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Manufacturer June 2013 June NZ 2013

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The Future of Manufacturing

Manufacturing Technology Free CAM for SolidWorks.

The sky’s the limit.

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Lighting up

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company about four years ago when he was CEO of the newly formed Tonga Power and he was approached to take part in a trial, swapping out ordinary sodium streetlights for LEDs. The results were fantastic – in just the first 12 months McGill says they were looking at savings of 35,000L of diesel from just 100 LED street lights. He moved to ECOLight just over a year ago. The LED lights themselves use a far lower wattage – you can replace a 500W metal halide light with a 140W LED – which in itself saves money and extra savings come from the fact that LEDs don’t produce as much heat. An incandescent bulb converts just 5 per cent of the energy it uses into visible light. The rest is converted into heat. “We work with a number of consultancies that look at the whole picture, including lighting, to create a total energy plan for a business,” McGill says. “It’s our understanding that with businesses that use cooling, every watt we save in LED lighting

www.solidtec.co.nz

Rear View

Closing the gap. Page 17

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Proud entrepreneur pioneers new refrigeration system

E COLight hosted the June showcase for GETBA members at their Neilpark Drive warehouse, mixing drinks and nibbles with an explanation of how LEDs can bring businesses some serious financial and environmental savings. The first commercially available incandescent light bulb lasted just 13 and a half hours. Fast forward 133 years and the latest LED bulbs use just a fraction of the power and can last up to 20 years. These technological advances bring with them some serious savings – both financially and environmentally – and ECOLight is helping businesses in East Tamaki and beyond to take advantage of those benefits. A division of TransNet NZ Ltd, ECOLight has been operating in the LED sphere for about six years and has 55 staff working in warehouses in East Tamaki, Wellington, Perth and Tonga, as well as five staff on the ground in China. General Manager Peter McGill first came into contact with the

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ngineer turned entrepreneur, and owner of EcoChill, Matthew Darby, is on a mission to revolutionise refrigeration and offer solutions to help reduce the impact of harmful and pollutant HFC gases. Mindful of the country’s obligations under the Kyoto Protocol and New Zealand Emissions Trading Scheme, EcoChill offers novel, environmentallyfriendly refrigeration systems for supermarkets, coolstores and processing plants, that use natural gases, such as carbon dioxide (CO2), propane and water as the coolants.

Continues page 28

Apart from providing more eco-friendly options for cool stores, EcoChill offers advanced technologies such as the removal of defrosts.   This means when produce is stored humidity levels are higher, allowing growers to maintain the condition of their fruit for longer – helping increase sales. In addition, heat recovery technology can also be employed - often providing free hot water, removing the high electrical demand of standard water heating. Currently in-use in numerous locations across New Zealand, Continues page 8

Matthew Darby.

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NZ Manufacturer June 2013

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www.asurequality.com


NZ Manufacturer June 2013

CONTENTS Advisors

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DEPARTMENTS

18 19 21 22 26 27 28 29 30 31

• The Chinese spending spree. • Phil O’Reilly BIAC chair.

DEVELOPMENTS

Companies and entrepreneurs show their expertise.

BUSINESS NEWS

• The most extraordinary materials on earth. • New chair for Construction Industry Council.

Sir William Gallagher

Is the CEO of Gallagher Group Ltd. He is also a Fellow of NZ Institute of Management.

Page 7 – DEVELOPMENTS – Plant to manufacture affordable houses.

Stephen Drain

ADVANCED MANUFACTURING • Hybrid carbon nanotube yarn muscle. • The new ERP.

Stephen Drain is a Director at PwC specialising in Leadership Development and Forensics.

MANUFACTURING TECHNOLOGY

• Xenos chooses PowerMILL for very good reasons. • Geomagic Solutions advances manufacturing. Page 11 – ANALYSIS– Heavy • Free CAM for SolidWorks. Engineering Industry doubles spending on R & D. WORKSHOP TOOLS • Ultimate on-machine seasoning system. • Moulders manufacturer medical equipment. • SouthMACH 2013 opened window.

Catherine Beard

Is Executive Director of Export NZ and Manufacturing, divisions of Business NZ, New Zealand’s largest business advocacy group, representing businesses of all sizes.

THE FUTURE OF MANUFACTURING Their new materials.

Brian Willoughby

EMERGING TECHNOLOGIES World’s strongest nanowires.

FOOD MANUFACTURING

• Dairy product launched into Japanese market. • Breakthrough in dairy technology.

Page 14 –MANUFACTURING TECHNOLOGY – New industrial Ethernet.

Is president of the NZ Manufacturers and Exporters Association and managing director of Contex Engineers and Plinius Audio.

BETTER BUSINESS ANALYSIS

Is managing director of Connection Technologies Ltd, Wellington and is passionate about industry supporting NZ based companies, which in turn builds local expertise and knowledge, and provides education and employment for future generations.

The importance of robust business case compilation and risk analysis. Step up – yeah right.

ENERGY REPORT

• New energy use rating scheme a game changer. • Uninterupted supply of electricity. • A worthwhile investment.

ENERGY REPORT

• Slimline LED emergency light box. • Energy efficient bulbs reduce power bills.

Lewis Woodward

Professor John Raine ➡ Page 20 – SUPPLY CHAIN – Laser guided vehicles receive safety award.

Is Head of the School of Engineering and Pro Vice Chancellor – Innovation and Enterprise at the Auckland University of Technology.

EMPLOYMENT

Aurecon cadetship likely to expand.

FOOD MANUFACTURING

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BUSINESS NEWS

5 7 8 9 12

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• Disaster management focus for Auckland. • New partners reflect changing needs.

REAR VIEW

Closing The Gap.

Page 24 – LEAN MANUFACTURING – Working more efficiently.

Bruce Goldsworthy

An advocate for NZ manufacturing for 40 years, he was Chief Executive of the Auckland Manufacturers Association for seven years He has been Manager of EMA’s Advocacy and Manufacturing Services, and lately manager for Export New Zealand in the north.

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NZ Manufacturer June 2013

EDITORIAL

In business, I’ve discovered that my purpose is to do my best to my utmost ability every day. That’s my standard. I learned early in my life that I had high standards.

Publisher

Media Hawke’s Bay Ltd, 1/121 Russell Street North, Hastings, New Zealand 4122.

MANAGING Editor

Doug Green T: +64 6 870 9029 E: words@xtra.co.nz

CONTRIBUTORS

Nick Inskip, Sandra Lukey, John Cochrane, Craig Charlton, Tony Street.

ADVERTISING

Doug Green T: + 64 6 870 9029 E: words@xtra.co.nz

Design & PRODUCTION

Karl Grant T: + 64 6 857 7942 E: daylightmarketing@xtra.co.nz

WEB MASTER

Dan Browne E: dan@membrana.co.nz

PUBLISHING SERVICES

On-Line Publisher Media Hawke’s Bay Ltd

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MEDIA HAWKES BAY LTD

T: +64 6 870 4506 F: +64 6 878 8150 E: mediahb@xtra.co.nz 1/121 Russell Street North, Hastings PO Box 1109, Hastings, NZ NZ Manufacturer ISSN 1179-4992

Vol. 4 No. 6 June 2013 Copyright: NZ Manufacturer is copyright and may not be reproduced in whole or in part without the written permission of the publisher. Neither editorial opinions expressed, nor facts stated in the advertisements, are necessarily agreed to by the editor or publisher of NZ Manufacturer and, whilst all efforts are made to ensure accuracy, no responsibility will be taken by the publishers for inaccurate information, or for any consequences of reliance on this information. NZ Manufacturer welcomes your contributions which may not necessarily be used because of the philosophy of the publication.

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– Donald Trump

Giving it a go And that, dear reader, is what we do in New Zealand. We aim high and continue to do so.

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hen you’re passionate about what you do, you stick at it and by doing that, you are likely to succeed.

Manufacturing in New Zealand is precisely that; plenty of endeavour and determination invested to come up with a satisfying end result. At the same time, there are lots of examples of companies that don’t make it, that can’t succeed for one reason or another. This in itself is not necessarily a reflection on the company or personnel, or vision, or planning, it can actually be the circumstances of the day which change success into failure. Failure is not the greatest sin. As they say, if you do not make an effort at something that is the real failure. Failure can be a good thing; it teaches us where we went wrong and allows us to learn from those mistakes. To try again. Richard Branson reminded me of this at a conference in Florida when he said that he had been involved in literally hundreds of companies over the years – many of them no longer exist. His take on it was give it a go, and keep on giving it ago because success is just around the corner. Persevere relentlessly and aim high. And that, dear reader, is what we do in New Zealand. We aim high and continue to do so as we achieve with our product development, gaining export orders and notoriety on local and world markets. The results are there. For all the doom merchants’ manufacturing is doing okay, in fact, going by the recently released figures, which you have probably seen, as good as we have for a while. The Opposition’s investigation into the state of manufacturing in New Zealand highlighted some glaring issues. By working together these issues can be sorted and a better future is there for all of us. It is about grabbing the opportunity. Whether you are moving to 3D or 4D manufacturing, whether you have recently established a design studio in your engineering company because you can see the changing manufacturing future or whether your company is developing energy efficient products for our changing environment it’s good to know you are giving it a go.

Doug Green


NZ Manufacturer June 2013

BUSINESS NEWS

Move out of your comfort zone. You can only grow if you are willing to feel awkward and uncomfortable when you try something new. – Brian Tracy

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The Chinese spending spree

he Chinese shopping cart is filling fast as more of China’s private and state-owned businesses look to mature markets, such as New Zealand and Australia, for investment opportunities. Over the past five years, the value of Chinese M&A (Mergers & Acquisitions) deals overseas has increased from NZ$12.6 billion in 2008 to a record high of NZ$79.9 billion in 2012, according to announced data and PwC analysis. PwC Partner and China sector specialist Colum Rice says, “China’s outbound investment has grown sixfold in just five years, which signals the beginning of a new global M&A environment where more high growth market companies are seeking to step out of their domestic market to invest in mature market economies. “China is already a critical trading partner, recently overtaking Australia to officially become New Zealand’s number one export market for the March 2013 quarter. “We now need to make New Zealand’s trade relationship with China sticky by working hard to attract more permanent investment

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into our country and compete not only with our neighbours but with other attractive markets overseas. There should be no doubt in the minds of New Zealanders, our relationship with China is underpinning our economic performance. “Ambitious Kiwi businesses have a decision to make, are they in or will they let the Chinese opportunity slip away to more welcoming and proactive investment destinations?” asks Mr Rice. Between 2008 and 2012, high growth market companies invested NZ$197.2 billion into mature market companies, outstripping the opposite flow of NZ$184.9 billion, found PwC in a recently released report. The report also shows among five high growth markets, China has been the leader since 2009, accounting for nearly 70% of high growth market investment into mature markets in terms of deal value in 2012. “Chinese companies are actively looking for outbound investment opportunities. The time when sovereign wealth funds and state owned enterprises looking to secure resources were the main drivers of overseas investment is over. Private

companies are now key players,” adds Mr Rice. “These companies are looking for access to sales channels, supply chains, resources, technology, know-how, brands or management experience that we in mature markets can provide. Investing into mature markets gives high growth market companies the ladder they need to succeed on a global scale. “Savvy Kiwi companies also recognise that inbound investment can give them the partnerships and relationships they need to help them access high growth markets and grow their firms,” explains Mr Rice. “Cross-border M&A deals are always complex as contrasting differences in culture, political and economic approaches and processes

CPW welcomes Phil O’Reil y Solid Energy staff appointed BIAC Chair

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Optimizer HQ raises $4 million in new capital

ew Zealand technology firm, Optimizer HQ has closed a multi-million dollar investment in new capital from local and international investors. A number of eligible investors have demonstrated their confidence in Optimizer HQ, by investing $4 million in the Company. The CEO of Optimizer HQ, Manas Kumar, says he is thrilled to see Optimizer HQ secure this significant investment funding. “We are delighted to have secured this new investment capital and to have received such a positive response and support from the investor community,” he says. “This investment will allow us to continue our international expansion and implement our strategic business plan. The costs of expansion into international markets is expensive and this new capital will assist us with funding that growth strategy” Kumar says that he believes it is the business’ diversified business model and exciting international prospects which has motivated investors.

B Manas Kumar, CEO of Optimizer HQ.

“Optimizer HQ’s solid leadership, innovative technology, and sound business strategy, will assist the business in achieving success,” he says. “This has no doubt inspired the support of our network of investors who have invested into Optimizer HQ.” Building on its success, Optimizer HQ recently announced plans to explore the prospect of listing on the New Zealand Stock Exchange.

need to be added to the high pressure environment that exists in any major transaction. We recommend coming to grips with the hurdles early and ensuring both buyers and sellers know what it is the other wants from the deal. “We can expect the type of high growth market to mature market M&A trend to accelerate in the coming year as companies look for investment opportunities their domestic markets can’t offer. New Zealand businesses have an opportunity to further seize the day or risk overseas competitors gaining the benefits from alliances with high growth markets that should be ours,” concludes Mr Rice.

usinessNZ Chief Executive Phil O’Reilly has been elected Chair of the Business and Industry Advisory Council (BIAC) to the OECD. The BIAC is the voice of business at the OECD – the world’s foremost provider of integrated statistics and fact-based policy recommendations. The BIAC network includes national business, industry and employer associations from OECD members and observer countries, as well as international sector-specific associate experts. Mr O’Reilly said it was an honour to serve the BIAC, whose advocacy was vital for growth and employment internationally, and a great opportunity for New Zealand business to contribute to this work. Mr O’Reilly has been a member of the Board of the BIAC for three years.  He will continue in his role as Chief Executive of BusinessNZ in addition to serving as BIAC Chair.

group of former Solid Energy NZ staff initially seconded for design work on the Central Plains Water (CPW) scheme, have joined CPW as permanent employees. The expertise of the group was engaged late last year to project manage the $144m first stage of the irrigation scheme, taking the project through the design and land procurement stages to the start of construction. “We’re really happy to have these competent, skilled people on board with good management skills working on one of the largest infrastructure projects of a lifetime,” said Doug Catherwood, CPW Chair. Some of the Solid Energy staff had been working on the CPW design since last October, and with recent redundancies and the disestablishment of various positions at Solid Energy, they have now signed contracts directly with CPW, he said. “This means we now have the capacity and expertise in-house from highly competent technical staff. Their input over the last six months in the project’s development has been critical to the success so far. It allowed us to hit the ground running and their mining skills and construction and earthmoving backgrounds and expertise has proven invaluable to the swift advancement of the project, “he said. CPW now has a staff of 14 and continues to outsource work as necessary to specialist consultants. “We’re continuing to receive environmental input and some technical services from Solid Energy on an as needed basis.” www.nzmanufacturer.co.nz


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NZ Manufacturer June 2013

BUSINESS NEWS

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The number of times I succeed is in direct proportion to the number of times I can fail and keep on trying. – Tom Hopkins

Construction activity continues to grow

he Cantometer Index continues to move higher, lifting to 0.8 in June from 0.7 previously. ASB Chief Economist Nick Tuffley says, “Since we started publishing the Cantometer in October, the index has steadily lifted from 0.1 in the first issue to 0.8 in June. This increase comes as construction activity continues to lift, with the rebuild also boosting other economic activity in the region with it.”

the previous edition. The March quarter building activity showed a 19% increase in construction work in Canterbury over the quarter.” Car registrations have also increased strongly over recent months. Mr Tuffley says, “The increase in car registrations is a strong indication of increased population and economic activity in the region. This follows strong increases in net international migration inflows over the past few months, confirming population growth is picking up as the rebuild requires additional labour.” The housing market is also showing improvements, with house sales continuing to lift as some confidence returns to the Canterbury market. Anecdotes from real estate agents suggest some of the earlier buyer reservations toward TC3 land are fading. Mr Tuffley notes indicators suggest Canterbury house prices will continue lift sharply over 2013 as demand continues to outstrip supply.

Photo: Otago Daily Times

Outlook

Nick Tuffley

Once again, the lift in the Cantometer was led by construction. Mr Tuffley says, “The construction index increased to 2.7 from 2.4 in

“Over the coming year, the RBNZ will balance the construction-led lift in activity and intensifying housing market pressures against the impact of the still-elevated NZD. We continue to expect the RBNZ will leave the OCR unchanged until March 2014,” concludes Mr Tuffley. The Cantometer is designed to summarise activity in Canterbury.

The study takes a range of publically available regional economic data, which are standardised and aggregated into a summary measure. The index has been rebased to zero in June 2010 (the end of the quarter immediately preceding the first earthquake) such that a positive number represents activity being above pre-earthquake levels. Along with the aggregate Cantometer index, there are five sub categories: Construction, Housing, Employment, Consumer spending and Miscellaneous*. These sub-indices will provide some insight into which sectors are driving the rebuild activity at a given point in time.

For most activity the data reference the level of activity. However, when incorporating wages and house prices into the index we believe levels are less informative. Instead the index uses prices relative to the rest of the country. An increase in relative prices is a signal for resources to be reallocated to the Canterbury region.

*The miscellaneous category includes electricity, car registrations, guest nights and permanent and longterm net migration. A common factor driving these areas will be population growth, and we expect all these indicators to increase as the rebuild gathers momentum.

Benefits for sustainable companies A Change in the Cost Equation Directory

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he U.S. has become more competitive with other nations in manufacturing costs over the past decade. Producing goods remains less expensive in emerging nations such as China and Thailand than in the U.S., according to data from Boston Consulting Group, but the gap has closed: In 2003 manufacturing costs were 18% lower in China than in the U.S., but the difference has narrowed to 7% this year. The gap is closing in part because labor and energy are becoming more expensive in China relative to the U.S. The U.S. retains a big edge over Europe, where costs run as much as 19% higher. Some countries www.nzmanufacturer.co.nz

in Europe and elsewhere that were close  to the U.S. in costs in 2003, including the U.K. and Japan, have grown more expensive. Canada and Mexico, the U.S.’s partners in the North American  Free  Trade Agreement, are on diverging paths. Canada now has higher manufacturing costs than the U.S., but Mexico remains at the same 11% discount as 10 years ago. Energy costs have risen relative to the U.S. for most countries since 2003 (Canada being a notable exception). So have labor costs, though for many European countries the gap has shrunk since 2008.

– Phil Izzo

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ompanies that behave sustainably can expect more customers, says the Sustainable Business Council (SBC). A nationwide survey conducted for the SBC showed significant opportunities for companies that compete not only on price but also on environmental and social factors. The Business and Consumer Behaviour 2013 survey conducted for the SBC and Fairfax Media revealed two thirds of consumers would switch brands if their regular brand or service provider was having a bad effect on the environment, people or society, or behaving unethically. The survey showed that in the last year 23% of consumers did switch for those reasons. 

“This strong sentiment by consumers is extremely good news for New Zealand companies that undertake sustainable business practice,” said Penny Nelson, SBC Executive Director.   “It’s a signal to all companies that sustainability – environmental, social and financial – is critical for success.” The survey indicated around 53% of organisations are thought to behave sustainably (looking after profits as well as the environment and people), a figure that has dropped slightly over recent surveys. Penny Nelson says companies can gain significant opportunities from sustainable practice and face risks from ignoring it. 


NZ Manufacturer June 2013

Leadership is a potent combination of strategy and character. But if you must be without one, be without the strategy. – Norman Schwarzkopf

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DEVELOPMENTS

Plant to manufacture affordable homes Tendering in a

culture of mediocrity

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rime Minister John Key recentlyopened eHome Global’s new plant for manufacturing conventional (timber framed) affordable homes and apartments. The Kumeu facility is the first

in New Zealand to use European concepts and equipment to produce conventional New Zealand apartments and homes in a factory. As a result of the manufacturing standards and the quality materials

Companies and entrepreneurs show their prowess

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n open call to action for businesses, entrepreneurs, innovators and students in Australia and New Zealand with breakthrough commercial ideas for reducing our carbon footprint has resulted in two New Zealand companies netting awards. GE’s first ever ecomagination Challenge in Australia and New Zealand resulted in five winners overall, including New Zealand companies Hydroxsys and Outpost Central. Membrane technology company Hydroxsys, and smart meter technology specialists Outpost Central, took home two of the five AUD$100,000 Innovation Awards that were up for grabs. Hydroxsys, started by engineer Daryl Briggs, has designed membrane technology that captures and recycles 90 percent of water and around 85-90 percent of energy from industrial processes to be fed back into the manufacturing process. Meanwhile New Zealand-based co-founders James Riddell and Jedd Forbes of Outpost Central have developed smart water meters that can help water utilities, mining

and farming organisations achieve 20 percent savings in water usage within the first year. Ben Waters, Director of ecomagination, GE Australia & New Zealand, said the five ecomagination Challenge Innovation Award winners share common characteristics. “They are passionate about finding new and better ways of approaching challenges, have identified key opportunities to increase efficiency and carbon productivity, and have acted to make these opportunities a reality,” adding that entrepreneurship and passion is what will “help Australia and New Zealand continue to remain competitive and drive measurable change”. A team of five venture capital companies were invited to assist GE in reviewing the entries and selecting winners. The challenge attracted over 191 entries from New Zealand and Australia and 35 companies were shortlisted, resulting in the following seven New Zealand companies being interviewed by GE:Aquaflow, Outpost Central, Hydroxsys, Revolution Fibres, Duke Engines, ikeGPS and Derceto.

used, the homes produced are more durable, and have reduced whole of life costs than traditional houses. As well, a significant proportion of the 55 strong work force at eHome Global was selected and trained in a highly successful partnership with the Salvation Army. eHome Global is well equipped to deliver low rise (three and four storied) apartments which will blend closely with the Auckland Council’s plan for a compact Auckland city which parallels most European cities where residents often live in low rise apartments and travel to work on public transport. The privately owned eHome Global facility currently has commitments for its next year of production. eHome Global’s facility is well placed to assist in the challenge of New Zealand’s affordable housing shortage, says Marsh Hudson, eHome’s chief executive.

he process of tender bid production often evolves at random over the years and methods of measuring quality can be weak. This makes knowing how, when and where to apply improvements very hard to define. We live in a culture of mediocrity and apathy led often by government agencies. For example most parents know that all asbestos fibres are deadly to health. Yet today there remain prominent schools in New Zealand with decaying asbestos roofs leaking needles of amosite on to children. And this is despite my receiving a letter from a Ministry of Education official back in 1983 assuring me that there are NO schools in NZ with decaying asbestos roofs. The Ministry responsible now appears to deem breathing 4 million asbestos fibres per week to be “safe”. Quality is a choice, and our choice of the process to deliver quality defines us. Imagine bid evaluators finding no fault with your tender proposals, and your staff being entirely happy with the way each bid is produced. This situation is the aim of Total Quality Management (TQM) which can work on at least 40 measures of quality within the tender bidding process. Contractors truly sensitive to quality in tendering will see that when failures occur too often then either they must re-train their team, or get professional help. A mediocre tender bid document strongly reflects a mediocre bidder. Tendering is at the very peak of industrial marketing so an “it’s good enough” viewpoint will surely work against success. Quality is the road up which every contractor and service provider proceeds towards trumping the – Tom Evison competitors.

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NZ Manufacturer June 2013

BUSINESS NEWS

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Great things are not done by impulse, but by a series of small things brought together. – Vincent Van Gough

The most extraordinary materials on earth

ranium glass, steel cloth, magnetic liquid, concrete that can heal itself using embedded bacteria and rock that acts as a naturally occurring optical fibre. These examples are among a collection of the most unusual materials in the world. They have been given a permanent home in the Materials Library which recently opened in the Institute of Making at University College London, in the United Kingdom. Alongside the library containing more than 1500 materials sits the MakeSpace, described as the ultimate workshop, which gives members the chance to boil, bake, turn, mill, mend, spin, print, cut, cast, drill, sand, scrape and make. The facilities include 3D printing, sewing machines, ovens, soldering irons and even a crane. The combination of the Materials Library and the MakeSpace is a world first for a university engineering faculty. The Institute of Making as a whole, whose glass walls face on to Malet Place in the heart of UCL in Bloomsbury, west London, aims to let users experience first hand the relationships between materials and tools that constitute processes of making. Mark Miodownik, Director of the Institute of Making and UCL Professor of Materials & Society

said: “Making as a way of thinking is fundamental. Engineering has been dominated by the internet and the digital sphere for the past 20 years, but people do not live a virtual life; they live in the real, material world. “Material science is now coming up with the goods and showing how to remake the world a completely different way.” The Institute of Making will be open to the public for special events and open days. The Institute also plans to host workshops with guest experts, maker residencies and opportunities  to make, break and repair everything from jewellery to robots. Dr Zoe Laughlin, Creative Director of the Institute of Making & Curator of the Materials Library said: “The Institute of Making is like a dream garden shed where anything is possible. Every material is to hand, from iron ore, to the perfect piece of string.” “We have created a space where the power and joy of making can be fully realised.” A Materials Library  iPhone  app is in development which will allow users to digitally explore the collection from anywhere in the world. Previous Institute of Making projects have investigated how we experience materials, looking at how the taste of food is affected by the

From page 1

Proud entrepreneur pioneers new refrigeration system EcoChill continues to grow from strength to strength and there are plans for more installations across the country. Matthew Darby, EcoChill’s driving force, says: “EcoChill is all about offering natural refrigeration solutions that are environmentally friendly and reduce energy consumption. “Humans are doing a pretty good job of wasting energy and environmental resources, so we need to help people understand more about the impact this has on our planet, at a personal, community and commercial level. “We’re trying to educate people

“Humans are doing a pretty good job of wasting energy and environmental resources.” www.nzmanufacturer.co.nz

about the solutions available, to help both clients and the public make better, wiser and conscious decisions. “We have been around for many years and we’ve been industry leaders in many areas.  Since rebranding as EcoChill (formerly Arneg), we aim to continue to lead the way in natural refrigeration solutions.  “We’ll always remain focussed on reducing the environmental impact our industry creates by designing and installing more efficient systems that require less power to do the same amount of cooling.   “We’ll use naturally occurring gases, such as CO2, instead of the synthetic gases that have a massive global warming impact.  We’ll also manufacture refrigeration systems that are more environmentally sensitive, more recyclable at the end of their operating life and where possible, have been constructed with materials that are renewable.”  EcoChill has patented technology and is set to grow nationally and internationally as it makes it mark as a true leader in natural refrigeration.  

Uranium glass is among the extraordinary resources of the Materials Library.

cutlery we eat it from, and how the appearance of materials affects the way they feel to us. Studentships funded by the Institute of Making have

allowed UCL students to pursue interdisciplinary material based projects, such as one in UCL Medical Physics & Bioengineering looking at developing fabrics kinder to skin.

New Chair for Construction Industry Council

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lex Cutler, Chief Executive of the New Zealand Green Building Council, has been elected Chair of the 36 member Construction Industry Council, a pan industry grouping that represents most of the country’s building trade organisations. She succeeds Pieter Burghout, a foundation member of the organisation who is resigning as Chief Executive of BRANZ Ltd to take up the position of General Manager Canterbury Operations with Fletcher Building. Ms Cutler said following her election that the industry was currently faced with a number of issues. Among them are housing affordability, a review of the Standards setting process, the materials construction markets inquiry, security of payment in the event of building company liquidations, a gathering crisis in respect of skills availability for the Christchurch rebuild and the projected surge in Auckland house building. “The Council’s aim is to be a conduit for exchanges between the industry and the public sector on these issues in a bid to find solutions which advance government and consumer objectives, while

Alex Cutler

enhancing the commercial vitality of the industry. “Boom and bust economic cycles lie at the heart of a number of problems the industry faces. A potential large upturn is on the way. This lends some urgency to resolving these issues in a manner that sets a good platform for future stability of the building and construction sector.”


NZ Manufacturer June 2013

Business is the process to imagine and understandthe imagination. Revenue comes later. – Anon

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ADVANCED MANUFACTURING

Hybrid carbon nanotube yarn muscle

rofessor Seon Jeong Kim of Hanyang University has created a high capacity yarn muscle that does not require electrolytes or special packaging. It will have a big impact in the motor, biological and robot industry. Kim’s article, “Electrically, Chemically, and Photonically Powered Torsional and Tensile Actuation of Hybrid Carbon Nanotube Yarn Muscles,” was published in the journal of Science. He is currently the director of the National Creative Research Initiative Center for Bio-Artificial Muscle at Hanyang University (HYU). In 2006, the research center was designated as the “Leader’s Research Support Business” by the Ministry of Education, Science, and Technology.

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Traditional methods of electrochemically powered yarn muscles were destined to include slow responses, low strain and force generation, a short cycle life, and low energy efficiency. They were also in need of electrolytes, counter electrodes, and device packaging. Such requirements increase the weight of the actuator leading to a decrease in performance. The ‘Hybrid Carbon Nanotube Yarn Muscles’ created by Kim however, has overcome such limitations by confining paraffin waxes, a thermally or electrothermally powered actuators, within the yarn. By doing so, the response rate is enhanced and a helical geometry enables both torsional rotation and tensile

Faster and more flexible machining

n order to shorten production processes and design them more flexibly, the tube bending machine manufacturer SchwarzeRobitec invested one million Euro in its new drilling and milling centre and is preparing itself for the increasing requirements of the industry. This investment means the company can create added value in-house and optimize their manufacturing processes,. In just one clamping, the system can precisely machine up to 30 tonnes of heavy components on five sides.

The experts in tube bending machines also took the system’s energy efficiency  into account when making the investment. This means that the machining centre makes the manufacturing process even more environmentally friendly. The machine is operated from a cockpit from where trained staff can move along the components at a speed of up to 0.5 metres per second. With a movement range of twelve metres horizontally and three metres vertically, even large components can be machined.

contraction. Muscle contraction – also called actuation – can be ultrafast, occurring in 25-thousandths of a second. Including times for both actuation and reversal of actuation, the researchers demonstrated a contractile power density of 4.2 kW/ kg, which is four times the powerto-weight ratio of common internal combustion engines. Application of the ‘Hybrid Carbon Nanotube Yarn Muscles’ are diverse because the yarn muscles can be twisted together and are able to be woven, sewn, braided and knotted, they might eventually be deployed in a variety of selfpowered intelligent materials and textiles. For example, changes in environmental temperature or the presence of chemical agents can change guest volume; such actuation could change textile porosity to provide thermal comfort or chemical protection. Such yarn muscles also might be used to regulate a flow valve in response to detected chemicals, or adjust window blind opening in response to ambient temperature.

Professor Seon Jeong Kim

Kim stated, “The ‘Hybrid Carbon Nanotube Yarn Muscles’ is a new form of yarn muscle due to its torsional rotation and tensile contraction which functions in an electrolyte-free environment.” In addition, “Its simple operating method and structure will have a big impact on the motor, biological, and robot industry.”

The ‘Hybrid Carbon Nanotube Yarn Muscles’ is a new form of yarn muscle incorporating large-stroke, high-power and high-work capacity.

E-mail: acsdesign@maxnet.co.nz www.nzmanufacturer.co.nz


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NZ Manufacturer June 2013

BUSINESS NEWS

If everyone is thinking alike, then no one is thinking. – Benjamin Franklin

The new ERP supporting business transformation in manufacturing O ne of the greatest challenges of our time is to achieve and sustain excellent business outcomes in the face of constant change. To this end manufacturers require their ERP system to go beyond transactional efficiency to radically improve business performance. A manufacturer’s business is embodied in its technology and can only change as fast as the underlying technology allows it. Overall IT performance is no longer measured in speed, and bits and bytes, but by how it facilitates overall competitiveness and growth. Analyst firm, Aberdeen Group, describe Enterprise Resource Planning (ERP) as “an operational and transactional system of record”. With its roots in Material Requirements Planning (MRP) it has long been used by leading manufacturers to uncover untapped efficiencies, reduce costs and provide visibility to managers to aid decision making.i ERP has moved well beyond data entry and reporting and has emerged as a real-time platform for strategic business execution. The business value of ERP goes beyond running and driving the business or improving transactional efficiency and transparency. IT systems must support innovation and business transformation, however, many manufacturers pursuing business transformation struggle to realise the full value of their ERP investments. Business transformation is about developing new capabilities and when necessary, moving away from business models that are no longer competitive. The capability to transform when needed, or when better business outcomes can be achieved, is essential for survival in today’s manufacturing environment. To enable this, manufacturers must

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By Craig Charlton,

SVP & General Manager, Asia Pacific, Epicor Software

Craig Charlton

align strategy decisions and business systems to drive implementation and execution to support sustained longterm, continuous transformation. To achieve a competitive advantage in this environment, manufacturers must optimise their internal operations and their entire supply chain. The right technology can play a major role in this effort yet many existing ERP solutions are not up to the task. These systems are

incomplete, difficult to modify in the face of changing business conditions and unable to furnish the visibility necessary to streamline enterprise and supply chain operations. The answer is found in a new class of enterprise applications. These integrated, manufacturing enterprise applications are built on a service-oriented architecture (SOA) and incorporate modern business rules and business intelligence to furnish flexibility, interoperability,

and visibility. With these solutions, manufacturers can improve productivity, streamline the supply chain, reduce costs, achieve regulatory compliance and thereby enhance customer service and increase their competitive advantage. A complete and modern enterprise manufacturing solution enables manufacturers working in make-toorder and mixed-mode production environments to automate their endto-end order processes. One that sits on a service-oriented architecture allows manufacturers to modify their applications as needed in a highly granular fashion and to easily interact with customers, suppliers and partners In the past, a large part of IT’s role was to “mind the gap” between yesterday’s business applications and tomorrow’s business needs. A great deal of time and energy was devoted to deploying and managing the various resources that were thrown at overcoming the limitations and extending the functionality of legacy ERP or MES systems. Today, manufacturers can ill afford this approach given the fast pace of business. With modern day ERP systems, manufacturers are moving well beyond transactional efficiency, to radically improved, game-changing business performance, through adoption of an agile application development paradigm. Imagine an enterprise application framework that is built to change with your business, architecting new business processes on demand, incorporating new ways of working and new partners or suppliers in a near instantaneous fashion.


NZ Manufacturer June 2013

11

ANALYSIS

Business is a combination of wealth and intellect.You can’t count on money every time. – Anon

Heavy Engineering Industry doubles spending on R&D

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BIE Minister Steven Joyce, who is the responsible Minister for the Heavy Engineering Research Levy (HERL) Act, has approved the increase in the industry funded levy for heavy steel plates to a new rate of $10 per tonne from the at present rate of $5 per tonne. This increase will become effective from 1 July 2013 and will be applicable for all imported and locally produced heavy steel subject to Schedule 2 of the HERL Act. The Heavy Engineering Research Association (HERA) is an industry owned and governed organisation that core funds its R&D program from this levy. Since 2002 industry has advocated with successive governments for an increase in their levy contribution to common good industry research activities. However, despite broad based industry support for a substantial increase in its own contribution to sector wide R&D, a number of government administrative hurdles have delayed its introduction. Following a cross-party vote late last year to lift the levy maxima rate in the HERL Act, it was Minister Steven Joyce who finally was able to announce the increase. The effective doubling of the industry’s research spend linked to the heavy steel levy schedule appears to be significant, but has to be seen in perspective. HERA Director Dr Wolfgang Scholz states: ‚”Since the last increase of the research levy in 1984, to the current $5 per ton of steel, inflation and in particular wage inflation has been massive and this has slashed the amount of research work that can be done per levy. “However, HERA managed to maintain a credible research program through substantial increases in heavy steel consumption linked to the success of its activities until the Global Financial Crisis impacted on the ability to sustain and grow research activities to meet industry needs. “This forced HERA to reduce research, to an extent where in the last three years we have only been able to focus on core activities, while increasing income earning activities so as to maintain our highly qualified and specialist staff until the requested increase came through.” “The industry is well aware of the return on their investment in sector wide HERA R&D‚” says Dr. Scholz. ”The new rate of $10 per tonne of heavy steel adds about 0.5% to the cost of steel. This is

not significant when compared for example with the influence of exchange rate fluctuations. However, collectively the total research levy through the heavy steel schedule amounts to over $1 million annually.” Scholz also adds, “But more importantly, this core funding leverages twice its amount in further HERA activity through additional industry and government cofunding as well as self-generated income through industry training and consulting.” HERA Chairman Peter Hutton, who is also General Manager of Construction for the Fitzroy Engineering Group in New Plymouth, advises: “Firstly, let me say that we applaud the Government’s decision to agree to our industries request for a levy increase. HERA has demonstrated a record of achieving excellent research outcomes that have lifted the competitiveness of our industry, particularly in steel construction. This is largely due to the fact that the need for research is industry-driven and often directly flows into industry documents such as the Steel Structures Standard NZS 3404. This Standard is used in all New Zealand steel construction, and in our view HERA research paid off in big way in the Canterbury earthquakes where structural steel buildings performed very well. Looking ahead of what is to be done with the additional research money, HERA Chairman Peter Hutton adds:”Many pressing research needs have not been able to be funded over the last few years, such as low damage seismic structural systems technology, addressing metals industry sustainability targets or scoping more business opportunities for the non- structural heavy engineering sector in emerging areas such as renewable energy.” “As an industry which has recognised how important it is to move from lowest cost contractor to being high value products and services providers, but which is also under pressure from low cost imports, we know how important it is to understand and build our competitive position,” argues Peter Hutton. “HERA research underpins our industry strategy development and enables us to address industry issues and build our potential.” Dr. Scholz adds, “With our many international contacts we know how important it is have stable core funding to consistently provide industry innovation. Our heavy

HERA Director Dr Wolfgang Scholz

engineering research levy based funding system is not unique in New Zealand where the Commodities Levy Act and other research levies such as the building research levy, help fund industry research. It is especially important for a small country which has a very limited range of large companies contributing to our nation’s research efforts.” “As long as an industry is right behind cross-sector industry research and able to agree on its spending and the targets, consumption-based research levies are ideal funding schemes with very little options for free riding. Particularly in economically challenging times where company profits are under pressure and everyone agrees it is R&D which provides a way to the future, being able to continue providing innovation is essential. The heavy engineering industry and HERA staff is grateful that Parliament and Government has now turned this industry request into more industrydriven R&D.

HERA Chairman Peter Hutton www.nzmanufacturer.co.nz


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NZ Manufacturer June 2013

MANUFACTURING TECHNOLOGY

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Success is the sum of small efforts, repeated day in and day out. – Robert Collier

Xenos chose PowerMILL for very good reasons

nvesting in CNC machinery and software isn’t a cheap process but worst once you commit to brand x or brand y. You have usually spent your money and have either done the right thing or you are saying in hindsight we should of, bugger... woops, too late. We will have to make do. Xenos certainly didn’t just look at Delcam we looked at lots of software .The biggest box to tick was A Cam Package that’s decent and has good support. Xenos chose Delcam PowerMILLpro for the programming of their in-house 4axis CNC milling machine which is used to make components for the company’s line of Aseptic Bottling Machines. Xenos competes against some seriously big global companies, like Tetra Pak, for example. Says Rob Binnie, production engineer, “We looked at software that was locally supported (NZ) and were somewhat concerned at the lack of knowledge some of these sellers appeared to have in CAM packages they were selling and offering training for. “We have 4 sets of Solid Works for in-house design of our product line and we considered CAM packages that ran within Solid Works but we decided to keep the CAM separate (Delcam also has a CAM that runs within solid works “PowerMILL for Solid Works”). We also needed the seat of Solid Works for design. “I have used several cam packages over more than 15 years, something like 5 actually some of them are not a good memory, just quietly. “I have never been so impressed with a CAM package as I am with Delcam’s; it’s so powerful but mostly it is so simple to programme complicated parts .Actually, when I did first use Delcam it amazed me as it was so easy to programme the stuff that used to be a nightmare. “Its data translators for model importing are very strong, which is sometimes problematic. “ Xenos does the roughing of big

KEVIN KEVANY 09 520 5206

www.nzmanufacturer.co.nz

parts during the day and run the machine finishing, lights out with confidence that when staff come to work in the morning there isn’t going to a lot of melted sticks in the magazine that were tools ..There is nothing like a feeling of confidence when you are at home watching the telly not having to worry about things going wrong. Xenos machine most of their parts out of stainless steel and that can sometimes be a challenge. But with PowerMILL’s roughing / remachining and finishing that work so good, the hard stuff becomes a piece of cake and PowerMILL “just does it”. Rob also says that “With Toolpath editing I have never seen anything that comes even close; you can adjust lead ins /lead outs without the need to recalculate the toolpaths. You can limit to a plane / a surface /a boundary / trim/reverse direction/ reverse order /reverse cut direction. “What’s more, safety heights can be changed and there is no need to recalculate anything.

PETER ISSAC

06 340 8134 peter.isaac@xtra.co.nz

Toolpath calculation is multi thread calculation in the background, no waiting for stuff to happen.” Collision checking for tools and chucks between clamps/ fixtures/or even a complete rotary axis and the fixture are easily done .But most of all they work 100% reliably not just most of the time.

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“Xenos is extremely happy with their decision to go with Delcam and the parts we are making look great. “Support is via Australia and the support team there is awesome and only a couple of hours behind NZ time line which is great if you are stuck with a question that needs a quick answer.”

Geomagic Solutions advances manufacturing

D Systems has announced the launch of its integrated designto-manufacturing software tools under its Geomagic Solutions brand combining 3D Systems’ comprehensive reverse engineering tools together with its affordable mechanical CAD, fully automated inspection and verification software and its cuttingedge haptic modelling to deliver intra-operable design functionality.

DAVID BURKE-KENNEDY 09 473 8635 dbk@compublicity.co.nz

Geomagic Solutions includes a voxel-based modeller that is 3D printer ready, further enhancing engineering productivity and parts manufacturability. Re-shaping the engineers’ desktop with game changing design-to-manufacturing tools that deliver enhanced productivity and embedded manufacturability, is more than welcome in today’s competitive manufacturing environment.

SANDRA LUKEY 021 2262 858

sandra@shinegroup.co.nz


NZ Manufacturer June 2013

A wise man will make more opportunities than he finds. – Francis Bacon

13

MANUFACTURING TECHNOLOGY

Delcam launches free CAM for SolidWorks

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elcam has launched a free version of its Gold-Certified Delcam for SolidWorks integrated CAM system for SolidWorks. Delcam for SolidWorks XPRESS provides the essential 2D milling and drilling functionality available in Delcam for SolidWorks. It can be downloaded free of charge from www.delcamforsolidworks. com/xpress. Delcam for SolidWorks XPRESS is intended mainly as an introductory level program for users that are new to computer-aided machining. However, it will also be useful for companies, such as design studios, that only need to program simpler CNC machines or those that wish to experiment with 2D machining before investing in a full 3D software package. Users will be able to generate NC code for feature-rich 2D parts quickly and easily with the unique ‘feature-from-feature’ technology inside Delcam for SolidWorks. The software is, of course, fully compatible with the latest version of SolidWorks. Delcam for SolidWorks XPRESS is fully integrated into the

SolidWorks environment, in exactly the same way as the full Delcam for SolidWorks software, so that the program looks and behaves like SolidWorks. Similarly, it offers the same full associativity with SolidWorks so that any changes in the CAD model are reflected automatically in the toolpaths. The XPRESS version provides the same high level of automation as the full program. The software automatically selects the appropriate tooling for the project, allocates the appropriate feeds and speeds to all the toolpaths, and orders the various roughing, semi-finishing and finishing operations into the most efficient sequence. The drilling options cover all hole types, including tapped holes, and support drilling cycles with subprograms for the standard controls. Full 3D simulation of all toolpaths can be undertaken, with comprehensive gouge detection, to check the programs before they are sent to the machine. Time estimates can also be made to compare the results of using different strategies. The software is supplied with a basic set of post-processors for

Delcam for SolidWorks XPRESS is free CAM software for 2D milling and drilling

typical controllers and functionality is provided so that more experienced users can tweak the standard posts to match their machine-tool controls. Training videos for Delcam for SolidWorks XPRESS are included on the www.delcamforsolidworks. com/xpress website, as well as on YouTube. A forum for users has also established on the website, so that members are able swap tips on the use of the software. Delcam for SolidWorks combines the benefits associated with Delcam’s PowerMILL and FeatureCAM CAM systems. It is based on Delcam’s proven machining algorithms that

are already used by more than 40,000 customers around the world. The software offers PowerMILL’s exceptional speed of toolpath calculation, plus the advanced strategies for high-speed and fiveaxis machining, to ensure increased productivity, maximum tool life and immaculate surface finish, even when cutting the hardest, most challenging materials. At the same time, Delcam for SolidWorks has the same strong focus on ease of use as FeatureCAM, including all of the knowledge-based automation that makes that system so consistent and reliable.

www.nzmanufacturer.co.nz


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NZ Manufacturer June 2013

MANUFACTURING TECHNOLOGY

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The golden rule for every business man is this: Put yourself in your customer’s place. – Orison Swett Marden

New industrial ethernet switch eases integration

he integration of machines onto a plant’s network architecture can prove difficult as OEM IPaddress assignments rarely match those of the end-user network IP-address requirements. This is challenging for the machine builder and end user as IP addresses are generally unknown until the machine is being installed, which can add cost and time to the commissioning of the equipment, and delay moving that equipment into production. Rockwell Automation has addressed this challenge with the Stratix 5700 managed industrial Ethernet switch, which now includes an optional integrated Network Address Translation (NAT) feature. The hardware-based NAT feature allows for high performance and simplified integration of IPaddress mapping from a set of local, machine-level IP addresses to the end user’s broader plantprocess network. This can greatly benefit manufacturers that are integrating identical machines into a production line, especially when multiple equipment builders are

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being integrated into a common production line. The Stratix 5700 switch NAT feature allows OEMs to deliver their standard machines to customers without having to program unique IP addresses into them. The end user can then use the NAT feature to more simply integrate the machines into the larger network. Because the machines are identical to their standards, they are easier to maintain. In addition to integrating NAT into the Stratix 5700 switch, customers have an optimised solution by eliminating the need for additional components that require extra cabinet space, extra wiring,

A challenging task for the machine builder and end user as IP addresses are generally not known until the machine is being installed.

and additional configuration and management support. Additionally, the NAT setup is part of the overall switch configuration environment, making it easier to maintain. The Stratix 5700 switch with NAT technology also allows users to have the flexibility to segment or isolate network traffic by determining which devices are exposed to the larger network. By limiting access to certain devices, they can be isolated from broader network traffic, which can help optimise the network performance at the local level. The Stratix 5700 line of switches is currently available with six, 10 and 20 fixed-port configurations. The product includes features, such

as IEEE-1588 time synchronisation, QoS (prioritisation) and Resilient Ethernet Protocol (REP). Additional features also allow for increased network availability, and help improve network performance and troubleshooting-enhanced security. Each Stratix 5700 switch includes: dual-power inputs, input and output alarms, console port, fiberready SFP slots, DIN rail mount, and operating temperature range of minus 40 C to 60 C. Model options include: NAT, two gig ports, SD flash card, conformal coating, and two different software configurations for a total of 20 different models to best match machine and end-user applications.


NZ Manufacturer June 2013

15

WORKSHOP TOOLS

Unless a man undertakes more than he possibly can do, he will never do all that he can. – Henry Drummond

EX Series injection moulders manufacture medical infusion equipment

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ix EX Series full electric injection moulding machines are manufacturing medical infusion equipment, i.e. threeway stopcocks and large volume syringes. Close to 1 billion injectionmoulded parts leave the B.Braun production lines each year under very stringent quality specifications, as most of the parts are used directly on the human body. The company manufacture around 100 million syringes and 150 million three-way stopcock bank products each year. There are 200 product variations of the stopcocks which makes mass production difficult. However Krauss Maffei and B.Braun have overcome this obstacle by placing injection moulding machines in cleanrooms that are directly linked to the assembly and packaging units that operate with minimal manual intervention. The EX Series Injection Moulding machines with 80 ton clamping force were chosen for their precision

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reliability and longevity, as the long term use of machinery is of key important to B.Braun. The machines

A closed oil lubrication system supplies the pivot points of the Z toggles and prevents lubricants from leaking. The production cell is virtually without particle or thermal emissions and potential sources of impurity are eliminated as the platen pivot points are completely encapsulated and tie-bars are no longer required as guides for the moving platen. B.Braun has just placed an order for an additional two EX machines as well as two larger hybrid machines with 320 ton clamping force.

commonly found around many vehicles, from trucks and cars to motor homes, caravans and even boats. The new lamp has all the features of the earlier fixed position multivoltage 9–33V lamp, with its stylish design and powerful 1W L.E.D light, thus making it ideal for passengers to check a map whilst the vehicle is on the move at night, as well as relaxing at the end of the day reading a book or just helping to shed more

light over the interior. The light output provided is a crisp clear light, which is designed to ease eye strain when reading and the flexible arm enables quick and easy light adjustment. To activate, it is equipped with an integrated on/ off switch built into the lens. The light has an ultra-low current draw of just 0.18A at 12V, is attractively packaged in a stylish blister pack and carries a 5-year L.E.D Warranty.

Handy plug-in map reading light

The L.E.D map reading light can now be directly plugged into a vehicle’s accessory outlet, making it more versatile and easy to use. A version features an accessory plug at the end of its 250mm flexible arm that plugs into power outlets

The new L.E.D flexible map reading light can now plug directly vehicle accessory outlets

Reliable CBN010 insert grade for turning steels

BN010 is a new, uncoated grade designed to provide excellent performance in continuous to moderately interrupted cuts. Offering an extremely homogenous structure, the new grade provides stable performance and consistent tool life to minimise downtime and machining costs. Similar in composition to the existing CBN10 and CBN100 grades, CBN010 incorporates a newly developed manufacturing process to achieve a highly uniform microstructure. The grade features low cBN content with an average grain size of 1.5 µm and TiC ceramic binder. This improves both wear resistance and toughness, allowing excellent performance in a range of materials. Optimised for case hardened steels and bearing steels, CBN010

are designed specifically for complex mouldings and offer maximum dynamics and precision. They have precise platen control and coupled with the metering accuracy of the all-electric plasticizing unit The mold cavities can be filled precisely eliminating flash, which is an issue in the mass production of medical goods, given the high cavitations and corresponding shot weights. The EX CleanForm systems have the unique feature of excellent accessibility of all machine areas for obligatory cleaning cycles.

can also be successfully applied to tool steels, high-speed steels, hightensile steels, martensitic stainless steels, ferrous powder materials and hard facing alloys. CBN010 inserts are available in solid, full face, tipped and multitipped formats. The full face and tipped option features a cBN thickness of 1.6 mm, with the stress free solid tip being attached by a modern brazing technique to give it the strongest possible connection to the carbide blank.

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The ultimate on-machine seasoning system

he latest evolution of the leading intelli-flav seasoning range, the tna intelli-flav OMS 5, offers consistent coverage and flavour for both wet and dry seasoning. Fully integrated with both oil spray and flavour injection systems, the new OMS provides total control of adhesion and fast flavour changes for snack lines. It features a responsive variable mass seasoning system with dynamic vibratory weigher to directly control oil spray and powder flow into the drum. This enables an accurate, proportional amount of seasoning to be evenly

applied to the product for improved coverage and flavour dispersion. Further performance benefits are realised through the enhanced position of the scarfplate on the tna intelli-flav OMS 5 infeed. Mounted to the edge of the drum, the scarf better directs the product into the spraying and flavouring area, providing high quality seasoning performance. Additionally, the newly designed scalloped infeed conveyor allows more product to enter the seasoning drum, while also helping to control product direction for greater accuracy and reduced waste. With a simple, modular design, the intelli-flav OMS 5 is fully enclosed for increased levels of hygiene and ease of cleaning. Moreover, a new pivoting drum improves accessibility for hard to reach areas, simplifying day-to-day operations. www.nzmanufacturer.co.nz


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NZ Manufacturer June 2013

WORKSHOP TOOLS

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The elevator to success is out of order. You’ll have to use the stairs...one step at a time. – Unknown

SouthMACH 2013 opened window

outhMACH 2013 was the event chosen by Australian reel specialist ReCoila as the ideal industry setting at which to comprehensively display its extensive technologies to New Zealand. The company, which maintains established distribution channels through Blackwoods as well as its own dedicated office in Auckland, used SouthMACH 2013 in Christchurch as the springboard to display a cross-section of its technologies including PVC reels,

T-Series, C-Series, stainless steel and forklift reels. By being at SouthMACH, ReCoila’s NZ representative, Mr Lloyd King, believes the event was an excellent way to concentrate many of its technologies simultaneously in front of the tight-knit NZ industrial market. “Because we are a specialised manufacturer, many of the potential client bases aren’t always aware of the huge extent of our technology lines and our ability to custom design solutions for specific or

Certification tools improve profitability

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luke Networks has announced its new family of Versiv Cable Certification Testers designed to help data communications installers more quickly, accurately and profitably achieve system acceptance for copper and fibre jobs. Versiv is a powerful platform offering interchangeable modules for copper, fibre and Optical Time Domain Reflectometer (OTDR) testing, as well as new software innovations that speed test time and accuracy, and simplify testing setup, planning and reporting. In a global study of cabling professionals, mistakes, complexity and rework are adding more than a week of labour to a typical 1,000 cabling drop installation, resulting in average losses of more than $2,500 USD.* To combat these growing challenges, Versiv has been built from the ground up to go beyond testing and troubleshooting to address the entire certification lifecycle. Its new capabilities help contractors manage the complexities of today’s certification landscape and reduce errors that can threaten profitability. Key to simplifying the complexity is the new ProjX management system. In addition to letting team leaders set up test parameters to work across multiple jobs and media, the system accelerates planning and setup of projects by letting technicians capture consistent test parameters across an entire job, or switch from job to job by simply clicking between projects

Being at SouthMACH, was an excellent way for ReCoila to concentrate many of its technologies simultaneously in front of the tight-knit NZ industrial market.

processing, agriculture and general manufacturing is rich and diverse. “The NZ market mirrors this to the greater extent, yet with the geographical spread being far less challenging and SouthMACH was the ideal way to bring the market in to see what we do. “One of ReCoila’s main competitive advantages is to be able to leverage our huge list of niche technologies and incorporate them into tricky tailor-made solutions for just about any industry sector. “We have the technologies, parts availability and also the direct presence to give every industry in NZ exactly what it needs in relation to reel requirements and very much put this forward at this year’s show.” SouthMACH 2013 is New Zealand’s only forum for engineering and manufacturing machinery and technology suppliers to showcase innovations and solutions with exhibition stands, seminars and live demonstrations.

Thickness gauges with waveform

A stored in the tester. The system also enables up-to-the-minute project analysis and oversight to help speed certification and reporting. If problems are encountered during the testing process, technicians can create a “Fix Later” troubleshooting to-do list for later evaluation by more experienced installers. Versiv also features an intuitive and instructive touch screen interface that elevates the capabilities of the less experienced installers and increases the speed of testing and global ISO Level V testing compliance. From wizards that speed set up, to the advanced Taptive™ user interface for navigation and new workflow enhancements, all of the new features in Versiv combine to make it the fastest tester on the market, so jobs get done right the first time.

Manufacturers Newsfeed www.nzmanufacturer.co.nz

difficult needs,” said Mr King. But SouthMACH gave us a way to give the NZ market a very good look at the huge variations in reels which have been developed for the diverse Australia market where mining, construction, marine, food

new line of ultrasonic thickness gauges now includes the Sonagage IV, T-Gage V, Microgage III and Steelgage II. The Sonagage IV is a straightforward gauge for corrosion applications & can measure metal loss within a range of 1mm-500mm to an accuracy of +/- 0.1mm. Ideal for operators testing a few different materials, the Sonagage IV has 8 set-ups for common materials & 2 custom set-ups. Also for corrosion assessment is the T-Gage V series, which comes with monochrome display as standard. All models can be ordered with a colour TFT display. Simple in-field upgrade options, for such features as data logging (with Data XLS software) & A-Scan/BScan displays are also available throughout the life of upgradeable models. The T-Gage V comes in three standard models. The T-Gage V-B has a variable velocity facility to allow a wider range of materials to be measured. The T-Gage V is a midrange model which offers the most popular features including echo–toecho for ignoring coatings, alarms & “Transducer attendant” which notifies the user when it is time to replace the transducer. The T-Gage V (CDLW) is the top of the line model offering all the features of the T-Gage V, plus colour, waveform and data logger, allowing storage of up to 100,000 readings. A powerful feature & unique in its

class is the B-Scan which allows up to 20 thickness readings per second to be displayed in a cross-sectional view & stored for future reporting. The Microgage III is ideal for precision applications which require greater accuracy & capability. The Microgage III is available in 7 different configurations including basic, datalogging, with & without waveform in colour or monochrome. All gauges weigh only 230 g & have a battery life of up to 200 hours. They come with a limited 2 year warranty, couplant & carry case as standard. Cygnus Instruments ultrasonic thickness gauges are also available.


NZ Manufacturer June 2013

The world makes way for the man who knows where he is going. – Napoleon Hill

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THE FUTURE OF MANUFACTURING

The sky’s the limit

one, a Finnish liftmaker, has announced that after a decade of development at its laboratory in Lohja, which sits above a 333-metre-deep mineshaft which the firm uses as a test bed, it has devised a system that should be able to raise an elevator a kilometre (3,300 feet) or more. This is twice as far as the things can go at present. Since the effectiveness of lifts is one of the main constraints on the height of buildings, Kone’s technology—which replaces the steel cables from which lift cars are currently suspended with ones made of carbon fibres—could result in buildings truly worthy of the name “skyscraper”. The problem with steel cables (or “ropes” as they are known in the trade) is that they are heavy. Any given bit of rope has to pull up not only the car and the flexible travelling cables that take electricity and communications to it, but also all the rope beneath it. The job is made easier by counterweights. But even so in a lift 500 metres tall (the maximum effective height at the moment) steel ropes account for up to three-quarters of the moving mass of the machine. Shifting this mass takes energy, so taller lifts are more expensive to run. And adding to the mass, by making the ropes longer, would soon come uncomfortably close  to the point where the steel would snap under the load. Kone says it is able to reduce the weight of lift ropes by around 90% with its carbon-fibre replacement, dubbed UltraRope.

Roped together

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Carbon fibres are both stronger and lighter than steel. In particular, they have great tensile strength, meaning they are hard to break when their ends are pulled. That strength comes from the chemical bonds between carbon atoms: the same sort that give strength to diamonds. Kone embeds tubes made of carbon fibres in epoxy, and covers the result in a tough coating to resist wear and tear. According to Johannes de Jong, Kone’s head of technology for large projects, the steel ropes in a 400-metre-high lift weigh about 18,650kg. An UltraRope for such a lift would weigh 1,170kg. Altogether, the lift using the UltraRope would weigh 45% less than the one with the steel rope. Besides reducing power consumption, lighter ropes make braking a car easier should something go wrong. Carbon-fibre ropes should also, according to Mr de Jong, cut maintenance bills,

because they will last twice as long as steel ones. Moreover, carbon fibre resonates at a different frequency to other building materials, which means it sways less as skyscrapers move in high winds—which is what tall buildings are designed to do. At the moment a high wind can cause a building’s lifts to be shut down. Carbon-fibre ropes would mean that happened less often. All of which is worthy and important. But what really excites architects and developers is the fact that carbon-fibre ropes will let buildings rise higher—a lot higher. Lighter, stronger ropes mean the main limiting factor in constructing higher skyscrapers would become the cost, says Antony Wood, an architect at the Illinois Institute of Technology, in Chicago. Dr Wood is also executive director of the Council on Tall Buildings and Urban Habitat, which, among other things, lists the official heights of skyscrapers. At present the tallest is the Burj Khalifa in Dubai, which was completed in 2010 and, at 828 metres, shot past the previous record-holder, the 508-metre Taipei 101 tower. The Mecca Royal Clock Tower in Saudi Arabia, completed in 2012, is now, at 601 metres, the second-tallest. The Freedom Tower in lower Manhattan, built near the site of the World Trade Centre’s twin towers (417 metres and 415 metres) that were destroyed by al-Qaeda in 2001, had its spire added in May to reach 541 metres. But work has now started on the

Videos Kingdom Tower in Jeddah, Saudi Arabia. Its exact proposed height is still a secret, but it will be at least a kilometre. With a big enough budget it would, says Dr Wood, now be possible to build a mile-high (1,600-metre) skyscraper. Even with carbon-fibre ropes few of such a building’s lifts would go all the way from the entrance lobby to the observation deck. Most would debouch into intermediate sky lobbies, where passengers could change lifts (not least because a mile-high lift which seemed to stop on every other floor would not be popular; it would be unutterably tedious and might force the poor souls on board to make eye contact). Such an arrangement is already familiar. Many skyscrapers are more like three-stage rockets, with different buildings stacked one on top of another—offices, a hotel and apartments. Sky lobbies mark the frontiers between these uses. But carbon-fibre ropes will allow each of these stages to be taller, too.

The sky’s the limit

Nor need carbon-fibre lift-cables be confined to buildings. They could eventually make an idea from science fiction a reality too. Space lifts, dreamed up in the late 1950s, are a way of getting into orbit without using a rocket. Building one would mean lowering a cable from a satellite in a geosynchronous orbit above the Earth’s equator while deploying a counterbalancing cable out into space. The cable from Earth to the satellite would not be a classic lift rope because it would not, itself, move. But it would perform a similar function of support as robotic cars crawled up and down it, ferrying people and equipment to and from the satellite—whence they could depart into the cosmos. There are, of course, many obstacles to building such a lift. But the answer to one—finding a material that is light and strong enough for the cable—might just have emerged from that mineshaft in Finland. www.nzmanufacturer.co.nz


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NZ Manufacturer June 2013

THE FUTURE OF MANUFACTURING

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Put all your eggs in one basket and watch that basket. – Andrew Carnegie

Their new materials

oeing Co.’S 787  Dreamliner has drawn popular attention as the first commercial plane with skin made of carbon-fibre composites. To the aviation industry, the plane’s less-heralded materials underneath—including highly engineered titanium and a range of cutting-edge aluminium alloys—are equally significant. Not long ago, passenger jets were built of familiar metals such as aluminium and steel. In 1974, European upstart Airbus pushed the technology envelope with a composite rudder on its first plane, the A300. Since then, plane makers have been steadily increasing their reliance on high-tech materials that are lighter, stronger and less prone to corrosion than the metals they replace. Now, the new Airbus A350 sets a new mark as the most-composite passenger jet flying. The A350, which began test flights on Friday, is 53% composites by weight compared to 50% for Boeing’s Dreamliner, according to the companies’ own information. “It’s quite an exciting time because a lot of new material combinations are coming on line,” said Ric Parker, director of research and technology at  Rolls-RoycePLC, which builds engines for both planes. The British turbine-maker is developing new composites with plastics, ceramics and metals for its Materials have always been critical to aviation. In 1930, Boeing built some of the first all-metal airplanes, which boasted superior strength and aerodynamics over existing wood-and-fabric models. Eight years later, Boeing’s technology enabled it to offer the first fully-pressurized airliner, the propeller-driven 307 Stratoliner. In the 1950s, Boeing and its engine makers tapped material technologies developed during World War II to build the first commercially successful jetliner, the 707. Jet engines are at the vanguard of commercial aviation’s push for new materials because the heat, stresses and performance demands on them exceed what nature can offer.  General Electric  Co.,  the biggest jet-engine maker and a world leader in advanced materials, is building new factories to create composite engine parts, including from new-wave ceramics. Its GEnx engines on the Dreamliner are the first to use a light but strong alloy of titanium and aluminium that engineers have been developing for more than 20 years. www.nzmanufacturer.co.nz

Airbus A350 Composites: 53% Aluminium/AluminiumLithium: 19% Titanium: 14% Steel: 9% Other Materials: 8% Source: Airbus But featherweight materials can carry hefty price tags. Robert Schafrik, general manager of materials and process engineering at GE Aviation, jokes that an advanced material is “one that costs 10 times as much as the current material.” If that can be cut to just twice the price, he says, other savings in weight and maintenance costs can offset the difference. “There has to be a very strong value case for going forward with some advanced materials,” said Mr. Schafrik. Excitement about new materials is also tempered by sobering experience. Rolls-Royce Limited was financially crippled in 1971 because advanced composite fan blades it was developing for new engines failed. Airbus, now a unit of  European Aeronautic Defence & Space Co., in 2005 discovered that composites on its earliest planes didn’t age well after the rudder snapped off a 14-year-old passenger jet in midair. The A310 landed safely. Boeing 787 Dreamliner Composites: 50% Aluminium: 20% Titanium: 15% Steel: 10% Other Materials: 5% Source: Boeing Boeing and its suppliers have

Boeing’s 787 Dreamliner.

also struggled with the Dreamliner’s carbon-fibre and polymer structures. The plane’s fuselage, for example, consists of barrels made from tape wound around cylindrical moulds and then baked. Mastering the process was tough, and several of the first sections produced were rejected. In 2009, Boeing conceded it had to fix wrinkles in the skin of the first 23 barrels. Headaches with composites and their continued high cost have helped encourage metals companies to push back with new alloys. U.S. giant Alcoa  Inc.,  for example, is supplying Airbus with A350 components that are made for the first time from a new aluminiumlithium alloy that combines benefits of traditional aluminium and composites. And since materials have different attributes, such as stiffness and elasticity, engineers are getting increasingly specific in not just the shape but also substance of each part. “You tend to have a certain material that is well adapted for a specific environment,” said Charles Champion, Airbus’s executive vice president for engineering. Blending material characteristics with economics yields some complex decisions. As chief engineer of the Airbus A380 superjumbo a decade ago, Mr. Champion selected a synthetic material of glass fibre and plastic, called Glare (a.k.a. glass laminate aluminium reinforced epoxy), that appeared to have big potential in aviation. But when Airbus designed the new A350 a few years later, it dropped Glare because carbon-fibre composites were less expensive and easier to produce, Mr. Champion said. Industry officials predict the

role of composites will continue expanding as engineers learn better how to produce and use them. For example, when Boeing built the first Dreamliner model, the 7878, designers included big safety margins on many components and later found they withstood stresses “significantly higher than could ever be experienced in even extreme cases,” said Mike Sinnett, Boeing’s vice president of engineering. For the second version now in development, the 787-9, “we found ways to design to the required conservatism but not to overcompensate,” Mr. Sinnett said. The tweaks aim to improve efficiency without compromising safety. Despite increasing applications of advanced materials, expansion of their use will be halting. Mitsubishi Aircraft Corp. had planned to make the wings of its new MRJ small jetliner from composites, but in 2009 switched to aluminium, saying it would offer better fuel economy and be less expensive to produce. And when Airbus and Boeing launched new versions of their popular single-aisle models about two years ago, they largely stuck with the decades-old metals to control costs. As Airbus looks to a successor model that could be built in a decade, “we are competing composites against alloys,” said Mr. Champion. While that process will take years, engine advances will continue because components are constantly replaced. By introducing more heat-resistant materials, designers can keep squeezing efficiency from existing models. And, notes Mr. Parker at Rolls-Royce, “there are still a couple of hundred degrees for the scientists to go at.”


NZ Manufacturer June 2013

Never mistake activity for achievement. – John Wooden

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EMERGING TECHNOLOGIES

World’s strongest ‘nanowires’ excite industrial interest P ioneering research has developed the strongest silica nanofibres in the world. Globally, the quest has been on to find ultra highstrength composites, leading scientists at the University of Southampton’sOptoelectronics Research Centre (ORC) to investigate light, ultra high-strength nanowires that are not compromised by defects. Historically, carbon nanotubes were the strongest material available, but high strengths could only be measured in very short  samples  only a few microns long, providing little practical value. Latest research by ORC principal research fellow Dr Gilberto Brambilla and ORC director Professor Sir David Payne has resulted in the creation of the strongest, lightest weight silica nanofibres - “nanowires” - that are 15 times stronger than steel and can be manufactured in lengths potentially of thousands of kilometres. Their findings are already generating extensive interest from many companies around the world and could be set to transform the aviation, marine and safety industries. Tests are being carried out globally into the potential future applications for the nanowires. “With synthetic fibres it is important to have high strength, achieved by production of fibre with extremely low defect rates, and low weight,” said Dr Brambilla. “Usually, if you increase the strength of a fibre you have to increase its diameter and thus its weight, but our research has shown that as you decrease the size of silica nanofibres, their strength increases, yet they still remain very lightweight. We are the only people who currently have optimised the strength of these fibres,” he added. “Our discovery could change the future of composites and high

strength materials across the world and have a huge impact on the marine, aviation and security industries. We want to investigate their potential use in composites and we envisage that this material could be used extensively in the manufacture of products such as aircraft, speedboats and helicopters,” said Dr Brambilla. Professor Payne continued: “Weight for weight, silica nanowires are 15 times stronger than high strength steel and 10 times stronger than conventional GRP (glass reinforced plastic). We can decrease the amount of material used, thereby reducing the weight of the object. “Silica and oxygen, required to produce nanowires, are the two most common elements on Earth’s crust, making it sustainable and cheap to exploit. Furthermore, we can produce silica nanofibres by the tonne, just as we currently do for the optical fibres that power the

internet.” The research findings came about following  five years of investigations by Brambilla and Payne using Brambilla’s fellowship

funding of 500,000 pounds from the Royal Society. Dr Brambilla shared his findings with fellow researchers at a seminar he organised recently at the Kavli Royal Society International Centre, at Chicheley Hall, Buckinghamshire. “It was particularly challenging dealing with fibres that were so small. They are nearly 1,000 times smaller than a human hair and I was handling them with my bare hands,” added Dr Brambilla. “It took me some time to get used to it, but using the state-of-theart facilities at the Optoelectronics Research Centre I was able to discover that silica nanofibres become stronger the smaller they get. In fact when they become very, very small they behave in a completely different way. They stop being fragile and don’t break like glass but instead become ductile and break like plastic. This means they can be strained a lot. “Up until now most of our research has been into the science of nanowires but in the future we are particularly interested in investigating the technology and applications.

JULY 2013 ISSUE FEATURES • Food Manufacturing and Processing • The Future of Manufacturing • Workshop Tools • Software • Industrial Maintenance

Advertising Booking & Copy Deadline – 22nd July 2013

For further information contact:

Managing Editor: Doug Green P: 06 870 9029 E: words@xtra.co.nz

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NZ Manufacturer June 2013

SUPPLY CHAIN

While most are dreaming of success, winners wake up and work hard to achieve it. – Unknown

Laser guided vehicles receive safety award O CME S.r.l, an Italian world leading manufacturer of packaging, filling, handling and palletising systems for the beverage and consumer products industries, has received the 2013 IMHX (International Materials Handling Exhibition) Design 4 Safety Awards in the automation category for their Auriga Laser Guided Vehicles. The Design 4 Safety awards were distributed at the International Materials Handling Exhibition. The awards showcased the material handling industry’s deep commitment to safety, as demonstrated in innovative safety design features in products and procedures. The Auriga is a laser guided system to transport goods without the need of an operator. It follows a path verifying (up to 8 times per second) its position by detecting the reflection angle of a Laser ray sent out from a Laser Navigator. The use of laser technology eliminates the need to add embedded rails or to modify the site. Reflectors are positioned in inconspicuous locations and can be easily moved to cater for future site expansion. The inbuilt safety systems used, guarantee a safe working environment. If the system detects movement in the shuttle operating zone, the combined action of sensors and bumpers will automatically interrupt the shuttle movement. Advantages and features of the OCME Auriga LGV include: • High speed movement up to 1500mm/sec.

• Position and movement accuracy of + 5mm.

• Maximum load of 6 tonne dependant on model.

• Lift height of 6 meters. • Up to 3 pallet width capability • • • • • •

with patented auto tyne adjustment feature. Ability to run on uneven floors. No physical modification to site required. Simple and fast installation and easily customised for future expansion or changes. Automatic system for battery recharging. WMS (warehouse management system) included. Real time tracking of logistic cycle and product placement.

Hyper-Detect provides stable operation

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he hyper-detect is a nonsymmetrical balanced coil metal detector with a conical aperture into the detector. While conventional ‘throat’ metal detectors have long been used in the industry to inspect the product before it enters the bag to allow the use of metallised film, packaging speeds have been limited until now. The revolutionary integrated design of the hyper-detect allows the metal detector to be positioned much closer to the multi-head weigher, dramatically increasing the speed at which the bagger can produce finished bags. With a high frequency function, the hyper-detect provides stable operation for optimum sensitivity and consistent performance when inspecting products. Able to detect ferrous contaminants from 0.8mm

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to 0.9mm, non-ferrous pieces up to 1.0mm and even non-magnetic stainless steel from 1.0mm to 1.2mm, the hyper-detect is extremely sensitive, greatly reducing the risk of contaminants entering the value chain, safeguarding consumer safety and the company’s reputation. The hyper-detect metal detector and bagger integration takes place on two levels. Mechanically, the detector and chute work together to provide a fully optimised path for the product to travel down, offering greater control and repeatability for faster product transfer and reduction in rejects. At the same time, operator control is integrated into the robag product and operational screens allow for a single set-up of the whole system, leaving no room for error, and offering real productivity and cost improvements.

• Do you have a story you want to share? • Developments? • New markets discovered? • How are you finding business in this challenging economy? Email Doug Green at words@xtra.co.nz and we’ll share your story with readers.


NZ Manufacturer June 2013

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FOOD MANUFACTURING

The starting point of all achievement is desire. – Napoleon Hill

Dairy product launched into Japanese market

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ew Zealand-based dairy biotechnology company, Quantec Ltd, has signed a distribution and supply agreement with major Japanese specialty ingredients company, Kanematsu Chemicals Corporation. Kanematsu will distribute Quantec’s patented complex of bioactive milk proteins, called IDP®, throughout Japan. In a deal that is expected to extend over a number of years, the distribution agreement gives Quantec an expansion opportunity into a key Asian market and provides Kanematsu with access to a unique New Zealand dairy-based bioactive protein ingredient for inclusion into Japanese functional foods and human health products. “Japanese consumers have always looked very favourably on New Zealand dairy products and we expect the agreement between Quantec and Kanematsu to further build on this customer perception of quality and innovation,” according to James Groenhart, Business Development Manager of Kanematsu New Zealand Ltd. Founder and Managing Director of Quantec Ltd, Dr Rod Claycomb explained that, “IDP is a unique ingredient naturally derived from

Dr. Rod Claycomb

fresh milk. It contains what we refer to as having ‘Triple-A’ activity antibacterial, anti-inflammatory and antioxidant. For example, if used in an oral care product, IDP® targets and kills organisms responsible for bad odour while leaving healthy mouth organisms unharmed. It does so by being selective and targeting those characteristics of more harmful bacteria.

“We’ve been working with Kanematsu for over two years to test the Japanese market and prepare for product development and launch. We’re especially thankful to Peter Maxwell, Callaghan Innovation’s Business Growth Manager at Waikato Innovation Park in Hamilton, who recognised the opportunity for both Quantec and Kanematsu and made the initial introductions.”

Founded in 2007, Quantec is unlike many other dairy-based companies in New Zealand who are attempting to cash-in on the current trade of dairy commodities, like milk powder. Instead Quantec is focused on the discovery and commercialisation of high-value bioactive compounds from milk. This agreement with Kanematsu of Japan comes on the heels of the signing of Quantec’s first major international distribution agreement, which is to supply its patented milk protein ingredient, IDP®, to China, through Aucklandbased company, NZ New Paradise. Based at the Waikato Innovation Park in Hamilton, New Zealand, Quantec is a company specialising in the discovery and commercialisation of high-value bioactives from natural products. Quantec discovered and patented its novel milk fraction, comprised of native immune defense proteins (IDP®), that has proven antimicrobial and antiinflammatory properties. www. quantec.co.nz Kanematsu Corporation has had a long association with New Zealand through its subsidiary company, Kanematsu NZ Ltd, which has been active in the NZ primary food and agricultural export sector since 1937.

Breakthrough in New Zealand-made dairy technology

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Kiwi company with an innovation and technology focus has invented the first ever New Zealand-made electronic milk meter designed to use every milking, every day. Waikato Milking Systems has created the new high-accuracy meter to give farmers real-time information about the performance of their cows, and to help increase their herds’ productivity and efficiency. Waikato Milking Systems Chief Executive Dean Bell says it is the first and only electronic milk meter designed and manufactured in New Zealand for everyday use in conventional milking systems. “We believe it is the most modern, reliable and easy to use electronic milk meter available anywhere in the world,” Mr Bell says. It differs from milk yield indicators which are typically much less accurate. It also differs from other electronic milk meters which are designed for occasional use for herd testing. Waikato Milking Systems is a leading provider of dairy technology throughout the country and around the world, exporting to more than 20 countries. It is a 100% New

Dairy design: Waikato Milking Systems has launched the first New Zealand-made electronic milk meter, taking design innovation from drawing board to dairy shed.

Zealand-owned company, dedicated to creating new dairy technology for farmers. “Milk metering technology itself is not new – it has been around a long time. What is new about our Electronic Milk Meter is that it has been designed to reflect our core philosophies around performance, simplicity and value for money. It is also the only 100% New Zealand designed and manufactured

electronic milk meter,” Mr Bell says. “Milk metering technology is usually really complex, expensive to buy, expensive to maintain and out of reach of the everyday farmer. This new electronic milk meter has been designed to overcome those barriers.” The meter is expected to have significant international appeal because it is the latest technology and because it delivers results while being exceptionally easy to use, Mr Bell

says. It is designed to perform well in pasture-based environments such as New Zealand, and also intensive indoor dairy farming systems more typical overseas. Intensive systems generally have faster-milking, higheryielding dairy cows, which means the design has to cater for a very broad range of milking conditions. The meter clearly shows milk yield, milking time and milk flow rates during milking, along with a range of additional information about each cow. At the end of a milking routine, yield information can be automatically uploaded to external herd management software – including LIC’s Protrack Vantage. A more extensive range of realtime animal data is expected when the next generation of Protrack is launched in the near future. The Electronic Milk Meter package for every milking machine bail includes a Bail Marshall, which is new plug and play technology from Waikato Milking Systems. The Bail Marshall manages connectivity and communication between all devices on each bail, and enables farmers to add as many devices to each bail as they like – now and into the future. www.nzmanufacturer.co.nz


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NZ Manufacturer June 2013

BETTER BUSINESS

Failure defeats losers, failure inspires winners. – Robert T. Kiyosaki

The importance of robust business

It should have been a winner. Instead, a New Zealand manufacturer’s $69 million investment in new processing facilities missed the target by a country mile. The targeted Net Present Value was to have been $19.8 million. In the event with all the costs in, the NPV was just $500K. This is just one horror story from many that business case and capital expenditure (capex) specialist Tony Street can cite to illustrate the importance of robust business case compilation and risk analysis. With the high dollar, NZ manufacturers can now ill-afford capex cock-ups.

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he mistakes in this case were simple accounting ones: failure to take account of capital outlays in the correct period; interest costs during construction, and the “must-do” expenditure and necessary upgrades in years to come. Further, had finance team members identified and tested key assumptions (such as forex) by running a Monte Carlo simulation, it would have revealed a 45% probability that the project would loose money. And sensitivity analysis could have uncovered practical risk mitigation measures - had the right team members been consulted. Perhaps the reason that many companies take a casual approach to preparing business cases is a result of inflated confidence levels by senior management. When preparing expenditure proposals, incorporating input from others can enhance decision quality, yet often senior executives do not effectively utilise advice - according to US research in 2010. A study into organisational behaviour prepared by See, Morrison, Rothman and Soll explored the detrimental effects of power on confidence, advice taking, and accuracy. Results from a series of experiments found that although higher power participants had greater confidence in their final judgements, they had significantly less accurate final judgements and took less advice than those with lower power. Business case processes form an important sub-set of an organisation’s capital management infrastructure - which amongst other objectives will identify the entity’s cost of capital. In his book entitled ‘Corporate Governance & Wealth Creation in NZ’ former Regional Investment banking head Joseph Healy talks about a “performance crisis” and pinpoints poorly specified or non-existent return on capital objectives. He also highlights poor corporate discipline www.nzmanufacturer.co.nz

in allocating capital where it can influence returns. In Healy’s view, corporate governance must be concerned with not only compliance, but also performance, and there needs to be a commitment (from the Board down) to creating shareholder value. His 2002 findings showed that economic profit per unit of capital in NZ (-0.5%) was substantially lower than Australia (12%), USA (13%), UK (19%) and Sweden (22%). To ensure that capital is allocated where it can best boost returns, he advocates Economic Value Added (EVA) performance measures. American quality control champion Edward Deming (1990) believed that poor capital allocation occurs when a business lacks a well-designed capital allocation system disciplining management to optimise shareholder value. NZ Management Magazine featured an article entitled “How EVA Exposes Non-Performers” in Aug 2002. Then Comalco CEO Kerry McDonald charged that “what’s lacking is effective management infrastructures – a lack of commitment to developing the tools, practices and processes that let good managers and leaders achieve the best results.” Sensing growing shareholder concern, astute Boards now see the need for ‘best practice’ capital management infrastructures to safeguard shareholder value.

“The productivity and profits of NZ companies are being impacted by their inability to consistently deliver projects that fulfill the expected objectives”.

Tony Street

Port of Tauranga (POT), for example, has achieved a stunning 24% compounding return for shareholders over the last decade - compared to the 5.6% NZX Index average. POT is the best performing share on the NZX over the past 15 years. Judged the most efficient port in Australasia, POT’s key has been to back innovation-driven capital investment with rigorous economic and financial analysis. Fourteen years ago, POT implemented capex software to assist in business case compilation and priority setting. Their CFO manages capex as a limited resource and rejects ad-hoc spreadsheet building as inconsistent, timewasting and error prone. Even plant replacements undergo rigorous financial analysis. POT refuses to spend hard-earned capital resources on “gut feel” or doubtful “strategic” projects. POT also know that “must do” capex - which may not have financial benefits - is deemed essential to meet environmental, staff health & safety, service quality, and compliance objectives.

Specialist consultant in the field, Tony Street applauds POT’s innovative approach to capital spending. “The need to rigorously evaluate alternatives; test assumptions; systematically assess risk and carefully analyze (and then monitor) true value are essential elements to a robust capex infrastructure. It is very concerning that such a disciplined approach so often falls through a crack in the floor. As a consequence, I fear that 20 - 35% of capital expenditure is unwarranted in many corporates. A spectacular opportunity for financial improvement exists in diverting

In Healy’s view, corporate governance must be concerned with not only compliance, but also performance.


NZ Manufacturer June 2013

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BETTER BUSINESS

Business has only two functions – marketing and innovation. – Peter Drucker

case compilation and risk analysis these capital funds into valueadding projects that truly pay for themselves.” Sadly, a 2010 KPMG study of 100 NZ companies and their project planning practices raises serious concerns. It found that many companies begin projects with only a vague hope of achieving a return. Seventy percent of companies experienced at least one major project failure in the past year, and only one third of companies always prepared a business case. Sixty per cent do not measure project benefits, so cannot determine whether their investments prove worthwhile. KPMG’s conclusion: Many firms

are unable to translate project investments into valuable returns. KPMG’s Perry Woolley states: “The productivity and profits of NZ companies are being impacted by their inability to consistently deliver

New Zealand manufacturers are discovering the importance of business cases

projects that fulfill the expected objectives”. If shareholder value is not the focus, managers and directors may lack a principled criterion for measuring performance. Such a “stakeholder-based” business may well fail if competing with a shareholder-value-based business. This is because politicking occurs as people promote projects based on loose criteria. “Woolly thinking” prevails and the organisation becomes dysfunctional. The Board is the heart of corporate governance and as agent of shareholders must monitor management performance. If

management mis-manages, board members place themselves at risk of negligence if they do not take corrective action. Today more than ever the Board should ensure appropriate financial management information systems are used to assess returns on invested capital. It must insist management use a robust capital management and business case infrastructure based on current best practice. And it’s also about improving productivity. For example, the capex workflow, collaboration and reporting process in many organizations can be streamlined - saving considerable management time.

Tauranga a magnet for domestic and international manufacturers T auranga and the Western Bay of Plenty offer significant opportunities for business growth and continue to be one of New Zealand’s fastest growing economic regions. “The Tauranga Business Case campaign (www. taurangabusinesscase.co.nz) has really put us on the map – domestically and internationally,” says Andrew Coker, Chief Executive of Priority One. “To date we are working with 25 businesses that are making significant investments into the Tauranga and Western Bay of Plenty area. “This includes manufacturing operations establishing here and others expanding on existing domestic or international business. We are working with businesses across industries such as food processing, ICT, printing and specialised manufacturing. “At last count these businesses are creating over 200 new jobs for local residents across a range of sectors and skill levels,” Andrew added. One of the international businesses that Priority One has been working closely with to establish operations in Tauranga

is Australian-based FSP Holdings Pty Ltd, (www.fspandco.com), manufacturer and major exporter of rotational moulded plastic lockers, cabinets and mining equipment. Looking to expand their global footprint - which currently includes FSP offices in Australia, China and Chile (and in 2014 North America), and agents/distributors in Kalimantan Indonesia, PNG, Zambia, Mozambique, Belgium and Canada - Kevin Voss, Manager of Business Development at FSP, created comparative business cases for the establishment of a manufacturing plant in Indonesia, Thailand and New Zealand. Competitive manufacturing costs, accessibility and frequency of import and export services, and the availability of skilled labour made New Zealand the most attractive location of the three. “Once we settled on New Zealand, we looked at Auckland, Wellington and Tauranga as potential manufacturing sites, as close proximity to a major port was the most important aspect in

our decision making,” said Kevin. “Discussions with Priority One really confirmed our feeling that Tauranga had more advantages for our business than other locations we were considering and gave us the confidence to move forward quickly”. “The deciding factor for us really was The Port of Tauranga. They offered a frequency of service to and from Australian and international ports that we just couldn’t get from other New Zealand ports. With advice from Priority One and Colliers International, we were able to find a site in Tauranga that suited our purpose in close proximity to the port with all available services, providing savings on transportation and logistics,” added Kevin. FSP plan to be operational within the next four months, and will employ 20 staff in the early stages. The employment opportunities that come from business growth and attraction in the Tauranga and Western Bay of Plenty are one of the most important aspects of the

Tauranga Business Case campaign. Andrew Coker says, “It’s about growing jobs now in Tauranga and the Western Bay of Plenty - a region in recovery from the impacts of Psa in the kiwifruit sector, the global financial crisis, and of course the Rena grounding”. “It’s not about robbing Peter to pay Paul and taking businesses out of other regions, including Australia. That’s a zero-sum game. It’s about informing those people that make decisions as to where they invest and locate their businesses based on the competitive advantages that make their business thrive,” says Andrew. The Tauranga Business Case campaign showcases the advantages of doing business in Tauranga and the Western Bay of Plenty on the back of long-term investments that have been made by local authorities working together with the business community in areas such as roading, broadband, commercial developments and capital investments. The Tauranga Business Case campaign has also shown people the benefits of living and working in a strong, supportive business and community environment.

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NZ Manufacturer June 2013

LEAN MANUFACTURING

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When you know what you want and you want it bad enough, you will find a way to get it. – Jim Rohn

Working More Efficiently

ow much waste does your organisation produce? For example, do you ever have to wait for someone else to finish a task before you can get on with your own work? Do you have a large inventory of unsold stock? Do you have more workstations that you need? Or do you order materials months in advance of when they are needed? How about flexibility? If consumers want a modification to your product, can you quickly change your processes to meet their needs? Waste costs you and your customers money. And if your

customers have to pay more because of it, they might go elsewhere. Being competitive also requires a lot of flexibility. You must be able to meet the changing demands of your customers quickly and effectively, and adapt to a rapidly changing business environment. So, how can you reduce waste and do things more efficiently? And how can you keep up with the changing demands of consumers? First mentioned in James Womack’s 1990 book, “The Machine That Changed the World,” lean manufacturing is a theory that can help you to simplify and organize your working environment so that

www.nzeco.govt.nz www.nzmanufacturer.co.nz

you can reduce waste, and keep your people, equipment, and workspace responsive to what’s needed right now.

A Brief History of Lean Manufacturing

Henry Ford was one of the first people to develop the ideas behind lean manufacturing. He used the idea of “continuous flow” on the assembly line for his Model T automobile, where he kept production standards extremely tight, so each stage of the process fitted together with each other

stage, perfectly. This resulted in little waste. But Ford’s process wasn’t flexible. His assembly lines produced the same thing, again and again, and the process didn’t easily allow for any modifications or changes to the end product – a Model T assembly line produced only the Model T. It was also a “push” process, where Ford set the level of production, instead of a “pull” process led by consumer demand. This led to large inventories of unsold automobiles, ultimately resulting in lots of wasted money. Other manufacturers began to use Ford’s ideas, but many realised that


NZ Manufacturer June 2013

LEAN MANUFACTURING

Laziness is nothing more than the habit of resting before you get tired – Mortimer Caplan

the inflexibility of his system was a problem. Taiichi Ohno of Toyota then developed the Toyota Production System (TPS), which used Just In Time manufacturing methods to increase efficiency. As Womack reported in his book, Toyota used this process successfully and, as a result, eventually emerged as one the most profitable manufacturing companies in the world.

Lean Manufacturing Basics Lean manufacturing is based on finding efficiencies and removing wasteful steps that don’t add value to the end product. There’s no need to reduce quality with lean manufacturing – the cuts are a result of finding better, more efficient ways of accomplishing the same tasks. To find the efficiencies, lean manufacturing adopts a customervalue focus, asking “What is the customer willing to pay for?” Customers want value, and they’ll pay only if you can meet their needs. They shouldn’t pay for defects, or for the extra cost of having large inventories. In other words, they shouldn’t pay for your waste. Waste is anything that doesn’t add value to the end product. In lean manufacturing, there are eight categories of waste that you should monitor: 1. Overproduction – Are you producing more than consumers demand? 2. Waiting – How much lag time is there between production steps? 3. Inventory (work in progress) – Are your supply levels and work in progress inventories too high? 4. Transportation – Do you move materials efficiently? 5. Over-processing – Do you work on the product too many times, or otherwise work inefficiently? 6. Motion – Do people and equipment move between tasks efficiently? 7. Defects – How much time do you spend finding and fixing production mistakes? 8. Workforce – Do you use workers efficiently? The lean manufacturing process

has three key stages:

Stage 1 – Identify waste

According to the lean manufacturing philosophy, waste always exists, and no matter how good your process is right now, it can always be better. Lean manufacturing relies on this fundamental philosophy of continuous improvement, known as Kaizen.

One of the key tools used to find this waste is a Value Stream Map (VSM). This shows how materials and processes flow through your organization to bring your product or service to the consumer. It looks at how actions and departments are connected, and it highlights the waste. As you analyze the VSM, you’ll see the processes that add value and those that don’t. You can then create a “future state” VSM that includes as few non-value-adding activities as possible.

Zero Defects – This system focuses on getting the product right the first time, rather than spending extra time and money fixing poor-quality products. By using the Zero Defects system, you’ll reinforce the notion that no defect is acceptable, and encourage people to do things right the first time that they do something.

Single Minute Exchange of Die (SMED) – This helps you build flexibility into your production. For example, in the automotive industry, it could take days to change a line to produce a different car model. With SMED, the assembly process and machinery are designed to support quick and efficient changeovers. (Here, a “die” is a tool used to shape an object or material.)

Kanban – This is one of the key ways to involve people in the lean manufacturing process. Here, you support the Just In Time model by developing cues in the system to signal that you need to replace, order, or locate something. The focus is on reducing overproduction, so that you have what you need, only when you need it.

The 5S Philosophy – Lean manufacturing depends on standardization. You want your tools, processes, and workplace arrangements to be as simple and as standard as possible. This creates fewer places for things to go wrong, and reduces the inventory of replacement parts that you need to hold. To accomplish a good level of standardization, use the 5S System.

date. They started small with the removal of rubbish bins from desks and involving all staff in generating ideas for waste reduction. One area where they have made a huge impact is with the disposal of 80 tonnes of aluminium powder every year. This

is now given to another supplier and used in special paint products and saves Fletcher Aluminium around $60,000 per year in landfill fees. Competenz holds 3-4 Lean Hubs per year that are open to all interested organisations.

Tools to Reduce Waste

Once you have identified wastes using the three key stages above, you can then apply this next set of tools to help you reduce waste further:

Stage 2 – Analyze the waste, and find the root cause

For each waste you identified in the first stage, figure out what’s causing it by usingRoot Cause Analysis. If a machine is constantly breaking down, you might think the problem is mechanical and decide to purchase a new machine. But Root Cause Analysis could show that the real problem is poorly trained operators who don’t use the machine properly. Other effective tools for finding a root cause include, Brainstorming and Cause and Effect Diagrams.

Stage 3 – Solve the root cause, and repeat the cycle

Using an appropriate problemsolving process, decide what you must do to fix the issue to create more efficiency.

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Just in Time – This is the core idea of lean manufacturing and is based on the “pull” model. To minimize stock and resources, you only purchase materials, and produce and distribute products when required. You also produce small, continuous batches of products to help production run smoothly and efficiently. By reducing batch size, you can also monitor quality and correct any defects as you go. This reduces the likelihood of quality being poor in future batches. (In manufacturing, a key way of doing this is to use Kanban, below.)

Lean Hub held at Fletcher Aluminium

letcher Aluminium hosted the second Competenz Lean Hub in May. Despite a lightning strike disabling their security system the night before, Sen Chen and the Fletcher Aluminium team were excellent hosts to nearly 50 representatives from businesses around New Zealand engaged in lean. Fletcher Aluminium began their lean journey in 1995. Competenz has worked with them for more than 5 years, supporting over 120 learners to achieve manufacturing qualifications. Unique amongst our Competitive Manufacturing customers, Fletcher Aluminium has put 11 people through the National Diploma and now make a Certificate in Manufacturing a pre-requisite for working in the factory. They have also provided support around Literacy and Numeracy for many of their employees. Bimal Sheth, Fletcher Aluminium’s Environmental Manager, talked about the waste elimination (RRR) journey at Fletcher Aluminium that began in 2008. They set a target of a 95% reduction in waste going to landfills annually and have reached 92% to

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NZ Manufacturer June 2013

ANALYSIS

Hire character. Train skill.

Step up – yeah right

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e often see various views of how to improve our manufacturing sector, ranging from policy change, to believing we are on the right track and those suffering should just be quiet and just deal with it because we are in the best of all possible worlds. This simple minded analysis leads to solutions like: increase prices, be more efficient, improve productivity or generally just step up and succeed. Regardless of who says this or how many people say it, this is simply rubbish. Many New Zealand exporters in the elaborate sector are already operating at the leading edge – continuous improvement, pricing to market are habitual for them. That is precisely how they have developed and it is a requirement for survival. This is particularly true for those at the high tech or elaborate end of value added activity. Take one example, of how a rising currency makes a significant and direct hit on profitability: a New Zealand based software firm that offers a subscription based service, to the global market, with price determined market by market.

• Sales by area: 75% US, 7% UK, 7% NZ, 7% AUS and 3% Europe.

• Exchange rates a month ago: 0.85 US, 0.55 UK, 83 AUS and 0.64 Euro. Revenue index of 1.21. • Exchange rates in 2001: 0.39 US, 0.27 UK, 0.74 AUS and 0.40 Euro. Revenue index of 2.42. • Exchange rates last week: 0.79 US, 0.51UK, 0.84AUS and 0.60 Euro. Revenue index of 1.28. A month ago, this firm would have had to sell 2.24/1.21 = 2 times the unit volume to earn the same number NZ Dollars as it did in 2001. The world turns, the dollar falls and the index becomes 1.9 times the sales in 2001, who knows what it will be next week or next month. This has a massive effect on returns, and what is the basis for planning or borrowing to invest in development?

New Zealand needs to create a level playing field for manufacturers and exporters

Employment Court decisions signal new path in restructuring and redundancy

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mployers will need to be much more careful when making redundancies as a result of restructuring, judging by recent decisions in the Employment Court. Employment law specialist Sarah Townsend, of Duncan Cotterill, said that three recent rulings made it quite clear that employers must be aware that their commercial decisions, and the way in which these are reached, will be subject to greater scrutiny by the Courts in future. “There was a long held perception that Courts would not interfere with management’s commercial decisions to restructure and make redundancies as they saw fit, even if those decisions were poor ones.   “That has changed with the spotlight now also firmly on the justification for the employer’s commercial decision to restructure,” Townsend said.  In each of the three cases recently before the Employment Court, the employer was reprimanded for making staff members redundant as a result of restructuring based www.nzmanufacturer.co.nz

on financial grounds. Employers failed to adequately show enough information about how proposed cost cutting justified the redundancies. Townsend said that previously the onus of showing that a redundancy was genuine had largely been confined to demonstrating that the redundancy was the result of a genuine commercial decision.   “Unless the employee could show that the redundancy was a sham, motivated by a desire to exit an employee for reasons other than redundancy (for example, poor performance), the Courts tended not to interfere. It was considered a management prerogative to structure the business as an employer saw fit.” This meant that case law used to focus on the process followed by an employer when implementing a redundancy – and, in particular, whether the employer fairly consulted with affected staff before making a final decision about restructuring and redundancy.  

If this was a start-up today, would shareholders want to invest, would survival be possible in the face of start up costs? This effect is apparent to a greater or lesser extent depending on particular circumstances for all exporters bound to market price points and need investment/borrowing for productivity and efficiency gains. Policy settings in New Zealand are such that even companies that are world leaders in their markets, question investment and location; all decisions that have potentially negative outcomes for New Zealand based activity. This issue of investment is a significant hurdle for most manufacturers. To begin with, what forms the basis of a prediction of investment return when revenue level is a lottery regardless of unit volume any return on investment calculation is at best a guess? Hardly a sound basis for borrowing or aggressive growth. The same policy settings that make investment in elaborate export activities a problem create incentives in other activities. Investment in land and building carry tax advantages and are isolated from currency fluctuations, in fact activity in this asset class creates pressure on the productive economy; as we are seeing again with Auckland house prices. We need to address these imbalances to encourage investment in productive activity and better paid jobs. Without this investment, our future competitiveness will be greatly inhibited, as the ability to innovate and stay world leaders slowly wains. New Zealand needs to create a level playing field for manufacturers

– Peter Schutz

John Walley

and exporters. Those operating here have already overcome inherent disadvantages such as small scale domestic markets, distance to major markets, and huge currency fluctuations. The longer this pressure continues, the greater will be the loss to New Zealand. These disadvantages are exacerbated when you take into account the support productive activity receives in other countries. Innovation is critical for everyone, but for most businesses the operating environment is also a major factor. Most high tech firms which lead innovation in New Zealand do not have to be here, they are not tied to any particular resource.  They are free to leave here, and will do so if the policy framework does not respond to their needs, impoverishing that which remains. Suggesting our manufacturing exporters simply need to “step up” to survive demonstrates a superficial analysis, a lack of any real understanding of what drives New Zealand manufacturers, and underestimates the debilitating impact of the status quo on the development of our entire economy.

NZ economy – gaining traction

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he BusinessNZ Planning Forecast indicates New Zealand’s economy is gaining traction. Export prices remain high, and economic growth is forecast to average just over 3 percent per annum out to March 2015. Improved business, consumer confidence and continued solid growth prospects for China, New Zealand’s largest export customer, are among the positive indicators in this quarter, says BusinessNZ economist John Pask. However, growth prospects for Australia, New Zealand’s second largest export customer, are muted. One concern in the domestic economy is increasing household

debt levels. “Debt is increasing at a time when servicing costs are relatively low and interest rates are at historic lows.  There is a danger that when interest rates rise again, households may get into strife if the economy falters,” Mr Pask said. BusinessNZ Planning Forecast incorporates BusinessNZ’s Economic Conditions Index (ECI) which tracks 33 indicators, including GDP, export volumes, commodity prices, debt and confidence figures. The ECI sits at 19 for the June quarter, up 9 on the previous quarter and up 27 on a year ago. The BusinessNZ Planning Forecast for the June 2013 quarter is on www.businessnz.org.nz


NZ Manufacturer June 2013

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ENERGY REPORT

You have everything you need to build something far bigger than yourself. – Seth Godin

New energy use rating scheme a game changer

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he door has now opened for New Zealand’s existing office buildings to be recognised for energy efficiency, contributing to a more sustainable built environment and ultimately reaping the rewards of as much as $200 million in energy savings annually, says the New Zealand Green Building Council (NZGBC). The long-awaited NABERSNZ scheme independently rates office energy use, measuring performance across a one to six-star scale; one being poor, three being the market average and six aspirational. “We are excited about the ability of this tool to create new opportunities for existing buildings to gain market recognition on the basis of good energy performance and, ultimately, begin to implement meaningful changes that will raise the bar for green buildings as a whole,” says NZGBC Chief Executive Alex Cutler. This new tool will contribute to the market value of office buildings on the basis of good energy performance, and stimulate continuous improvement for those parties wanting to move up the rating scale and improve the value of their properties. NABERSNZ is based on the Australian NABERS (National Australian Built Environment Rating System) tool operated by the New South Wales Office of Environment and Heritage (OEH) since 1998. The scheme has transformed the way energy is used in commercial office buildings across Australia, leading to lowered operating costs, increased occupancy rates and higher capital values on buildings with good ratings. Now, the NABERS tool has been licensed for New Zealand use to the Energy Efficiency and Conservation Authority (EECA) by OEH and it will be administered by the NZGBC. It has been adapted to suit the New

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Zealand market by the Energy Management Association of NZ (EMANZ) and Energy. A building’s day-to-day operations have a dramatic impact on its performance, and without better information, facilities and property managers cannot identify inefficiencies and improve operations of their assets, says Ms Cutler. “The crucial thing about NABERSNZ is not simply that it ranks buildings and benchmarks their energy use; it’s using this as a tool to improve,” says EECA Chief Executive Mike Underhill. “Kiwi businesses on average could improve their commercial building energy use by 20 - 25%, worth $200 million to the economy. NABERSNZ will help us realise those savings. “The development and rollout of NABERSNZ has been a real collaboration between industry and government. It’s pleasing to see such widespread enthusiasm from the commercial property sector.” Ms Cutler says a number of factors affect a building’s ability to deliver good energy performance, including energy-modelling, properly timed energy solutions, quality commissioning, upfront goal setting and benchmarking, and co-ordination between design and operation. The NZGBC’s Green Star rating system already addresses early intervention opportunities for improving the environmental impact that is a direct consequence of a building’s site selection, design, construction, and maintenance, including energy efficiency benchmarks. But the biggest issue is the way occupants use the building daily. Are there protocols in place for checking controls are operating as they were designed to? Do technicians know when those controls malfunction? How granular is the data coming

through? What processes do facilities managers have in place to address data discrepancies? “NABERSNZ will provide instant measure of a building’s energy performance that can be compared to other office buildings. Tenants, particularly, will find NABERSNZ useful when procuring new premises and owners will find value in being able to demonstrate building energy efficiency. With such useful information on offer, the scheme has been hotly anticipated

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by the commercial property sector.” “NABERSNZ Practitioners are being trained in the technical detail of the tool and a large proportion of the market will find this the most useful training” she says.”NABERSNZ Accredited Assessors will assess 12 months of energy use data to provide a Certified Rating which can be used for promotional purposes. Alternatively a free online self assessment tool is available for a rough guide on how a building or tenancy might rate.”

Uninterupted supply of electricity

he CellCube energy storage system provides emission-free energy based on Vanadium Redox Flow technology. Tested and proven in practice over many years, the CellCube provides an uninterrupted supply of electricity via solar and wind power plants even in the dark and when there is no wind. The CellCube is a stable electricity storage device with scalable system power for every situation. The CellCube FB 200-400, which with 200 kW and 400 kWh provides tremendous energy reserves for widely differing applications and is therefore the perfect solution for industrial use. CellCube FB 200-400 comprises a power stage and an energy stage. The power stage comprises the stacks, the flow battery controller, the DC/ DC converter and the inverter, while

the energy stage includes the two tanks for negatively and positively charged electrolyte and the pump system for the liquid circulation. Examples of possible applications of the innovative energy storage device include grid support for stabilising low-voltage and mediumvoltage networks, for example, as an energy reserve, or for smoothing peaks and compensating for load and generation peaks. However, the CellCube FB 200400 can also be used as a backup solution when used as an in-line UPS with frequency and amplitude decoupling without detriment to the system. It can also be used as a buffer in wind and solar farms for smoothing the energy output and for compensating for fluctuations, or to provide contractual safeguards by way of energy reserves in times of reduced power.

A worthwhile investment

he SunCarrier 22 provides up to 35% more output compared with fixed systems. With up to 4.3 kWp per wing and low installation height, the SunCarrier 22 is a worthwhile investment for any photovoltaic application – as

a small system with up to 11 wings controlled by a motor or as an effective tracking system in large wind farms. Flexible fixing options and an alternative design are possible.

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NZ Manufacturer June 2013

ENERGY REPORT

Your most unhappy customers are your greatest source of learning. – Bill Gates

Slimline LED emergency light box

H The Hi-Optics L.E.D Slimline Light Bar for emergency or working vehicles and machinery is streamlined and powerful.

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new slimline emergency light box reduces wind drag on vehicles whilst using latest L.E.D technology to ensure it is even more visible. Interest for this product may come from a wide range of customers, from local authorities and roading contractors, to heavy-duty mining operations. The low-profile light box features six high intensity L.E.D’s per module with six modules per lamp, each further enhanced by magnifying optics. These collectively deliver an intensely bright light output for outstanding visibility to enhance safety levels. Multi-voltage circuitry has

been used in the 12 and 24 Volt applications, combined with solid state L.E.D circuitry, incorporating eight commonly used flash patterns. The construction of the lamps is from premium materials, including a virtually unbreakable polycarbonate lens. Numerous units can be synchronised together adding to their versatility in catering for a wide range of applications. Both flange and magnetic base mounting options are available, with an on/off and flash pattern selector switch, making it convenient for any operation in the field. The magnetic base version features heavy-duty rubber vacuum magnets suitable for a range of surfaces.

Energy efficient bulbs reduce power bills

awke’s Bay residents are being urged to buy energy efficient light bulbs following new research by Consumer showing most are brighter, last longer and use less electricity than standard incandescent bulbs. Consumer found the majority of compact fluorescent lamps (CFLs) it tested produced more light than standard incandescent bulbs. The magazine, which reveals a standard CFL costing $6.50 would pay for itself in less than four months, also says light bulbs carrying the blue Energy Star mark are also most energy efficient. The testing revealed the best models are more durable and most reach full brightness quickly. Consumer is advising shoppers to look for lumens rather than wattage on new energy-efficient light bulbs From page 1

Lighting up

saves an equivalent wattage in air conditioning because of the heat normally generated by traditional lighting.” The key advantage of LEDs, however, comes from the controls you can put in place. LEDs are dimmable and don’t have to warm up to their full brightness, which means they’re ideal for implementing “daylight harvesting”. Put simply, the strategy involves using natural light wherever possible and having the lights come on only when they’re needed. “Natural light is the cheapest form of lighting available so it makes sense to take advantage of it,” McGill explains. “We have incorporated daylight harvesting into our own lighting controls at our East Tamaki warehouse and we’re approaching energy savings of 80 per cent. That has a big impact on the bottom line.” As another example McGill points out that security lights could be operated at 40 per cent through the night and ramped up to 100 per cent when the sensors detect certain conditions.

“If the whole country converted to LEDs we are looking at 15 per cent energy saving and that is equivalent to one Tiwai Point.” www.nzmanufacturer.co.nz

packaging. Lumens measure the bulb’s light output while wattage only states how much energy the light bulb is using to create light – for example, a 100W standard incandescent has a typical light output of 1600 lumens.

LED technology itself is not brand new, but McGill says it’s now at the point where the extra money spent on buying and LEDs can be regained through energy savings. McGill says for a large commercial environment where the lights are on 24 hours a day the payback can be less than two years, while for smaller businesses that use lighting for eight to 10 hours a day, five days a week, the payback is more like three to five years. In fact, prices are almost low enough to make it worthwhile for residential spaces as well. “A few years ago LED lamps cost $60 each, now we’re seeing LED lamps close to $20 each, plus they last up to 20 years. As the cost falls even further, the pace of change will increase dramatically.” It’s estimated that LEDs will have a 65 per cent penetration into the world’s commercial lighting by the year 2020. Environmentally, because LED lights use electronic chips they don’t contain the “nasties” – including lead and mercury – that traditional lights do, so they’re easily disposed of. To get an idea of the effect this could have, big operations have to replace their lights every two to three years, and all of the old lights have to be taken away by special waste companies. “Lighting causes about 70 per cent of the amount of greenhouse gases that vehicles emit,” McGill says. “If the whole country converted to LEDs we are looking at a 15 per cent energy saving and that is equivalent to one Tiwai Point.”


NZ Manufacturer June 2013

Your time is limited, so don’t waste it living someone else’s life. – Steve Jobs

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EMPLOYMENT

Aurecon cadetship likely to expand

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uch has been the success of the cadetship programme between Aurecon and the South Island Ng?i Tahu tribe, that Aurecon is looking to increase the number of cadets it takes on board during the next financial year as well as investigating the establishment of the programme with other New Zealand tribes. The brainchild of Neil Barr, Manager of the Australian/New Zealand Aurecon offices, the cadetship’s vision is to provide meaningful career opportunities for young Maori. Aurecon provides engineering, management and specialist technical services for public and private sector clients globally with an office network extending across 25 countries. Barr, who remembers the challenges for young people he faced during his upbringing in the UK, said that the most economically beneficial untapped natural resource that New Zealand has sits between the ears of its young people. “I am personally very much aware that breaking the cycle of generational hardship is incredibly difficult but being able to successfully tap that well of talent is worth the challenge. Youth unemployment rates are significant and we all owe it to our future generations to try harder. There is a wealth of talent out there that is not being used to the full potential. “Existing cadetships were very much geared at the lower social economic spectrum with jobs like manual labour on offer. I’m not knocking that, I worked as a labourer myself after leaving Uni unemployed, and it does provides skills and training that otherwise weren’t there. But more professional opportunities could be provided for teenagers if we as a business society wanted to provide them” he said. As there was no precedent for this type of partnership, careful planning went into the Memorandum of Understanding to ensure that such a long-term relationship had real value, from an educational as well as cultural and lifeskills perspective. The Christchurch Polytechnic Institute of Technology was included from the start. “A big component of our programme was driving the importance of basic work skills like getting up on time and being proud of doing a good job, a grounding for what it means to be a professional and a passion for the industry,” he said. Aurecon Talent Development Manager, Paul Gardner said that discussions were held within Aurecon on how cadets’ study leave

would be managed within the team and the potential impact on project workload. “Meetings were held between the various unit managers to ensure consistency in approach so that each cadet had a similar learning experience. Our responsibility for pastoral care is more than just 9 to 5 work,” he said. After a selection process involving several interviews, Dunedin’s Antony Gray and Christchurch’s Josh Mitchell were selected and have both been at Aurecon’s Christchurch office for a few months. Both 18-year-olds are extremely grateful for the opportunities they have received and the support they have been given in starting out on such exciting careers, Josh as a cadet Geotechnical Engineering Technician and Antony as a Cadet Drafter. Both have now enrolled on their New Zealand Diploma of Engineering with Josh’s weekly workload involving 20 hours at Polytechnic and 32 hours at Aurecon and Antony’s replicating that as his polytechnic study intensifies. Antony, who had to change cities to undertake his new job having been educated at Dunedin’s Bayfield High School, is private boarding with a family he knew from Dunedin and slowly turning Christchurch into his home. “Aurecon is such an awesome place to work and I am trying to play a bit of volleyball and some basketball and that is helping me get to know more people, but now that I am undertaking the same

Josh Mitchell (left) and Anthony Gray.

Polytechnic course as Josh I’m not sure I will have much spare time.” Josh started at Aurecon after finishing school in November, having originally been at Shirley Boys High School and then moved to Ellesmere College post the earthquakes and damage to the school. “It’s a privilege to get this opportunity and I know what a huge difference it has already made in getting me started on a career,” he said. Monday’s are the most challenging day for Josh with 12 hours of classes at Polytechnic. Sir Mark Solomon, chairman of Te R?nanga o Ng?i Tahu, said that the cadetship creates a significant opportunity for Ng?i Tahu to contribute to the earthquake recovery and gain a meaningful career in a professional field. “Aurecon has a strong relationship with Ng?i Tahu Property, so this partnership further leverages iwi commercial relationships to create employment opportunities for iwi members whilst also building iwi technical expertise to assist Ng?i Tahu Property in future

developments. “I must commend Neil Barr for his drive in creating this opportunity, not only for Ng?i Tahu, but if his plans for the other tribes in New Zealand come to fruition, for them as well,” he said. Aurecon provides engineering, management and specialist technical services for public and private sector clients globally. With an office network extending across 25 countries, Aurecon has been involved in projects in over 80 countries across Africa, Asia Pacific, the Middle East and the Americas and employs around 7 500 people throughout 11 markets. • Construction • Data & telecommunications • Defence • Energy • Government • International development assistance • Property • Manufacturing • Resources • Transport • Water

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NZ Manufacturer June 2013

BUSINESS NEWS

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Your “I can” is more important than your “IQ”. – Robin Sharma

Disaster management focus for Auckland

emand for a new breed of disaster management expert in New Zealand has inspired the creation of both a masters degree and a Centre for Disaster Resilience, Recovery and Reconstruction at The University of Auckland. The Centre for Disaster Resilience, Recovery and Reconstruction was set up this month, and the masters degree in Disaster Management will be offered by the Faculty of Engineering in 2014. “Learning from recent disasters showed that a new breed of disaster management expert is needed who can understand the complexity of built environments, state-civil society relations, social capital and leadership,” says the Centre’s new co-director, Associate Professor Suzanne Wilkinson. “Finding those professionals still presents a challenge.” This focus is unique in New Zealand because it specifically addresses complexities of the urban built environment and large scale disasters, and differs from other national and international courses with its unique mix of courses from different faculties.   “This Masters is a response to the demand from the disaster and emergency management industry for a postgraduate degree enabling a specialisation in disaster management topics including disaster resilience and disaster risk management that address the challenges posed by modernday disasters”, says Dr Wilkinson from the Department of Civil and Environmental Engineering. Discussions between members of the Faculties of Engineering and Science, Schools of Architecture and Planning Centres for Development Studies and Environmental Law (NZCEL), and the Department of Social and Community Health confirmed the need to develop a programme that draws from the multi-disciplinary content across

Faculties. “The University of Auckland has developed a significant body of research in disaster management and is well positioned to offer a unique multi-disciplinary Masters programme,” says Dr Wilkinson. “The Masters will prepare students for careers and leadership roles in disaster management.” The new degree is associated with the establishment of a Centre for Disaster Resilience, Recovery and Reconstruction in the Faculty of Engineering, in line with The University of Auckland’s goal of developing centres of excellence. The other co-director for the Centre is Dr Ljubica MamulaSeadon, whose position is supported by a grant from the Auckland Council.    Dr Mamula-Seadon is an internationally recognised expert in disaster resilience, policy and risk management. “There has also been consultation with central and local government, the engineering profession and with other education providers that have interests in this area,” says Dr Ljubica Mamula-Seadon. “These organisations are challenged by the potential impacts of disasters and understand the need for suitably qualified practitioners.” A common theme that arose during consultation on the new Masters in Disaster Management was recognition of the widening gap between academic training and practice in disaster management.  This was particularly in post-disaster recovery planning and management assignments, she says. A need was expressed for post-graduate programmes with a multi-disciplinary and interdisciplinary focus on disasters.  Such programmes would target educating both practicing professionals to lead and work in this space, as well as academic professionals to expand the education and research on disaster management and disaster resilience. The Earthquake Commission

(EQC) was one of the stakeholders consulted about the new Masters, and was encouraged by the proposal and the focus on holistic capability development for engineers and other professions, such as planners, urban designers, and community

New partners reflect changing needs

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wC will admit three new partners to the firm 1 July to bring its total number of full equity partners to 112. PwC New Zealand’s Chief Executive Officer Bruce Hassall says, “We’re continuing to gear up for growth, investing in areas of our business and adding capacity where we can see demand is strong. Kevin Brown and Andrew Holmes will join PwC’s Assurance team, while Callum Dixon will sit in the firm’s Advisory practice, working across the financial services sector, effective 1 July 2013.

Callum Dixon

Kevin Brown

Andrew Holmes

Kevin has a broad range of skills and expertise, developed by working across a diverse portfolio of clients. A specialist in the retail and insurance sectors, he’s responsible for the majority of Wellington’s clients in this area. He also has a strong interest in the oil and gas industry and is growing his involvement in this high potential sector for the Wellington www.nzmanufacturer.co.nz

developers. “One of the lessons from the Canterbury earthquakes experience is the importance of a broad understanding of the disaster risk context for engineers, planners and designers,” says Dr Wilkinson.

practice. Kevin joined PwC New Zealand on a secondment from the UK firm (Southampton office) in 2004, never returning home. Callum Dixon is multifaceted, and works in both PwC’s Advisory and Assurance practice areas providing treasury, finance and assurance services to his clients. His highly specialised skill set allows him to work in the high growth area of Financial Risk and the technical area of large banking audits. Callum joined PwC New Zealand in 2002 as a graduate, following two summer internships with the firm. He has gained experience working in the Cayman Islands and London during this time. With his blend of financial, risk management and IT related skills, Andrew Holmes will focus on growing the RCS practice further to meet future market needs. His skill-set fits across the internal audit, risk management and systems process assurance areas of the business. His professional career began in 1999 when he joined PwC South Africa, where he also undertook secondments to the US and UK firms. Later in 2005, he joined Toyota South Africa Motors as the Head of Internal Audit, and was subsequently promoted to head of Risk and Controls. In 2007, he rejoined PwC in the US, where he served some of our most important global clients and also undertook a number of leadership roles, before transferring to PwC New Zealand in 2010.


NZ Manufacturer June 2013

Whatever you do, be different – that was the advice my mother gave me, and I can’t think of better advice for an entrepreneur. If you’re different, you will stand out. – Anita Roddick

Closing The Gap

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n interesting speaker in the HERA session at the 2013 Metals NZ Industry Conference was Dr Steven Schmid whose presentation Bringing Manufacturing Back to the US - Lessons for New Zealand was particularly topical in light of increasing pressures on local manufacturers from the unfavourable exchange rate and margin constraints from cheap imports, again also linked to exchange rates. Dr Schmid is Associate Professor of Aerospace and Mechanical Engineering at Notre Dame University in the USA, who has been spending a sabbatical year as part of President Obama’s taskforce looking at revitalizing American manufacturing. Many of the issues he identified which have impacted manufacturing in the US over the past few decades have also been seen in New Zealand. One of the taskforce’s key findings was the disconnect between university-based research and company application of the research in bringing innovation to new products and services. He said that they had identified that there was a step between what universities did and what companies could take up; that was missing, which could be loosely termed the technology demonstration phase. He said that this phase, which he described as Technology Level 4 to 7, was a gap in manufacturing innovation and typically too high a risk for many companies and outside what most universities do. The task force has proposed the development of innovation hubs, up to 15 manufacturing innovation

REAR VIEW

Commentary by Heavy Engineering Research Association Industry Development General Manager Nick Inskip

Manufacturing has a higher multiplier affect on the economy that any other sector Dr.Steven Schmid

institutes, spread across the country, each with a unique focus to close this innovation gap which exists between basic research mostly funded by government and commercialization of technologies funded mostly by industry. The model for the institutes is very much oriented around industry needs in much the same way that HERA’s activities are and is based on creating industrial commons where companies of all sizes have an opportunity to participate. Their overarching mission is to “create new U.S. manufacturing capabilities and industries, and to grow high paying manufacturing jobs of the future.”

The model relies on large companies taking a leading role in funding, along with government, and it is here that the model stops working for New Zealand in that the bulk of New Zealand manufacturers are small companies; we simply don’t have any of the scale to support initiatives of the size required. This does not mean that a lot of what the US has found cannot be applied in New Zealand, only that another gap; a funding gap, has to be overcome if we want to follow the same path. As to why Obama wants to bring manufacturing back to the USA, it’s simple; Steven Schmid showed that manufacturing has a higher multiplier affect on the

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economy that any other sector. One dollar generated in manufacturing provides half as much again benefit to a dollar generated in arts and entertainment and nearly twice as much as financial and business services. The lesson for New Zealand is that the US has identified what gaps need to be addressed in order to support the development of their manufacturing industry and have a strategy to close them.  Though we have an additional ‘funding’ gap to overcome, closing it may be just what we need to “create new NZ manufacturing capabilities and industries, and to grow high paying manufacturing jobs of the future”.

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NZ Manufacturer June 2013

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