NZ Productivity Organisation

Transforming Supply Chain Planning: How to create resilience, efficiency and agility

From February issue of NZ Manufacturer -Chris Foord, Partner, Argon, New Zealand Post Pandemic we are seeing an essential change in how businesses review their supply chain strategy with a focus on integration and forward-looking planning. Advanced Planning Systems (APS) are at the heart of digital transformation when looking to improve operations management. Companies in Australia and New Zealand have traditionally lagged in investment in this area. However, with the market maturing and good options available for small to large organisations, it is worth considering the opportunity. The benefits of implementation that we usually observe are: 20% reduction in working capital 3% reduction in COGS 6% reduction in Logistics costs 10-20% improvement in forecast accuracy Improved customer service What necessitated companies to modify their supply chain planning? The global pandemic has fundamentally altered the landscape of supply chain planning. Prior to the pandemic, supply chains were focused on creating efficiencies based on a just-in-time model, with inventories kept intentionally low. Businesses relied on backwards looking data to evaluate decisions, and adjusted plans on most recent events. However, the global pandemic caused businesses to reconsider this approach, with inventories now seen as a buffer to unexpected disruptions, leading companies to consider moving to a just-in-case model. The result has led to a recalibration of how businesses consider suppliers, capacity, and inventory, with the focus now centred on resilience, efficiency and agility through the supply chain. How are companies refining their strategies and approaches? The key change has been businesses embracing sales and operations planning (S&OP). S&OP is an integrated planning process that aligns demand, supply, and financial planning, and is managed as part of a company’s master planning. Rather than just a supply chain process, embracing S&OP results in planning coming to the forefront of the business as the business planning […]

The year of digital transformation

From February issue of NZ Manufacturer -Adam Sharmer, Senior Partner, Dsifer If 2023 was the year of Generative AI, 2024 looks set to be the year of digital transformation. A recent survey of manufacturers found that 70% of those surveyed planned to increase spending on digital transformation in 2024. This is perhaps no surprise as organisations continue to review their operations to improve production efficiency, optimise supply chain and leverage data and analytics to shift to predictive, rather than reactive planning and improvement disciplines in response to high production costs, supply chain instability, workforce challenges and data security concerns. As industries transition towards Industry 4.0, defining a comprehensive digital manufacturing strategy is crucial, yet 42% still collect most or all of their data using non-digital processes and 63% collect less than half their data using digital processes. Through our engagement with organisations in New Zealand and the UK, we have identified 10 factors that are critical to the success of digital transformation. Clear Business Objectives Before diving into the world of digital manufacturing, it is essential to establish clear business objectives. Whether the goal is to enhance operational efficiency, reduce costs, or accelerate time-to-market, having a well-defined purpose will guide the entire strategy. Understanding the unique challenges and opportunities of the organisation lays the foundation for a tailored and effective digital manufacturing approach. Data Management and Integration In the digital era, data is the lifeblood of manufacturing. Efficient data management and integration are critical components of a successful strategy. Organisations need to invest in robust systems that can collect, analyse, and leverage data from various sources such as sensors, machines, and enterprise software. This enables real-time decision-making, predictive maintenance, and improved overall visibility into the manufacturing process. Technology Infrastructure Building a strong technology infrastructure is essential for implementing digital manufacturing […]

Small is our Superpower

From February issue of NZ Manufacturer “AMA is committed to working collaboratively towards a system that works smoothly and supports a sustainable, prosperous future.” -Catherine Lye, CEO, Advanced Manufacturing Aotearoa (AMA) New Zealand has a strong manufacturing sector, but it could be better, stronger, more productive. Technology is a key enabler. When it comes to boosting productivity in the manufacturing sector, small is indeed New Zealand’s superpower. Despite New Zealand’s size, our manufacturing & tech sector has capitalised on this characteristic to drive efficiency, innovation, and competitiveness. “New Zealand’s small market allows us to develop and market-test in a small scale before scaling up to export to larger markets. Manufacturing onshore means we have more control over quality and our IP, and we support local suppliers, which all helps grow the economy.” Nick Coubray, CEO (New Zealand Advanced Manufacturing Report 2023). Our manufacturing and tech sectors have many great individual players, but we lack the coordination necessary to realise their full potential. New Zealand needs growth. New Zealand needs companies that are going global and internationalising, growing prosperity and potential for all NZ. But we could do better. Through modernising our manufacturing, we can continue to foot it with the best in the world. “Buckleys is embracing Industry 4.0 with its ongoing investment in CNC machines which are bigger, faster, more accurate, and can process more than one job. Continued development with senior operators on their use of digital tools is an ongoing programme, ensuring the investment is fully realised. Additionally, the business has purchased an enterprise resource planning system, enabling better data-driven manufacturing and processing improvements. This digital investment enables Buckley Systems to maintain its growth trajectory.” Arron Sands, CEO. There is opportunity for enhanced production through improving coordination and awareness across manufacturing, tech, agritech, aerospace, and energy. Silos […]

RegenerationHQ Perspective – Unpacking Productivity in New Zealand

From February issue, NZ Manufacturer – A view by John Luxton Productivity has long been a buzzword in political and economic discussions in New Zealand, often presented as a simple solution to complex problems. However, I am deeply unimpressed with people who rattle off the word “productivity” with no more thought behind what it actually means than “woke”. I believe it’s crucial to understand that productivity encompasses far more than what surface-level conversations suggest. Simplistic, bumper-sticker answers do not suffice when it comes to a topic as nuanced and multifaceted as productivity. Understanding Productivity – Productivity, in essence, is about maximising outputs while minimising inputs. It’s a measure of how efficiently resources like labour, capital, and technology are used to generate goods and services. A look at the world’s most productive countries – Switzerland, Luxembourg, Germany, Singapore, Netherlands, Norway, Denmark, Sweden and Hong Kong reveals a variety of approaches to achieving high productivity levels. The USA is in that mix, but with the size and scale of their economy, there is less for us to learn from their example. Myths and Realities – Common rhetoric blames unproductive workers, excessive taxation, and bureaucratic inefficiencies for low productivity levels. However, a closer look at the top productive countries shows a different story. These nations excel in areas like macroeconomic stability, resource utilisation, open trade, and advanced economic structures. Key Factors Driving Productivity – Several factors are critical to driving productivity in a national economy: Macroeconomic Stability – Low inflation and realistic interest rates create a stable environment for business planning. Natural Resources – Efficiently utilised resources significantly contribute to productivity. Open Trade – Free trade enhances productivity through diverse product/service offerings. Economic Structure – Moving away from agriculture toward a more diverse economy. Access to Capital – Essential for business growth and […]

Landmark carbon reduction project powers ahead

From February issue of NZ Manufacturer magazine. www.nzmanufacturer.co.nz Around 70% of world’s steel is produced from iron ore reduced in blast furnaces. Most of the remaining 30% is produced by minimills, which recycle scrap steel using electric arc furnaces – a proportion set to grow as companies seek to decarbonise their operations. Work is underway at New Zealand Steel to install an electric arc furnace: a move which will shrink the carbon footprint of its Glenbrook steel mill and place the company at the leading edge of low emissions steelmaking worldwide. As the company gears up to celebrate 60 years since it was founded, this crucial upgrade will secure steelmaking – and the corresponding jobs it supports – in New Zealand for the long term. Announced in May 2023, New Zealand Steel’s electric arc furnace (EAF) project will reduce Glenbrook’s carbon footprint by 800,000 tonnes each year and the country’s total annual emissions by 1% from day one. The carbon reductions – equivalent to taking 300,000 cars off the road permanently – will come from replacing the steel mill’s existing oxygen steelmaking furnace and two of the four coal fuelled kilns. Chief Executive New Zealand and Pacific Islands Robin Davies described the project as “a pragmatic response that not only sustains our critical domestic steel supply, but also provides a collaborative approach with public and private sector players to be world leaders in lower emissions steel.” The company is on track to be producing lower carbon steel as soon as 2026, having continued to hit project milestones such as the completion of a feasibility study, beginning to prepare the site for installation and the signing of new project partnerships since the May 2023 announcement. Already users of technologies such as robotics, automation, wireless sensors to collect real-time data and […]

Choose reuse as the new normal

From February issue of NZ Manufacturer magazine. Nada shares with us the vision of her company, Again Again, and even tells us what her favourite book is! Nada Piatek, Founder, CEO, Again Again. Again Again’s vision is to end single-use waste with a commercial, reusable container borrow system that makes it easy for everyone to choose reuse as their new normal. On a daily basis I am committed to that kaupapa and excited to be making inroads to achieving it. A societal shift like this is an enormous ask, and a slow burn. For many people in our community, even the understanding that each single-use packaging (SUP) unit is a part of a wider, enormous problem is missing. In fact the scale of this issue is massive: 400 million tonnes of single-use packaging waste is created each year around the world. Again Again’s key focus is to build the systems and infrastructure to facilitate brands designing out this waste and delivering food, beverages and grocery items in packaging that can be returned, washed, and used again for the same purpose. Changing people’s behaviour is also something Again Again can and does contribute to,but is the responsibility of our whole community. With regulations such as extended producer responsibility schemes (EPRs) and plastic taxes coming into force around the world, the economics of packaging is changing. In some regions, reuse is already close to cost parity with SUP over time – when one amortises the significant set-up costs – however, there are simply very few facilities that can deliver reusable packaging at all, let alone at scale. Legislation and consumer pressure demanding these systems is mounting and it is a solution that is increasingly coming into focus, for brands and retailers alike. A chicken and egg scenario exists. The wash infrastructure needs investment, but this investment is not […]

Productivity Works

I The year ahead, NZ Manufacturer will be following closely the policies of the new government and will, of course, invite the Minister for Manufacturing, Andrew Bayly, to share his thoughts and explain how New Zealand companies can enhance on their current situation for a brighter future. We invite readers to share their journey and methods they are using for efficiency and growth, leading to better business outcomes. We can talk about Productivity as much as we like…however, that talk needs to lead to action for change.

New Zealand Steel: Landmark carbon reduction project powers ahead

Around 70% of world’s steel is produced from iron ore reduced in blast furnaces. Most of the remaining 30% is produced by minimills, which recycle scrap steel using electric arc furnaces – a proportion set to grow as companies seek to decarbonise their operations. Work is underway at New Zealand Steel to install an electric arc furnace: a move which will shrink the carbon footprint of its Glenbrook steel mill and place the company at the leading edge of low emissions steelmaking worldwide. As the company gears up to celebrate 60 years since it was founded, this crucial upgrade will secure steelmaking – and the corresponding jobs it supports – in New Zealand for the long term. Announced in May 2023, New Zealand Steel’s electric arc furnace (EAF) project will reduce Glenbrook’s carbon footprint by 800,000 tonnes each year and the country’s total annual emissions by 1% from day one. The carbon reductions – equivalent to taking 300,000 cars off the road permanently – will come from replacing the steel mill’s existing oxygen steelmaking furnace and two of the four coal fuelled kilns. Chief Executive New Zealand and Pacific Islands Robin Davies described the project as “a pragmatic response that not only sustains our critical domestic steel supply, but also provides a collaborative approach with public and private sector players to be world leaders in lower emissions steel.” The company is on track to be producing lower carbon steel as soon as 2026, having continued to hit project milestones such as the completion of a feasibility study, beginning to prepare the site for installation and the signing of new project partnerships since the May 2023 announcement. Already users of technologies such as robotics, automation, wireless sensors to collect real-time data and computer-aided engineering and design, Mr Davies says his teams […]

Developing the manufacturing sector

By Jane Finlayson; Head of Advanced Manufacturing; EMA A lot has changed in recent months. Not only have we had a change of government, and with it a change in policy direction, but we have also seen the establishment of Advanced Manufacturing Aotearoa (AMA). Led by Catherine Lye, AMA is tasked with working with key sector partners - including unions, researchers, educational institutions, industry organisations, and Māori and Pacific manufacturers – to gather information and supply feedback on the practical steps that can be taken to further develop the manufacturing sector. The AMA is an important initiative that we hope will be supported by the new government. It is industry-driven and independent, representing manufacturers across Aotearoa New Zealand. This positions it to deliver enormous benefit to the manufacturing sector at a scale not realised previously. The EMA is proud to support the AMA, alongside our other partners across the country. As the newly appointed Head of Advanced Manufacturing at the EMA I am looking forward to working closely with Catherine and the AMA to advance the interests of the manufacturing sector. Since taking up my new role, I have enjoyed the opportunity to attend regional manufacturing action group meetings, in Waikato, Northland, Bay of Plenty and Auckland and I’ve met with a wide range of innovative manufacturers who have adopted technology to enhance their businesses and improve productivity. Clearly the past year has been challenging for many manufacturers. The global economic slowdown, rising costs, supply chain constraints and critical skills shortages have all combined to create a difficult environment for the sector. This has been reflected in the steady decline of the BNZ – BusinessNZ Performance of Manufacturing Index (PMI), which has sat below 50 since March. This indicates manufacturing activity in New Zealand has been contracting throughout much of […]

Systems thinking and sustainable manufacturing

Remember the moment your flatpack furniture finally took shape (with no pieces missing and your relationships intact)? The last piece slotted in because you got the ‘system’ right. Assorted pieces came together, in the right way, to make a useful item of furniture that was ‘more than the sum of its parts’. Sustainability is about systems too. Understanding the relationships between a strong bottom line, a flourishing environment and thriving people and communities will help you make your manufacturing business more sustainable. In fact, you can’t have a healthy business if you don’t attend to all parts of the system. In this article, we look at systems in your manufacturing business. Drawing on examples from our 2023 articles, we show the opportunities these systems offer to become more sustainable. But first, some background. Systems in sustainability The United Nations’ 17 Sustainable Development Goals are a good place to start. They highlight the social, economic and environmental systems that make up our world, plus the links between them. These systems reinforce one another. Some systems are virtuous. Get one thing right and we fix others too. For example, if we consume and produce responsibly (SDG12), we reduce carbon emissions (SDG 13) and modern slavery (positive impacts on social SDGs 1, 5 and 8). Vicious cycles are possible too. If we plant soybeans to create renewable bio-diesel (SDG 7), we risk crowding out native plants (SDG15). Systems in manufacturing As a manufacturer you’re familiar with ‘systems thinking’, even if you don’t call it this. That’s because your business is a system. For example, when raw materials are unavailable, your production line slows down. You have to re-plan your team’s rosters, your production run, marketing schedule, deliveries and cashflow. Everything’s linked. Here are some other examples of systems in your business and what […]

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