a fixed speed). The output shaft is connected to the driven equipment. A small part of the power is driven through the torque converter, where the speed is adjusted and then superimposed in the planetary gear. All three components of the planetary gear (the annulus gear, the planet carrier and the sun gear) are moving in a superposing planetary gear system. A variable output speed is obtained by addition or subtraction of speed which is achieved by variation of the planet carrier speed. The turbine wheel of the torque converter is connected to the planet carrier of the superposing planetary gear via the fixed planetary gear. In the superimposing planetary gear the two power flows are combined and transmitted to the output shaft. Only the power branched-off through the torque converter (a portion of power) is subject to the hydrodynamic efficiency of the torque converter which could result in a reasonable overall efficiency at the full-load or the loads near the full-loads. For a lower speed range (a speed

could be the result of the circumferential speed of the annulus gear (driven by the driver). Generally with increasing the speed ratio, the possible transmitted power (the power rating) is decreasing. Some limitations are usually caused by the geometry of the revolving gear. The higher the gear ratio, the smaller the sun wheel and the smaller the number of planets because of the intersection.

Making the right choice

below the normal speed), the turbine wheel acts as a hydrodynamic brake (this is a reversal of the power flow). Because of this effect, the MVSD part-load efficiency is usually lower than the VFD. The minimum speed limit of the variable speed gear system (MVSD) could be around 55 to 70 percent of the maximum continuous speed. Some MVSD performance limitations

For low voltage electric motors almost always a VFD is preferred, as it is cheaper than an MVSD. MVSDs, such as hydraulic torque converters, are not recommended for large rotating machines (above 18 MW). MVSDs are special variable speed systems which should only be used in a right application, where there are technical, commercial or foot-print benefits. For the right application, an MVSD could probably be 5 to 20 percent cheaper than a VFD. The decision should always be based on the optimisation of the total purchase-operation costs.

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