Accelerate - June 2014

The changing face of success in hi-tech manufacturing

At a recent TINTalks event, international expert on high-tech manufacturing Professor Göran Roos spoke about the latest trends and challenges in the manufacturing sector.

Professor Roos stressed that to become successful and, more importantly, to stay successful, manufacturers must keep track of technological developments in other sectors that can have a huge impact on their industries. He used the example of the effect that 3D printing is having on various industries; in particular, its huge impact on the manufacturing industry. It may be a costly investment, but it is not cost that is driving the shift towards 3D printing: it is the value of customisation, fast prototyping and ease of use.

Successful firms in Europe further invest about 5% of their annual turnover in R&D, a further 5% in renewing their capital equipment, and another 5% in continually developing their staff. Investing in these three areas is critical in order to keep an edge in the competitive manufacturing industry.

He remarked that we need employees who have the skills to work in the new world. We have more services for more solutions for customers; businesses must add value through extra services to grow their businesses – with these new services and value-add leading to the need for new competencies.

Professor Roos said that access to highly skilled management is essential for success in the manufacturing sector. How do you get highly skilled managers? You expose your bright and rising stars to competitive manufacturing environments.

In New Zealand’s case, he advises to send them on secondments to European suppliers. This has the add-on effect that it builds cultural knowledge and stronger relationships between international suppliers and New Zealand. The next step is to complete a business degree; very importantly, first the secondment then the degree, never the other way around.

Another interesting observation regarding New Zealand was that it would be a waste of money to invest in the usual MBAs available from tertiary institutions. He advises that Kiwis enrol in an appropriate business school that specialises in SME business training, as many business school degrees and courses are aimed at management of large international and multinational corporates, not SMEs.

As technology takes over, the core need is for fewer but higher-skilled people. European manufacturers demand a bachelor’s degree as an entry qualification. Professor Roos also expressed his concern about the high demand for engineers, and the fact that there is a worldwide shortage of them. He said that across the globe we need to invest more in science, technology, engineering and mathematics education and, importantly, that it should happen at primary school level, as it is too late to make an impact at secondary and tertiary levels.

In conclusion, he said that it is important to remember that manufacturing drives the economy of a country – “you cannot drive an economy with lawyers and accountants”.

Updated: 4 September 2015