mapping capability and connections northern tasmania manufacturing sarah jones, facilitator,...
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Mapping Capability and ConnectionsNorthern Tasmania Manufacturing
Sarah Jones,
Facilitator, Entrepreneur DevelopmentAugust 2015
• Objective:
To support the growth of small to medium enterprises (SME’s) in the manufacturing supply chain by:– Better understanding current capability– Identifying ways to support firms to build individual capability and capacity – Exploring new business opportunity (individually or via a collaborative approach)– Identifying key skills needs (now and future)– Building broad collaboration and networking opportunity
• Project partners and participants: – Launceston Chamber of Commerce;– University of Tasmania and Australian Maritime College;– Department of State Growth;– RDA Tasmania;– Northern Tasmania Development; and– Industry (31 firms).
Background to Project
• Detailed firm ‘interviews’ – October 2014 to January 2015:– Business profile/overview (demographics);– Capabilities and characteristics;– Business outputs and sectors;– Supply chain connections;– Business growth and diversification;– Regional characteristics (that support or constrain)– Business management systems and skills needs
Process
Employment
Small to medium (SME) firms many employing less than 20 people
Age
74% have been operating for more than 10 years – 61% more than 20 years.
Participant Profile
6
8
9
4
1 3
<10
10-19
20-49
50-99
100-199
200+
Turnover
Majority operated with gross turnovers under $5M
(2013/14 year)
Products and Services
Key categories of products and services supplied by participants.
Light engineering and fabrication (up to 2T) 55%
Mechanical maintenance & repair 48%
Engineering, design and drafting 42%
Manufactured goods 39%
Medium engineering & fabrication (2-9T) 35%
Participant Profile
1
5
14
4
2 2 2
0
2
4
6
8
10
12
14
16
• Specialised or unique products • Well established (long term) customer
relationships• Quality and flexibility of the business• Location/proximity to customer • Technical expertise • Capability of facility • Broad/diverse customer base and
product capability • Customer service• Skills and training of employees • Innovation in approach• Commitment to research and
development
“We are big enough to be relevant but small enough to be nimble”
“If we can’t do the job we will help the customer to find some way to do it”
“We deliver to spec and on time – it’s what the customer values the most.”
“We have in-house design capability this enables us to offer the full package – we don’t subcontract – we maintain control and adopt innovative approaches.”
Value Proposition
Sales
Distribution location of products/services
(70% Tasmania)
Purchases
Strong regional focus & long term
(60% of supply relationships in excess of 10 years)
Supply Chain Linkages
50%
20%
16%
18%Region (NorthernTasmania)
Rest Tasmania
Mainland
International
60%9%
26%5%
Region (Northern Tasmania)
Rest of Tasmania
Mainland
International
Customers are in a range of sectors.
Key focus areas:• Minerals
processing• Food and
beverage• Construction
Sectors
Minerals processingFood and beverage processing
ConstructionRetail food and grocery
MiningUtilities / infrastructure
ManufacturingAutomotive
MaritimeResidential housing
MiscellaneousGrain / feed
Agriculture / HorticultureCommercial / industrial
Oil and gasChemical industryElectronics / solar
Timber / forestryHospitality / food service
Steel processingAquaculture
Electrical - residentialPharmaceuticals
Powder / granulesPackaging
0.0% 5.0% 10.0% 15.0% 20.0% 25.0%
22.7%10.0%
7.8%7.7%
6.5%6.5%
5.4%4.7%4.7%
3.2%3.0%
2.4%2.1%2.0%
1.6%1.5%1.5%1.5%1.5%
1.1%0.8%0.6%0.5%0.3%0.2%
Strong reliance on some key customers within the region.
Relationship seen as critical for the business rating:• 8.2/10 and 7.4/10 in terms of importance.
Supply chain linkages
Strategy • 48% developed on an ‘as needs’ basis• 35% had more formal processes in place – documented
and reviewed at least annually• 17% engage external assistance and had a very
formal/structured approach (tended to be larger firms).
Productivity and Continuous Improvement
• Strong focus on identifying opportunity to improve productivity and implement improvements.
• Staff actively involved in doing this.• Only 1/3rd had a systemised approach (Lean).
Innovation • 84% are actively (and continuously) seeking new products, systems and processes to improve what they do - customers and suppliers were seen to be key to this.
• “We work with our customers to innovate with our products, and our workforce to improve our process.”
Organisational Processes/Approaches
Partnering and Networks
• Not a strong area of focus.• Only 19% actively exploring Networking/collaborative
opportunity• Was seen to be an area where they could/should do more.
Recruitment • Tended to be on an ‘as needs’ basis (dictated by economic climate)
• Almost a third indicated that when recruiting they were trying to align this to future/anticipated skills needs.
Training • Workforce development was not a strong focus.• Training for almost 50% tended to be ‘as required’• Only 16% had a training ‘plan’ linked to broader
organisational strategy or growth plans.
Organisational Processes/Approaches
Skills ‘gaps’
Trades seen to be area of greatest gap.
Issues raised:• attitude and
‘aptitude’• ‘system’ and
quality• Ability to
access training
• “Finding people capable of being trained in this area is a challenge.”
• “We can close the skills gap if we have people that are willing to do it - we have issues with young people and their attitude.”
• “As a business we managed our skills needs but the industry doesn’t.”
Current Skills Gaps
Boom/scissor lift/crane operation
Business development/marketing
Data analysts
Engineers (experienced & graduates)
ICT skills
Lean/continuous improvement
Supervisory/team leadership skills
Trades (automation,mech.)
Trades (other)
0 1 2 3 4 5 6 7 8 9
• Trade qualifications:– mechanical, electrical, boiler makers, machinists etc.
• Professional qualifications/capabilities:– marketing, business, finance, business development, engineers, geology,
metallurgists, leadership, management, production management, process engineering, ICT.
• Competencies (can also be qualifications):– Design, CAD, drafting, Lean, customer service/sales, CNC,
automation/robotics, PLC programming, industrial blasting/painting, process operations and technicians, crane operators, HV specialists, data analysts.
• Attitudes and aptitude:– Mathematical knowledge, literacy, mechanical “nouse”, work readiness –
attitudes and willingness.
Skills to support growth
Market intelligence
Difficulty finding information to support business development.
Road transport corridors
Transportation to Ports outside the region.
Research Institutions
Not considered to be important.
Regional Factors
Avail. Skilled staff
Prox. Likeminded Co's
Prox. Airport/Ports
Avail. Premises
Prox. Larger cities
Avail. Spec business serv.
Avail. Funding/finance
Access specialist expertise
Access fast internet
Reliability elect supply
Avail. Water infrast.
Road transport corridors
Access industry networks
Access to mentors
Prox. Partner orgs
Prox. To market
Access to market intel
Access quality transport prov.
Prox. quality higher ed
Prox. qual research instit.
0 1 2 3 4 5 6 7 8 9 10
Adequacy
Importance
Employment growth through:• Diversification• Increased
volumes (current customer)
• Competitors leaving market
Existing spare capacity and capability
• Building, workshop, floor space, warehousing, office space• Industrial zoned land • Equipment & capability – laser cutter, folder, CNC machines ,
injection moulding, research lab, profile extrusion• Skilled staff • Design/engineering capability• Blast and coat facilities
Future Directions/Opportunity
• Trends in employment over past 3 years:29%
32%
39%
Increase Stable Decrease
Enhanced customer relationships
Enhanced supplier relationships
Future Directions/Opportunity
Planning and schedulingCommunications
Joint strategiesProcess innovations
Skills/training/induction processesTechnology development
Networking with other contractorsContinuous improvement programs
Contract issuesSharing information
Personnel exchangeAggregated procurement
0% 10% 20% 30% 40% 50% 60%
Inventory or ordering
Freight - timing, cost
Cost
Communications
Behaviour
Value of relationships
Business management
0% 10% 20% 30% 40% 50% 60% 70%
Participants currently actively seeking work:• 32% - mining/ &
resources sector
• 29% - water and energy project area
• 26% - advanced manufacturing
• 19% - food and agribusiness.
Future Directions/Opportunity
Min
ing
/ re
sour
ces
proj
ects
Wat
er a
nd e
nerg
y pr
ojec
ts
Com
mer
cial
/ in
dust
rial
Agr
ibus
ines
s an
d fo
od
Oil
and
gas
proj
ects
Adv
ance
d m
anuf
actu
ring
Con
stru
ctio
n pr
ojec
ts
Com
mon
wea
lth,
Sta
te a
nd L
ocal
Gov
er..
.
Def
ence
indu
stry
pro
ject
s
Civ
il In
fras
truc
ture
(In
clud
ing
utili
ties)
Bui
ldin
g pr
ojec
ts
Land
dev
elop
men
t
0
2
4
6
8
10
Median
“We need the right people that are able to relate to the customer”
“The cost of freight is beyond the capacity of the business”
“Freight limits our opportunity to go off island”
Skilled staff 39%
Freight limitations – costs and delays 29%
Access to finance/capital investment 16%
Cost of inputs and equipment 13%
Timeliness and surety of delivery by suppliers 10%
Regulation and licencing 10%
Plant/facility space and suitability 10%
Identified barriers to growth
Importance of relationships and brand (individual business brand more so than regional).
Contributors to future profitability
Improved end user relationships
Individual brand recognition
New market and market diversification activities
Niche market identification and exploitation
Applied innovation in production techniques
Production quality improvements
Strategic commercial alliances with other regional businesses and institutions
Improved Agent/Wholesaler/Re-seller relationships
Aggregation of products/services with other regional businesses
Regional brand recognition
Research solutions for supply and production impediments
Improved capability statements / "elevator pitch"
Renewable energy production
0% 10% 20% 30% 40% 50%
• Skills – addressing current and projected future skills needs. • Business planning and development – identifying growth areas for the
business – alignment of planning and business development to achieve.• Knowledge and market intelligence – developing an understanding of key
growth sectors and what it takes to be competitive in these.• Promotion of industry capability – demonstrating what currently exists• Addressing vulnerabilities/dependencies on key customers –maintaining
relationships while seeking new opportunities.• Collaboration –to deliver individual and collective commercial outcomes.• Innovation –better linkages with research institutions, investment in skills,
developing design focussed businesses and adopting new technologies and processes.
Emerging Themes – the way forward
• Awareness of what is available – “simplifying the bureaucracy”:– Access to business advice and information– Market assistance– R&D support– Training and skills support
• Addressing duplication:– Red tape – environmental areas– Planning systems – State and Local
• Providing opportunity:– Government tenders – Access to politicians – build knowledge and support (collaboration)
• Continuing to explore solutions with industry:– Freight– Payroll tax thresholds
Where ‘Government’ and other stakeholders can assist
• Supply chain ‘facilitation’:– Within existing customer and supplier base and exploring new opportunities
• Promotion of capability– Demonstration of regional and firm level capability– Utilisation of spare capacity
• Skills and workforce planning– Aligned to business plans– Accessible and affordable
• Business improvement and productivity– Business planning– Implementation of Lean– Management resources
• Networking and collaboration– Knowledge sharing– Joint tendering
Recommendations
