Department of State Development

 

What does the State Government mean when it uses the term ‘advanced’ or ‘high-value’ manufacturing?

Advanced manufacturing uses advanced technology to improve products or processes.

High-value manufacturing refers to firms and clusters of firms creating a competitive edge through unique knowledge and expertise, innovation and other means.

These create and capture value through:

  • the application of new technology
  • new business models
  • design and branding
  • solutions-based manufacturing.


Why does South Australia need a manufacturing strategy?

Manufacturing has traditionally been the back-bone of South Australia’s economy. Manufacturing employs 73,200 people in South Australia and contributes 10 per cent of Gross State Product. In South Australia, there are 2.8 jobs created for every one in manufacturing and this is the third highest multiplier behind utilities and mining.

We need manufacturing to trigger growth in productivity, innovation, exports, high-value services and jobs.

We need to create a diverse and resilient economy and a healthy manufacturing sector is crucial to that goal.

A sustainable manufacturing sector underpins a high standard of living and community well-being.

We need to take action now to retain and develop manufacturing capabilities – particularly related to opportunities in mineral and energy resources.


What are some of the key initiatives of the strategy?

Manufacturing Works outlines a broad suite of new programs and initiatives to grow advanced manufacturing in South Australia.

An Innovation Voucher Program is providing funding to connect manufacturers with researchers to develop solutions to commercially identifiable problems.

A Mining Industry Participation Office (MIPO) seeks to boost local industry participation in major mineral and energy projects. ‘MIPO’ will achieve this through mapping local skills and capabilities against future demands.

A strengthened Industry Participation Policy is increasing opportunities for local SMEs to participate in major projects in the state. This policy came into force in July 2012 and will ensure local SMEs have a full and fair opportunity to bid for work linked to major projects in this state.

A Small Business Innovation Research Pilot (SBIR), demonstrating how government procurement can stimulate innovation and growth for local businesses.

A Competitive Foods Initiative, encouraging food companies to work collaboratively to develop new strategies, apply new technologies and respond to new opportunities by working together to share knowledge and skills.

Business Model Innovation Series, an extension of the Business Innovation Model workshop series of 2011, conducted by Professor Roos.
Building Design Competence Pilot, for manufacturers to test design-based innovation models
Manufacturing Services Series, a program to help manufacturers develop services-based innovation strategies

Skills Development and Workforce Training initiative involves four new programs to increase skills, to ensure high-performing workplaces are able to adapt to a globalised, high-cost environment. The programs include:

an industry and academics exchange program to help improve the way we apply knowledge to real-world problems, drawing on a successful model developed by the CSIRO
a program to help to transition workers vulnerable to industry restructuring into more highly skilled jobs
an innovation management program to encourage more educators to offer best practice training in innovation management and
a new website with information about careers, that will help to rebrand manufacturing as an attractive career path, with opportunities linked to emerging growth sectors in the South Australian economy.

A Manufacturing Leaders Network of experienced executives, is being established by DSD, to maximise and multiply the number of manufacturing businesses and managers exposed to practical pathways to higher-performance manufacturing. The members of the network will share knowledge and engage with international experts and CEOs of successful national and international SMEs.

Who will implement the initiatives outlined in Manufacturing Works?

While the majority of the initiatives will be Government-led, we will rely heavily on industry to encourage participation in each program and initiative.

After all, the programs outlined in the strategy will only be as successful as the level of participation from local manufacturers.

DSD will be the lead agency on most initiatives, however the department will work closely with its partners across government including PIRSA, DPC and Defence SA and the Commonwealth Government, as well as various industry associations and research and development providers.

The Advanced Manufacturing Council has been established to guide and steer the roll-out of initiatives outlined in Manufacturing Works. 

How long will it take to implement Manufacturing Works?

The strategy will be delivered over 10 years.  To see a breakdown of the programs and when they are to be delivered, see the schedule.

What is the role of the Advanced Manufacturing Council in this strategy?

The Advanced Manufacturing Council has been established to guide and steer the roll-out of initiatives outlined in Manufacturing Works.  The Council consists of recognised experts in their fields.

Professor Goran Roos chairs the Council, with other members drawn from the Australian Manufacturing Workers Union, the Australian Industry Group, the Commonwealth Scientific and Industrial Research Organisation and other industry groups.

What role has industry played in the development of this strategy?

The process to develop Manufacturing Works involved a comprehensive consultation process with industry, government and the research sector.

This began in early 2011, when industry was asked to comment on a discussion paper, Industry Capability Initiative: Maximising value from major projects and emerging industries.

In November 2011, the former DMITRE hosted a workshop with key industry stakeholders to discuss new directions for manufacturing.

Discussion papers on three key sectors, cleantech, resources services and technology and high-value manufacturing were also presented at the workshop. These papers contained strategies to foster productivity, innovation and technology.

In March 2012, the former DMITRE released a Green Paper to stimulate conversation with the manufacturing sector. Industry was asked to consider a range of actions proposed to help ensure its long-term sustainability in a high-wage, high exchange-rate economy.

Feedback on the Green Paper was incorporated in the final Manufacturing Works strategy.

What actions are required by manufacturers in the strategy?

Manufacturing Works is more than an action plan for the State Government. It is a call to action for companies to identify what they need to do to create new, distinctive and enduring competitive advantages.

Manufacturers can secure their own future by making practical and immediate decisions to:

experiment with business innovation for a new competitive edge
broaden their systematic search for new business ideas and opportunities
invest in creating high-performance workplaces and STEM skills in their workforce.

This is not a solitary pursuit. Manufacturers need to collaborate widely, especially with universities and research organisations, training providers, industry bodies and government regulators.

DSD strongly encourages companies to review the suite of programs available in Manufacturing Works and consider which ones will be most helpful to their respective business.

What are clusters and how will they help?

Industry clusters are groupings of businesses in related industries situated in close geographical proximity of one another.

Clusters are characterised by proximity, networking and specialisation and can help overcome the problems of scale experienced by small economies, like South Australia. They also help accelerate the application of new knowledge and innovation.

South Australia has had industry clusters for 20 years, so we are well positioned to make new and significant advances in cluster development to target high-value opportunities.

The defence precinct at Techport, the agribusiness precinct at Waite and the bioscience precinct at Thebarton are examples.

A new modern cluster currently under construction is the redevelopment of Tonsley Park, in which the State Government is investing $253 million over the project’s 20-year life.

Clusters help capture the opportunities emerging from the state’s tens of billions in major projects – projects in minerals and energy, in defence, in urban development, infrastructure, health and education.

What is happening at the Tonsley site?

Tonsley is being redeveloped as a magnet for South Australia’s new breed of advanced, high-value manufacturing companies.

Tonsley will support a manufacturing cluster which responds to demands for high-value manufactured goods and services which span the mineral resources, health, environmental and renewable energy industries.

The project is a fundamental initiative under this strategy.