Building the nation will be impossible without engineers

AUSTRALIA 2025: How will science address the challenges of the future? In collaboration with Australia’s chief scientist Ian Chubb, we’re asking how each science discipline will contribute to Australia now and in the future. Written by luminaries and accompanied by two expert commentaries to ensure a broader perspective, these articles run fortnightly and focus on each of the major scientific areas. Here, we examine where engineers can take us.

Australian industries need the flexibility, insight and foresight that comes from thinking creatively, asking critical questions, forming and testing hypotheses and reasoning quantitatively – and engineers have the technical knowledge and the problem solving skills to respond to constant change.

As they have a holistic understanding of the practical needs of communities, businesses and the environment they are well positioned to work with other disciplines, including scientists and designers, to provide a stream of new ideas and technical responses essential for sustainable competitive industries.

But future knowledge-based industries won’t just spring up because Australia’s engineers are generally well regarded or because Australia’s engineering degrees and professional associations are of high quality.

The ability of engineers to build Australia into the future – to literally build our modern infrastructure and to foster invention and innovation to support internationally competitive industries – will depend largely on changes that must occur over the next decade or so.

marco antonio torres/Flickr, CC BY-SA

Australia’s next generation of engineers, our school students, poorly understand the role of engineering and the importance of the sciences and the mathematics that underpin the ubiquitous technology that determines the way we live.

We have too few students studying science, technology, engineering and mathematics (STEM) subjects at higher levels at high school, too few going onto engineering at university, and a shortage of engineering skills across the economy as a consequence.

We can’t just look to immigration to fill this gap; engineers are in demand across the world. Recent national efforts to promote STEM education are good news and are gaining ground, but we need to proactively continue to support capacity building.

The importance of a collaborative culture

From the university perspective we need to further enhance the engagement of engineering students with industry – beyond existing professional experience requirements within Australian engineering degrees – to produce truly “work ready” graduates.

The OECD currently lists Australia last place out of 33 nations for collaboration on innovation between businesses and the higher education sector and public research agencies.

This is a critical gap that we must address by providing substantial opportunities for students to undertake internships within a variety of industries and by bringing many more industry specialists and policy makers into the classroom to enthuse and inspire students.

This kind of holistic engineering education produces graduates who not only understand how to innovate, but how to address the real world needs of both societies and industries.

To make sure we can respond competitively in the face of intense global competition, engineering education and research must be framed by the understanding of the economic realities and operating conditions that industries face that such deep engagement fosters.

Ford has a long history in Australia and those skills can be put to use after its factories close in 2016.
Five Starr Photos (Aussiefordadverts)/Flickr, CC BY-SA

From a business point of view we need to change the way we think about our industries. The recent announcements ending car manufacturing in Australia are a good example.

That Australia will no longer manufacture cars is only a disaster if we are unable to identify and analyse what it took to make those cars, and apply this knowledge in another way.

So instead of mourning the loss of “big” industries defined by particular “end products” we need to be constantly looking for creative, new opportunities along increasingly complex, evolving value chains.

Adding value

To create niche solutions that are smarter and more efficient requires both human and intellectual resources working within a vibrant culture of innovation. The key concept here is “high-value output” which is not necessarily an “end product”.

With consumer consumption driving the mass proliferation of high-tech products, we can be certain that these products will have some aspects in common such as various electronic components, which will in turn drive demand for the niche materials we need to make them.

Businesses might identify opportunities for diversification by making chips for various electronic products used in entertainment and health industries. Those car parts manufacturers could switch to making steel parts for complex equipment or for the beds used in hospitals, as the health-related industries expand with ageing populations.

What is critical here is expertise in making sophisticated steel parts and the ability to recognise and take advantage of commercially viable opportunities to continue to use those skills as economies evolve (such as within the burgeoning health care sector).

Matt Houghey/Flickr, CC BY-NC-SA

Interestingly, this growing demand for health care services and related infrastructure and equipment and the explosion in electronics – that require high-value, niche inputs such as metal alloys – is converging as the health care sector depends increasingly on complex information technology and as more and more health services are deployed in the homes via sophisticated self-managed equipment and the remote monitoring of, and communication with, patients.

Likewise, when we think about the value chain we need to think more creatively about how to incorporate the masses of potentially valuable materials we currently throw away as waste.

Not only are natural resources being depleted at an unsustainable pace, and carbon emissions rising, but industries recognise the cost-effectiveness of reusing materials. It will largely be engineers that can deliver previously unimaginable solutions.

It may not seem obvious, but alternative carbon sources from waste plastics to used tyres – huge waste burdens globally – can be usefully transformed into value-added steel by partially replacing the conventional carbon source, non-renewable coke, in electric arc furnace steelmaking.

This “green steelmaking” process, which I helped develop at UNSW, results in a more efficient furnace, reducing demand for power and simultaneously transforming problematic wastes.

Greater than the sum of its parts

Equally, engineers can provide the technical expertise to support entrepreneurs pursuing their own ideas. Such a combination of engineering and business enables both areas of expertise to achieve much more together.

In my own experience working with our commercial partner to develop our “green steel” making process, a whole range of different professions were critical in ensuring that we captured the intellectual property (IP) we generated.

Protecting our IP has meant we were able to take our business case to the world, resulting in international commercialisation of our technology in collaboration with our industry partner.

Working in partnerships with other disciplines and with industries, engineers will create new knowledge, generate groundbreaking technologies, participate in research collaborations and training exchanges. This will ensure a rapid translation of knowledge into value for Australian industries.

This will create a culture of learning driven by innovative thinking, grounded in collaboration and built on the recognition that the dynamic changes in our world are inevitable.

If we are prepared to see change as a continuous cycle of new opportunities, not new problems, we will realise our aspirations. Future generations of engineers have much to contribute to ensuring new ideas and solutions lead to continuous improvement in quality of life, in Australia, and internationally.

Robin Batterham, Professor at the University of Melbourne

As a former Chief Scientist, I can be brave and push the line that ideas, as such, don’t really affect our lives. Don’t get me wrong – uncovering knowledge is important and we must play our part in generating and exchanging it. That said, it is the application of ideas in technology and science that impacts our livelihood.

Kevin Dooley/Flickr, CC BY

Do you want to wind the emissions clock back without getting rid of six billion people? Then chat up the engineers as what needs to happen also must be economic and practical and innovative – the realm of engineers.

Moving from climate onto manufacturing: it is hardly the strong and vibrant core of Australia at the present, and yet it could be.

Through Cooperative Research Centres (CRCs) and other research groups and with industry associations, there is a renaissance of activity in high value add, agile manufacturing companies, tackling the world’s supply chains as they become more complex, demanding and internationally linked.

Be it communication systems, bionic devices or advanced composites, engineers are creating and driving success that benefits us all, economically, socially and with sustainability.

We just need more of them.

Cathy Foley, Chief of CSIRO Materials Science and Engineering

Australia has an excellent track record of scientific discovery, but what are not as well recognised are the engineered outcomes that use this science.

Andrew Goodwin/Flickr, CC BY-NC

From cochlear implants and sleep apnoea breathing machines to new chemical engineering processes that improve all plastics, Australia has some great examples of technology-led products that have global markets. But have we kept up with the times and is Australian engineering competitive enough?

We need to take that scientific ingenuity that we are famous for and engineer our discoveries into new industries. These industries should be the basis of future technologies and next generation products that transform how we live and work.

We have this stereotypical vision of scientists with their heads in the clouds and engineers with their heads under the car bonnet.

Imagine if we got better at connecting scientists, engineers and investors to turn our manufactured future into a modern, resilient, exciting and highly exportable commodity.

Australia is well placed to create an engineering-led boom – so let’s do it.

This article is part of the Australia 2025: smart science series, co-published with the Office of the Chief Scientist. Further reading:
Australia’s future depends on a strong science focus today
Physics: a fundamental force for future security
Proteins to plastics: chemistry as a dynamic discipline
Optimising the future with mathematics
Australia can nurture growth and prosperity through biology
A healthy future? Let’s put medical science under the microscope
Groundbreaking earth sciences for a smart – and lucky – country
Marine science: challenges for a growing ‘blue economy’

The Conversation

Veena Sahajwalla has collaborated with OneSteel through ARC Linkage grants scheme. The PIT technology – “Green Steel” – has been licensed to OneSteel for commercialisation. Current grants and previously received grants are ARC grant schemes (ARC Linkage, Discovery) and AISRF, and industries including: OneSteel, Hyundai Steel, POSCO, ACARP, Austral Bricks and LKAB. She a member of a range of professional associations: EA, AIST, ACS, ASM International, AusIMM, ATSE, Climate council and NSW Australia Day Council Board member.

Cathy Foley is a member of a range of professional societies such as the AIP and a Fellow of ATSE.

Robin Batterham receives funding from the Department of State Development, Business and Innovation and Visy Pty Ltd. In 1999 he was appointed as Australia’s Chief Scientist, a position he held concurrently with that of Chief Technologist for Rio Tinto Limited.

This article was originally published on The Conversation.
Read the original article.

As India and China transform, Australian manufacturers must follow

As Australia laments the decline of its manufacturing sector, China is actively taking steps to accelerate its move up the value chain.

Historically a low-cost operating environment, China was once an attractive option for multinational companies seeking to minimise production costs. However with a burgeoning middle class aspiring for a better place in the global ecosystem, the cost advantages are rapidly eroding.

A Bloomberg Businessweek article examined how tech manufacturer Knowles has grappled with these changing conditions, and their experiences aren’t unique.

The rapid increase in wages, increased cost of doing business – physical infrastructure and raw material – and a higher Yuan are all contributing to manufacturing cost pressures. These challenges, and the pace at which they are taking place, are forcing multinational companies in China to rethink their local strategy to remain competitive.

For those firms not in a position to move up the cost/quality curve, an attractive option is to shift their operations to other parts of Asia where labour costs are still a fraction of China’s, such as the Philippines or Vietnam.

Increasingly multinationals are also facing hiring competition from local private and state-owned enterprises. Temporary relocations from rural areas to larger cities for work are also common in parts of China, with employees returning to their families after a year or two.

It is no surprise then for companies to be investing in employee engagement programs. In one instance, a leading manufacturer of building products in Guangzhou has made a considerable investment in employee engagement programs to achieve a staff turnover rate of 20% (which they identify as being well below the average at comparable companies).

“Indigenous innovation”

Led by the government’s 9% growth target for the production of sophisticated goods, China has concentrated on improving its business and governance environment to create a high value-adding manufacturing industry, as opposed to its traditional low-cost, low value-added ecosystem.

In doing so, their focus has been on “indigenous innovation” – creative production nationally that is less reliant on foreign capabilities.

Analysis conducted by the Royal Bank of Scotland and Bloomberg indicated a shift in job types away from traditional textile and clothing, to computers and communications. Medium and high-tech goods production has increased from 40-60% over the past two decades.

While China is transforming itself into an advanced manufacturer, India is actively promoting itself as a manufacturing hub. India’s recent 11th Five Year Plan (2007-12) showed 28.5% jobs growth in the manufacturing sector. India plans to create an industrial corridor between Delhi and Mumbai, investing in vital support infrastructure such as power plants, water facilities and transport infrastructure.

Alongside this global manufacturing and trading hub, will be the creation of seven “Smart Cities”, while at the Third Global Innovation Roundtable (GIR) 2013 in Delhi, there was also discussion of incorporating industry-university clusters, as well as virtual clusters.

How can Australia compete?

All this means that Australian manufacturers need to be prepared for increasing competition in higher value manufacturing, and consider a wider range of options when looking to offshore operations.

So where should Australia place its efforts and how does it retain its competitive edge? My recent article on Asian value chains clearly establishes the economic case for Australia to deepen its engagement in Asia. But more needs to be done. UWA Professor Tim Mazzarol’s recent piece on the “big shift” in manufacturing – from controlling assets and stocks to leading global knowledge networks – makes this case too.

This accords with calls by industry minister Ian Macfarlane for Australia to expand its industry base to cover new industries and products and transform relationships between research, skills, training and industry.

This ethos of collaborative competition will serve Australia’s interests well in moving up the value chain of activity, allowing Australian companies to lead new developments.

At the micro level, Australian companies must start to foster an enabling culture that moves individuals from thinking about ‘my’ role to ‘enabling another’s’ role within the company.

But a prerequisite is the creation of a high skilled, globally minded workforce, which needs to begin through schools, universities and even into organisations.

Sustained interventions at different levels of the ecosystem in education, management and industry will enable a national culture that drives future productivity, innovation and entrepreneurship.
Education must be the avenue by which we not only prepare individuals for jobs, but help them to become creators of jobs.

The Conversation

Dr Christopher Vas is the recipient of the 2014 Endeavor Australia India Education Council Research Fellowship. He is also one of the Chief Investigators in the Singapore Government funded research project on benchmarking productivity and innovation in Singapore’s manufacturing sector.

This article was originally published on The Conversation.
Read the original article.

In the Airbnb world we need a new productivity measure

The latest report on Australia’s productivity performance wasn’t good news. The annual update by the Productivity Commission confirmed Australia continues to lag most other developed economies, and has done so now for more than a decade.

Our productivity woes are blamed – by the Productivity Commission and others – on a range of factors, from falling terms of trade as the commodity prices boom fades, the high Australian dollar and natural disasters, through to poor management skills. Even our labour-intensive artisan bakeries and small vineyards get a mention.

What’s needed is the transformation of our national productivity, underpinned by value creation through intangible resources – rather than unprocessed raw materials – and driven by a coordinated, strategic approach to productivity and management.

The reality is we produce services, not just widgets, so it’s time to put the P into productivity – in the form of people.

My just completed research into productivity for service and network-based firms shows that a paradigm shift is required. The traditional input-process-output production model is reductionist and outdated. Instead I propose new measures that incorporate customer input and technology integration, both of which play a critical role in the modern firm’s productivity.

A multi-level approach to productivity.

Productivity is not flat

Manufacturing processes are built for scale, with goods production largely standardised, produced away from the market and with little direct customer input. Service, on the other hand, relies on interactions between people, technology as an enabler and greater use of networks. This changes the dynamics of how we work.

Let’s go to the health sector for an illustration. “Lean manufacturing” principles are often applied to hospitals, with the aim of getting patients in and out within, say, four hours. But is a person with a head injury or someone having a heart attack the same as a car being assembled using standardised parts, in a fixed and measured time? The truth of the matter is hospitals require very skilled staff who can collect, analyse and synthesise data from people and technology, processing this in real time to make decisions with life or death consequences. That’s hardly the same as assembling 100 Toyota Camrys.

The role of the customer is another aspect affecting productivity. You can produce a car without a customer – but try to deliver a service with no customer. The customers and their input into the service delivery process is fundamental to service firms, which now account for more than 85% of gross domestic product and employ over 85% of Australia’s workforce. Increasingly, organisations are using self-service technologies and online tools to co-create services with customers. The customer helps to create value. Think of Apple’s App Store, where people who were once just customers are now also app developers.

In a sharing economy, in an era of collaborative consumption, consumers buy from consumers via enablers such as accommodation portal Airbnb and share-ride service Uber, placing customers as competitors to traditional businesses.

This customer input into the service delivery process fundamentally changes the nature of how “value” is created, captured and appropriated. But customers and customer input is not included in the current productivity equations despite being a “factor of production”.

Technology dis-integration

Information communication technology (ICT) is also critical as it connects customers, organisations and suppliers. Technology adoption is often cited as an indicator of productivity. But my research shows it’s not adoption in and of itself that delivers gains but ICT integration that matters.

Take, for example, the travel and tourism industry, which is regarded as a prime user of technology. My research shows that while there is a high degree of adoption of ICT, the lack of integration between systems, across stakeholders, is a major inhibitor to service productivity in this sector.

Information is still being reformatted, rekeyed and redistributed manually within organisations, sometimes among five different ICT systems. This lack of systems integration leaves organisations with a hole in the centre. As business struggles to connect with customers using a range of “must-have” platforms, such as Facebook, Twitter, Google+ and LinkedIn, the problem worsens – the hole gets even bigger.

Our productivity problem is a like an epidemic. It affects many businesses and threatens the prosperity of future Australians yet it is poorly understood and goes largely unnoticed, especially in a service economy. If a problem of this size and scale were to affect people’s health, money would be raised for further research to isolate the causes and cures for the malady.

The problem requires attention and funding from policymakers to foster initiatives aimed at tackling productivity failure. Collaboration is required, with business sharing transactional data and industry intelligence with academics and researchers, so together they can identify gaps and benchmark within and between industries, with the goal of achieving the productivity increase needed to maintain our standard of living.

The Conversation

The authors do not work for, consult to, own shares in or receive funding from any company or organisation that would benefit from this article. They also have no relevant affiliations.

This article was originally published on The Conversation.
Read the original article.

In Conversation: Australia needs tax breaks for innovation

Australian innovation has stagnated in the past 50 years, and could be reinvigorated by focusing on key areas, according to Donald Hector, President of the Royal Society of New South Wales in an interview for The Conversation.

Agriculture, mining and biotechnology all offer huge potential for further development with the right incentives, including tax breaks for research and development, and more secure funding.

With budget cuts looming for Australia’s national science and research body, it’s a good time to assess the best way to encourage innovation.

The Commonwealth Science Innovation and Research Organisation (CSIRO) is reportedly bracing for cuts up to A$150 million in this week’s federal budget, following 300 jobs announced to go next year, and 400 positions axed last year.

The recent federal Commission of Audit recommended greater oversight of CSIRO, and abolishing climate bodies such as the Climate Change Authority and the Clean Energy Finance Corporation.

I interviewed Hector on the state of innovation in Australia today, and how we might once again become a world leader.

Read the full interview transcript here

Peter Doherty: Thinking in terms of Australia’s future, how important is it for us to expand activity in the innovation/high technology sector?

Donald Hector: It’s critically important. If you look at countries that have been successful since the early days of the Industrial Revolution they’ve largely done so through having highly innovative industries that maximise utilisation of technology.

Peter Doherty: Do you think that an expanded high technology sector should focus solely on areas like IT, encryption, software development and so forth, or should we also be expanding niche manufacturing and both heavy and light engineering applications?

Donald Hector: ICT is very important because there are enormous business opportunities in the industry; it’s still very much in its infancy.

But it’s also important to be developing niche operations and manufacturing capability in areas where Australia has a natural strength. Biotechnology and pharmaceuticals are a good example of that.

We didn’t really do much in the way of pharmaceuticals manufacturing at all until about 1948. We then started to manufacture penicillin. Australia was only the second country in the world manufacturing penicillin commercially and was the first country to make it available for the general population.

We started making penicillin in 1948 and by the mid-50s we were one of the biggest penicillin producers in the world, if not the biggest. In 1950 the value of locally-produced pharmaceutical actives was £6.7 million and imports were £630,000. Over 90% of pharmaceutical actives used in Australia were manufactured in Australia.

Today the reverse is so. Over 90% of active pharmaceutical ingredients are imported, and the local content is largely limited to formulation and repackaging.

We’ve gone from being in a very dominant position and self-sufficient position to an absolute devastation of that industry.

But it need not be like that. [Biotherapy company] CSL made the transition from government-owned enterprise to a highly-successful publicly-owned company, and is now one of the biggest producers of blood products in the world.

Tasmanian Alkaloids, which was started in Tasmania by Abbot Laboratories in the 1950s to produce opium alkaloids, was sold to Johnson and Johnson – why did this not end up in Australian hands?

Peter Doherty: What could the universities do better, both in the sense of discovery and translating discovery for economic benefit?

Donald Hector: I’m rather of the view that universities are best suited to doing pure research, and from time to time really good stuff will come out of that. But I think you need research institutions that are not constrained by a heavy requirement to produce income out of their research.

That’s best left to private sector, and possibly government, and that’s why I think the CSIRO and ANSTO (Australian Nuclear Science and Technology Organisation) are so important.

They should be the commercial arms as was originally intended, and develop industrial research so that it puts Australia at the forefront of innovation.

Peter Doherty: What could CSIRO and other government research agencies like DSTO (Defence Science and Technology Organisation), ANSTO do better to promote greater economic activity?

Donald Hector: CSIRO and ANSTO, and particularly CSIRO, are much maligned. They’ve created very innovative inventions over the years, and have been responsible for some truly fantastic technological developments.

But we expect them to deliver success with every project, and research is not like that. We also expect them to do so on shoestring budgets. There’s nothing worse than funding a project that might be expected to cost $50 million and finding out that it needs twice that, and then saying that you don’t have the money to continue and killing the program.

I’m not suggesting that we should be trying to pick winners, nor am I suggesting that we should hesitate in killing off research programs that aren’t going to deliver. But you’ve got make sure that you focus your funding on areas that are likely to be a success, kill off the programs in the early stages when they look like they’re not going to succeed, and heavily fund the ones that show potential until they are successful, recognising that that usually takes a lot more money than you originally expected.

Peter Doherty: What are the barriers from the business side?

Donald Hector: What Australian companies, particularly the top 300 of the ASX, have historically done is to have very strong government lobby groups and the Australian governments, irrespective of their political persuasion, have been very heavily persuaded by them.

What I think that’s led to is a lack of entrepreneurship. We lack a mittelstand in Australia of the type they have in Germany. I think there are about three million often relatively small, family-owned companies in Germany that typically that have a few hundred employees and they’re world leaders in a niche area. They supply world marketplaces and the big German manufacturing sector. We’ve never developed that here because we’ve been to eager too look after the larger companies that feel that the Australian government owes them a living.

Peter Doherty: What can government do better? Are the tax settings right?

Donald Hector: I’m not sure that a general tax policy in terms of support for industry is a good idea. We certainly need research and development concessions. We need to have some public funding to encourage research and development expenditure, and we’ve got to recognise that issue and provide tax incentives to encourage it.

If you look at the US, a lot of the high-tech industries there have their origins in defence industry. It’s not uncommon to find engineering faculties in the US universities with hundreds of millions of dollars from government research funding for defence.

If Australia decided to be a much bigger player in agriculture and mining where we have some very clear internationally competitive industries, why aren’t we more fully integrated into those industries? Why aren’t we the manufacturers of agricultural and mining equipment as we were once?

Why was the government response to the car industry crisis not more visionary? We could have taken the several hundred millions of dollars of car industry subsidies and made that money available to a couple of the big earth-moving companies like Caterpillar and Komatsu to establish their global research and development and world-scale manufacturing facilities here.

I am of the view that you need government policy to encourage the development of those industries, but you have to do so in a way that will be internationally competitive and will lead to a globally-competitive industry for the long term.

Peter Doherty: What are you aiming to achieve by re-invigorating the Royal Society of NSW, and how do you see such long-established institutions functioning in modern Australia?

Donald Hector: We want the Royal Society of New South Wales to be true to its original charter of encouraging studies and investigations in science, art, literature and philosophy. The main aim behind that is to advance knowledge and encourage innovation and entrepreneurship to develop the resources of New South Wales and, more broadly, of Australia.

We see our role as providing a forum where we can bring together people who are interested in seeing those things happen and being a facilitator so that we can bring important issues to public attention and to influence policy. We want to provide a place for people to meet who are engaged in those areas of human knowledge, for them to exchange ideas and to learn from one another.

The Conversation

Peter C. Doherty is a member of the advisory committee to the CSIRO Biosecurity Flagship. He is on the board of The Conversation.

This article was originally published on The Conversation.
Read the original article.

©2019 All Rights Reserved. MHD Magazine is a registered trademark of Prime Creative Media.