Australia’s Modern Manufacturing Strategy 2020

Australian manufacturers have faced many different challenges and opportunities in the months since the COVID19 pandemic hit Australia. Locking down our economy has impacted demand for many sectors, along with creating shortages in others as international supply chains failed. Australian’s famed ingenuity has come to the fore with many businesses pivoting, shifting their capabilities to meet immediate opportunities and community needs. Something for us in the sector to be very proud of.

The inability to find a vaccine quickly (or for the virus to die out) has created the concept of a “new normal”. This will require Australia to develop ways to live with COVID19 until an effective vaccine is available.

Of course, the impact of COVID19 has been significant. Both in economic terms, but also in highlighting some of the risks and consequences of decisions made by business, the community and government over the last 40 years.

In the last week we have seen the Australian Government announce the Modern Manufacturing Strategy. I believe within this strategy, there are many things that are a major step in the right direction. The emphasis is on being world-competitive, resilient and willing to scale-up to take on the world (I prefer to think – to deliver to the world). 

Possibly the most important point made in the Prime Minister’s launch is that “Manufacturing is critical to Australia’s economic future, to the prosperity of our regions and to the capabilities that underpin the success of so many other industries.” Whilst some may not see this as important, I believe it signals a subtle but critical shift in the positioning of manufacturing as a fundamental component of the Australian economy.

I have previously discussed the three aspects crucial to remaking Australian manufacturing as 1) striving for excellence – being competitive in the world and delivering to the world; 2) focusing on productive technology; and 3) creating an environment of Constructive Leadership of all stakeholders (business owners, the workforce and government).

The Modern Manufacturing Strategy and other policy decisions with respect to supporting investment in new technologies such as the instant asset write-off are great steps on the journey. There is however, a concern that once we scratch below the surface, the basis of the thinking may restrict the progress to remaking Australia.

The Modern Manufacturing Initiative (MMI) is the centre-piece of the strategy, with a focus on six prioritised sectors. Along with the Manufacturing Modernisation Fund and the Supply Chain Resilience Initiative, there must be some concern about the ability to get traction with these programs in a time frame that creates momentum and a positive outlook.

History demonstrates that Australians will build great manufacturing businesses with the right support, the access to opportunities and the confidence to act in the long term. In this respect, it will be the leadership that is shown as the strategy is implemented… a willingness for the leaders in the manufacturing sector (from all sides) to look beyond the short term, will be fundamental to success.

From personal experience successful change in manufacturing requires leaders to paint a vivid picture of what success looks like and challenge their people to achieve the high standards of performance required. With a strong vision, they will challenge what is possible and continuously strive to do things better.

In essence, the challenge for manufacturers in Australia in late 2020 is remarkably similar to what it has been for the last 20 years; demonstrate the leadership required to create the change. The only difference I see, is that perhaps now there is a clear understanding of the consequences of not having a vibrant, sustainable and successful manufacturing sector in Australia.

I welcome your thoughts on this post and the future of manufacturing in Australia. Reach out via the form on my site, or by calling me directly on my mobile 0407093662. 

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