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We Need to Talk About Inflation

Stephen D King With the title clearly a take on the Lionel Shriver book, “We must talk about Kevin”, one is immediately warned to approach Stephen King’s book with trepidation. Like Kevin, inflation in this book is bad, particularly if out of control. And like Kevin’s parents, those responsible for keeping inflation in check should be made to read and understand the warning signs early enough and act decisively to tame it. Otherwise, it all ends in tragedy. Unless of course we learn the lessons – 14 of them according to King, and not just from the recent crises but going back 2,000 years. So we can live happily ever after and in one piece, unlike the characters in Lionel Shriver’s tale. Well- that at least is the conclusion one gets to when reading King’s book. There are some lighter moments like the recurring theme of the love/hate relationship between Richard Burton and Elisabeth Taylor to characterise what is going on between monetary authorities and the fiscal side of the equation. Periods of harmony are great. Pulling in opposite directions proves disastrous. And King offers lots of historical examples as to when things went well on the inflation front and when they didn’t. Some interesting conclusions though. In King’s view the argument used by central banks against tightening, that it was all just ‘transitory’, was fuelled by central banks having presided over a low inflation environment for nearly two decades, falling victim of their own anti-inflation propaganda. As a result, serious mistakes were made when circumstances suddenly changed. We saw the impact of the supply and demand imbalances when Covid restrictions ended and then the extra pressures on energy and food prices with the war in Ukraine. But in King’s view the reappearance of inflation in the last couple of […]

Chip War: The Fight for the World’s Most Critical Technology

By Chris Miller An epic account of the decades-long battle to control what has emerged as the world’s most critical resource—microchip technology—with the United States and China increasingly in conflict. You may be surprised to learn that microchips are the new oil—the scarce resource on which the modern world depends. Today, military, economic, and geopolitical power are built on a foundation of computer chips. Virtually everything—from missiles to microwaves, smartphones to the stock market—runs on chips. Until recently, America designed and built the fastest chips and maintained its lead as the #1 superpower. Now, America’s edge is slipping, undermined by competitors in Taiwan, Korea, Europe, and, above all, China. Today, as Chip War reveals, China, which spends more money each year importing chips than it spends importing oil, is pouring billions into a chip-building initiative to catch up to the US. At stake is America’s military superiority and economic prosperity. Economic historian Chris Miller explains how the semiconductor came to play a critical role in modern life and how the U.S. become dominant in chip design and manufacturing and applied this technology to military systems. America’s victory in the Cold War and its global military dominance stems from its ability to harness computing power more effectively than any other power. But here, too, China is catching up, with its chip-building ambitions and military modernization going hand in hand. America has let key components of the chip-building process slip out of its grasp, contributing not only to a worldwide chip shortage but also a new Cold War with a superpower adversary that is desperate to bridge the gap. Illuminating, timely, and fascinating, Chip War shows that, to make sense of the current state of politics, economics, and technology, we must first understand the vital role played by chips.

Horizons of growth in a challenging world

Image: Karsten Würth on Unsplash. “Over the longer term, the only way for the world to propel itself out of the low growth environment is through cooperation.” -Mirek Dusek The world is currently mired in a low growth environment, with the latest IMF forecasts projecting 2.8% global growth in 2023 and 3.0% in 2024 – rates which are well below the average experienced over the past decade. This is in the context of other ongoing fragilities including stubborn inflation, a global debt crisis, geo-economic rivalry, geopolitical conflict and vulnerabilities in the financial sector, among others. Despite this sobering outlook, or perhaps because of it, it is so crucial not to lose sight of avenues to relaunch growth and put us on a firm trajectory to new competitiveness and resilience. In this respect, I would like to point to three horizons of growth, for short-, medium- and long-term revitalization of the global economy: Reopened Asian economies Among the regions hardest-hit by the COVID-19 pandemic, Asia is emerging from a protracted period of muted economic activity and looks set to resume its role as the world’s growth engine. China’s economic opening up earlier this year has provided a much-needed boost to both the regional and global economy. The reopening of crucial Asian economies at large provides us with immediate growth markets which can serve to spur growth in the short-term, while also establishing a base from which to overcome the low growth environment moving forward. In comparison with other regions, Asia-Pacific is by far the brightest spot for economic growth at present, with the IMF’s latest estimates projecting the region to contribute 67.4% of all global growth in 2023, and with China alone contributing 34.9% of that total. The annual growth rate for the region is projected at 4.6% for 2023, representing […]

Becoming a data-driven organisation to optimise performance

-Adam Sharmer, senior partner, Dsifer As the pace of digital innovation accelerates, and organisations look to exploit the financial and strategic advantages of digital technology, automation and AI, data is increasingly becoming the lifeblood of organisational decision ecosystems. Whilst the collection and analysis of data to inform operational decision-making is not a new concept, advances in connectivity of technology, AI and machine learning as well as ERP and MES solutions have driven exponential gains in the availability, quality, and integration of data in manufacturing organisations. Spend a few moments on LinkedIn and its easy to become overwhelmed by the level technology available and the visions of possible futures available through its adoption. However, whilst there is no doubt that Industry 4.0 technologies represent a potential step-change in manufacturing performance, the reality is that the CAPEX required for investments in, for example, lights-out warehousing or production automation, is beyond the reach of a lot of organisations. As a result, the journey from current state to the Industry 4.0 utopia can seem like an insurmountable one. The good news is that, whilst strategic adoption of technology should be on the business plan for all organisations if they are to remain competitive, there is a lot of value that can be unlocked with the current context or with low levels of investment. In our experience, most organisations have increased their maturity in the collection and storage of data in all or most organisational processes. However, the true value of this data is not yet being realised. A deliberate focus on process, system, analytics and cultural dimensions to become a data-driven organisation, can unlock the latent value in current systems and data and build the foundation from which to optimise I4 technology. From our experience, data-driven organisations share the following characteristics: They collect […]

Increasing interest in ZLD driven by costs and environment

By Matt Hale, International Sales & Marketing Director, HRS Heat Exchangers In 2021 the global market for zero liquid discharge (ZLD) technology was estimated at US$1 billion and is forecast to grow at almost 12% over the next ten years. The rise is being driven in particular by an increase in adoption of the technology by the food and drink and textile industries as a growing world population puts greater pressure on fresh water supplies. What is ZLD? Zero liquid discharge (ZLD) is a liquid waste stream treatment which involves transforming liquid waste streams into clean water (which can be reused) and a minimum volume of solid residues. One of the advantages of ZLD over other treatment techniques is its theoretical ability to separate unwanted materials from water, whether they are benign, hazardous or toxic. The resulting solid residue is often more stable, making it suitable for recycling or landfill. However, poor management or handling of the remaining residue can result in unintended environmental consequences. For example, storage ponds may leak or affect local wildlife while there is the potential for toxic chemicals to leach into groundwater from landfill. It is therefore important that when implementing a ZLD system, full consideration is given to the entire process, including the ultimate fate of liquid and (semi-)solid waste streams. A well-designed ZLD system should minimise or even eliminate liquid waste streams, resulting in clean water for reuse or environmentally-friendly discharge, and a solid residue suitable for further processing (often to recover valuable components for use elsewhere) or for safe disposal. The factors driving ZLD uptake According to Transparency Market Research, ZLD is being implemented across a wide range of industries, including chemical and petrochemical production, food and drink production, textiles, energy and power, and pharmaceutical manufacturing. These industries are being driven to […]

New cloud-based solutions bring speed and feline agility to unlock the power of manufacturing data

Historically, manufacturing data has been gridlocked, trapped in the devices, or the applications where it was created. “Today, owners of that data want to be a cheetah, a business cheetah,” said Brian Shepherd, senior vice president of software and control at Rockwell Automation. In the current global climate, a business cheetah needs to be able to pivot with speed and agility, he says, which is why the world’s largest company, dedicated to industrial automation and digital transformation, is introducing its latest cloud-based Software as a Service (SaaS) solutions. The new suite of cloud-based SaaS products is part of the FactoryTalk Design Hub software, which provides on-demand design tools. SaaS delivers software via a licencing and delivery model, whereby hardware and infrastructure are centrally hosted. Users subscribe and receive the benefits of the software on-demand over the web, freeing themselves from large upfront investment and ongoing hardware and infrastructure maintenance. SaaS solutions were developed in partnership with Microsoft on the Azure platform to help business to digitally transform with confidence using the cloud. “The cloud is tried and tested. It’s proven,” Shepherd said. “SaaS in the cloud provides the speed and agility that customers are looking for to meet their key business outcomes. The cloud enables those business outcomes by changing the way you work,” said Shepherd. The cloud can also accelerate time-to-value and reduce the need for expensive on-site experts and teams for deployments, patching, and upgrades. “That’s good, because you can’t find those people anyway.” Adopting the cloud also eliminates large upfront purchases for hardware and software licenses. “You can start small and scale up fast,” Shepherd said. “That’s real agility. You can scale back down as business conditions change.” There’s no question that the cloud is here to stay. We see what cloud computing is capable of and […]

Embracing equity for women in STEM

This year’s International Women’s Day (IWD) follows the theme of “embracing equity” — focusing on giving fair opportunities for everyone to succeed. An example of a business invested in its people is, Sandvik Coromant, here highlighting the experience of their President, Helen Blomqvist. One of IWD’s key missions is to forge inclusive work cultures where women’s careers thrive and their achievements are celebrated. This year, the campaign centres around equity and how providing equal opportunities is no longer enough. So how do we achieve equity? At Sandvik Coromant, the number of females in functional management roles currently sits at 43%. This is above the estimated industry average, which is considered to be 38%, according to the Chartered Management Institute (CMI). However, if we’re to look across the manufacturing industry, it’s clear there’s still a lot to be done to truly achieve equity. A recent report by the Manufacturing Institute found that females make up just 29% of the manufacturing workforce. Staggeringly, it also finds that 63% of women struggling to get into the field face challenges due to the sector’s lack of flexibility and almost half are deterred due to childcare issues, compared to just 8% of males. It seems, therefore, that females wanting to succeed in the manufacturing industry still face challenges that rarely affect their male counterparts. If the industry is to truly reach equity, it must be aware of the unconscious bias certain groups face and find ways of managing that bias. But first, businesses must realise that hiring diversly does not just help fulfil a quota. In fact, it can bring real, measured business benefits. Time to act According to a Wall Street Journal report examining diversity and inclusion among S&P 500 companies, “diverse and inclusive cultures are providing companies with a competitive edge over either […]

Operational technology security in smart manufacturing

By Alex Mosher, Senior Vice-President of Global Enablement at Armis The business needs of Operational Technology (OT) environments are rapidly evolving where systems are increasingly connected to both enterprise networks and externally to the internet, exposing them to new and emerging cyber threats. This means that security becomes strategically important for OT, IT, and business stakeholders in the manufacturing sector. According to a study conducted by Forrester Consulting, 66% of manufacturers have experienced a security incident related to IoT devices over the past two years. Believe it or not, OT devices in industrial and manufacturing environments often have no built-in security, nor can you install a security agent on them. They were designed this way by manufacturers operating on the now invalid assumption that these devices would not be installed on a network that conveys any type of threat. The same devices are now exposed to many types of cyber threats leaving the manufacturing sector vulnerable. The fact that OT devices cannot accommodate security agents robs security managers of visibility to what the device is, what risks it harbors, and whether it is behaving outside the norm. Not only are OT devices increasingly vulnerable to attack, but they typically are not able to accommodate a security agent that could monitor and protect the device from attack. This design choice allows the device manufacturer to maximise economy and power efficiency, which in the past (and arguably still) have been seen as more important than security. Alex Mosher, Senior Vice-President, Global Enablement at Armis, talks to NZ Manufacturer about the strategies involved in managing IT/ IoT/ OT device security in the manufacturing, advanced manufacturing, and smart manufacturing space. Andrew, thank you so much for your time. What are the challenges manufacturing companies face when managing OT devices? With automation and smart devices […]

Siemens and Nissan collaborate to digitalise production lines for new crossover electric vehicle Ariya

Siemens, a leading supplier in the field of automation and industrial software, cooperates with Nissan to build production lines for the new all-electric crossover Nissan Ariya at the company’s plant in Tochigi, Japan. Both companies build on their long-standing cooperation. Nissan had already been using the Siemens Digital Industries software portfolio to optimize design and production. End-to-end digital threads enable Nissan to connect a wide variety of sources of information across product lifecycle management (PLM) platforms. “The successful launch of the new production lines is a milestone in the collaboration of the two companies,” says Cedrik Neike, Member of the Managing Board of Siemens AG and CEO Digital Industries CEO. “Climate change and stringent environmental regulations are powerful drivers for the development of electrified powertrains. We will bring in all of our cutting-edge technologies to this collaboration to enable a highly flexible, efficient and sustainable automotive production. “At our Nissan Intelligent Factory in Tochigi, we are building the future of mobility. It enables us to not only improve the work environment but also to realise a zero-emission production system. To digitalise our new electric vehicle production line, we chose to work with Siemens, our innovation partner and one of the leading companies in industrial automation and digitalisation, because they have the necessary expertise in this area,” says Teiji Hirata, Corporate vice president, Vehicle Production Engineering and Development Division at Nissan Motor Co., Ltd. The system architecture of Nissan’s newly developed electric powertrain aims to standardise the processing and assembly of the powertrain. It includes Siemens’ safety PLC Simatic S7-1500, ET200SP distributed I/ O module as Siemens One Single Solution (OSS). Profinet creates end-to-end communication from the field to the management level, and the engineering framework TIA Portal has also fully integrated all automation devices. This enables complete access to the […]

Delivering supply chain resiliency across the fabricated metals industry with ERP

By Roger Landman, Head of Product Management at SYSPRO The fabricated metals industry inherently runs on very slim margins due to factors like fluctuating material costs, direct and indirect labour and overhead expenses. Global raw material costs are often dictated by the London Metal Exchange (LME), the largest exchange for options and futures contracts for base metals, which includes steel, aluminium, zinc, lead, copper and nickel. Besides the volatility of external global factors, the industry is also expected to meet specific, made-to-order, customer demands. With all these factors at play, it comes as no surprise that the industry is so heavily reliant on specific raw materials suppliers, manufacturing processes, labour and outbound logistics requirements. With ongoing supply chain disruptions, competitive advantage is being lost. According to the recent SYSPRO survey entitled ‘Realigning the links of the disconnected supply chain’, 82 percent of fabricated metal businesses have experienced supply chain and material handling disruptions, further eroding diminishing margins and ultimately customer service. Despite these challenges, only 12 percent of businesses have systems that support in servicing external customers. To build resiliency, metal fabricators should consider the right technology solutions to improve operational efficiencies, enhance external collaboration and meet unique customer demands. Maintaining a consistent supply of raw materials For decades, China has been a leading supplier of raw materials to the fabricated metals industry, partly due to its competitive pricing to match low industry margins. Russia has also been a top producer of materials such as aluminium, steel and nickel. But raw materials don’t just stop at metals. Gasses like Oxygen and Argon are essential in the welding of carbon steel and some high alloy steels. With ongoing challenges like global lockdowns, sanctions and other unavoidable disasters, distribution of these materials has also been severely delayed. Last year, several countries experienced […]

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