Smart manufacturing is taking over Australia—are you ready?

05/06/20185 Minute Read

When the Australian vehicle industry officially ceased to exist in late 2017, the obituaries for the nation’s manufacturing industry appeared faster than Model Ts rolling off a production line. The Cassandras were half right: In this globalised economy, Australia has a comparatively small population expecting to be paid high wages, and this amounts to a nation that has no business manufacturing cars, clothes, or even electrical appliances.

In fact, most business models operating on high volume output with a low profit margin are off the list these days. That said, Australia is experiencing an economic shift toward the opposite; it’s well-positioned to expand into low volume business offerings that generate high profit margins. Fortuitously, just as innovations—such as ride-sharing platforms and self-driving vehicles—look set to reduce the demand for old-school goods, such as cars, Industry 4.0 (aka, the fourth industrial revolution) is opening up new opportunities in the world of smart manufacturing.

Long story short, cloud computing, cognitive computing, cyber-physical systems, robotics, 3D printing, simulation, visualisation and collaboration tools, and the IoT are commingling in a manner that would make Frederick Taylor’s brain synapses melt. As a recent report on the imminent digital transformation of Australia’s manufacturing industry noted, “Advanced technologies . . . are revolutionising manufacturing, with new abilities to design and manufacture complex, customised products with short lead times, minimal tooling and wastage, and low labour demand.”

Get smart or get out

Many Australian manufacturers have yet to fully embrace the previously mentioned technologies. However, they’ll come under growing pressure to do so. Luddite holdouts will soon be driven out of the market and sent to the wall by competitors using sophisticated tech to increase efficiency, reduce costs, and target their market with pinpoint accuracy.

Michael Barth, a portfolio manager at Thermo Fisher Scientific, is bullish about the future of manufacturing Down Under. He notes, “Germany is a powerhouse of manufacturing, and yet, you wouldn’t think their living standards and the cost to produce there are that different from Australia. If they can do it, then surely Australia can, too.”

Greg O’Loan is a regional vice president of software company Epicor. He recently observed in an interview that:

“Rising energy costs and strong competition from overseas companies mean Australian companies need to continue to find efficiencies throughout the business . . . Australian manufacturers need to combine smart manufacturing, appropriate labour costing, and efficiencies in the organisation to reduce costs and get control over spend . . . 2018 will be a year of preparing for change for many businesses. This includes letting go of legacy systems that are costly to maintain and don’t deliver a strong return on investment.”

Keep up with—and take part in—Industry 4.0

Plenty of Australian businesses have already embraced smart manufacturing and are reaping the rewards. Quickstep’s CEO, Mark Burgess, has suggested Australia, with its well-funded education system and plentiful supply of engineers, scientists, and IT professionals, could become an epicentre of defence design and manufacturing if the nation keeps up this innovative work. “Defence is concerned with quality and technology innovation,” he says. “We don’t have to compete in high-volume markets—we’re low volume, high quality, [facilitating] high prices and margins.”

In other words, if manufacturers play to Australian strengths, the country can be a leader in innovative manufacturing—it’s just a matter of pushing it to the next level and bringing about a full revolution of the manufacturing industry as it is now.

Future-proof your cybersecurity strategy

As an IT manager, you’re probably thinking it’s great Australia is well-positioned to build successful smart factories and all. But isn’t having a treasure trove of IP floating around communication networks—not to mention allowing production processes to be accessed and controlled through the cloud and various network servers—going to result in a cybersecurity horror show?

What happens if a compromised IoT device, perhaps one controlled by an app on a staff member’s phone, results in a production line grinding to a halt? Or what if a competitor tries to access your network and steal business-critical IP? How does your organisation deal with sharing sensitive data with suppliers and customers who bring their own systems into the mix?

When it comes to the IT security concerns Industry 4.0 brings, there’s good news and bad news. The bad news is that when Australia hits a smart manufacturing tipping point, the IT security concerns keeping IT specialists awake at night will multiply. The more encouraging news is that many of the same cybersecurity policies and procedures originally developed for nonmanufacturing operations can be applied to smart factories.

Here’s some of the lower-hanging cybersafety fruit you can pluck if your organisation is introducing the latest manufacturing technologies:

  • Whether it’s 3D printers or just the ordinary kind, opt for print gear that comes with robust security features built in.
  • Ensure all cloud-based device information and local dates are securely stored.
  • Take advantage of the latest encryption, AI, and machine-learning technology that creates responsive threat intelligence across cutting-edge security platforms.
  • If your organisation hasn’t invested in IoT devices, it likely will soon, so make sure those devices incorporate secure coding practices throughout their lifecycles.
  • War-game worst-case scenarios. Have a plan in place for how your company will respond if a bored teenager in Minsk manages to take control of its widget factories.

The smart manufacturing movement is here to stay, and it’s only getting bigger in Australia. There’s never been a better time than the present to prepare your network cybersecurity arsenal for the fourth industrial revolution.

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