Productivity

Finding Your True Competitive Edge: A Guide for Manufacturers

Adam Sharman, CEO LMAC Group, APAC Throughout 2024 we have heard the mantra ‘survive to ‘25’ across a number of businesses and sub-sectors of our industry. In challenging economic times, manufacturing businesses face unique pressures from all directions – supply chain disruptions, decreased demand, and tightening credit markets. However, history shows that companies taking decisive action during downturns often emerge stronger when the economy recovers. In these times, organisation must be clear on what it is that sets them apart, in order to prioritise investment of time and resources in those activities that will accelerate their competitive advantage as markets recover. But how many truly understand what sets them apart? A genuine competitive advantage isn’t just about being better—it’s about being different in ways that matter to customers and are difficult for competitors to replicate. Looking Beyond the Obvious Traditional thinking often leads manufacturers to focus on standard metrics like price, quality, or delivery times. While these factors matter, they rarely constitute a sustainable competitive advantage. Every serious player in manufacturing strives to optimise these elements, making them table stakes rather than differentiators. The key lies in identifying unique combinations of capabilities that create lasting value. Consider Toyota’s revolutionary production system—it wasn’t just about efficiency, but rather a holistic approach combining worker empowerment, continuous improvement, and waste reduction that took decades for competitors to understand, let alone replicate. The Three-Step Analysis Framework Customer Value Mapping Start by mapping your customers’ entire value chain, not just their immediate needs. What challenges do they face upstream and downstream? A manufacturer of industrial fasteners discovered their true advantage wasn’t in the products themselves, but in their ability to provide engineering support that helped customers optimise their entire assembly process. Document every customer touchpoint and gather data on: Problems customers face that they haven’t […]

Fixing manufacturing’s billion-dollar harm problem

Jane Finlayson, EMA Head of Manufacturing Harm in New Zealand manufacturing is unacceptably high and urgent action is needed. The good news is that through a recent partnership between the Accident Compensation Corporation (ACC) and the Employers and Manufacturers Association (EMA), help is on the way. ACC claims costs for the manufacturing sector have skyrocketed, exceeding $165 million annually, with weekly compensation costs doubling from $51 million to $109 million between 2015 and 2024. Health and safety regulator WorkSafe estimates that chronic harm results in a staggering loss of 5,000 disability-adjusted life years each year, contributing to an economic burden of approximately $1.23 billion. The breakdown of this burden is alarming: 27% of injuries stem from musculoskeletal disorders, 17% from mental health issues, 16% from cancers, and 15% from respiratory problems. In a significant stride towards addressing this harm, ACC appointed the EMA to lead a by industry for industry project to create a harm reduction action plan. The EMA stood up Project Whakahaumaru, which translates to ‘safeguard’ or ‘protect’, and gathered the perspectives of around 200 stakeholders from the manufacturing sector, health and safety professionals, and WorkSafe via focus groups, one-to-one interviews, co-designed workshops and surveys. EMA Head of Manufacturing Jane Finlayson says the recently released results of this discovery phase have been sobering. “We embarked on this journey to safeguard our industry, and the findings highlight a pressing need for change,” Finlayson says. “Injuries are not just numbers; they represent lives affected, families impacted, and potential futures altered. “We cannot ignore the implications of these injuries – not only for the workers but for businesses and the economy as a whole. “These figures are a call to action.” Over the past year, the EMA has worked with stakeholders across the sector to develop the Project Whakahaumaru Harm Reduction […]

Aotearoa’s Industry 4.0 journey

From November issue, NZ Manufacturer magazine (below) Sean Doherty, Product Manager, Callaghan Innovation The advent of Industry 4.0 has been a game-changer for the manufacturing sector and can deliver real returns for New Zealand businesses, through increased efficiency, productivity, and innovation. However, many manufacturers remain hesitant to embrace these technologies. This reluctance often stems from persistent myths that cast doubt on the practicality and benefits of Industry 4.0. Based on Callaghan Innovation’s experience working with New Zealand manufacturers who are on their Industry 4.0 journey, we’re keen to dispel some of these common myths and provide some evidence-based solutions to encourage Kiwi manufacturers to confidently step into the future with Industry 4.0. … Myth 1: Industry 4.0 is only for large manufacturing operations. The Reality: Industry 4.0 is not exclusive to large manufacturers. Small and medium-sized enterprises (SMEs) can also leverage these technologies to enhance their operations. Indeed, as a nation of SMEs, this is where Industry 4.0 technologies arguably have the most potential to boost this country’s productivity and economic output. Companies like Nautech Electronics, Gyro Plastics and Oasis Engineering, are all great examples of SMEs deploying Industry 4.0 technologies to good effect. The key is to start small and scale up. For instance, SMEs can begin by implementing IoT sensors and use data analytics to optimise their existing processes. Retrofitting new hardware systems to older equipment can be a cost-effective way to integrate Industry 4.0 technologies without the need for significant upfront investment in new machinery. Myth 2: Exorbitant costs outweigh the benefits The Reality: While initial investments may seem daunting, the long-term benefits of Industry 4.0 technologies can lead to substantial cost savings and increased efficiency. Several McKinsey and Company case studies show manufacturers gaining a 10-20% increase in efficiency, between 10-15% improvement in quality and […]

5S – Not That Old Chestnut

Ian Walsh, Partner, Argon & Co NZ I was reflecting recently on how many business owners have started an improvement program with 5S and failed. Before I talk about the “why” and the “how” 5S implementations fail in these businesses, and for those who haven’t come across 5S before, allow me to briefly explain what 5S is. 5S is a practice that was developed at Toyota in the 1960s. 5S consists of 5 “S’s” based on Japanese words and the associated anglicised word: Seiri (Sort) – Eliminate unnecessary items from the workplace. Seiton (Set in Order) – Organize the necessary items so they are easy to use and accessible. Seiso (Shine) – Clean the workplace and keep it clean. Seiketsu (Standardise) – Standardise the best practices within the workplace. Shitsuke (Sustain) – Ensure discipline and commitment to maintain the 5S processes. All the business leaders that I’ve talked to about failed 5S implementations were unable to maintain the “standardise” and “sustain” the initiative. After a period of time, standards slipped and then eventually (or quite quickly) returned to the previous level with a few artifacts remaining. Most of these leaders said “we tried that, it didn’t work”. This needs a deeper analysis. There are examples across the globe of world-class companies that rely on 5S as a core practice and have succeeded in sustaining the practice. On that evidence, surely it’s not that 5S itself fails, but that particular implementations fail? Many of these business leaders I talked to stated that they were told something along the lines of “if you can’t do 5S you can’t do anything”, and so they started their improvement journey with 5S, usually with help from a “mentor”. Typically, they would do a 5S exercise in an area in 1-2 days and then move into […]

Scott Aylett, SEA Electrical a winner

Scott Aylett from SEA Electrical, a Master Electricians member, received a bronze for the Emerging Business Award at the recent Excellence Awards. A bit more about him here…

Embracing digital transformation: A strategic roadmap for Argus ManuTech Ltd

-Adam Sharman, CEO LMAC Group, APAC Argus ManuTech is a new name, but it has over 50 years of experience as an industry-leading manufacturer of electrical products. It specialises in cable and harness assemblies, viscous reheating products, and electrical medical devices. It has a rich history of supplying local and global customers from its facility in Christchurch. The global manufacturing sector is experiencing a major transformation fuelled by rapid technological advancements and an increasing demand for efficient, sustainable, and data-driven operations. Recognising the opportunities these changes presented, Argus ManuTech set out to tackle key challenges such as improving productivity, optimising supply chains, and remaining competitive despite rising labour costs. To address these issues, the company developed a clear roadmap for its digital manufacturing transformation. Argus ManuTech’s digital transformation strategy was developed through an initial two-step assessment process. Initially, a business survey was conducted with all employees to understand their challenges and needs regarding their work and the opportunities for the organisation. This survey proved invaluable in shaping the transformation strategy and identifying key insights and themes. Nathan Hay, General Manager, says, “I can’t stress enough how impactful and important it was to engage with staff before developing any strategy.” The second step involved using the Smart Industry Readiness Index (SIRI) framework to guide Argus ManuTech in prioritising initiatives for digital transformation initiatives. The SIRI framework, an Industry 4.0 diagnostic tool facilitated for Argus ManuTech by LMAC’s certified assessors, was employed to evaluate the current digital state of Argus ManuTech’s factories. This framework addresses three fundamental aspects of Industry 4.0: Process, Technology, and Organization. Based on this assessment, four high-impact areas were identified for ManuTech to focus its resources on: vertical integration, shop floor automation, shop floor intelligence, and inter and intra-company collaboration. Using these impact areas, Argus ManuTech developed a […]

NZ Manufacturer October issue out now

Read the best analysis and observations for the manufacturing future for New Zealand. Exchange opinions and experiences with your peers, who are enhancing Productivity and market share in local and international markets. Subscribe to the magazine and send your success stories to us. We will share them for you.Contact publisher@xtra.co.nz

Beyond the Status Quo: Rethinking Workforce Development for a Competitive Future

David O’Connor, Head of Emerging Markets, The Learning Wave As a nation, we take pride in our innovation and adaptability. However, when it comes to workforce development, we still find ourselves lagging behind. The challenges are clear: a widening skills gap, ongoing productivity issues, a growing need for both transferable and technical skills, and businesses struggling to meet global competition demands. Are we ready to push boundaries and adopt effective solutions for today’s workforce and tomorrow’s needs? Or are we content to tinker at the edges of a broken system? Recent conversations suggest the latter. So, what can we do? It’s easy to blame outdated educational structures, funding issues, inter-agency hurdles, and slow policy changes. But are we truly held back by the system, or are we reluctant to challenge the status quo? Current structures, though well-intentioned, often miss the mark when it comes to evolving business needs. We need a shift towards flexibility, continuous learning, and strong industry partnerships. We must stop waiting for the government to solve the skills gap; we require more business-led initiatives. Relying solely on government action is unrealistic and short-term thinking. Instead of waiting for mandates or funding schemes, the government should incentivize businesses with tax breaks for upskilling and training their staff. The business community must lead the way. Organisations can – and should- drive change by partnering to source and fund necessary skills training. Many companies recognize the value of investing in their workforce, and there’s an opportunity to create a coordinated, industry-wide effort that harnesses the best training available. Small businesses often claim they can’t make an impact, but we can transform isolated successes into a nationwide movement. Collaboration among businesses is key to creating a more agile and responsive training ecosystem that meets the needs of both employers and their […]

Can we be world-class leaders?

From October issue NZ Manufacturer magazine www.nzmanufacturer.co.nz -Ian Walsh, Partner, Argon and Co Recently, I had the opportunity to work with business leaders on New Zealand’s productivity performance and, how it compares to key trading nations and OECD members. Over the past 50 years, New Zealand’s ranking has fallen from being in the top five to the bottom five. It’s a tough reality, but more interestingly, the discussion centred around why Scandinavian countries and Ireland excel while we continue to struggle. Many attribute New Zealand’s lagging performance to factors like distance to market, limited access to capital, and the small size of our domestic markets. Undoubtedly these do play a role, but they are largely beyond a business’s control. No matter how efficient we become, we still face the challenge of shipping goods across the globe. If we focus on these external factors alone, we will continue to run the risk of overlooking the most crucial areas where we can improve – leadership and people management. Studies show that New Zealand consistently underperforms in these areas compared to other OECD nations, and this is not a recent development. Over the last 40 years, other countries have systematically invested in cultivating great leaders, while New Zealand seems to have fallen into five fatal assumptions about leadership. The Five Fatal Assumptions About Leadership in New Zealand: Promoting the best operator to leader will work out Many workplaces fall into the trap of promoting the best operator to leadership roles. While they are often respected for their technical skills, they may lack the ability to manage people effectively. This can result in the loss of a great operator and sometimes even a demotivated team. Leadership requires a different skill set—one that needs to be developed, not assumed. Leaders are born, not made The […]

Winston Peters’ $100 billion infrastructure fund is the right idea. Politics-as-usual is the problem

-Timothy Wech, Senior Lecturer in Urban Planning, University of Auckland, Waipapa Taumata Rau New Zealand’s infrastructure woes are a constant political pain point. From ageing water systems to congested roads and assets increasingly threatened by climate change, the country faces mammoth upgrading and future-proofing challenges. Enter Winston Peters and NZ First with a surprise proposal for a NZ$100 billion “Future Fund” dedicated to infrastructure investment. Sounds promising – but the proposal’s success will hinge on getting the details right and, more importantly, getting the politics out of infrastructure planning. Unveiled at NZ First’s annual convention last weekend, the idea bears striking similarities to challenges previously highlighted by urban planning and infrastructure experts. The country currently has an estimated infrastructure deficit of over $100 billion which aligns eerily with the scale of Peters’ proposed fund. The Future Fund proposal sounds impressive on paper. Ring-fenced from political meddling and focused on national interests, it’s billed as a silver bullet for infrastructure funding problems. Peters claims he’s taken a page from the Singapore and Ireland playbooks – potentially breaking New Zealand’s habit of treating big infrastructure projects like they’re part of a three-year plan. Long-term savings As always, the devil is in the details – and the Future Fund is light on them. How exactly would this fund be financed ? How would projects be selected and prioritised? And, crucially, how would it be insulated from the political interference it claims to avoid? The potential benefits are significant.Research suggests that a stable, long-term approach to infrastructure investment and better utilisation of existing assets could unlock substantial savings – potentially up to 40% of total project costs. A well-managed $100 billion fund could provide the certainty and consistency needed to achieve these efficiencies. The scale of the fund also aligns with the urgent need for […]

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