Manufacturing gloom and the contrarian

I’ve been in love with watching stuff being made since childhood factory tours. Cheese was the first date, the ‘Rotolactor’ turntable milking machine the engagement and ice-cream wrapping lines the wedding. At age seven I knew I wanted to be around machinery.

The motion of industry still excites me, and the best part of my job is visiting new sites and getting to watch the genius of manufacturing design at work.

The next generation of industrialisation - ‘Industry 4.0’ as coined by the Germans - won’t be so visually stimulating, however. Embracing the ‘Internet of Things’, it conceives of a highly automated and integrated supply chain construct of inventory, schedules and resource management to achieve the next transformation of productivity.

This Industry 4.0, or the fourth industrial revolution (after the mechanisation, mass production and digital revolutions), is certainly coming, but we’re far from finished with exploiting the current version, and the diminishing Australian manufacturing sector still has much life left in it, albeit not without changes.

For example, the Australian uptake of robots is only marginally above the global average of 50 robots per 10,000 manufacturing workers (source: International Federation of Robotics). This figure is comparable with the UK, but ignoring the robot-rich automotive manufacturing sectors of South Korea, Japan and Germany (figures over 250), we are still well below other industrialised nations.

Historically, robots are seen as a tool for the big boys with big budgets, but the global uptake of robots has provided the necessary scale, and the price of robots has fallen so far as to now be within the reach of even boutique manufacturers. With limitless gripper options, they can be less expensive than customised single-purpose machinery and provide the flexibility to perform multiple tasks. Further, the development of compact units, safe human interaction and assisted lifting mechanisms has extended the range of applications that small manufacturers can exploit. Unlike the disruption of replacing a whole production line, robots can be introduced one cell at a time, so that the benefits of the first cell fund the next one. They enable a business to be rebuilt and transformed little by little - akin to the way the business originated.

From the headlines, you might think governments don’t care about manufacturing. There are, however, a number of government grant and export trade programs at both state and federal levels that encourage innovation and diversification, and with the fast ROI that robots typically provide, a business could be literally transformed within 12 months. Small manufacturers in food, agriculture, fabrication and materials processing are removing bottlenecks, improving consistency, eliminating hazards and reducing costs with the adoption of robots for picking, placing, packing, lifting and welding operations.

The gloom for Australian manufacturing is well documented - the very high returns, however, of the investment in robotics are not so prominent. Add to this the government support, speed of implementation and a payback often measured in months rather than years and the next wave of casualties could be avoided.

In the ’70s, automation was accused of displacing workers. This fear didn’t materialise - 40 years later the unemployment rate is no worse despite significant population growth. More recently, robots have met the same opposition. The truth in both cases, however, is that they shift jobs but protect businesses, and the world has fallen in love with robots while Australia is still just flirting.

*Mark Elrick is an Electrical Engineer with experience in the manufacturing, infrastructure, OEM, distribution and systems integration sectors. He consults in the area of industrial automation and networks with Integrated Automation.