A message from Jens Goennemann
Recently, I was invited to join an American Chamber of Commerce delegation visiting some of the most innovative manufacturers in America. Along with AMGC’s Chair, Paul Cooper, we got to see how the big end of town, from Apple and Facebook in Silicon Valley to Boeing in Seattle, became global businesses.
To say this was an amazing journey does not do the experience justice. It really was jaw dropping to see the technology enabling these firms and other manufacturers evolve.
Contributing to Global Value Chains
It became clear that, while Australia is not placed to compete with lead system integrators like Apple and Boeing, there are myriad opportunities for Australian manufacturers to play a vital role in the global value chains of these manufacturing powerhouses. Many Australian manufacturers, such as AMGC member Sutton Tools, have already found ways to compete internationally, and successfully sell final products or intermediate components into the supply chains of such giants.
The Australian manufacturers that have succeeded within global supply chains have done so because they disrupted the market. They have pushed forward with a mixture of relentless innovation, collaboration and an understanding that competing on value, rather than cost, is essential. Contributing to the value chains of the players at the big end of town requires Australian manufacturers to be better, not cheaper.
Size Really Doesn’t Matter
I was most impressed by the smaller American manufacturers. For me, they proved that size really doesn’t matter. When the cake is big enough, a nice, small slice is tasty too.
For instance, San Francisco-based Planet boasts the most prolific satellite production facility in the world, which has enabled them to launch over 350 satellites, some of which are no bigger than a shoebox. With Australia now home to its own Space Agency, there are similar opportunities available for Australian manufacturers. Some manufacturers, such as AMGC members Gilmour Space Technologies, are already capitalising on these opportunities. Gilmour Space Technologies is developing new capabilities for launching small satellites into space, pioneering innovative hybrid propulsion technologies with the goal of providing lower cost access to space. Elon, we’re after you!
Impossible Foods is helping restore biodiversity and reduce the impact of climate change by making delicious, nutritious, affordable and sustainable meat, fish and dairy products directly from plants. This California-based manufacturer cannot keep pace with orders. Why? Because they have disrupted the market. They are delivering value to customers through innovation, technical leadership, and a superior quality product. They are competing on value, not cost.
Manufacturing is a critical force across the world. It is not just a sector, it is an enabling capability, accounting for approximately 15% of global GDP. Australian manufacturers must become a part of global value chains. We must carve out a real point of difference and create innovative products to compete on a global scale. We must disrupt the market, not be disrupted.