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NZ Manufacturer May 2011 May 2011

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Business News

Developments Waikato Aviation Industry Cluster

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www.investwaikato.com

Lean Thinking

Cashing in on Vietnam boom

Lean Business programme heats up business Page 30

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Waikato’s Aviation Industry Steel-framed housing finally breaks through for quake housing Cluster takes off

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contract since 2009 when it took over from the Katolyst Group. Opportunity Hamilton chief executive Sandra Perry, AIC chairman John Jones, AIC general manager Shaun Mitchell and board member John Cook, of Stainless Design, recently met to sign papers allowing the cluster to become its own entity. Sandra said the cluster stepping out of its own was the next step in recognising its vision to be the centre of light aircraft manufacture, maintenance and pilot training in Australasia. Continues page 9

Photo: Stephen Barker/Barker Photography ©CTC/Aviation Cluster

t’s an exciting time in Waikato’s aviation history with the regionally-based Aviation Industry Cluster spreading its wings to become a business entity and charitable trust in its own right. The sign-over comes at a time the cluster is leading New Zealand aviation in numerous achievements, including the construction of a specialist aircraft paint facility near Hamilton International Airport. Opportunity Hamilton, the city’s economic development agency, has managed the aviation cluster

Acting Minister for Economic Development Hon David Carter launches the new Aviation Paint facility with a sod turning at the site, surrounded by Aviation Cluster board members, from left, Gordon Luke (Aeromotive), Maxine Sutton (Micro Aviation), Damian Camp (Pacific Aerospace), Shaun Mitchell (cluster manager), John Cook (Stainless Design), Chris Doak (Hamilton International Airport), Sandra Perry (Opportunity Hamilton) and NZTE regional manager Peter Smyth, near CTC Training centre at Hamilton International Airport.

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n time, it’s likely to be referred to as “the whisper that roared”. Steel-framed housing has nudged on to the national agenda with the award, to a joint venture of FRAMECAD and NZ Transportable Units, of a major tender issued by the Department of Building and Housing to construct up to 300 temporary accommodation units for those affected by the Christchurch earthquakes. The JV proved to be one of the three successful proposals out of 226 tender submissions. Key industry players who have been advocating “give steel an even chance”, are welcoming the award. “The industry is both proud and pleased we can assist directly and tangibly in Christchurch’s recovery. It’s a terrible situation clearly requiring immediate attention to what remains still very desperate need,” says Carl Davies, GM National Association of SteelFramed Housing Inc (NASH). He is at pains to dispel that this marked the beginning of the end for timber-framed houses: “We aren’t so much looking to replace timber, which can be acceptable in certain circumstances, as we are in getting ‘a fair go’ for steel-framing, when and where it is entirely appropriate. New Zealand has, until now, been one of the few developed countries where steel got overlooked or deliberately ignored by government departments. “The industry must take some of the blame for not educating the market on the superior performance of steel-framing in earthquake zones and forest fires etcetera. Over time

By Kevin Kevany

Carl Davies we expect to capture somewhere in the order of 20 percent of the market, which is where we should have been by now,” says Davies. So you’d imagine that the timber industry will be quite relieved by the reassuring words from the feared opposition? Not one bit of it. An editorial in “the voice” of the Australasian timber industry, “Friday Offcuts” notes in its main feature: The steel-framing industry has taken an early lead in not only positioning the product (it’s being promoted now as “A Sustainable Solution for Tough Times”), but have very cleverly added their marketing spin. Continues page 12

• Email: sales@sew-eurodrive.co.nz • www.nz.sew-eurodrive.com www.nzmanufacturer.co.nz


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If there’s a bit of Doug in you, then there’ll be a bit of Kiwibank too. Call one of our Business Banking Specialists today on 0800 601 601 or visit www.kiwibank.co.nz/business-banking to hear more from Doug.

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NZ Manufacturer May 2011

CONTENTS Advisors

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DEPARTMENTS

OPPORTUNITY HAMILTON

Skills shortage stunting growth in manufacturing.

APPOINTMENTS

New chief for WaikatoLink

FROM WHERE I SIT

Ian Lind managing director of Meco Engineers shares all.

Page 9 – OPPORTUNITY HAMILTON – Waikato’s Aviation Industry Cluster takes off.

AUCKLAND MANUFACTURERS

Diverse manufacturing sectors in Super City.

BUSINESS NEWS

Chris Whittington

Technical Director with Camplex NZ Ltd. An experienced Graduate Mechanical Engineer with extensive experience in both Product Design and Manufacture. Considerable recent experience in both rapid prototyping and reverse engineering.

Bruce Goldsworthy ➡ An advocate for NZ manufacturing for 40

Cashing in on Vietnam boom.

PRODUCT NEWS • Retro Chic

Page 14 – AUCKLAND MANUFACTURERS – Steering the steel-framing case.

• Adding waste toner to roads.

CASE STUDY

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.

Open sourcing a future for renewable energy.

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manufacturing and is constantly striving to improve training methods for students. He is Head of the School of Engineering at Deakin University in Australia.

• Employment case sets new benchmark.

• Lowering power consumption.

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Professor Guy Littlefair MSc PhD CEng MRSNZ is passionate about

• Benefits of partial privatization outweighs fears.

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BUSINESS NEWS

ANALYSIS

Do you need capital investment?

MANUFACTURING TECHNOLOGY • Winning design sponsored.

• New level of reverse engineering.

Vishnu Rayapeddi ➡

DEVELOPMENTS

IRL launches R & D business booster.

SUPPLY CHAIN

RFID the “New Clever in the New Normal!”

REAR VIEW

John Walley

Is the Chief Executive of the New Zealand Manufacturers and Exporters Association. John consults to a number of overseas companies and is a Chartered Engineer, a Fellow of the Institute of Professional Engineers NZ, a Fellow of the Institute of Management NZ and a Member of the Institute of Electrical Engineers UK.

Page 23 – DEVELOPMENTS – US Government invests in our green energy technology.

The path to export success.

Vishnu is the founding director of Productivity Solutions Limited, a Lean and Supply Chain Management consulting company aimed at helping its clients create and sustain World-Class Operations. PSL offers Lean and Competitive Manufacturing programmes in association with NZTE, CMI Consortium and HERA.

Hans Frauenlob

Is New Zealand Trade and Enterprise’s Director – Specialised Manufacturing, with responsibility for NZTE’s Specialised Manufacturing team.

June in

NZ MANUFACTURER

The Budget

What it means for business

Page 30 – LEAN THINKING – Lean Business programme heats up business.

sales@plasticweldingtools.co.nz www.nzmanufacturer.co.nz

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.

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NZ Manufacturer May 2011

EDITORIAL

Most newspaper companies still have their heads in the sand, but other media companies are aggressive. - Rupert Murdoch

Great things going on in manufacturing

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

Peter Isaac, Guy Littlefair, Kevin Kevany, Bruce Goldsworthy, Catherine Beard, Vishnu Rayapeddi

SALES & MARKETING NZ ADVERTISING MANAGER

Max Farndale T: + 64 6 870 4506 E: max@nzmanufacturer.co.nz

Design & PRODUCTION

Karl Grant T: + 64 6 870 9028 E: daylightmarketing@xtra.co.nz

WEB MASTER

Dan Browne E: dan@membrana.co.nz

PUBLISHING SERVICES

On-Line Publisher Media Hawke’s Bay Ltd

SUBSCRIPTIONS

Media Hawke’s Bay Ltd T: + 64 6 870 4506 E: mediahb@xtra.co.nz 11 issues per year. New Zealand $55. Australia and Pacific $95. Rest of the World $132.

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 Publishers of; NZ Manufacturer, Cape & Bay, The Mirror, Asia Manufacturing News. Plus contracted publishing services.

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oger Kerr on his morning finance commentary on radio says manufacturing is picking up; word from Otago region is that things are dire. We can’t have it both ways, there will always be differing views affecting our manufacturing future. So when the positive comes along, I’d prefer that we went with it and build on our solid bases. In this issue there are some cracking articles for you to read – from opening up business opportunities in Vietnam to the launch of the Waikato Aviation Cluster, to the words of wisdom from Ian Lind, managing director of Meco. Sir Ken Stevens, leader of the Vietnam Trade Mission saw the visit as most worthwhile as did Ron Hendl of Waikato stainless steel fabricator Hendl and Murray who reported making a lot of contacts who will come to New Zealand to discuss business. (See Page18). The Waikato Aviation Cluster recently became a business entity and charitable trust in its own right. This stepping out on its own was the next step in recognising its vision to be the centre of light aircraft manufacture, maintenance and pilot training in Australasia. Its worth noting that 1000 aircraft have been manufactured in the Waikato, nearly 50 years after the first plane rolled off production lines at Pacific Aerospace. Well done! Bruce Goldsworthy, EMA’s manager of advocacy and manufacturer services looks at the positive side of the government appointing successful business leaders to the boards of state owned enterprises (SOEs) (Page 6). He sees this increased business experience as being vital when privatizing some of our SOEs takes place. There’s plenty else for you to read about within these pages. In June we will provide analyse on the Budget to see what it offers businesses.

Doug Green

ISSN 1179-4992

Vol. 2 No. 3 May 2011 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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NZ Manufacturer May 2011

BUSINESS NEWS

Almost all quality improvement comes via simplification of design, manufacturing... layout, processes, and procedures.

Benefits of partial privatisation outweigh fears

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t’s great to see the Government appointing successful business leaders to the boards of stateowned enterprises (SOEs) this month. Too often in the past we have seen these boards positions stacked with directors whose experience is mainly their standing in the political party making the appointment. The increased business experience and wisdom evident will be called upon when New Zealand begins the process of partly privatising some of our SOEs. New appointments include former Fisher & Paykel Appliances chief executive John Bongard, Westpac NZ chairman Peter Wilson, and former Te Runanga o Ngai Tahu chief executive Anake Goodall to the board of Meridian - a crown asset earmarked for partial privatisation. New appointments to the board of Transpower are Don Huse and Keith Tempest, formerly chief executives of Auckland International Airport and TrustPower respectively. Our congratulations to them. In January the Government unveiled plans in their next term to sell minority shareholdings in power companies Meridian, Mighty River Power and Genesis, coal company Solid Energy and to reduce its stake in Air New Zealand from 76 per cent to 51 per cent. Prime Minister John Key said the sales could raise $7-10 billion, which could be invested in other assets to help reduce our reliance on debt from offshore to fund much needed infrastructure. Before that happens New Zealanders apparent fear of privatisation will have to be laid to rest. The mere word privatisation seems to draw a negative response. The Maori Party and the Greens

oppose it, and attract support from their electorates on the presumption that many see it as bad. But if private ownership is bad, and if logic was to prevail, they would presumably also want the government to buy up businesses like Fletchers, Telecom, Fisher and Paykel, CHH, Mainfreight and others. My question of them is why should the government own all of a coal mining company, several power companies, and 75 per cent of an airline? Some seem to think if these businesses were owned 49% by individuals they would increase their prices to pay a higher dividend, but the government as their owner appears to be encouraging them to do that anyway. And if our SOEs are not charging a market price and not giving the government an appropriate rate of return, we will all pay more in taxes. Such a debate is nonsense because, for instance, Solid Energy sells coal into a competitive international market and cannot set its own price. The electricity wholesale market is also a competitive market (though not perfectly) and so too is electricity retailing. Others oppose privatisation because they don’t like the idea that some shares may be bought by foreigners. But many New Zealanders own shares in foreign companies, a lot of them because of the lack of choice available in New Zealand. No doubt there are other reasons why kiwis are fearful of part privatisation, so let’s look how those fears could be allayed. Let’s suppose the government sells a 49% stake in several SOEs and invests the proceeds in a new SOE wholly owned by the government.

The new SOE would be a sovereign wealth fund, let’s call it the New Zealand Investment and Development Fund (NZIDF). Various organisations as well as EMA have proposed something like this including the Capital Markets taskforce, the NZ Stock Exchange, BusinessNZ, and the NZ Institute. This NZIDF could be empowered to sell bonds to the public and to other investment funds, and by being able to borrow from the public it would have more money to invest in New Zealand’s infrastructure such as transport, reticulated services, education, health, prisons and the like. In this way the Government would retain a 51 per cent shareholding in the SOEs as well as having 100 per cent ownership of the new NZIDF. By leveraging state ownership of our SOEs in this way, most New Zealanders fears should be put to rest as politically,

The mere word privatisation seems to draw a negative response. The Maori Party and the Greens oppose it, and attract support from their electorates on the presumption that www. many see it as bad. baskiville. com

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- Tom Peters

By Bruce Goldsworthy, EMA’s Manager of Advocacy and Manufacturer Services they prefer the Government to retain control over the assets that they the taxpayer has helped build up. This approach should resonate with Kiwi’s because they know our current account deficit is the second highest in the world as a percentage of GDP. They also want our government to be less reliant on borrowing money from abroad, and the goal of this proposal is to leverage publicly owned assets to achieve higher economic performance for the good of all New Zealanders. That being so, it would be seen as equitable and politically saleable. The partly privatised SOEs would also benefit from the commercial discipline and scrutiny that comes from being publicly listed on the stock exchange with shareholders electing its directors. Their performance is bound to improve. The NZIDF fund would also provide the sort of safe, interest bearing investment opportunity that many, mainly retired folk are looking for. The NZX and New Zealand investors too would benefit from the greater choice of investments here, not just from individuals but from the likes of the “Cullen” fund, the ACC, and the raft of Kiwisaver providers.


NZ Manufacturer May 2011

As soon as everyone is on the bandwagon with one idea, a leader should be working on the next one. - Roger Enrico, Pepsico

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BUSINESS NEWS

Employment case sets new benchmark

new Employment Court decision could radically change the way in which employers carry out restructuring and disciplinary processes. Information that had previously been considered “off-limits” by employers must now be disclosed to employees as part of a restructuring consultation or disciplinary action. Employment partner Scott Wilson, of Duncan Cotterill Lawyers, said that the decision could have a major impact on an employer’s ability to withhold information on the basis that it was sensitive or confidential. “Employers should assume that all documentation relating to a restructure, selection or disciplinary process may need to be disclosed. This includes the likes of Board minutes, internal memos and emails, guidance and advice from an HR manager, interview notes, and information about other candidates in a restructuring selection process.” The shift follows a recent case, Massey University v Wrigley in which the university moved to restructure part of its operations, with existing staff vying for fewer jobs. Wilson said the university went through what seemed like a robust selection process. “Candidates were given a lot of information about the selection process. They were subsequently given information about their scores and the recommendations that had been made about them.Information about other candidates was not

provided.” But a dispute arose when the unsuccessful employees asked the university to reveal its selection information including copies of handwritten notes and information about how other, successful, candidates had been scored and assessed. The Employment Court held that employees were entitled to access interview sheets for all candidates who applied for the same role, their scores and individual assessments; any handwritten notes taken by the interviewer and information about the successful candidates contained in the panel recommendation to the decision maker. The Court said that although the issues in this case arose in the context of selection of candidates for redundancy, they applied equally in other cases where employment was at risk, including serious disciplinary cases.

Employers should assume that all documentation relating to a restructure, selection or disciplinary process may need to be disclosed.

Scott Wilson Wilson said there had long been relevant information where that a tension between employees and information has been received in employers in general about what confidence or may be commercially information to disclose, particularly sensitive. “ in restructuring situations and Wilson worried that the delicate disciplinary situations – restructuring could potentially for example, sexual harassment or be drawn out by demands for bullying. disclosure of all relevant information “Employers have tended to err which would sometimes involve a on the side of caution and withhold large volume of material.

www.irl.cri.nz/scientist-day

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NZ Manufacturer May 2011

OPPORTUNITY HAMILTON

A budget tells us what we can’t afford, but it doesn’t keep us from buying it.

- William Feather

Skills shortage ‘new norm’ Innovation Park pilot spray dryer goes ahead

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Training session in progress

anufacturing leaders spoken to by Opportunity Hamilton, the city’s economic development agency, all agree the lack of qualified employees in the workforce has slowed growth of their businesses. Opportunity Hamilton chief executive Sandra Perry said the message from manufacturers is training staff from within is essential if their businesses are to grow. Many Hamilton-based manufacturers were taking the right step by implementing in-house training programmes, Sandra said. “It’s encouraging to see so many manufacturers taking the initiative and implementing training in the workplace. This is not only of benefit to them but to the industry as a whole,” she said. John Cook, of Stainless Design, Roger Evans, of Stafford Engineering and Les Roa, of Longveld Engineering all invest in training, despite the tough economic times. “Finding people with the right experience for a niche business like ours has been difficult for many years and not going to get easier. You’ve got to be prepared to invest in people and bring them up to speed,” Roger said. “A lack of skill and experience hinders business growth in many instances so retaining staff is critical. Our response is to operate a business model that allows us to carry them if need be and being prepared to invest in people. Business leaders have to work out that it’s just as important to invest in people as it is to invest in

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plant and machinery.” John Cook is another leader taking a stand on skills by establishing his own in-house training centre. New Zealand employers are competing on a global level for talent, with the skills shortage a world-wide phenomenon, John said. “We feel like there has been a skills shortage for years, even right through the recession. The situation is not going to change.” Stainless Design recently opened the Waikato Lean Gemba Academy. The aim of the academy is to deliver world-class training by lean experts and the opportunity to be immersed in the Lean culture at Stainless Design. Longveld Engineering’s Les Roa saw a glimmer of hope recently when he advertised for tradespeople and had some qualified response. “That’s the first time in 20 years that’s happened, with qualified, ticketed tradespeople applying. But it’s still not enough to fill all our vacancies,” he said. In-house training has become an essential part of the industry, as is being a ‘preferred’ employer, Les said. “We’ve got at least a third of our staff in some form of training. But it seems as fast as weíre training people they leave for Australia,” he said. Tradespeople can earn double what they earn in New Zealand ‘across the ditch’, with one former Longveld employee being paid $57 per hour in Australia compared with about $25, according to Les.

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he Innovation Waikato Ltd Board of Directors has approved the construction of an $11 million product development spray dryer facility to be built on the campus of the Waikato Innovation Park. The spray dryer will be the Waikato component of the Government sponsored New Zealand Food Innovation Network. The Innovation Waikato expects to break ground in April, with construction taking around 13 months. The pilot spray dryer will allow companies to research and develop new spray dried food products – something that is difficult to do in large, commercial factories. Capacity of the multi-purpose spray dryer will be one-half tonne/hour. As a comparison, the capacity of spray dryers at Fonterra’s Te Rapa dairy factory is 25 tonnes/hour. Innovation Waikato CEO, Derek Fairweather, says the spray dryer “will initially be set up to allow companies to research, develop and manufacture new whole milk powders. However, the long-term strategy is to expand its capability to manufacture infant formula, fruit and vegetable juice powders.” Finance for the dryer will come from Innovation Waikato Ltd debt and a Government grant of $3.95 million. Hamilton Mayor, Julie Hardaker,

says this spray dryer facility will be a great economic asset for the city. “Hamilton, as the heart of the Waikato region, contributes significantly to New Zealand’s economy through our dairy, food and agricultural exports.  This pilot spray dryer facility is a significant opportunity to attract investment from companies outside our region, and even overseas, to the city,” says Mayor Hardaker. “Initially the spray dryer facility will focus on helping companies develop new dairy products. The dairy industry is the Waikato’s most important export sector, contributing around 27% of the region’s GDP. We believe this dryer facility is a key mechanism for moving the dairy industry from a focus on commodities to valueadded production,” explains Derek Fairweather. Once built, the pilot spray dryer facility will be the only independent development dryer available in New Zealand. The Innovation Park has received strong enquiries from companies outside of the region and overseas, interested in using the pilot plant for research and development purposes. Waikato Innovation Park Spray Dryer – At A Glance: • Only independent development dryer in NZ. • $11 million project. • Capacity of one-half tonne/hour.


NZ Manufacturer May 2011

OPPORTUNITY HAMILTON

Family farms and small businesses are the backbone of our communities. - Tom Allen

From page 1

Waikato’s Aviation Industry Cluster takes off

Construction of the paint facility is a major accomplishment to the cluster’s achievements, including manufacturing more than 1000 aircraft, establishing an aluminium heat treatment plant and sealing a 650m grass runway. Aviation Industry Cluster Chairman, John Jones says the clusters’ milestones had the world taking notice of the region’s aviation sector. “Our counterparts throughout Australasia now really see aviation in the Waikato and in New Zealand as taking off, whereas in the past we’ve flown under the radar.” A New Zealand Trade and Enterprise report from June 2010 showed the New Zealand aviation sector brought an estimated $9.7 billion into the economy in 2009, with $5.9 billion from domestic activities and $3.8 billion from export activities. The New Horizons report shows the industry is expected to grow to $12.6 billion by 2015 with John confident Waikato is poised to net a “significant slice” of the growth. General manager Shaun Mitchell said the cluster’s success would

The cluster is leading New Zealand aviation in numerous achievements.

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not have been possible without the backing of New Zealand Trade an Enterprise. NZTE funded $2 million towards the cluster and provided board advisory representative Peter Smyth. “The cluster’s success would not have happened without NZTE. They have provided a huge amount of support to both the cluster and New Zealand’s aviation sector in general,” Shaun said. Later this year the AIC is poised to showcase New Zealand’s aviation prowess to the international community when it hosts Rugby World Cup visitors at a three-day event The event, held at Te Kowhai Airfield from 13-15 October, will demonstrate New Zealand’s capability in aviation design, manufacturing and pilot training. Flair is being modelled off the world-famous airshow AirVenture Oshkosh in Wisconsin, USA. It will combine exhibitions with aircraft demonstrations and new product launches. All aspects of the industry will be on display, including manufacturing, design, supply, materials, certification, space exploration and pilot training. The Aviation Industry Cluster has more than 70 members including manufacture and supply and maintenance businesses, pilot training and aviation services. The region is home to some of the world’s leading aviation specialists.

aircraft as large as military sized aircraft like the C130 Hercules and P3 Orion, as well as Boeing 737 and Airbus A320 aircraft. 

1000th aircraft

In 2010, the cluster commemorated the 1000th aircraft manufactured in the Waikato, nearly 50 years after the first plane rolled off production lines at Pacific Aerospace. The 1000 aircraft were manufactured by four companies, representing eight models including: five manufactured by Pacific Aerospace - the P-750 XSTOL, CT4, Cresco, Fletcher and Air Tourer, Alpha Aviation’s Alpha 160A Trainer, Micro Aviation’s Bantam B22 Microlight and Autoflight’s Dominator Gyrocopter. The largest manufacturer, Pacific Aerospace, holds the honour of achieving the 1000th aircraft with its latest P-750 XSTOL aircraft destined for export to South Africa.  Of the 1000 aircraft, Pacific Aerospace produced 627, Micro Aviation produced 333, Alpha Aviation produced 23 and Autoflight produced 17 gyrocopters.

Sealing of 650m runway

Hamilton International Airport’s runway sealing in June last year

opened the way for continual growth of airport traffic. The $780,000 project was made possible by a $300,000 contribution by the WAIC.

Aluminium heat treatment plant

Pacific Aerospace last year established an aluminium heat treatment plan with the help of the Waikato Aviation Industry Cluster. WAIC provided 50 percent contribution of $50,000 to Pacific Aerospace to add heat treatment capabilities within the cluster, with half the plant’s capacity available to other Waikato aircraft manufacturers.

Flair 2011

The Aviation Industry Cluster will host a comprehensive, three-day event, Flair, to showcase New Zealand’s capability in aviation design, manufacturing and pilot training. Flair will be held at Te Kowhai airfield north of Hamilton from October 13 to 15. In addition to the business side of the event, Flair will also incorporate a comprehensive demonstration of New Zealand aircraft capabilities.

Waikato aviation milestones

Paint facility “coup” for NZ

Hamilton’s state-of-the-art aircraft paint facility, being constructed adjacent to Hamilton International Airport’s runway, will bring in multimillions of dollars each year alone. “The paint facility is not only a coup for the New Zealand aviation industry. It is a facility that will be an asset for the broader Australasian aviation industry as well. There are numerous spill-over benefits to the region and New Zealand,” John said The $2 million paint facility, to open by August this year, integrates

the world’s latest spray-painting technologies, and will be capable of painting an aircraft 65 percent faster than any facility in Australasia. The facility will be built in two stages and will be capable of painting a range of aircraft from helicopters to ATR, Q300 and Beech 1900 aircraft.  The cluster expects high demand for re-painting by owners of the 4000-plus light aircraft in operation throughout New Zealand The facility’s second stage will Waikato Aviation Industry Cluster (WAIC) chairman John Jones, left, and advisory be constructed in 2014 and will board member John Cook sign the paperwork, with Opportunity Hamilton chief be capable of painting passenger executive Sandra Perry and WAIC general manager Shaun Mitchell.

www.opportunityhamilton.co.nz www.nzmanufacturer.co.nz


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NZ Manufacturer May 2011

OPPORTUNITY HAMILTON New server facility to offer NZ companies safe IT haven

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he Waikato Innovation Park and one of its tenants, theCloud Limited, have signed an agreement to develop a purpose-built IT server facility on the campus of the Waikato Innovation Park. theCloud Limited will operate the facility as a data housing site. It will also provide fault-tolerant server hosting for companies looking for a disaster recovery or backup solution. Construction is set to start later this year.

Bruce Trevarthen, CEO of theCloud Limited, says the company has server facilities in various locations throughout New Zealand. He chose Hamilton as the site for the new server facility because of the city’s low risk profile.   “More so than ever before, companies are looking for a secure location to house their primary and back-up data servers. Not only does Hamilton have a low risk profile when it comes to natural disasters, it’s also in close proximity to a high

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proportion of New Zealand’s largest companies who are looking for offsite data storage and computing service,” he explains. theCloud Limited shares its name with the internet term, ‘the cloud,’ which refers to computing services delivered over the internet in real time. Cloud computing drastically reduces the need for companies to invest in expensive IT hardware. Mr Trevarthen says theCloud Limited “aims to convert our clients’ IT costs from being a capital intensive investment to an operational expense. Building a world-class server facility in Hamilton is a key element that will allow us to deliver our cloud computing services to clients throughout New Zealand.” Waikato Innovation Park CEO, Derek Fairweather, says “a further advantage of locating theCloud Limited’s new server facility at the Waikato Innovation Park is the secure electricity infrastructure available.  “We are in discussions with WEL Networks to install a small scale generation facility onsite to further guarantee continuous supply in the event of an outage to the national grid.  “However, later in the year, WEL will be setting up a direct feed for us to the Transpower substation adjacent to the Park.  Once we have the security of a direct feed, an onsite electricity generation facility may not even be necessary.”

CRV AmBreed Moves Into Park

he Waikato Innovation Park’s newest tenant is CRV AmBreed. The company recently moved 13 of its staff into the Park, while it will continue to maintain the company’s headquarters just outside Hamilton. Managing Director, Angus Haslett, says CRV AmBreed moved into the Park because it was a clear fit for the company. “Key drivers for our company are growth and innovation. We’ve expanded a lot in the last few years and in our current location we sometimes feel a bit isolated. In our new offices, we have opportunities to network with other tenants, as well as farmers and industry leaders who frequent the Park. We’re confident these networking opportunities will help fuel the growth path we’re already on. “Plus, the Innovation Park is a hub for new ideas in the agricultural industry and that is a perfect fit with www.nzmanufacturer.co.nz

our company - it’s very much us,” Mr Haslett explains. CRV AmBreed has moved key staff from their sales, marketing and genetics teams to the Park. Waikato Innovation Park CEO, Derek Fairweather, says attracting CRV AmBreed to the Park is huge. “The Innovation Park has earned the reputation as New Zealand’s centre for agricultural technology innovation. And, CRV AmBreed is definitely a leader when it comes to developing advancements in on-farm technologies and genetic science. Having them on-site adds real depth to our tenant mix,” says Mr Fairweather. Mr Haslett says, “being located at the Innovation Park will be a great selling point when it comes to recruiting the very best talent to our team.” The Waikato Innovation Park now houses over 50 companies, which employ over 400 staff.

To the person who does not know where he wants to go there is no favorable wind. - Seneca

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Hamilton businesses step up to help quake-stricken Canterbury

ozens of Hamilton business owners are stepping up to help their quake-affected Canterbury peers via a new website – www.hamiltonchristchurch.com. The site has fielded dozens of offers of business support from Waikato, ranging from mentoring “shoulders to lean on” to rent-free periods from landlords and manufacturers willing to fulfil contract obligations on behalf of Christchurch businesses. The site is an initiative driven by Hamilton Mayor Julie Hardaker and is a partnership between Hamilton City Council, the city’s economic development agency Opportunity Hamilton and the Waikato Chamber of Commerce. “This is very much businesses speaking to businesses about how they can help in a time of crisis,” Mayor Julie said. Opportunity Hamilton is coordinating offers of help and expressions of need from the website, and forging appropriate business links. Project manager Sandy Turner said the site had been well publicised in Waikato with the challenge now to ensure Christchurch business owners know about it. “We intentionally waited until we had some really good offers before we launched a campaign in Christchurch. Now we have some great offers and we’d like Christchurch business owners to let us know their needs so we can get in touch with them,” Sandy said. Keeping businesses trading in Christchurch is a priority of the initiative wherever possible. “There will be those who choose

to relocate, and we are in a position to support them, but the priority is providing the appropriate support to help get Christchurch back on its feet.” Stafford Engineering’s Roger Evans is one business owner offering help. Roger will assist businesses similar to his to fulfil their contract obligations and can employ staff temporarily. “The biggest issue for many of these businesses is supporting their existing customer base, which requires delivery as agreed. If these customers are forced to find other manufacturers, the connection is lost and the chance of re-establishing is limited,” Roger said. Other offers of help include: a modern woodwork factory to make components or fulfil contracts; landlords offering free rent periods and help with relocation costs; IT servicing including repair, data recovery and database management, human resource advice; free hostel and hotel accommodation; free office space; free help finding rental accommodation; free food processing – diced, minced and chilled; free use of a 2400l stainless steel water tank in Christchurch; serviced office space with free phone and broadband for a business less than two years old until May; temporary or permanent vacancies and/or secondments including truck mechanics, design engineers, fabricator/welders, workshop hands, mechanical maintenance supervisors, sheet metal apprentices, earthmoving mechanic; free business mentoring and engineering contract fulfilment. nextSTEP www.hamiltonchristchurch.com

National Agricultural Fieldays 15th to 18th June

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ew Zealand National Agricultural Fieldays is the largest agribusiness exhibition in the Southern Hemisphere. New Zealand is a world leader in agriculture and pastoral farming and the National Fieldays is the ultimate launch platform for cutting edge agricultural technology and innovation. With over 1000 exhibitors, National Fieldays is essential in keeping up with the latest trends and developments in the agriculture and farming industries.

National Fieldays is held over four days each June attracting in excess of 130,000 visitors from around New Zealand and internationally from 38 different countries. The current exhibition and demonstration space is over 40 hectares and boasts over 1,000 exhibitors on 1400 sites. Held at Mystery Creek Events Centre, the agricultural Fieldays is located right in the heart of the Waikato, adjacent to Hamilton International Airport, close to State Highways 1 and 3; and just ten minutes from Hamilton, Te Awamutu and Cambridge.


NZ Manufacturer May 2011

High achievement always takes place in the framework of high expectation. - Charles Kettering

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APPOINTMENTS

New chief for Victoria University announces latest Honorary Doctorates WaikatoLink

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Duncan Mackintosh

aikatoLink has announced the appointment of Duncan Mackintosh as Chief Executive. Mr Mackintosh was General Manager, Business Development, at WaikatoLink and is the Founding Manager of AngelLink. In his previous role at WaikatoLink, Mr Mackintosh was responsible for opportunity identification, venture creation, technology and commercial development, and deal broking for University of Waikato based intellectual property and start-up companies. Duncan has founded or cofounded a number of new ventures based on University of Waikato IP. He is the Founding Manager and Director of AngelLink, a national angel investment network backing New Zealand high growth technology ventures with an emphasis on life sciences, engineering and ICT. Prior to WaikatoLink Mr Mackintosh held roles in commercialisation and technology incubator development and management. He graduated from Massey University in 1995 with a BVSc in Veterinary Science and worked as a veterinarian for seven years.

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Dr Bob Buckley

ictoria University of Wellington will confer honorary degrees on a world-leading physicist, and a champion of our kiwifruit industry. World-leading physicist and manager of Industrial Research Limited’s (IRL) Superconductivity and Energy Group Dr Bob Buckley is both an IRL Distinguished Scientist and a Fellow of the Royal Society of New Zealand. Over the past 16 years, Dr Buckley has led IRL’s research into the synthesis, discovery and application of high temperature superconductor (HTS) materials and managed their commercialisation. He was closely involved in the establishment of the IRL company HTS-110, and is currently a board member of a second HTS based company, General Cable Superconductors. HTS technology underpins new developments that allow the transmission of electricity without resistance or the loss of energy. This enables the manufacture of lighter, smaller and more efficient electrical equipment than can be achieved with existing copper wire technology. Victoria University ViceChancellor, Professor Pat Walsh, says

that Dr Buckley is at the forefront of the industry. “Bob Buckley has played a key role in developing New Zealand’s strategy for capturing the benefits of HTS discoveries. Among his many achievements, he co-invented Bi2223, the material used to make high temperature superconducting wires.” Dr Buckley completed his PhD at Victoria University in 1979. He is also a board member of the MacDiarmid Institute for Advanced Materials and Nanotechnology, based at Victoria University, and the author of 100 referred publications and nine patent applications. In 2004 he was awarded the Royal Society of New Zealand’s prestigious technology honour, the Pickering Medal, in 2009 he won Wellingtonian of the Year in the Science and Technology category, and in 2010 he was jointly awarded the inaugural Prime Minister’s Science Prize. Dr Ross Ferguson is the international authority on kiwifruit biology and an ambassador for New Zealand science. Projects under his leadership have been fundamental to New Zealand’s kiwifruit breeding programme and to the New Zealand kiwifruit’s expansion to an international market. In 1973, with kiwifruit emerging as an increasingly important crop for New Zealand, he began studying the fruit’s biology. Much of this research was later included in the seminal work, Kiwifruit: science and management. Dr Ferguson has authored or co-authored nearly one hundred books and papers on the topic, and is regularly invited to address scientific conferences. Professor Walsh says that Dr Ferguson’s efforts have been of huge importance to a very important

Dr Ross Ferguson industry for New Zealand. “Dr Ferguson is another example of the importance of scientific research to our export industries. As a major contributor to the success of the kiwifruit industry, he is a model for the way science and industry in partnership can be of enormous benefit to our economy.”Dr Ferguson graduated with a BSc (Hons) from Victoria University in 1965. He is a scientist with Plant and Food Research and is a Fellow of the Royal society of New Zealand. In 1995 he received a New Zealand Research and Technology Medal, and in 2007 was made an Officer of the New Zealand Order of Merit for his contribution to the kiwifruit industry. In 2010 he was awarded the prestigious Jubilee Medal of the New Zealand Institute of Agricultural and Horticultural Science for his exceptional contribution to primary resource science over a sustained career. Dr Bob Buckley will receive the honorary degree of Doctor of Science at Victoria University’s May 2011 Graduation. Dr Ross Ferguson will receive the honorary degree of Doctor of Science at Victoria University’s December 2011 Graduation.

WaikatoLink appoints new Chairman and Director

aikatoLink, the commercial arm of the University of Waikato, has announced two new board appointments. Auckland business leader and long-serving army officer, Lt Col Tenby Powell has been appointed as Chairman, and Hamilton-based lawyer James McGillivray, has been appointed as a director. Tenby Powell, founder and director of Hunter Powell Investments, is the entrepreneurial force behind the success of a number of companies including the New Zealand Rental Group, the country’s leading rental equipment

provider. New Zealand Rental Group began life as Hirepool and now encompasses Port-a-Loo, Henderson Rentals, Rhodes Rentals, Barricading Solutions, Castles Marquee Hire, Hirepool Access and Hirepool Energy. Prior to this he held senior management positions in Fletcher Challenge and Viking Pacific Group (formerly the Skellerup Group). He co-chaired the 2009 Entrepreneurial Summit, serves on the board of Antarctica New Zealand, and is a Trustee of the Auckland Rescue Helicopter Trust. He graduated from the

University of Waikato in 1987 and was honoured last year with a Distinguished Alumni Award for his entrepreneurial talents and leadership. Tenby Powell is also a graduate from the Harvard Business School and holds the rank of Lieutenant Colonel in the Royal New Zealand Infantry Regiment. James McGillivray is a Partner at Hamilton law firm Tompkins Wake. He leads the commercial litigation team and specialises in high level complex disputes. Continues page 22

Tenby Powell www.nzmanufacturer.co.nz


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NZ Manufacturer May 2011

FROM WHERE I SIT IN BRIEF

Action needed on asset bubbles

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igh debt levels in the New Zealand dairy industry remain one of the greatest concerns for the banking sector according to KPMG’s Financial Institutions Performance Survey.  The New Zealand Manufacturers and Exporters Association (NZMEA) is supporting moves by the Reserve Bank to increase the amount of equity that banks must hold to cover rural loans and suggests further balancing using capital gains and land taxes to move capital from the tax shelters of land and buildings into productive business. l l l l

JV wins tender for Christchurch temporary housing

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joint venture of FRAMECAD and NZ Transportable Units has been awarded a major tender issued by the New Zealand Department of Building and Housing. The tender requires the construction of 300 temporary accommodation units for those affected by the Christchurch earthquake of 22nd February this year. l l l l

Markets expanded

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iwi Lumber has expanded its export markets and now supplies clients in North America, Asia, Europe, Australia and throughout New Zealand. l l l l

Prisoner trade training initiative praised

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inister of Corrections Judith Collins initiative to train prisoners in Christchurch in a wide range of vocational trades is to be commended, says the Employers & Manufacturers Association. “Giving prisoners skills training is a practical response to the shortage of skilled workers Christchurch will need as the re-build gets underway,” said Alasdair Thompson, EMA’s chief executive. “Its also good for New Zealand in the longer term. “Just as important is that prisoners will get the chance to earn a trade’s skill they can put to good use in their lives after prison for their own benefit and the nation. l l l l

3 billion affluent Asians by 2050 

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y the middle of this century, an additional 3 billion Asians could enjoy higher living standards, but only if Asia sustains its present growth momentum and addresses daunting multigenerational challenges and risks.- Source: Asian Development Bank www.nzmanufacturer.co.nz

Success is a journey, not a destination.

- Ben Sweetland

Ian Lind, Managing Director

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Z Manufacturer talks to Ian Lind, managing director of Meco Engineering Co Ltd which trades as Meco Engineers. Ian has been with the company since 1986 and he continues to create a company culture of accessibility and flexibility, while driving it in a viable way for the shareholders. What do you do? As a director of a number of companies I enjoy the challenge of working with like- minded people. I believe openness and good communication with all my staff is important to neuter the best they have to offer. This, in my opinion, is satisfaction in running a business.I strongly believe it’s the staff in the business that sells the product. How do you relax? Having a mixed business portfolio allows me to be somewhat flexible in my day to day activities. Planning my next project or business venture is never far from my thoughts, which is always a chance to button off and relax. My passion outside my working life is Classic cars and restoration or driving is never far from my mind. How do you see business in New Zealand for your company? One needs to reflect briefly on the past 12-18 months and learn from the international financial

meltdown. In moving forward the recession is troughing out and I believe we are more savee about financial awareness and leaner in our operations moving forward to see growth and better financial returns. Are there opportunities overseas for Meco? Having had international contacts in the past. I have always wondered why repeated New Zealand Governments have never supported export opportunities in heavy fabrication to the same extent as Australia and other south Asian countries. Niche market opportunities are always there, it’s finding that market and developing the culture that fits around the opportunity. I also believe there are great opportunities still in New Zealand, we seem to be more focused on international orders. What is your philosophy for success? I have always felt that one should do what they know best. Coming to work on time and having an open door policy for my staff and clients is a must. I believe that everyone is entitled to a point of view, and in my experience issues raised by the junior apprentice has been the path to the future that has sometimes been overlooked by senior management.

Ian Lind Not seeing the trees from the woods comes to mind. Favourite musician? As I enjoy music from the 60s and 70s a number of artists get my ear. Neil Diamond, Buddy Holly, Fats Domino, Beach Boys and Elton John amongst others. Favourite sports team?

I am a past player of rugby and enjoy watching the Hurricanes. Greatest achievement? Winning international contracts against stiff opposition based on our reputation and commitment to detail.

From page 1

Steel-framed housing finally breaks through for quake housing “The attributes of steel staying straight and true; not rotting; and not being pumped full of preservatives is highlighted. The environmental credentials (recyclability, energyefficiency) of steel vs wood are also getting a good airing on the back of the coverage that surrounds the successful tender,” it seethes. Timbermen/women are then invited “to check-out the details and claims being made with the link in the story below”. While Davies, who is also on the board of the newly formed Metals NZ association, shows restraint, the timber industry will be aware of extensive tests which have been conducted by NASH with various universities and BRANZ in the above-mentioned earthquake simulations – up to 9 on the Richter quake scale – the University of Melbourne and Auckland University. He won’t be drawn on the source of political opposition, other than to say that a certain Christchurch MP

was “very much linked to timber”, but was open to discussions. Of course, steel-framing is more than a solution in disaster situations. Golden Homes has quietly upped its commitment to steel-framing, with it becoming the major base for new dwellings over the last few years --

JV proved to be one of the three successful proposals out of 226 tender submissions.

following an extensive evaluation process. And we’ve all viewed the competitive TV advertising for the providers of barns, garages and sleepouts. Davies, who claims little resistance to steel from local authorities – who currently carry about 85 percent of the cost of leaky houses and cannot even give away the failed-beforeit-started 25:25:50 government “solution” to that scandal, and would clearly have reason – said the Golden Homes’ deliberate approach would pay dividends in the future. Note: In future editions “NZ Manufacturer” will feature some of the local companies making a huge impact on the global steel-framed housing and roofing industries.

www.nzmanufacturer.co.nz/videos


NZManufacturer ManufacturerMay May2011 2011 13 13 NZ

Diverse manufacturing sectors in Super City

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uckland is a large geographic area which stretches from north of Warkworth down to south of Franklin. Manufacturing activity is dispersed throughout the region with significant clustering in some areas. The predominance of manufacturing takes place in a ring from the southern part of the central isthmus almost to the southern Auckland border. This ring includes locality names that are frequently seen on business leatherheads and business cards: Onehunga, Mt. Wellington, Penrose, East Tamaki, Mangere Airport Oaks, Manukau, Wiri, Manurewa and Papakura. Each of these names represent a hub with intense concentration of manufacturers located within it. 73% of Auckland’s manufacturing takes place within this circle in the form of intense industrial hubs surrounded by suburban and retail activity. Each industrial hub has its own history and evolutionary pattern making it unique in its structure, businesses level of maturity and the support networks with the community. Access to this manufacturing circle comes both through the Highway One motorway and the new South Western link motorway linking across to the airport and the Manukau Harbour. Combined with the railway line bisecting from north to south, two inland port facilities and the largest New Zealand international airport within this circle, manufacturers migrate to what is perhaps the best serviced transport area in Auckland. Businesses, on the whole, are

larger in this circle when compared to other precincts within Auckland providing a very high employment base and diverse skill requirements. When comparing the manufacturing hubs, we encounter differences in the physical make up of area and businesses. Examples being Onehunga, a very old establish Auckland suburb with an equally old established industrial hub on the south western aspect toward the Manukau harbour waterfront. The hub is not large geographically and has very little in the way of bright new buildings or wide open spaces. The manufacturing companies themselves tend to be mature and have frequently been on sites they have functioned on for many many years. Interspersed with mature, long standing companies are newer companies who have come into the area for the high access to motorways and transport facilities. The range of businesses tends to be - but not exclusively - engineering based. In contrast, East Tamaki - perhaps the largest industrial precinct - is much newer with planned streets with space trees and a diversity of building styles. The manufacturers within this precinct are very diverse. There are engineering, sheet metals, high precision machinery, manufacturers through to food export companies neutraceutical companies, animal therapeutics, plastics, and two of our largest breweries. Wiri is vastly different again - a hub of heavy industrial manufacturing from aluminium

extrusion to oil and petroleum recycling facilities. Manufacturing areas outside of this ring are not to be forgotten. The strength in the marine industry manufacturing is based on the upper reaches of the Waitamata Harbour between the northern and western aspect of the city area. Small, innovative electrical engineering manufacturers are also frequently found dotted throughout the Albany industrial basin. Small smart companies appear in Silverdale. The western part of the city has strength in the wine manufacturing areas and a strong, diverse, mixed manufacturing precinct covers Rosebank Road across to New Lynn The spread of manufacturing types within the industrial hubs, and across the region, make it difficult to quickly and easily identify each individual business, its subsector strength and sustainability prospects. This has been a contributory reason for ATEED to look at supporting manufacturers through a variety of activities. Existing sector programmes are being enhanced with an increased focus on food and beverage manufacturers, health product manufacturing, marine industry manufacture, niche high value and bespoke manufacturing and specialist materials manufacture.

73% of Auckland’s manufacturing takes place in an intense industrial hub

Other sector manufacturing supports being incorporated are the supply chains from primary produce areas such as Franklin’s agricultural food bowl and the coastal aquaculture activities. The ATEED regional delivery offices also support the manufacturing sector through the Ministry of Science and Innovation partner programmes supplying companies with access to technology and business development supports. Over the next few months ATEED will present more information on manufacturing development and projects across the region. nextSTEP Visit: www.em.org.nz

Fact Sheet

• 73% of Auckland manufacturing occurs within intense, industrial hubs. • Auckland has the largest international airport and best serviced transport area. • Businesses provide a high employment base and diverse skill requirements. • Manufacturing companies tend to b e mature and well established. • East Tamaki is the largest industrial precinct. • Wiri is a hub of heavy industrial manufacturing including aluminium extrusion. • Success marine industry manufacturing takes place on the north shore. • The western suburbs has strength in wine manufacturing. www.nzmanufacturer.co.nz


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NZ Manufacturer May 2011

AUCKLAND MANUFACTURERS

Cannibals prefer those who have no spines.

- Stanislaw Lem

Steering the steel-framing cause through the log-jam

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he smiles are broader, but the champagne remains on ice. There’s more than a flutter in the steel-framing dovecote, but having waited all this long to crack it in New Zealand, the GM of the National Association of Steel-Framed Housing Inc (NASH), Carl Davies is all for down-playing the significance of the award of a Department of Building and Housing (DBH) contract to a FRAMECAD and NZ Transportable Units Limited JV for up to 300 temporary homes in Christchurch. (see page one) “I guess we are saving it for the next award which will be for permanent housing: then we’ll know that the government has finally understood that steelframing, which is now more than price-competitive against timber, along with all its other advantages, has moved to take-up the position it enjoys in the developed world – and increasingly in other parts of it as well. “The days of dismissing steel based on price are gone. And when you add the superior attributes of the product in many construction types and situations – as well as the thoroughly proven disaster scenarios – you’ll appreciate that this is a product whose time has come,” Davies says. And support is coming from the most unexpected sources: with environmentalists and the health profession endorsing the sustainability and cleanliness of steel, for example. The New Zealand Asthma Foundation, for one, is on record as “valuing its Sensitive Choice partnership with New Zealand Steel’s AXXIS® Steel” as part of identifying companies which are “committed to reducing asthma and allergy triggers” since its components “don’t let off gas or rot or grow toxic mould and they can’t be attacked by vermin or insects”. Consequently, they are “considered non-allergenic, with neutral impact to indoor air quality, and so contribute positively to a healthy environment”. You wouldn’t want to be peddling pinus radiata to the next generation of home buyers or builders with that endorsement for the opposition ringing in your ears. Davies focuses on the positives: “Following on with AXXIS® Steel – they emphasise that not only can steel-frames be used in all climate conditions, with properties that make them an excellent material to resist earthquakes, they’re strong yet lightweight, making them easy for installers to handle. They don’t absorb moisture and steel does not www.nzmanufacturer.co.nz

twist, warp or split. “That consistent quality and dimensional stability contributes to better drywall and exterior appearance and performance, resulting in fewer time-consuming call-backs to fix cracks in interior and exterior linings too. “Now that’s a bunch of competitive advantages whether taken whole or individually. Always now too there is cost, which has switched to become an advantage for us.” And he is right behind FRAMECAD CEO Mark Taylor’s comment that the criteria for Christchurch temporary accommodation tender selection read like a FRAMECAD brochure, where it specified “a recognised capability to deliver portable dwellings effectively and quickly, for a competitive price.” “Mark’s FRAMECAD technology creates light-weight steel frames onsite: for immediate use. They are made rapidly and precisely to spec meaning this temporary housing is completed and available for occupancy as quickly as possible for Christchurch residents in need.” FRAMECAD developed a mobile steel-frame fabrication factory or emergency relief and sustainable reconstruction following the Pakistan 2005 quake -- of a similar intensity and characteristics -housed in a modified 20ft-shipping container, and able to be quickly deployed into virtually any location, and be made operational within hours. It’s been a hard slog to break the strangle-hold the timber industry has in the housing market -- despite being directly involved in the biggest industrial disaster this country has ever suffered – the $11-$20-billion (take your pick)leaky homes’ scandal, with untreated and below spec. timber to the fore. Davies acknowledges that they are up against “history”, the most powerful and well-funded lobby in the land, and the linkage of jobs and votes for politicians. But he’d rather talk about the science and engineering behind steel-framing, “and make this a factual rather than an emotional issue: Kiwis prefer that.” You might say: he would; wouldn’t he? That’s because he comes from the Rhondda Valley in Wales, where he qualified as a civil engineer at Cardiff University and worked in some of those famous/ notorious dark, satanic mills. Which is possibly why in later life he was “rewarded” with positions involving everything from engineering design, industry training, local government

management etc – the Full Monty -- in exotic places like the Zambian “Copper Belt” and the Seychelles, which some believe was the setting for the Garden of Eden. He and his wife later moved to New Zealand, where he gained local experience, before taking up the NASH cudgels some three years ago. So, naturally, science and engineering are at the forefront of his thinking and the basis of NASH’s chipping away at opposition products. Whether you believe in global warming being the basis of what would appear to be a massive increase in natural disasters, or attribute it to the power of the Internet and mobile communications, we are all far more focused on how safe we are against the elements – at home, work or school, the latter becoming a growth market, in particular. “Take our tests done with the University of Melbourne, under the direction of Prof. Emad Gad, with technical support being provided by Prof. Charles Clifton of the University of Auckland, BRANZ and NASH (Australia). This was the first time light steel-framing had been tested under simulated quake conditions. We did everything to ensure that while it couldn’t be done here we created local conditions – using NZ bricks and even a Kiwi bricklayer to add the cladding. “The magnitude of the earthquake loading was determined in accordance with defined performance levels under the New Zealand Earthquake Loadings Standard, NZS 1170.5, so that the performance achieved in the test

Support is coming from the most unexpected sources.

could be directly related back to expected limit state conditions for New Zealand. “The test house measured approximately 2.6 - 2.8 m in plan and 2.4m in height. It comprised a light steel-frame with brick-veneer exterior cladding and plasterboard interior-lining, constructed to NZ Building practice. The steel frame was manufactured from 0.75mm thick G550 lipped C-sections. “The test house was subjected to earthquake motions based on the El Centro 1940 North-South record, scaled to generate levels of earthquake loading, ranging from serviceability (SLS) to maximum considered (MCE). It performed extremely well, with MCE levels of shaking only causing minor cracking to the plasterboard and brick veneer walls. “So it was taken up to just on 1.51 MCE -- equivalent to magnitude 9 on the Richter scale -- with no bricks being lost from the out-ofplane walls. This is extremely good performance given the fact that the Test House had already been subjected to seven earlier high-level earthquakes. “Being lightweight, the frames are able to flex in an earthquake and absorb lateral movement without compromising the structural integrity of the building. “The testing was terminated after a final shake equivalent to 2.7 El-Centro (1.57 MCE), since the capacity of the shaking-table had been reached. As far as we know, the world has not suffered a larger quake than that,” says Davies. It’s a good note to end on although he’d like to cover another independent test which took a steelframed house to 1,000 deg C (steel melts at 1,400-1,500 deg C) and the superior strength their product demonstrates in flooding, another New Zealand issue, but that can save for another day. I’m a believer.


NZ Manufacturer May 2011

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www.ericpaton.co.nz www.nzmanufacturer.co.nz


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NZ Manufacturer May 2011

AUCKLAND MANUFACTURERS

Where you come from is not nearly as important as where you are going.

Securing a leading market position

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he next time you hear a Kiwi manufacturer banging-on about intense competition, sustainable development, money for research, engineering resources, or the need to deliver breakthrough products, tell him to head for Parnell. Not to the cafes, movie companies, but to a national gem – Industrial Research Limited. It’s the answer to a manufacturer’s prayer – super-successful at what it does across a wide field, and it seems eternally committed to wanting to do more, under the leadership of its dynamic CEO, Shaun Coffey. Attendees at a mini-seminar hosted by Auckland Tourism Events & Economic Development Ltd in Manukau got a taste of what IRL can – and most importantly, want to -- do for New Zealand manufacturers. Tony Cooper, BSc, of the Industry Engagement Group, Advanced Manufacturing Technologies, was the front-man on the day and, because of his broad knowledge and massive network, the contact person. He said, “we bring together industrial, research, and government organisations to work on the most challenging problems facing New

Zealand and the international community. “Industry partners help guide the research, participate in the engineering of solutions, and eventually take the resulting technology to market. Other researchers provide specialised science skills, knowledge and resources. Where there is the potential for significant benefits to New Zealand, we invite government investment in every phase of the research and development.” Days later his boss, Coffey was launching “Scientist for a Day”, offering the services of some of its world-class scientists and engineers, as part of an innovative programme aimed at demonstrating the benefits of R&D to New Zealand businesses.  The IRL wants you to apply to take part in a programme -- between August and 23 December -- designed to encourage you to think about what R&D can do for your business, and whether your R&D is focussed in the right areas. It’s a hands-on and faceto-face technical interaction which can take place either at your place or at an IRL laboratory, they can followup with a Business-Potential-forInnovation report.

Ph 0800 473 373

www.nzmanufacturer.co.nz

BusinessNZ CEO Phil O’Reilly calls it “a golden opportunity for Kiwi firms”. “Partnering science with business to turn ideas into profit is key to helping secure a brighter future for New Zealand and taking us up the OECD rankings. This is an extremely valuable opportunity for firms, and I urge all businesses to investigate. It could unlock untapped potential that makes the difference between a great idea and securing a world-leading market position.” How could they afford to do this you might ask? If its recent sale of a controlling stake in IRL associate company, HTS-110 to Dunedin-based, Scott Technology isn’t funding it, it will have certainly have encouraged them to go forward with the offer. HTS-110 designs, manufactures and sells powerful electromagnets which utilise world-leading superconducting technology developed at IRL. Applications for HTS-110’s products range from cutting-edge nanotechnology to the manufacture of ultra-high capacity computer hard drives, and from accelerated drug development to increasing yields in bio-fuel plants.

- Unknown

By Kevin Kevany

Patrick Lim, BE, ME, Team Manager of Engineering Innovation’s highlight presentation -- bridging the gap from research to manufacturing -- gave further insight into the worldclass innovation being accomplished. He called for a better model, which he described as ‘Research pull/industry push’, to replace the all-too-common ‘Technology push versus technology pull’. Here industry would determine needs/ requirements, before research-providers applied appropriate science, technology and engineering – “not over-engineered or burdened with too many functions”. Governance and leverage funding would be the province of industry. The audience were impressed with just two of his group’s successes: the world’s first automated sheep pelt-cut-down-forelegs which delivers remarkable skinned carcases; and not to be outdone, the world’s first fully-automated mussel shell opening machine, with a throughput of 30 per minute. The commercial prototype has been installed in Sanford Fisheries, at Havelock and the company has commissioned 26 machines to be manufactured.

www.viscountplastics.co.nz


NZ Manufacturer May 2011

DEVELOPMENTS

All is connected ... no one thing can change by itself.” - Paul Hawken

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17

Upturn in manufacturing activity

espite recent shocks to the economy, manufacturing has continued its run of expansion, according to the latest BNZ - BusinessNZ Performance of Manufacturing Index (PMI). The seasonally adjusted PMI for April was 51.5, up from 50.2 in March but still lower than the four month period of values at 53 between November to February  (a PMI reading above 50.0 indicates that manufacturing is generally expanding; below 50.0 that it is declining).  Four of the five indices were in expansion for April, compared with two in March. BusinessNZ’s executive director for manufacturing Catherine Beard said despite the recent tragic events in Christchurch there were a number of positive outcomes for the sector. “Looking at the main subindices, new orders, finished stocks and deliveries of raw materials all improved from March.  However, one obvious negative outcome of the April results involved more regions falling into decline and the Northern region alone showing strong results. “Comments from respondents were still heavily focused on the

Christchurch earthquake.  However, the proportion of negative comments fell back significantly for April, with some businesses mentioning the earthquake as a primary reason for increased business activity.” BNZ economist Doug Steel said the April PMI was encouraging, building on the already above-breakeven reading recorded in March. “Fortunes are diverse across the manufacturing sector at present, given a raft of strong and competing influences. Pulling the threads

together we find a sector that, on average, is still pushing forward not fast expansion, but heading in the right direction.” “The outlook is brighter, with many awaiting a lift in construction activity from its current very low ebb. Encouragingly, some leading indicators are starting to point in the right direction suggesting acceleration in manufacturing activity over the next year or two.” Unadjusted results by region showed that the clear distinction

between the two islands in March had now wavered, with the Central region (40.9) experiencing its lowest level of activity since May 2009.  This was mainly due to very low new orders and production levels.  Both the Canterbury/Westland (47.8) and Otago/Southland (47.2) regions experienced a relative improvement from March, although both regions were still in decline.  The Northern region (56.7) continued to show improvement, with its highest result since November 2010.

Skills for Canterbury essential for the rebuild

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he Budget’s focus on skills to rebuilding Christchurch is well-placed, says BusinessNZ’s Chief Executive Phil O’Reilly. Budget funding for trades training for the Canterbury region includes more construction-related places to be available at polytechs and other training institutions. It also includes using ‘commitment to training’ as a criterion for businesses gaining government reconstruction contracts, and a stop-gap provision for employers to

import high-skilled workers if New Zealanders can’t be trained in time. Phil O’Reilly adds that this is a balanced response by the Government. “Dedicated funding for construction training sends the message that skills are a critical part of the rebuild. “Incentivising training by business by making it a criterion for gaining government reconstruction contracts is useful as it helps to make businesses part of the skills solution.

“And being able to import high-skilled workers where New Zealanders can’t be trained in time is sensible, although we probably need the leeway to import semiskilled people also, given the critical scarcity of skills at all levels in the construction sector. “This approach could be usefully extended to the construction sector nation-wide, as the scarcity of building skills is not just a Canterbury problem,”  Mr O’Reilly concluded.

To see more go to www.delcam.tv/hydeaero

Email: marketing@delcam.com | Web: www.delcam.com

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NZ Manufacturer May 2011

BUSINESS NEWS

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You cannot sit on the road to success for if you do, you will get run over. - Anonymous

Cashing in on Vietnam boom

n Danang, half way between Hanoi in the north and Ho Chi Minh City in Vietnam a property development boom is driving a confident local economy. GDP growth in the vicinity is powering along at over 12% a year, about twice the national average, as beach side resorts spring up to cater for burgeoning tourist numbers while government plans and incentives go after overseas investors to set up in high tech, bio tech and IT industrial parks. This city of 1 million people lies alongside an excellent harbour and beaches that out-do Piha. They enjoy great weather and wonderful baskets of tropical fruit. You can sense their ambition is to build an eastern Riviera, plus education and skills training establishments to create jobs for their young people. Vietnam’s population of 84 million in all is indeed very young; over half are under 30 years of age, and in striving to develop better paying jobs for them. The most advanced technologies available are being sought. Visitors to Danang are flying in in droves from Western countries, and wanting to eat western foods at least for some of the time. They’re flying in as well from the big neighbours to the north: China, Taiwan, Russia and Japan, and those places are where a lot of the large investment is coming from, as well as from the US. Apart from dairy, meat and other food and beverages what does Danang have to attract New Zealand manufacturers? Export New Zealand joined forces with the Combined ASEAN New Zealand Business Council to take a trade mission there to find out close up. One challenge was to identify the demand, and likely channels to market for New Zealand food and wine for a resort such as Danang in particular. Another was to find out what was required for New Zealand made building products to meet local standards, and identify which authorities had jurisdiction. A third challenge was to meet up with business partners that mission delegates could work with. To meet these objectives we packed in a programme of economic and sector briefings, meetings with officials, site visits, and pre-arranged business matching. We toured a port, a shipbuilding yard, a ceramics factory and a brewery. Building up trustworthy business partnerships are rarely achieved overnight; building good business in Vietnam as for elsewhere in South East Asia depends on developing sound relationships. Nonetheless www.nzmanufacturer.co.nz

By Gilbert Peterson

Mission leader Sir Ken Stevens, Heather Riddell, NZ Ambassador to Vietnam and Graham Sims, NZ Trade Commissioner and Consul General in Ho Chi Minh with host at a business meeting in Danang Mike Petersen of aluminium window and door joinery manufacturer, NALCO reported they were invited to participate in a $US1bn resort development project in Danang. Early talks are underway on the viability of opening a representative office in Vietnam on behalf of New Zealand construction businesses, and orders are expected for a range of NZ produce including cherries, apples and meat cuts. Ron Hendl of Waikato stainless steel fabricator Hendl and Murray reported making a lot of contacts he wouldn’t have otherwise, some of whom will come to New Zealand to discuss more business. “Its been very useful,” Hendl said. Building research executive Chris Kane of BRANZ reported many opportunities for New Zealand firms for builders’ supplies. The networks and contacts we established are

“incredibly valuable,” Kane said. For his own company, Glidepath Group, Sir Ken Stevens said the opportunities he unearthed in Vietnam exceeded expectations. New Zealand Consul General and Trade Commissioner in Ho Chi Minh, Graham Sims said: “Having been on the mission, if you come to Vietnam as individual businesses, we will now know what to expect,

Sir Ken Stevens said the opportunities he unearthed in Vietnam exceeded expectations.

and can partner with you, and set up a programme for you.” Sir Ken Stevens, leader of the Vietnam Trade Mission, and Managing Director of Glidepath Group said “The Trade Mission to Viet Nam was well worthwhile. The meetings organised ahead of the mission were well positioned and went off on time and without a hitch. “Delegates got a lot for their money. If you came here on your own, you would not get this. “The calibre of the NZTE Beachheads board members who we met is awesome. They are such eminent members of their local business communities and it does the heart proud to learn about their input and effect in accelerating exporters into complex markets. “I personally found the Vietnam team at NZTE to be just the best team I have worked with in NZTE’s network. Graham Sims proved to be a very competent and technically savvy Trade Commissioner. “On the social side it is as well to record the fund raiser for the Christchurch earthquake fund at Ho Chi Minh City saw over 300 people attend. It raised US$96,000 and I must congratulate our Australian bros as they turned out in numbers in support. “I personally enjoyed leading the mission and I would encourage exporters wishing to expand their markets to join a trade mission as the benefits are many fold.” *Gilbert Peterson is Communications Manager for the Employers & Manufacturers Association. He comanaged the Export NZ/ASEAN NZ Combined Business Council Trade Mission to Vietnam in March.

Delegates inspected a ship building yard in Danang


NZ Manufacturer May 2011

W W W. I N V E S U R E P R O D U C T I O N S . C O . N Z

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NZ Manufacturer May 2011

PRODUCT NEWS Retro Chic B ringing back the elegance and style of a forgotten age, two new ranges of desktop chassis from Hammond Manufacturing are now available. All three models are ideal for high-end hi-fi equipment, other consumer-facing products where appearance is as important as function and for retro-styled instrumentation. The HWCAS consists of a complete walnut frame fitted with aluminium top and optional base panels, available with either a black powder coat or natural finish. The 1444CWW and the 1441CWW families are fabricated from aluminium or steel respectively, fitted with walnut end panels to the shorter sides. The aluminium version has a natural finish; the steel has a black powder coat finish. The HWCAS is available in two sizes, either 330 x 254 x 76mm or 432 x 254 x 76mm. The chassis corners are of dovetailed construction, reinforced with corner posts fitted with brass inserts to take the panel fixings. The 2mm thick top panel will support heavy components such as transformers without bowing. The 1444 and 1441CWW units

come in six sizes ranging from 178 x 127 x 51mm to 432 x 254 x 102mm. The rigid chassis is spot welded for strength and rigidity and is complete with an integral top panel, so there are no visible fixings to mar the sleek appearance. nextSTEP Contact: Hi-Q Electronics Ltd E: sales@hiq.co.nz or Free NZ phone 0800 800293

Unless you’re willing to have a go, fail miserably, and have another go, success won’t happen. - Phillip Adams

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World-first research adds waste toner to roads

hree Kiwi companies are investigating if waste residue toner recovered from recycled cartridges can be re-used in New Zealand roads, in research that could cut the volume of crude oil imported into the country to make bitumen. The project, which is a unique collaboration between Ricoh New Zealand, Croxley Stationery and Downer, could result in diverting as much as 15 tonnes of waste residue toner a year away from landfill and into roads. Early testing has seen the successful inclusion of waste toner, left over from photocopiers and other Ricoh devices, in both bitumen and PMB (polymer modified bitumen). PMB has a high resistance to wear and tear and is used in heavy traffic areas, but the polymer additive is very expensive. The addition of the waste toner to this material is significantly cheaper and also a world first. The Ministry for the Environment

awarded $45,800 from the Waste Minimisation Fund to the project. Croxley’s subsidiary the Toner Recycling Centre (TRC), which operates a cartridge collection and recycling programme for document solutions companies including Ricoh, collects the old toner cartridges. TRC currently recycles more than 500,000 cartridges annually. Should the project be successful, other manufacturers would be invited into the scheme to achieve the goal of 100 per cent recycling of waste toner in New Zealand. The trial will continue testing waste toner in both PMB, the preferred option, and asphalt.  Downer, one of the country’s leading designer and builder of roads, is helping to fund the research. Should the project be successful, waste toner which is currently sent to landfill could be converted into a useable product, making the cartridges and toner within them 100 per cent recyclable.

Internal pipe cooling system boosts productivity

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new system for internal pipe cooling (IPC) significantly reduces the initial cost and the space requirements for new Polyolefin pipe extrusion lines and increases the productivity by up to 60% if the existing line length is maintained. The system can also be retrofitted to existing pipe extrusion lines. The IPC system uses ambient air which is sucked through the centre of the pipe at high speed against the haul-off direction by means of a side channel compressor. Used in addition to conventional external water cooling in vacuum tanks and cooling baths, it cools the pipe gently from the inside. The IPC can reduce the length of the cooling zone by as much as 40% resulting in floor space savings without compromising production speed should factory space be a limitation. Significant benefits are gained by using the IPC system in the production of thick walled pipe, where standard cooling methods are ineffective in removing heat from the extruded pipe. As with conventional pipe extrusion lines, the melt flows directly from the extruder into the pipe head, avoiding the problems

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of lateral melt feed. Continuous monitoring and active control of the air suction volume adjusts conditions to ensure the uniform cooling performance, essential to guarantee consistently high product quality. The IPC also provides substantial energy savings, as the system uses ambient air, and does not require the use of other cooling media. The IPC system can be used on all PO pipe extrusion lines from 110mm to 2,500mm diameter.


NZ Manufacturer May 2011

The person who gets the farthest is generally the one who is willing to do and dare. The sure-thing boat never gets far from shore. - Dale Carnegie

Heavy duty junction box makes it easier

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heavy-duty junction box makes it easier for commercial transport and automotive workshops to bullet-proof the wiring on trucks, trailers and heavy construction/mining/forestry equipment. The NARVA 8-way / 12-port waterproof junction box is designed and built for use specifically on trucks, trailers and large equipment. It has a housing constructed of durable ABS plastic with 12 pretapped cable entry points and a clear, virtually unbreakable polycarbonate cover for easy inspection. A silicone gasket within the lid seals the unit against the ingress of moisture and corrosive elements with a tight waterproof fit secured by six fixing screws. The 8-way junction box has a 50A per circuit amperage rating and is supplied with six filler plugs. A selection of five compression fittings are available as accessories, to suit

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The NARVA Waterproof Junction Box makes for more resilient wiring systems on truck, trailers and heavy equipment. differing cable diameters ranging from 9.5mm to 19mm and with 3mm and 4mm flat trailer cables. Mounting the junction box has been simplified by providing two eyelet reinforced holes at each end of the housing. It is available from leading automotive and transport outlets throughout New Zealand under Part No. 57850.

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will be used for loading green and kiln dried timber products on to T&T units. Also as a yard fork for unloading dry timber, stacking and feeding in and out of filleting and de-filleting stations. As well, the forklifts will bring dry semi- processed timber into the planer operation and take finished goods out to the pre-despatch storage area. The forklifts are particularly suited to yard applications and in particular, heavy manufacturing, stevedoring and warehousing. With the combination of a 100HP engine, fully automatic 3-speed ‘smart shift’ transmission, wet disc brakes and rugged chassis design, the GEN2 C80 provides exceptional performance, manoeuvrability and durability in its class. The Clark GEN2 provides

PRODUCT NEWS

Lowering power consumption

he VOC/VSD’s variable speed drive (VSD) lowers power consumption at the top end of capacity and maintains constant system pressure whilst the variable output compressor (VOC) airend extends part-load energy savings. Sullair Australia has pioneered compressor technology with its hybrid VOC/VSD compressor. The “driving force behind the company wanting to combine the two technologies was a desire to achieve the greatest downturn, therefore providing customers with greater flexibility and efficiency The VOC/VSD’s unique fusion of VSD and VOC technologies delivers optimal airend efficiency for compressed-air applications with widely varying loads. Individually, the VOC has a turndown of 50 per cent; VSD as much as 30 per cent. The VOC/ VSD hybrid air compressor can extend the range of downturn to 15

Committed to high standards

iwi Lumber, a privately owned New Zealand company, operates three modern sawmills in Putaruru, Dannevirke and Masterton. The plants are strategically situated to take advantage of the close proximity to the large commercial plantations in the Hawkes Bay, Wairarapa and Central Plateau areas of the North Island all of which are well serviced by professional contractors, harvesters and forest managers. The company, which produces a range of products specifically to meet the needs of manufacturers in the furniture, joinery, mouldings and building industries, have recently taken possession of three Clark GEN2 8-tonne IC forklifts. The forklifts have been supplied with 1350mm lumber forks and

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maximum visibility and hydraulic cushioning valves to reduce shock and vibration. The Operator Compartment is state of the art and features among other things, a fully adjustable suspension seat, a tilt steering column and hood mounted hydraulic controls. A parking brake that disengages the transmission when applied is a major safety feature of this model. Kiwi Lumber process Radiata logs that are milled entirely from renewable plantations, all of which comply with New Zealand’s environmental management policies. Kiwi Lumber has expanded its export markets and now supplies clients in North America, Asia, Europe, Australia and throughout New Zealand.

Fusion of the best of variable speed and variable output compression. per cent while keeping the pressure stable and power consumption to a minimum. Through its ability to automatically vary both the motor speed and the compressor’s airend length, the VOC/VSD’s efficient operating range is broader than any comparable compressor. The VOC/VSD utilises patented Optimal Flux Technology which allows precise and dynamic driveto-motor calibration, delivering optimum performance and efficiency throughout the VOC/ VSD’s operating range. Optimal Flux Technology reduces motor temperatures by up to 11 degrees Celsius, thereby permitting greater turn-down, eliminating forced ventilation and improving motor efficiency and longevity. The best way to determine if the VOC/VSD hybrid unit is the appropriate solution is by conducting an air audit. If there are huge changes in demand at a particular site with for example, a peak shift in the morning and a light shift in the afternoon or night shift, the VOC/VSD may be beneficial in maximising your efficiency and energy savings. The VOC/VSD can be built to your specifications and fitted with a range of extras to suit every application.

www.hydroflow.co.nz

sales@hiq.co.nz www.hiq.co.nz

www.apexvalves.co.nz www.theplumbersclub.co.nz

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NZ Manufacturer May 2011

CASE STUDY

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Change your language and you change your thoughts.

- Karl Albrecht

Open sourcing a future for renewable energy

magine a time when we have more control over the energy we have available to us: a time, for example, when we use the sun’s energy to power our homes and our electric vehicles; when individual households readily contribute power to a ‘smart’ distribution grid. It may sound rather futuristic, but with the right thinking we could get there sooner than you think. Wind farms, geothermal power and hydroelectric dams already account for close to 80% of all power generated in this country. But while viable technology to capture solar energy is progressing in leaps and bounds, New Zealand’s potential to exist wholly on renewable energy has yet to be fully tapped. There is little doubt that renewable energy is the way of the future. The question is: how far in the future will our homes and transport be energy self-sufficient, and when will our existing power stations be enough to maintain the status quo? The answer depends on two things: our ability to change the way we think about energy, its generation, distribution and use; and, crucially, the capacity for

companies operating in this space to alter the way they work. As with many industries, companies working within the power sector have traditionally laboured in isolation, keeping their knowledge closely under wraps. As a result, research and development costs are high, much effort is needlessly duplicated and time to market can be a long, hard slog. There is, however, a growing community of engineers, academics and business leaders in New Zealand that hopes to change this. They have created an open source forum to help develop technologies to support electric vehicles, solar energy technologies and smart power distribution. Open source describes practices in production and development that promote access to the end product’s source materials. Some consider open source a philosophy, others consider it a pragmatic methodology. Open source gained hold with the rise of the Internet, and the need for sometimes massive retooling of the computing source code. But the concept of open source and free sharing of technological information existed long before computers. For example, people have shared

From page 11

WaikatoLink appoints new Chairman and Director After commencing his career in Auckland in the litigation department of a national firm working on a broad range of commercial disputes, he spent four years as Senior Associate in the London office of leading international firm, Freshfields Bruckhaus Deringer. He graduated from the University of Auckland in 1994 with a Bachelor of Arts and a Bachelor of Laws. On his appointment Tenby Powell said, “I am passionate about seeing businesses prosper. We need successful businesses to stimulate wealth and job creation to contribute to a more vibrant New Zealand economy. I’m excited to be able to make a positive contribution to WaikatoLink as they unlock value from science and technology creating, out of entrepreneurial ventures, commercially viable IP and business entities that make a real contribution to New Zealand.” James McGillivray said, “WaikatoLink has a strong track record in translating research outcomes into commercial technologies. I’m delighted to be www.nzmanufacturer.co.nz

James Mc Gillivray able to bring my skills to bear as the company continues to grow from strength to strength.” The new directors fill the positions left vacant by Dr Gerald Bailey and Peter Schuyt. Current WaikatoLink Directors, Dr Rob Pringle, Sir William Gallagher, Professor Roy Crawford, Tom McClunie, Ross Townshend and Professor Doug Sutton, are all remaining on the Board.

cooking recipes since the beginning of human culture. A central principle of open source is collaboration. The approach encourages groups with a common goal to share their ideas, knowledge and findings. Importantly, product development isn’t compromised: people contribute what they want and take what they want. Open source simply irons out many of the pitfalls. With the end-product, sourcematerial, ‘blueprints’ and documentation freely available to the public, the upshot is that R&D costs are reduced and product can get to the market more quickly. Hi-tech company Greenstage has been driving an open source initiative in New Zealand’s power sector, pulling in necessary support from complementary businesses along the way. Their projects aim to capture people’s attention and demonstrate the potential of new technologies: generating demand for change is the primary goal. For example, the group is challenging our preconceptions: we’ve traditionally viewed the supply of power as a one-way channel, coming from the power companies to our homes and businesses; and electric vehicles are generally considered slow and cumbersome, with short running times between protracted recharges. But it needn’t be this way. Indeed, this was the catalyst for an open source forum in Pokeno recently. The occasion brought together like-minded people in the distributed generation and smart grid space for the first time in New Zealand. Facilitated by Greenstage, the goal was to establish an open source platform for the group and create an even and pragmatic playing field for those involved.

There is little doubt that renewable energy is the way of the future.

By Mike Playle, Fero The outcome was encouraging, with three projects spinning out from the event: the group has agreed to jointly progress low-volume electric vehicle production, a solar energy power distribution network, and combined battery charger and inverter technology. Greenstage is tackling the electric vehicle question from two angles: the team has begun building the Saker 750 electric race car and, using this technology, is also developing low-volume production road-going Sakers. It is the availability of a common platform which will make electric vehicles commercially viable; it has already provided the standards and tools for DIY car enthusiasts to convert their petroleum-driven vehicle to an electric-powered model. Participants from the Pokeno conference are also exploring a way to direct excess power to the national grid. SolarNetwork is an open source platform which relies on the continuous participation and cooperation of an online community. Put simply, consumers with off-grid solar installations would be able to both manage their own power requirements and sell surplus electricity via the Internet. Lastly, trials are planned for a vehicle battery charger/inverter circuit. The goal is two-way power transmission between the home and the car. The result would be a solarpowered vehicle that, as well as being able to draw power from the home, could in turn supply power to the home when it was not being driven. The beauty of an open source approach is that it is expected to shave years off the development of these technologies, allowing the benefits to be enjoyed by more people, much sooner. It’s simply smarter business. *Mike Playle is a Business Development Manager for electronic and wire technology company Fero. Mike participated in the open source forum held in Pokeno, and is involved in progressing the electric vehicle project.


NZ Manufacturer May 2011

Reengineering is a way of seeing the processes of the firm. - Peter Drucker

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DEVELOPMENTS

US Government invests in our green energy technology

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he United States Department of Energy (DOE) has, through North West Energy Innovations based in Oregon, invested US$2m in a wave energy project using technology developed by IRL in New Zealand. Wave Energy Technology NZ (WET-NZ), a collaboration between IRL (83.8%) and Power Projects Ltd (16.2%) and supported by the Ministry of Science and Innovation and EECA, has over the past three years proved the operating concept by  trialling a one-fifth size wave electrical generation device anchored off Taylor’s Mistake in Christchurch. The device was recently upgraded to a quartersize machine and operated successfully for 90 days, generating electricity with no down time. The technology is different from other wave energy converters in that the machine is anchored to the sea floor and  recognises  water movement, which through the use of on-board hydraulics, converts water energy into electricity, says IRL Deputy CEO Drew Stein.

“We are working directly and closely with North West Energy Innovations in Portland and the DOE as this project progresses. Our research programme involves building a half-size device which is being manufactured by Stark Brothers in Christchurch.” This machine, when completed in June and after testing off Akaroa, will be relocated and  anchored to the sea floor off Moa Point in Wellington. IRL will ship another set of control and hydraulic components to the USA where they will be installed in a half-size device built to IRL’s design, which will be anchored to the sea bed off the Oregon coast, he says. “We anticipate that once these devices have proven themselves under the strict USA Department of Energy review processes then licences for the wave energy converter will be signed. Future sales are predicted to be worth hundreds of million of dollars to the New Zealand economy. “The wave energy converter

technology is protected by international patent applications including an application in the United States. A patent has already been granted in New Zealand and IRL is anticipating all design, control and hydraulic components will be manufactured by New Zealand companies and exported around the world.

Wave Energy Technology NZ (WETNZ), a collaboration between IRL (83.8%) and Power Projects Ltd (16.2%)

Drew Stein “Demand for clean, green energy has never been more economically important nor in more demand and therefore there is a ready-made market for this type of electricity generating device,” says Drew Stein.

visit www.eecabusiness.govt.nz/motorsystems

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NZ Manufacturer May 2011

ANALYSIS

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A successful man continues to look for work after he has found a job. - Anonymous

Do you need capital investment?

ne of the things that is a barrier to the growth of New Zealand manufacturing companies keen to tackle global markets is capital. How does a $10 million turn-over company become a $100 million turn-over company and successfully internationalise itself? With a small domestic market and thin capital market, how do we get on the radar of investors and take our ideas to the world? Sir Paul Callaghan, currently New Zealander of the Year for his services to science and to business, has estimated we need 100 high-tech company’s doing as well as our top 10 performing high-tech companies to double our export earnings. Then we really would have a first world economy and lifestyle, because high tech companies have high earnings per employee, and we are not working harder, but smarter. In addition they have a relatively small environmental footprint. So how do you go about attracting capital investment? Many NZ companies that manage to get to the $10million turnover mark, struggle to find investment to take them to the next level. A unique idea is a good start. Sir Paul Callaghan is fond of saying if you have not heard of it or don’t understand it then it has a better chance of success internationally. This thinking is backed up by research conducted by Victoria University into what firms need to do to succeed in India and China. In big global markets with lots of multinationals competing, New Zealand firms have to have a unique product or service (preferably both) to stand out from the crowd. This is also appealing to outside capital. The key attributes of success are a unique selling proposition, outstanding management/ entrepreneurial skills (preferably with internationalisation skills) and access to capital. The latter is not an easy thing to resolve, though the New Zealand Institute has pointed out that other successful exporting economies, such as Denmark, Singapore, Hong Kong, Israel and the UK use the tax system to

incentivise investments in export capable companies. A venture capitalist at the recent Australia/New Zealand leadership forum suggested that in addition to tax incentives to invest in high tech growth companies, the NZ Superannuation scheme should be less risk averse with a portion of their investments and take a longer term view. In addition, larger companies should be encouraged to engage with smaller companies. The Australia/New Zealand leadership forum also identified we need to tackle the tax system as it applies to double taxation on investments between Australia and New Zealand. The issue of the mutual recognition of imputation and franking credits is not a new one, and businesses on both sides of the Tasman want to remove this anomaly. We have the relatively free flow of goods, services and people, now we need to deal with the free flow of capital. Double taxation is a disincentive for businesses to invest between our countries. The New Zealand Government does not need to be convinced of this, but the Australian Government does, and BusinessNZ and ExportNZ plan to work on this issue with our counterpart business organisations in Australia. One way for New Zealand manufacturers to attract capital investment is to be open to the idea of joint ventures with overseas partners. The other advantage of partnering with overseas investors is that they usually come with expertise, good connections and deep knowledge of the market you are trying to export to. Research undertaken by NZTE some time ago indicated that many NZ firms were very wedded to doing it all themselves which is a slower path to take. There are overseas investors scoping out the NZ landscape for opportunities to partner with local firms, either through investment or through adding them into their global supply chain. Lockheed Martin flew their

investment executives to New Zealand earlier this year to see if there were any NZ companies doing interesting things that fitted with their business interests and another UK based group of investors called Knowledge Matrix was recently in New Zealand looking for our ‘hidden champions’ with global technology potential. Obviously, finding the right joint venture or investment partner is important. The High Commissioner of India, Admiral (Retd.) Sureesh

How does a $10 million turn-over company become a $100 million turnover company?

By Catherine Beard Mehtaaid made the comment recently at a strategy meeting on India, that there is no shortage of capital in India (about $30 billion a year flows inwards and the same amount is invested outwards), and a good way to do business in India is to look for a partner that can invest and partner with you to internationalise your product or service. The message was that you don’t need capital to do business in India if you partner with a local firm, but you do need intellectual capital. New Zealand manufacturers interested in raising capital should check out the New Zealand Venture Investment Fund, Angel Association New Zealand, NZTE Escalator, and TechNZ’s “Global Expert” service can help with commercialisation advice as well as solving a technical problem.

www.baskiville.com info@baskiville.com www.nzmanufacturer.co.nz


NZ Manufacturer May 2011

I believe the greater the handicap, the greater the triumph. - John H. Johnson

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MANUFACTURING TECHNOLOGY

Solidtec sponsors a winning design from Access Automation

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arch 2011 saw the confirmation of sponsorship by Solidtec of Access Automation’s Terra FX Sports Racing car. Access Automation Limited has designed and manufactured a custom sports racing car which competes in the Sports Suzuki Class of the Independent Racing Classes (IRC) Series. The car is called the Terra Fx, being a play on words, as the design utilises the aerodynamic properties of “ground effect” when an aerofoil is operated in close proximity to the ground. The project has been used to hone the design and manufacturing skills of Access Automation by developing a highly innovative race car that can successfully compete in sports car racing, even with a novice driver. Essential to the success of the project was the use of SolidWorks 3D CAD software, with which the car was designed and modelled. The IRC Series that the Terra FX runs in involves eight race meetings per year which are held throughout race tracks in the North Island. Mark Galvin, Director of Access Automation is a Mechanical Engineer with wide interests in engineering and technology. Prior to starting Access Automation Limited in 1990 he worked as a research scientist for 19 years with the New Zealand government, first at DSIR and then Industrial Research Limited. He has invented and patented a number of commercially successfully products.

In 1990 he left the government and started Access Automation Limited. The main activity of AAL is the design and manufacture of inclined lifts. They are now the leading manufacturer of such equipment in NZ and also export many systems to Australia and the Asia pacific region. (www.accessauto.co.nz) “This project has given Access Automation Ltd the opportunity to really push the boundaries with some unusual design and construction innovations as well as having a bit of fun. In our normal line of business of designing cable cars we have to be a bit more conservative” says Mark.

Design Paradigm of Terra FX

The project is very much about design innovation, in particular, the aerodynamics of the vehicle. Previous experiments have shown that the car will generate very high aerodynamic down-forces by exploiting a phenomena called “ground effects” .This is where an inverted aerofoil shape operating in close proximity to the ground amplifies the aerodynamic forces. In the case of the Terra FX, the main shape of the car is an inverted wing and so it is more correct to consider the project as an inverted aircraft flying close to the ground, rather than a car. From day one, the design paradigm of the project has been to build a wing with wheels, rather than to build a car with good

aerodynamics. The concept sketch below shows the main architecture of the car. The three main elements are the central core, the engine side pod and the driver side pod. The central

The project has been used to hone the design and manufacturing skills of Access Automation

2011 Green Engineering Grant program announced

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he 2011 Green Engineering Grant program, is a worldwide competitive program that fosters rapid design, prototyping and commercialisation of promising new renewable energy, energy efficiency and smart grid systems. The 2011 program has a special focus on technologies that improve the smart grid and provide the foundation for a clean energy future. “For more than 30 years, engineers and scientists around the world have used NI software and hardware to implement their world-changing innovations more quickly and efficiently,” said Dr. James Truchard, president, CEO and cofounder of National Instruments. “The NI Green Engineering Grant program helps remove technological barriers by providing access to the training and tools needed to bring smart grid and renewable energy solutions to market.” LabVIEW software and the LabVIEW FPGA Module, as well as embedded prototyping and deployment platforms such

as NI CompactRIO and PXI instrumentation, are ideal for building innovative control and monitoring solutions for the renewable energy market. Small companies throughout many countries have combined the open, graphical nature of LabVIEW software with the highperformance characteristics of modular, reconfigurable NI hardware to prototype and prove advanced embedded designs significantly faster than with traditional solutions. “With only three employees, we work hard to develop clean energy solutions for people in developing nations,” said Matt Bennett, vice president of research and development for Windlift, a startup company that develops mobile airborne wind energy systems, including onboard energy storage for mobile microgrids in post-conflict reconstruction and disaster relief.  “The NI Green Engineering Grant gave us the tools to facilitate rapid development of our technology, helping us to progress from concept to prototype

in just eight months. Also, the same hardware and software will carry through the entire technology development process, providing a smooth transition when we are ready to enter production.” To date, the Green Engineering Grant program has delivered software and training to more than 40 startups and small companies working on a variety of revolutionary renewable energy applications. Because smart grid technology is a foundation for renewable energy innovation, the company recently hosted an interactive Earth Week webcast series about smart grid technologies and the 2011 Green Engineering Grant program. The three-part series examined the rapidly changing landscape of clean energy, smart grid and energy storage technologies. It also features presentations from past grant recipients and other technical demonstrations that show how technology can help engineers develop and speed the adoption of renewable energy systems.

core is both the main structure of the car plus the optimized aerofoil shape. It is very light, strong and rigid as it is an enclosed box without penetrations. The side pods hang from the central core. These house the driver and engine on the opposite sides of the car. Both these heavy items can be placed close to the ground without compromising the aerodynamics of the car as they are located in a low airflow area between the wheels. This configuration has proven to produce excellent down-force and excellent Down-force / Drag ratios (L/D). The unusual design of the car has proved to be very successful and attracts a great deal of attention at the race track. “SolidWorks 3DCAD software has been an essential tool in the design and construction of the Terra Fx racing car. SolidWorks was used to define the geometry of the vehicle, investigate suspension options, calculate spring rates, confirm packaging and running clearances and produce developed shapes and laser cutting files for the monocoque structure. SolidWorks has proved to be a truly versatile tool that has made the design and construction of this complex prototype possible with otherwise modest resources” says Mark. Access Automation have been a customer of Solidtec Solutions since 2009 and can attest to the value of using SolidWorks 3DCAD, and the training and support packages that Solidtec provides. “Solidtec have been absolutely brilliant as a supplier of the software. They offer training courses in our region, their technical support is prompt and of the highest standard and they have been proactive in organizing local user-group meetings which are both informative and a great networking opportunity.” nextSTEP Email: info@solidtec.co.nz www.nzmanufacturer.co.nz


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NZ Manufacturer May 2011

MANUFACTURING TECHNOLOGY

Seventy percent of success in life is showing up.

- Woody Allen

Delcam 2011 inspection software Next level of reverse engineering

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elcam has launched the 2011 version of its PowerINSPECT inspection software.  This new release makes the analysis of results even easier with the introduction of a “Quick Report” option.   It also incorporates improvements to the handling of point-cloud data and easier reuse of measured data to inspect additional features, plus enhancements to the GD&T functionality. PowerINSPECT is firmly established as the world’s leading hardware-independent inspection software.  It combines the ability to work with all types of inspection device with a comprehensive range of inspection routines for taking simple measurements, for inspection of geometric features and for analysing complex 3D surfaces.  The resulting reports present detailed information in an easy-to-read format that can be understood by all engineers, not just inspection specialists. Reporting in PowerINSPECT is now even more flexible with the “Quick Report” option.  This allows users to add headers and footers to any image taken from the full report in order to create a single page graphical representation of the inspection.  Faster interpretation of the data allows for errors to be identified and rectified more quickly, so reducing costs. Improvements to the handling and alignment of point clouds make it easier to deal with the large data sets generated when using laserline probes.  Emphasis on critical

he new range of Romer Measuring arms coupled with Dezignworks plugin Software enables the Romer arm to sketch directly into Solidworks to accuracies of up to 5micron. This revolutionary system will dramatically increase the efficiency and effectiveness of your RE application and as it provides a single solution for measuring your parts and sketching. Even complex free form surfaces are now made easy. Romer, the inventors and world leaders in measuring arms guarantee the highest quality products with features such as Carbon fibre shafts, TESA smart probes with Renishaw Ruby stylus and Wifi or USB data transfer. The arms have previously specialised in quality inspection of parts and have been used with various metrology software. However due to the cooperation of Creative Dezign Concepts and Solidworks the arm can now be used as a complete RE system. Since size does matter, Romer Arms come in a range of 1.2meters

areas of the part alignment can now be carried out by selecting the desired region of the point cloud and associating it to the CAD.  This allows priority to be given to the selected regions of the point cloud rather than treating every point equally, thus giving more control over the alignment. Points from geometric measurements can now be converted into surface-inspection points allowing them to be used in the inspection of the size and location.  This enhancement also allows the existing geometric strategies to be used for surface inspections so reducing the amount of time spent measuring and allowing for more detailed, consistent and cost-effective inspection routines. Increased capabilities in CAD formats mean that more and more data is becoming available to the inspector in these files.  GD&T is the most common ModelBased Definition format and PowerINSPECT now supports GD&T in Unigraphics as well as the previous support for GD&T in CATIA.  This lets the user create GD&T items directly from CAD.  Improved handling of the tree structure in CATIA files has also been implemented, allowing for easier navigation of the CAD data ervo drive systems from within assemblies. SEW-Eurodrive excel by their nextSTEP dynamic performance, high Contact: Chris Whittington, flexibility and cost efficiency. Camplex NZ Ltd Tel 06 836 7487 or With drive applications in New visit www.camplex.co.nz Zealand industry becoming ever more sophisticated, the need for more capable control and efficient systems can be achieved with the use of servo motors and add-on componentry. Servo design features enable JUNE 2011 ISSUE FEATURES Advertising optimum drive solutions for all Booking & Copy • The Budget 2011 – What it means for business applications that require an even Deadline – 10th • Auckland Manufacturer balance of power and precision. June 2011 No matter whether you need a • South Island Manufacturing servomotor or servo geared motor, • Opportunity Hamilton – Manufacturing in the Waikato this product portfolio for servo For further information contact: applications provides versatility and dynamics. The servo drives also Managing Editor: Doug Green Sales Manager: Max Farndale operate energy-efficiently as they P: 06 870 9029 P: 06 870 4506 use high-quality permanent magnets E: words@xtra.co.nz E: max@nzmanufacturer.co.nz  The new CMP motor series

www.nzmanufacturer.co.nz

to 4.6meters in size. There are also 3 models which differ in accuracy. This means that there is an arm specific for your application. Advantages of the Romer Arm + DezignWorks + SolidWorks System – • Digitise directly into Solidworks • Increase efficiency of Reverse engineering applications • Increase Accuracy of Manufactured parts • No third party Metrology software required • Two in one measuring and digitising device nextSTEP Email: info@solidtec.co.nz

Effective drive technology

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provides Precision, Dynamics and Power; this is what the compact CMP servomotors stand for. The particularly compact design lets you operate the servomotors in applications with very limited space. The low-inertia rotor of the CMP minimises the amount of energy required for motor acceleration. The powerful rotor of the CMPZ type control even extreme loads stiffly, reliably and accurately. The highly dynamic servomotors round off the torque range of CMP range with standstill torques of 0.5Nm to 47Nm in six CMP motor sizes and a total of 26 torque steps. The latest in winding and magnet technology gives the CMP servomotors a low mass moment of inertia despite their more powerful performance. nextSTEP www.nz.sew-eurodrive.com


NZ Manufacturer May 2011

DEVELOPMENTS

Be self-reliant and your success is assured. - Anonymous

EECA welcomes new fuel that cuts greenhouse gas emissions

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he Energy Efficiency and Conservation Authority (EECA) welcomes the launch of a new more environmentally-friendly fuel with a high bioethanol content on to the New Zealand market. Gull New Zealand has started selling E85 (85% bioethanol blended with 15% petrol) at its service station in Melville, Hamilton.  “Motorists who are able to switch to this fuel using flex-fuel vehicles would cut their greenhouse gas emissions by a third to a half, making a significant reduction to their carbon footprint,”  EECA’s transport spokesperson Elizabeth Yeaman said. “Switching to biofuel blends is a way for motorists to make an easy change that benefits the environment.” Only motorists with flex-fuel vehicles can use E85.  Holden have been selling flex-fuel vehicles in New Zealand since last year.    Flex-

fuel vehicles can use either E85 or ordinary petrol or any mixture of the two in the same tank.  However, almost all vehicles can run on some blend of biofuel, and these are available at some service stations for both diesel and petrol vehicles.  EECA recommends that motorists check with their vehicle manufacturer first before using biofuel blends.  “Many New Zealand businesses, as well as individual motorists, are using biofuel blends now”, Elizabeth Yeaman said.  “Using alternative fuels such as biofuels or electricity (in electric vehicles) is one of the ways we can reduce transport-related emissions. Transport makes up nearly a fifth of New Zealand’s total greenhouse gas emissions, and is the largest single source of emissions after agriculture.” nextSTEP Visit: www.eeca.govt.nz/biofuels  

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IRL launches R&D business booster

ndustry often questions the value of Research and Development (R&D). Yet, numerous international studies link the intensity of a company’s R&D spend with a raft of benefits including improved sales growth, productivity and market value. To help demonstrate the benefits of R&D to New Zealand businesses, Industrial Research Ltd (IRL) is offering the services of some of its world-class scientists and engineers as part of its Scientist for a Day initiative.  IRL commercial manager, Gavin Mitchell says the programme has been designed to encourage New Zealand businesses to think about what R&D can do for them, and whether their R&D is focussed in the right areas.  “By applying to take part in Scientist for a Day, companies can gain insight into the role R&D can play in transforming their business,” he says. Between August and 23 December, IRL experts will engage

with successful applicants in a hands-on and face-to-face technical interaction that can take place either at their business location or at an IRL laboratory. IRL can follow up with a business potential for innovation report. Mitchell says the visit can focus on anything: an existing problem, analysing and improving a product or process, developing an opportunity, evaluating the potential for innovation, or any other specific, well-defined idea. The programme is just one of a range of IRL activities aimed at boosting the level of private sector R&D in New Zealand. These include IRL’s What’s Your Problem New Zealand? competition, its CoInvestment Programme and its part in the government’s Technology Transfer Voucher scheme. New Zealand businesses have until June 30 to apply to take part in Scientist for a Day. nextSTEP www.irl.cri.nz/scientist-day

www.eecabusiness.govt.nz/motorsystems

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NZ Manufacturer May 2011

SUPPLY CHAIN

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If something is not worth doing at all, it is not worth doing well. - Warren Buffett

Perishables logistics union delivers ‘chill’ to EPS

hilltainers Hellmann Ltd, a newly-established jointventure between Chilltainers Holdings Ltd and Hellmann Worldwide Logistics Ltd, is expected to deliver an unprecedented level of global logistics capability and efficiency to the New Zealand perishables industry. The new equal-share entity is a dream unification of the expansive logistics network of Hellmann with Chilltainers’ unique thermal packaging system which will directly challenge the use of packaging grade expandable polystyrene (EPS), explains Chilltainers founder Wayne Harrison. “Operating in 443 branches within 157 countries, Hellmann is the only freight-forwarder with its own global network committed exclusively to this unique industry sector -- the Hellmann Perishable Logistics division” he says. “Chilltainers’ patented system, which utilises double-sided metallised laminate bonded to corrugated board to form a leakproof carton, is already delivering major environmental and economic benefits for perishables compared to the EPS alternative. “We are good at what we do, which is integrating packaging into production for perishable products, and Hellmann is very good at transporting these consignments in pristine condition. The knit and the fit between our organisations is perfect -- we share a mutual leadership on environmental efficiency and energy-conscious issues. “Combining Chilltainers with Hellmann delivers the logistics coldchain expertise to get perishables from A to B in the

most cost-effective, efficient and environmentally-friendly manner and ensures end-clients receive a premium price for their goods.” Hellmann New Zealand managing director Chris McCagney sees the combination of each party’s unique capabilities delivering somewhat of a “sum greater than the parts” scenario. “Hellmann’s primary focus is on ensuring temperature integrity and control at all points of the supply chain for New Zealand’s leading blue chip exporters, which is critical to achieve maximum shelf life and protect product quality through to the end consumer,” he says. “We recognise our customers, as proud champions of the ‘Pure New Zealand’ image, are becoming increasingly aware of the issues surrounding CO2 emissions and carbon footprints. We therefore believe it is critical to invest in technology that can minimise the environmental impact of airfreighting their high-value products to far afield markets. “Chilltainers’ packaging system delivers in this regard. It is not oilbased as per the EPS alternative and as it is predominantly recyclable there is minimal waste -- instead of incurring a cost to dispose of waste there is actually an opportunity to earn a payment from recyclers. “Additionally, its competitive pricing will be minimally influenced by the ever-rising cost of oil and its streamlined design enables higher-density freight and therefore reduced airfreight and roadfreight costs when compared to EPS. It is environmentally-friendly perishable packaging of the future.” Chilltainers has also recently appointed Aquahort Ltd owner

John Seccombe as a full-time sales and marketing manager to promote the brand throughout New Zealand, Australia, South Africa, North America, South America and Europe. The acquisition of Mr Seccombe, who will work alongside Mr Harrison, is expected to “significantly enhance” Chilltainers Hellmann’s market position, penetration and return on investment, says Mr McCagney. “Having gained a reputation selling innovative processing solutions and technologies to fish producers around the world for over 25 years, John strongly believes the time has come for Chilltainers to replace EPS in the coldchain. “The combined expertise of John, Wayne and Hellmann working in unison with clients, will see the Chilltainers packaging system and

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NZ MANUFACTURER • June Issue 2011 • Features Opinion Manufacturing Profiles Letters to the Editor Politics of Manufacturing Trade Fair World Diary of Events World Market Report Q/A Export News Business Opportunities Commentary As I See It Business News Appointments Around New Zealand Australian Report New to the Market Lean Manufacturing Equipment for Sale Recruitment Environmental Technology Manufacturing Processes www.nzmanufacturer.co.nz

overall best practice implemented from the beginning of the supply chain. As well as optimising processes, this will ensure we get the right product packaged at the right temperature with the lowest bacteria count. Quality going in equals quality going out.” A local award-winning invention, which has been progressively refined over the past two decades, the Chilltainers packaging system is currently being manufacturing in North America, with expansion soon expected in Australia, Chile, Norway and South Africa. In New Zealand, Chilltainers is manufactured under licence by the packaging division of New Zealandowned international Rank Group company, Carter Holt Harvey, with plants in both Christchurch and Auckland to service the perishables packaging markets.

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The Budget 2011 – What it means for business Auckland Manufacturer South Island Manufacturing Services for Manufacturers Opportunity Hamilton – Manufacturing in the Waikato Manufacturing Technology including Research and Development Advertising Booking Deadline –10th June 2011 Advertising Copy Deadline – 10th June 2011 Editorial Copy Deadline – 10th June 2011 Advertising material is to be sent to: Max Farndale, P O Box 1109, Hastings 4156, Hawke’s Bay Email: max@nzmanufacturer.co.nz Tel: 06 870 4506 / Mobile 027 628 2033

Editorial material to be sent to : Doug Green, P O Box 1109, Hastings 4156, Hawke’s Bay Email: words@xtra.co.nz Tel: 06 870 9029 Fax: 06 878 8150

At NZ MANUFACTURER our aim is to keep our readers up to date with the latest industry news and manufacturing advances in a tasty paper morsel, ensuring they do not get left behind in the highly competitive and rapidly evolving manufacturing world.


NZ Manufacturer May 2011

There are three ingredients in the good life: learning, earning and yearning.” - Christopher Morley

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SUPPLY CHAIN

RFID the “New Clever in the New Normal!” T he idea behind the ‘New Normal’1 is simple: it’s about the things we call digital and I have been advised that we are about at the halfway point of the digital revolution. What will happen when we cross this point? The ‘digital’ glass is half full and in the next twenty years or so the digital transformation will be exponential meaning fundamental changes in our behaviour and adoption of technology at home and in business. The impact on business will be enormous. What will happen is that digital will become the New Normal. So, the future is about silicon. Shakespeare said it nicely: “Striving to better, oft we mar what’s well.”* In seeking perfection, we miss out on the benefit of things we already have. Surely there are many companies doing exactly this in their approach to information technology. They hold off investment, putting aside today’s technologies in favour of the better or even perfect solutions seen to be just around the corner. But what if today’s technologies are “well”? What if they are capable of delivering big benefits to your business albeit short of the perfection you believe will come one day? Is it not better to invest now, grab the benefits and prepare for the future that way? In fact, embracing today’s technologies might be the best way to actually stimulate their development and hasten delivery of that better, even perfect, solution tomorrow. I think RFID (radio frequency identification) is a great case in point.

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Many companies, in New Zealand and internationally, have grasped the potential of this technology to make their operations more efficient, to ensure regulatory compliance and so on. But they are waiting for better or cheaper tags and readers to arrive, and/or for assurance that RFID will deliver fully on its potential once they have invested. They could, in fact, be missing out on big benefits right in front of them: They could even be “marring what’s well”. Four centuries on from the time of Shakespeare, there is a new way of thinking about the present in relation to the future and all its promise. It’s the “new normal” way of thinking –a term broadly applied to business and economic management post the global recession of 2008/09. In the new normal, there is growing recognition that running with what you already have, flawed as it might be, can be much better than holding off for perfection. At the least, the latter can be too costly and/or take too long to achieve. Companies are starting to learn that “near enough” could be good enough for their purposes. They are letting go of rigid, old assumptions about information technology: That it must involve precision, absolute workability and 100% delivery of results consistently. Such attributes have certainly been to the fore in investment decision making up until now, even if outcomes were completely different. In the new normal, companies

accept the reality of imperfect information technology and commit themselves to working with it, rather than waiting for something better or even perfect in the future. In fact it is easy to see “good enough” technologies all around us: Skype, for example, may have fuzzy images and poor quality sound but people extract huge value from it at work and at home, and usage is growing exponentially. With “good enough” technologies, what matters is that they work most of the time, they deliver benefits and they are economically viable. When it comes to RFID, the new normal thinking has plenty of scope. The future will bring low cost supply of tags that operate on ultra high frequencies with long read distances. They will be a near-perfect solution to monitoring temperature and humidity in the storage of perishable foods and other goods in long supply chains – but they are not yet ubiquitously available – but they’re very close – that is months, not years. Indeed, right now several companies internationally are rolling out semi-passive tags for the same purpose. They are going with current technology that is not quite perfect but economically viable and still capable of delivering big benefits. They recognise that active tags – or some better solution yet – will arrive in the future. Moreover, growth in demand for RFID tags today is a key stimulant in the development, and commercial availability, of the more efficient types of tags in the future. By adopting “good enough” technology today, companies can bring forward better solutions tomorrow!

By Gary Hartley of GS1 New Zealand Of course, RFID investment must always proceed on a good business case. The new normal thinking – with its emphasis on the benefits of current technologies that are lessthan-perfect but also less costly – will surely help the business case in many situations. For most companies the last ten years was about getting on-line. The next ten years are about using it cleverly – RFID coupled with the internet are a new cleaver in the new normal – a powerful business enabler. As a general rule, the most successful man in life is the man who has the best information. In a commercial context we could say its business intelligence. Marketing Guru Philip Kotler said, “Marketing takes a day to learn. Unfortunately it takes a lifetime to master”. With the New Normal I think you’ve probably got a couple of years, max. *From King Lear, 1605 1 Peter Hinssen – The New Normal ‘Explore the limits of the digital world.

Weigh scales meet entry level needs

he EziWeigh5 is designed to meet farmers’ ‘entry level’ needs, while EziWeigh6’s technology helps maximise the value and application of animal weight data. The release follows the recent launch of the XRP Panel Reader, further increasing choice and functionality for New Zealand farmers. Upcoming NAIT requirements are highlighting quite different needs for weighing and weight data management. NAIT requirements will mean many more farmers will be tagging and recording their stock, and their individual needs vary greatly. The EziWeigh5 is for entry level weighing while the EziWeigh6 offers EID capability at an attractive price level. The EziWeigh5 and EziWeigh6

Tru-Test EziWeigh6 Weigh Scale Indicator

EziWeigh6 offers EID capability at an attractive price level.

offer the largest weight display on the market. A high contrast display that’s clearly visible in the brightest daylight and an LED backlight for visibility in failing light or in dark sheds. Additionally, both products incorporate Tru-Test’s Superdamp III technology, making accurate live animal weights the fastest in the world, even with the liveliest animals. For farmers with greater data needs, the EziWeigh6 combines the best of EID (electronic identification) and VID (visual identification) compatible technology with strength and durability. USB compatible, the EziWeigh6 plugs directly into PCs or laptops and comes equipped with RS232 communications for compatibility

with EID panel readers. The EziWeigh6 also enables three-way manual drafting by weight, and is compatible with Tru-Test and other brands of panel readers as well as stick readers. The no-nonsense EziWeigh5 is ideal for weighing animals where additional data isn’t necessary. Both models are 100% water and dust proof, and have robust top quality load bar connectors. They both also come with an auto zero function to ensure that any accumulation of animal dirt on the weighing platform is automatically ‘zeroed out’ from the recorded weight. nextSTEP Visit www.trutest.co.nz www.nzmanufacturer.co.nz


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NZ Manufacturer May 2011

LEAN THINKING

If you want things to stay as they are, things will have to change.

- Giuseppe di Lamedosa

Lean Business programme heats up business

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ike many New Zealand exporters, Escea faces stiff competition from international companies but this Dunedin company says applying lean systems has helped it grow dramatically by improving efficiency and allowing it to give customers more choice. Escea designs and manufactures high-end, top quality gas fireplaces which are intended to be attractive to look at, just as much as they are expected to heat efficiently. It employs 45 people. The company has participated in the New Zealand Trade and Enterprise (NZTE) Lean Business programme, which helps educate senior managers about lean tools and techniques, and provides some funding to help them use an external consultant to implement lean systems in their business.

Setting goals to improve the bottom line

Chief Executive Nigel Bamford is passionate about designing and manufacturing in New Zealand but, given 80 percent of his competitors are overseas, says his company’s success is dependent on it being a world class operation. Implementing lean business systems has meant Escea has been able to double the number of products it can offer to customers, turn orders around much more quickly and accelerate its growth. Mr Bamford attended a lean seminar organised by NZTE and came away feeling confident he had learned enough to make significant positive changes to the way Escea operated and its bottom line. “It’s not a manual that you can read and apply for a couple of years. It’s about continual and neverending improvement. “I could see that everything we do could be done with less wastage,’’ he says. “It’s not really about costcutting, but about doing things efficiently with reduced waste and greater repeatability.’’

Implementing lean principles

Getting staff buy-in is essential to a lean journey being successful. Applying the lean philosophy is a culture change but Escea was fortunate because about one-fifth of its staff had already worked in a lean organisation. “They had a good level of understanding and were keen because a lean workplace is a much more pleasant place to work – it’s tidier, it’s clean, it’s light and airy.’’ www.nzmanufacturer.co.nz

Participating in NZTE’s Lean Business programme helped get the remaining 80 percent on board. An external trainer helped staff understand the principles in a simple way and returns to the business several times a year. The trainer asked staff to build something with Lego, then asked them to repeat the process with more strategic, streamlined thinking. The process was repeated and staff could see they could produce a better product in less time using a bit of clever thinking. The next step in Escea’s lean journey was to apply the ‘Five S’ principles – Sort, Set in Order, Shine (clean), Standardise and Sustain. “That in itself could take a couple of years to embed properly,” Mr Bamford says. “Next was to identify the key areas that needed to be measured; now we are constantly measuring progress versus goals et cetera. We’ve done it in such a way that we can glance at a board and instantly get a picture as to whether we are on track or not.’’ The ‘seven forms of waste’ – over-production, inventory, motion, waiting, transportation, overprocessing and not getting it right the first time – are closely monitored.

Tangible benefits

The benefits for Escea from participating in the NZTE Lean Business programme have been clear and easily measured. “We can now offer customers twice as many model types but our stock levels have dropped down dramatically,” Mr Bamford says. “We have been able to give our customers more choice without holding more stock.” “We do things more efficiently and have saved money in both stock and space. It’s possible to free up 50 percent of a factory. If we hadn’t gone lean we would have run out of space pretty quickly.” Employee suggestions on how things can be done better and proactively sought and as a result the company has been able to reduce the amount of rework it does.

Success is dependent on being a world class operation.

Nigel Bamford, CEO Escea “You would be surprised how few ideas are bad ideas. By far the vast majority from our employees have been gold. “We have always picked up quality problems before they left the factory but now we are able to pick them up when they happen, not at the end of the production line which means less rework for us.” Extra work was done to reduce the amount of floor area and travel time staff needed to complete their jobs. “We have managed to reduce the number of person hours it takes to assemble a fireplace which means we can make more fireplaces.” Orders are now shipped out within three days of receipt but often they go on the same day they are received.

Key achievements and next steps

Mr Bamford says going lean undoubtedly helped fast track the company’s growth. “Lean businesses are often the ones that are successful irrespective of the economy. We’re going through a recession but our business is going really well. “There’s no doubt that it is the right way of operating and NZTE’s assistance meant we got there much quicker than we otherwise would.” Escea estimates its future financial savings (annualised) resulting from lean improvements to be $250,000. In addition, it has achieved a 20 percent improvement in overall

labour productivity in the areas of the business where lean principles have been applied. The next lean project for Escea is to automate more of the daily measurements and to align measurements between departments. “We think we can improve our idea generation process and have some opportunities to improve our standards. There’s a hundred little things we can do.’’

About the NZTE Lean Business programme

Lean tools and techniques help companies create more value for customers from fewer resources. The NZTE Lean Business programme helps owners and senior managers at New Zealand companies understand the principles and philosophies of lean. Companies in the programme may also receive funding to help them implement lean systems and create a culture of continuous productivity improvement in their business. The programme is part of a suite of services NZTE offers to businesses that it is helping to succeed internationally. Key takeaways – Escea’s participation in the NZTE Lean Business programme – • Estimated financial savings resulting from lean improvements (annualised) $250,000. • Overall improvement in labour productivity where lean has been applied 20%.


NZ Manufacturer May 2011

If you want 1 year of prosperity, grow grain. If you want 10 years of prosperity, grow trees. If you want 100 years of prosperity, grow people. - old Chinese proverb

Differentiated products, not commodities, the path to export success

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igh commodity prices are seen to justify rises in the New Zealand dollar. Reserve Bank Governor, Dr Alan Bollard, noted in a speech recently that agricultural export prices are likely to remain strong for some time and the Bank expected these higher terms of trade to be reflected in the exchange rate. However, the high commodity

prices that help some sections of the economy will do little to promote a any turnaround towards an export led economy. Those exporting into the United States and Europe are struggling with lower returns from the high currency and some comments from our Reserve Bank indicating comfort with ever higher exchange rates push those rates even higher.

As the table shows, most of New Zealand’s exports are not the unprocessed commodities that might fundamentally justify higher exchange rates. Export growth in the processed primary and manufacturing sectors

require investment in product development, new plant and equipment to improve capacity. A high and volatile currency will increase the uncertainty of return, pushing back against export focused investment.

This table shows that sectors outside the soft commodities are again more important in terms of GDP, employment and as a sound

foundation for the service sector. The Government has largely washed its hands of this issue. Finance Minister Bill English said

in response to the latest rise of the dollar that a high New Zealand dollar had been a headwind for the economic recovery “right from the start”. “And that’s been driven to a large extent by policy in the US, the UK and Europe,” he said. “We’ve been fortunate to have at the same time, and related to the high currency, very high commodity prices, which are higher than they’ve ever been. We can see the export sector is making progress, it’s

The high commodity prices that help some sections of the economy will do little to promote a turnaround towards an export led economy.

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REAR VIEW

John Walley Chief Executive NZ Manufacturers and Exporters Association going to become profitable as it gets its debt levels right,” English said. The fact is that anyone succeeding with the high dollar is succeeding despite the Government and the Reserve Bank policy framework. Most countries have taken steps to prevent significant currency fluctuations whether through quantitative easing in the United States and the United Kingdom, capital flow restrictions in Canada and Brazil or direct currency management in China and Singapore. There are always going to be bright sides, and right now they are commodity prices and a favourable exchange rate with Australia, but macroeconomic policy changes are needed to promote growth across all export industries if we are to see a low stress balancing in the current account.

Or visit: www.filtercorp.biz

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NZ Manufacturer May 2011

Kiwis are innovators and manufacture many fine products for local and overseas markets. It is vitally important for the future of the country that we continue to do so. To be the best and show the world that by focusing on what we do best Ðbe it dairy products, computer software, marine products or electrical equipment Ð we punch well above our weight and succeed! NZ MANUFACTURER believes in our manufacturers and the levels of excellence they achieve. But more can be done. The opportunities are out there; letÕs grab them with both hands for the future benefit of us all. www.nzmanufacturer.co.nz

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NZ Manufacturer May 2011