Game-Changing Considerations Prior To Robotics Implementation
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The Manufacturers’ Network’s Dieter Adam sits down with Facteon to discuss the state of play in the manufacturing industry, both within New Zealand and globally. Following the unexpected events of 2020, Dieter reflects on the year that has been and the impacts on the manufacturing industry.
There has been a significant upturn in purchasing volumes. We saw increased sales at both an individual consumer and business level. As direct logistics costs intersect with difficulty sourcing products, we’ve seen a surge in purchasing volumes as manufacturers work to secure goods to avoid hold-ups in production. As it happens, raw material and input prices – excluding freight - have gone up considerably already, so the main driver for the growing stock levels is continuity of operation.
This has been countered by a lack of people and input materials. The border closures have led to difficulties securing labour. As a result, the skills shortage has worsened. With the general feeling being that this will continue for the next twelve to eighteen months, at a minimum, manufacturers have been taking steps to adapt. We’ve seen an increasing focus on doing more with what we have. So, we’ve seen on-the-job training become increasingly popular. This level of investment in the manufacturing worker is serving both workers and businesses by enriching the roles of workers which allows them to add more value to the operations of the manufacturers who employ them. Such training, however, will not on its own be able to fill the massive shortage of skilled workers we are experiencing now.
The evolving role of the human operator is also noted in the rising cost of human labour compared to the decreasing cost of robotics. From a business standpoint, it makes sense to invest in automation now.
While there has been discussion around the benefits of automation for some time, there has been a surprising lack of conversation around manufacturers preparing for the impact of regulation and changing customer demands in response to growing concerns about climate change. As consumers become increasingly conscious of the products they’re consuming and manufacturers are able to provide these consumers with information regarding the origins of products they purchase, I am hoping to hear more of this discussion in the near future.
Last year, I was involved in the writing of guidance by which manufacturers could return to operation at COVID-19 Alert Level Three (New Zealand’s second highest alert level). I was deeply impressed by the adaptability of New Zealand manufacturers. In speaking with manufacturers, I got the sense that they themselves were surprised by their own adaptability.
In terms of the common themes among those who emerged stronger, it was certainly those with a strong focus on improving business processes. For some manufacturers, processes have not changed much over the years. Instead, the way in which business processes were completed was adapted in 2020. We saw new technologies adopted at a cross-business level, such as Microsoft Teams and Zoom, which allows manufacturers to continue operating. This was quite remarkable.
The manufacturing sector has experienced productivity challenges for some time. Previously, we saw relatively easy availability of workers. Increasing the amount of labour in the manufacturing process was always the path of least resistance for manufacturers. Now, the focus has shifted to maximising the potential with current resources. We’ve seen a growing interest in Industry 4.0 technologies, compared to the time before the pandemic. It’s great to see manufacturers actively taking steps to future-proof their businesses in the long-term. Rather than deploying technology as a pandemic response, they’re looking to address shortcomings in their current operating model. This will drive long-term business success well beyond the COVID era.
With many New Zealand manufacturers exporting and those who sell locally competing against imports, it’s surprising to see so little conversation regarding the benefits of a circular-economy to product design and manufacturing, seeing that this could be a potential source of competitive advantage.
It would be great to see manufacturers themselves taking a more proactive role in reducing waste and increasing customer delight at the same time. A starting point is manufacturing products in way which ensures they are durable and easier to repair. It is critical to start at the beginning of the process to enact meaningful change.