Speakers series with Queensland Chief Entrepreneur

Date

25 June 2020

Time

10:00am11:00am

About

Our last Speakers series was hosted by Queensland Chief Entrepreneur Leanne Kemp who facilitated a virtual panel discussion with Queensland manufacturers in response to COVID-19.

In this session, we heard from three small businesses about how they've transformed their business models to produce essential items that are supporting health services and the wider community as part of the #MakingItForQLD initiative.

The panel members were:

  • Ty Hermans, Managing Director, Evolve Group—a plastics manufacture producing high quality surgical masks for frontline healthcare workers.
  • Luke Swenson, Director, The Bearded Chap—a beard grooming supplier who are producing hand sanitiser to supply thousands of bottles to Queensland hospitals.
  • Roland Dane, Managing Director and Team Principle, Triple Eight Race Engineering—a motorsport engineering company designing low cost ventilators using 3D printing with the help of medical professionals.

If you missed the session, you can now watch the video.

Filly Morgan

Good morning everyone and welcome to the first virtual Speaker series hosted by the Department of the Premier and Cabinet. I'm Filly Morgan, Deputy Director-General in the Department of the Premier and Cabinet, I'll be your MC today.

I'd like to start by acknowledging the Aboriginal peoples and Torres Strait Islander peoples as the traditional owners and custodians of the country on which this event is taking place. We recognise their connection to land, sea and community. We pay our respects to them, their cultures and to their elders, past and present.

So, let's get started. I'd firstly like to welcome our facilitator today, Queensland Chief Entrepreneur Leanne Kemp and our panel members: Luke Swenson - Owner and Director of the Bearded Chap; Ty Hermans - Managing Director of Evolve Group; and Roland Dane -  Managing Director, Triple Eight Racing Engineering. Thank you very much for joining us today. I'd also like to welcome staff from across the public service who are joining us online today for this first virtual Speaker series.

Now these Speaker Series events are designed to provide us with the opportunity to hear from Australia's business, philanthropic, sporting and creative leaders and learn from their stories and experiences and be inspired to think and act differently as public servants. So today we'll hear from these three small business owners. I'm very excited that they’ve joined us today and they’ll share their learnings around how they, how they've worked during and pivoted their businesses during COVID and in response to COVID-19. Now I'm going to hand over now to Leanne Kemp to get started. So over to you Leanne.

Leanne Kemp

Thanks Filly. What a privilege to be standing here and facilitating and coordinating this Speaker Series. Not only am I Queensland’s Chief Entrepreneur, but I'm also the Global Chair for the World Economic Forum for advanced manufacturing and largely of course, COVID has presented us with not only a series of challenges, but a significant opportunity to reshape global value and local value. Technology, climate, trade, manufacturing is at the heart of those global supply chains that clearly are very much under pressure. I was in Davos in January earlier this year and of course the constructive works around advanced manufacturing was already well under way around the world.  But end-to-end processes that underpin raw material extraction through the processing and customer fulfillment, as well as end of life disposal is all under a paradigm of localised production nodes. This was already something that was forecasted for the world, but of course it was bought so dramatically forward.

What we have seen here in Queensland is a deliberate commitment towards public, private engagement. A new framework of course has been well established under a pressured environment. I'm introducing the panel members actually now because these are examples of how we do innovation here in Queensland. It's not always about the scientific breakthroughs and endeavours, it's about that pivot, the perseverance and even a pirouette.

So, I'm encouraging everyone to submit questions on the panel, of course on the Q&A segment as we just said before. But um, the panel members that we’re introducing is Luke Swenson, who's the owner and director of the Bearded Chap. Now of course he has a premium beard care brand, not certainly something that I've used just yet everyone, but no doubt he has captured the corner of a market that produces natural and Australian made grooming products for the modern day gentlemen, of which of course we have many of them in Queensland. Ty Hermans, Ty no doubt that you should be buying off Luke with a beard like that mate. So Ty is the Managing Director of the Evolve Group and a plastics manufacturer right here in the southeast corner. And Ronald, Ronald Dane, the Managing Director of Triple Eight Racing Engineer, a motor sports engineering company.

We’re privileged to be able to engage with the complete panel today. So we will be hearing exactly, as I said before, about the pirouettes, the perseverance and of course, manufacturing in its heart. Queensland has been recognised as an advanced manufacturing hub by the World Economic Forum. And what does this actually mean? Innovation in the midst of COVID-19 actually gave birth to an opportunity like we have here today. Examples from other small businesses in Queensland who are pivoting their businesses models to a response to that global pandemic. The health of our citizens is at the core of the concern, but so too is the economic recovery. The global supply chains and opportunities from international markets are an absolute standout, yes, of course, but let's start.

Ronald, maybe give us a bit of a background how and what your business is and pivoting towards and give us a little bit of the background of where you were pre-COVID and where you are now.

Yeah thanks, thanks Leanne. So, we're essentially an engineering business based in Banyo and we have been involved in motor racing and building and engineering race cars both the UK and here for over 25 years. Our world came to a very sudden stop on March the 13th at the Grand Prix in in Victoria where we were as a supercar race team, we were supporting the Formula One act as we do every year there and we all had to go home and look at closing down for possibly six months. The reality is will actually be up and racing this weekend in Sydney again, which is great, but in the meantime, we've also had to look at how we survive this, this economic hardship, but also the cope with the health issues. And so, I wanted to try and ensure that we kept not only our brains fresh and active during the, the time that we were stood down for, but also tried to innovate around a very capable group of 12, 13 engineers that we employ here with, with great backgrounds. Mostly come out of QUT and UQ as it happens, but not all. And so, we set our minds to trying to come up with a ventilator concept at a time when the world looked as though it was extremely short of ventilators and we put our minds to trying to come up with a slightly different take on the concept of a ventilator. Not so much for use in a very high-level hospital environment such as you'd be used to in Australia, but more for coping with transportation of people over distances which could be relevant in the middle of our country. But also trying to use some of the technology that we have become familiar with in motor racing over the years to collect data from, potentially from ventilators and in a faster, more compact, easier to manage way than has been the case so far. And we, we've continued that development over the last three months and we, we want to really see if, if there's an ongoing role for business in the manufacturer development and manufacture of some very high-end medical equipment, which is something that this country is very short of, the capability. Not completely, but very short of the capability of producing. So that's been a big part of, of what we've done in trying to look for new avenues basically. In new areas where we can where we can take the business and keep ourselves, keep ourselves busy and keep our, our team of engineers and together, as, because they are a wonderful group of people and I don't want to see them having to having to dissipate on the back of this enforced situation we're in.

Leanne Kemp

You know Roland one of the famous words is necessity is the mother of all invention. But we also talk here about jobs for the future. But largely I think the recognition through COVID is that we have a skills currency, that our ability, whether it be you were once of course focused very deliberately in eights racing. But you've also got that capability and the skills currency to transform into medical equipment supply. You'll hear this same thing now actually resonating out on every one of our examples here with our entrepreneurs, which of course are not only small business owners but are inventors in their own right.

Luke I'm going to switch over to you for a moment. The Bearded Chap.  You stood up to the challenge, it was a call out. Did you wake up one morning and just notice there was a need? So tell me about the pre-COVID and the post-COVID environment and where you're sitting right now.

Luke Swenson

Yeah cool, thanks Leanne. Uhm yeah, essentially our business is a men's grooming product company and we mainly service barbers across Australia, Europe and also over to USA. When this hit all our barbers pretty much shut down, so it was pretty full on and essentially, we had to devise another plan. My partner is actually an ED doctor and at the time she was, she came home and she was like pretty much next week we're going to run out of hand sanitiser in the hospital and I couldn't believe it. It was actually unbelievable. Uh, that we rely on mainly overseas companies for that product, especially with such great health systems across our country. So that was a Friday night and by Monday morning we developed a full TGA compliant label. We were very fortunate that we had 15,000 bottles hanging around for one of their other products that were suitable for our germ killer. So, we tried to make it a bit of fun as well in a bad situation. And also yeah, essentially by Monday we were on sale online and it went crazy to the public and then about four days later we got a knock on the door from Queensland Health and the, the manufacturing development crew to see if they could help us out to secure the logistics because we literally drove around from here out to Ipswich and Toowoomba to try and secure Ethanol originally. Because we had never made that product before, we didn't have a secure supplier and yeah, that wrapped it up. So that’s how that little story happened.

Leanne Kemp

It's brilliant Luke. A couple of my takeouts is it's not just always about embeddedness of the idea of course. As you mentioned there’s the securing of supply chain, of raw materials to enable that pivot to occur. But also, you said something critically important. TGA approval. Right in the midst of this innovation or reinvention, of course, is responsible innovation. So, from a policy maker perspective or even the way upon which we connect in this community, how can we engage in a far better agile way, to ensure that our innovators and entrepreneurs can actually get that green ticket certification to move forward when a product or an invention is most desperately needed.

I'm going to switch across now to Ty Hermans. Ty the plastic king I would say in the southeast corner. You have quite an incredible story to be told. So please, for those that are on the line that aren't familiar with Evolve, you are doing quite incredible work at the core of manufacturing in its own right with many different products. Just give us yet again that spectrum of time view about pre-COVID, post-COVID and that awakening moment.

Ty Hermans

I was I was in the states setting up a new business over there and sort of seeing the beginning of the world starting to fall apart over there. Sort of saw a pattern that we were about three weeks ahead of where we were back then and saw friends of mine having their businesses shut down by government and that whole piece around a central service. So, I reached out to both state and federal government through the channels I knew and let them know that we're here to help. My team, my facility and everything we had was here to help out. And um, probably the one thing they heard from us that we weren't serving in a specific area, engineering or materials and so forth. It was tell us what you need, give us the hardest problem we’ll have a crack at it and that's what we did. So within, I think it was sort of a Thursday I think it started and yeah, by Sunday the state government made the announcement that we're going to jump into our facemask manufacturing.

Sourcing global supply chains, that was probably the hardest thing. We were taking, were confident getting into it because one of the businesses we have here is a roll forming company. So, for over 40 years we've been designing, developing roll forming machines in Australia and manufacturing them here and the mask manufacturing processes has some elements and roll forming in it. But securing supplies of materials from countries who were being less than helpful during that time was extremely difficult. So, between product developments, global sourcing and then as Luke mentioned, TGA and getting clarity on what certifications we needed in an area where we didn't actually have any local testing in Australia at all and having all of that sort of stood up concurrently was extremely challenging.

Leanne Kemp

So, we're hearing it now. These are great examples, the patterns within the stars that we’re showing now from ventilator machines to sanitisers and of course PPE. These three critical components in core manufacturing that largely of course didn't exist as a manufacturing sector here in Australia, let alone Queensland. But every one of these examples was critical to life. To life saving or to the protection of health.

Now as an entrepreneur and as a seasoned entrepreneur, a pivot is a huge risk. You have to be able to align the economic opportunity, the hurdles of innovation, the skill sets within the organisation and then, of course, firm up enough funding to ensure that you can meet the time demand of the opportunity.

Ronald can you give us a little bit more, Roland, can you give us a little bit more of an insight around those challenges at that pivotal point in time, when, of course you're inventing something on the fly, but also nearly trying to shore up the right set of resources, talent, skills, demand, opportunity. And of course, as we just said, the TGA, approvals or any of those sorts of approvals that were needed. What was the critical point where you thought this could be a complete breakthrough where you would now consider it either a breakout business or a reinvention of the core business?

Roland Dane

Yeah, the, the, the initial landscape was, you touched on a very good point about supply of, of componentry of materials, of raw materials, etc. Because every product such as a ventilator consists of a whole series of different, different components, some of which we can manufacture ourselves and some of it, it's unrealistic to expect to be honest, to be ever making in Australia. We can't make everything and we don't have enough critical mass often to justify not making some of the parts that are needed in a machine such as this. So we had an initial period which was really hard to deal with, if we had been called to make it something in quantity early on in the piece that we were trying to innovate around what was available to us. That then moved in, in luckily a very short space of time to being okay, well how would we do this down the road, how would we develop something that's actually better? Uses materials from Australia from particularly Queensland where we can, but then becomes, uh, uh, basically a product that we can bait, that we can base the manufacture of it on a more consistent long-term supply chain. So, we also had to align that with understanding TGA approvals. But not only TGA approvals, also, WHO approvals.

And this is where our contacts in motor racing around the world were so valuable. Because we have such great contacts with our peer group in the UK in particular, but also in Europe, generally, very quickly we were introduced to the WHO to give us guidance for potential markets outside Australia. And it was when that became apparent that actually, there are a whole series of smaller, what I would call nonaligned potential markets, where yeah, we're not going to sell ventilators in China, they make plenty of them. We're not going to sell them in Japan, they make plenty of them. The same in the United States. But they’re all the smaller countries and islands etc and territories, particularly in the Pacific, in the in the western Pacific region that we started to understand could be a really good potential market for us going forward. And that was really the moment, talking with the WHO representatives that led us to further explore and want to continue this program to a point I hope in the future where we are actually manufacturing a product with regional market.

Leanne Kemp

These are such enriched realities that have been spoken about today. So, for everyone that is listening, the Q and A box of course is available to you. Jump on, think of these questions that will drive to the real centre of the curiosity of this Speaker Series. Luke I'm going to ask you a slightly different question and that is, what advice would you give to entrepreneurs or even individuals and the public service to ensure Queensland Government can remain innovative, as well as responsive to the community and business needs?

Luke Swenson

Um, I would say common sense and that was probably the best thing that we experienced at our level. There's a lot of, because there are so many moving parts in the government, they’re sometimes very slow to react and when, I think the best thing about this crisis and pandemic was in that immediate three-month craziness, or in particular two months craziness. People remembered that they were people and actually took actions to make stuff happen.

I know we were the first, Queensland Government was donated 100,000 litres of ethanol by Bundy and the Department of Manufacturing was able to divert some back to us and my little tiny company, that we service barber shops and had never made anything like this before, we were very first people to get our hands on that ethanol. It had been sitting there for two weeks.

No one pushed the button and I had some very robust conversations with people in the government and also with Bundaberg themselves because everyone was like, oh, I don't want to get in trouble, and it was like you're not going to get in trouble, we’re f------ saving people. I don’t know if I was allowed to swear, but it was just like the reality of it is that if your grandparents are sick and they could have been prevented it by having their hands clean when they didn't have access to soap and water by using our product. That's happened for two weeks now where there's no one’s been able to do it. What the hell are you doing? So, when we broke down and got to the, the common sense and you're a person as well, you're not going to get your head cut off for doing something that was a reasonable action. Everything started to move and it was a really nice synergy I felt, with the government and private enterprise and everyone we dealt with at a higher level moving down all the way through the buyers. Even though there was some roadblocks with certain people, they’re just robust conversations with certain people that need to happen. It was cleared up very fast and to the point where we've got that relationship now and we’re obviously doing like Roland trying to have that long-term sustainable part of our business on there, not just short term, let's try and get some business and keep us alive. It's long term for the future and making a permanent contribution to the state.

Leanne Kemp

There's a great saying in entrepreneurship and that is ask for forgiveness, not permission Luke, so, no truer word is that spoken. You do see of course the rigidity and the governance that is so critically important in government at time. But there is actually quite an empowerment that can be given once we perfect that new framework of public private partnerships or the endeavouring around really crystallising what is the challenge to be solved making that open in an open innovation framework and allow the community, the great leaders, universities, unicorns, even if we have them here, as well as of course are small business and our innovators to really jump into that challenge.  Because we have the capability and we can make capacity to solve some of the challenges.

Ty, you know there's an interesting journey for you beyond COVID. Do you see a long-term sustainable business, an economically sustainable business, as well as an environmentally sustainable business, given that you're in the plastics industry, being something that Queensland should champion as ‘Cleansland’ as a prime example. Just give us a little bit of words around how you're thinking about the scenario planning, the future scenario planning around PPE.

Ty Hermans

Yeah look, there’s definitely a future in it. The greater business here is a plastics and composites design and manufacturing business. For probably 6 years now we've really been championing the reassuring movement and helping companies actually bring their manufacturing back from overseas back to back to Australia.

So we've already got a proven model there that works. All that's happened through COVID is our phones have just rung off the hook. I carry this laptop out the back and showed you the the factory, where 24/7 where busy than we've ever been. But the pipeline of work that's coming down the stream is huge. And conversations that we’re having, sort of even two to three years ago, are companies where they were concerned about us potentially in there mind, even though they're not correct, but we might have been 5 or 10% more expensive. That's off the table, they’re just how quickly can we get our manufacturing back.

Been so badly hurt through this process of seeing global supply chains shut down. For us as a business, plastic unfortunately, in some ways isn't going anywhere. Fortunately, the reason it’s not is because it’s such a good material. We made a move years ago to get away from single use plastics. Two-and a-bit years ago we, we removed the last single use plastic out of business in packaging and we're starting to focus more heavily on sustainable design first and foremost and then looking at ways and means of bringing biodegradable, truly biodegradable, not brainwashing bulls--- into the factory and swapping products out to that.

But you know, focusing on like our face shield. It’s not just the world's best face shield because we made it, but we put proper thought into making this sustainable in the way that you know these parts have now been used for nearly a month in Queensland hospitals and they tell us that they're not throwing these away, which is exactly what it’s… the face shield itself is removeable and you can replace that.

So just starting to bring that sort of more sustainable design thinking and getting rid of planned obsolescence wherever we can and the next thing we’ll start to tackle is this bad boy. We've already got some ideas of how that will change and become a more sustainable product by … but now I don’t want to give the patent away, but there’s a heap of opportunity in that the good thing is that people are thinking through this process. Luke and Roland made a couple of comments about how it's been interesting navigating government and and so on.

I learned very quickly how much easier it was doing business in the private sector, but at the same time I learn how much opportunity there is in the public sector as well. So, if government can align with local manufacturers and designers and developers here in Australia, there is an absolute s--- load of work that should be manufactured here and should be manufactured going forward. We just, that common sense thing is critical, but also taking some risks. I know that public servants and government needs to be seen not to pick winners, but right now especially in the recovery phase, you're going to have to pick a couple of winners. Cop a bit of public flack in the first couple of weeks, but when they see a s--- load of jobs being created in a very, very short time frame, the public will very very quickly back you. But you won’t be able to please everyone in the short term, but you will in the long term.

Leanne Kemp

It's a very good set of comments that have come out here Ty. I want to touch on a few things. Firstly, global is not going away. Glocal. Our ability to be able to finely balance a new equilibrium between global markets and local supply chains is critically important.  Reaching back out into a distributed manufacturing form is also critical. And Roland you know, I'm really interested in your thoughts around if we can't compete on cost, can we compete on durability and of course Ty just mentioned that we design for disassembly, we design for durability. These bad boys last longer. Surely that is good for us here, not only in our localised market, but then also when we're trying to compete out on a global scale because new markets will open up through this COVID environment. What’s you're sort of sound bites around how do we as Australian manufacturing, not only just think about reassuring, but what’s our competitive advantage, is it durability?

Roland Dane

I would say, to be honest our competitive advantage has to be around innovation. Innovation and also that that was brought about by being in a relatively small market is an ability to spot what in world terms, may be niches. But in our terms may be sizable niches but worth, worth going after.

We have to be able to innovate, we have to be able to have a starting point right back to educating people on the basis that engineering and manufacturing is sexy. And and unfortunately a lot of the last 20 years has been spent dispelling that if you like and everyone has to be a lawyer or a doctor or whatever, etc. Manufacturing had become a dirty word and manufacturing and innovation should be the absolute pillars of then trying to take to the next step the productivity. And we cannot compete purely on price anywhere 'cause we don't have the cost base and we don't have the size of the local market that we'd need to do that. So we gotta be smart about the way we go about it and the productivity has, this is where, for instance, the made in made in Queensland grants over the last few years have been smart and sensible in enabling businesses to, to create the potential to increase their productivity by being able to invest in in specific machinery which often is not made in Australia and can't be made in Australia, because we don't have a big enough market. But when they're deployed in this market then they can be used very usefully. That’s been a very good example, but we've got to innovate in order to be able to take advantage of the need to be able to have much better productivity than a lot of our competitors to be able to compete.

Leanne Kemp

So, there is a great question that just came in. In fact, I and I think all three should answer this question. How can governments, local, state, federal, particularly around the companies that have stood up and risen to the occasion or the challenge and pivoted to get new products, how do we support better into the domestic market?

Ty Hermans

Create policies for actual real buy local policy. Um, and even if the Australian product may not fit the current specification, work very hard to breakdown those barriers and the red tape to getting that product to market. You know we prove on a daily basis we can actually manufacture here more cost effectively than offshore in our particular products. Roland's point about being smart about where you actually apply itself is absolutely critical and we always say you know only badly designed products need to be manufactured offshore. Because we put the smarts in up front to design the product to be able to manufacture locally.  But you can do all of that, but if there isn't support from the buyers or the purchasing or procurement places to actually, actually buy local you see what's happening right now. There is still an absolute s--- load of product being imported from overseas that is currently being manufactured in this building. For instance, our face shields, face masks. It's happening right now and that could be stopped. You know, they could step up right now today and put a stop on all that imported product and divert that locally. But there is still a lot. There's still hand sanitiser coming in by the absolute truck load, container load. So, they need to need to jump in actually. Roll the dice and and…

Luke Swensen

Non TGA approved stuff as well that's flooding the market and we’ve seen that's like, some of the distilleries.  Upon this whole thing we did a massive pivot on top of everything which was, we created a Bearded Chap distilling co so we're now are going to be one of the largest gin distilleries in Queensland from this and we're going through the approvals which were having trouble with at the moment as well.

But we, we are ready to roll and have people employed to create a more sustainable model to be able to create a product in Australia for our local Queenslanders drink and we've got export people screaming for our product just based on our branding and story alone.

But coming back to that, there is products out in the market that are not approved and we've had people mistakenly have bottles of gin or our other alcohol with hand sanitiser in it and I think it was reported in New South Wales and was just things that weren't done up to spec. I think the biggest thing though, is making sure that we understand the long-term future of what's going to happen after this and supporting those businesses that took those massive risks and really backing them all the way through. Because it is, we put, everyone of us has put everything on the line here to make sure that our team have been able to stay employed.

Also, we’ve made sure that we can, in our circumstances, we grew our team by 10 people and that was absolutely phenomenal that I could do that when everyone else was culling jobs left, right and centre. So, having some of those restrictions being lifted like we’re approved to produce ethanol for hand sanitiser. But we can't at the moment, we can't produce alcohol for consumption to help fast track our approval before this next GFC hits.

Like if we're in a better position now, we've got a better chance of being able to support ourselves and grow through it with their, our customer base instead of getting pushed into a wall. And then all the sudden everyone's down the ground, we want your business, it's probably not going to succeed, you know.

Leanne Kemp

So, there's a Russian doll of policy here that needs to be unfolded, particularly as you said. This is, there's a second wave that's about to hit and it might even be an economic tsunami. Roland, your, your kind of thoughts around this, particularly as we just asked. What can government do to help with ensuring up or enabling domestic demand, or at least facilitating in some way the acknowledgement of where the demand sits and I wonder how important this is and how we might engage or re-engage with rural and regional Queensland, because there's also an incredible set of skill sets of talents that exist in the regions as well.

Roland Dane

Yeah, yeah, it it almost leads me onto, to another passion of mine in in Queensland. Firstly though, I'd like to to absolutely endorse what Ty and Luke said about the need for for government, both local, state and federal to properly acknowledge the products that are made in this in this country by giving them preferential treatment at some level.

I’m not saying buy a bad product, I’m saying give them the proper, the proper exposure to the buying process and help them where necessary. Because there it is unthinkable, absolutely unthinkable that a country like Japan is going to be buying any of the goods that they need right now offshore. They're not, and they don't do they buy wherever they can locally even though they are the members of the WTO and everything else. They source locally whenever they can. We need to have a different mindset towards towards that. The point about, about particularly regional Queensland that one of the areas that's actually been relevant to this whole COVID situation is the production of ethanol. And in 2009 I was a part of a big part of bringing in the use of ethanol fuel into the racing industry in Australia and we run on 85% ethanol mixture on our race cars today and have done for a decade. It’s a sustainable fuel. If there's a war in the Middle East tomorrow and we need enough power in this country as we all know, our reserves of fuel for vehicles in this country at remarkably low and the where would we go? The fact is that we've got a sugar industry that has been decimated by people not wanting to eat enough or drink, drink enough soft drinks and eat enough cream cakes or whatever over the last couple of decades and is crying out for support with a sustainable fuel and it's not only a fuel. We've seen where else it’s being used.  Luke buying it and using it. It that needs to be supported and we need to be actively supporting that and actively pushing this barrow from sustainable fuel from Queensland properly and we're not doing that.

Leanne Kemp

Great points Roland. The material science involved in that very early stage extractive industries as well as, of course, raw material supply chains, we’re one of the greatest exporters in the world of course, of minerals and rare earths. But there's something here that actually needs to be looked at a deeper level. One question just came in which I think is a really important question.

We've lost skills in manufacturing and how do we regain those skills quickly? And I wonder if there's truth to that question. So, I’m keen to hear what you have to say.

We saw very quickly the government support micro-credentialing in in certain areas are particularly around cybersecurity of course. A very critical skill set that we all should pay attention to given the digital transformation efforts that are occurring globally. But talk to me about what we've lost in terms of skills. How do we get it back? What does our labour force look like and where can we best put the bang for our buck in terms of that transformation? Understanding Roland, we want to make manufacturing sexy as you said before. Um, are there better programs in our youth, is there an intergenerational program which would bring together. What does that look like? Maybe Ty I know your workforce is completely diverse, in fact very inclusive. So be great to hear from you about what you think about this.

Ty Hermans

Um, first and foremost get, get the work coming here. Yeah, we've got roughly 120 odd in in this particular facility, plus others elsewhere. But if the works here, we can employ more people. I think we've put another, I think there’s, all up once all the machines and fired up there’d be nearly another 40 people here then pre-COVID. Just in the medical PPE piece plus other businesses that we've got are absolutely flying.

But if the works there you can hire and that's the critical thing. So, you know step one is to make sure that the work is coming through. I think the most, yeah that buy local thing is critical. Like you buy, the biggest challenge we found in all of that was that the purchasing officers are just trying to do their job. They’re fearful of doing the wrong thing. So, by empowering them and letting them know they're not going to lose their job or get their head cut off by, by supporting local or taking a risk in a product that might be slightly different. That gets up working.

From a skills point of view, certainly there are some skills that we've lost. But in our particular industry, um, we aren't, it's not a lack of skills that stopping us from going to like it. It's a lack of support and also funding.  Manufacturing unfortunately, is one of those line ball, you focus on the sense not the dollars. You can't leave anything laying around. So, you have to, you have to acquire high quality equipment and highly efficient equipment and banks don't look back. Oh, they only look back, they don’t look forward. So, getting funding and making sure you’ve got the right equipment then you can bring the trades and you can bring the apprentices in. We've got no problem attracting staff, we’ve got a, in the business, because it is a little bit. It's not overly sexy, but where we're focusing on design and developing cool products. But yeah, for me it comes back to the work. If the workflows there then it's, it's easy to invest in training and upskilling staff.

Leanne Kemp

You raised a good point about funding. Of course, funding comes from many different sources whether it be localised banks and or capital markets, you know grant led initiatives and even the power of purchasing and procurement.
Talk to me Roland, I would’ve imagined building a ventilator is capital intensive and not everyone has external investors in the business. There's a lot of companies, particularly SMEs, that are home grown you know that have built this out by inching forward on revenues.

But for those that have had relationships with investors, was there a convincing moment, was there a special board approval was it, was it, just demand driven? Talk to me about how investors should see opportunities around pivot and if any of you did have an investor backbone what was that dark room conversation that had to happen to enable you to sort of skill up and tool up outside of government support.

Roland Dane

Well here, from, from my point of view I had to have a word with myself and which is, was pretty straightforward and we've invested so far just over one quarter of $1,000,000 into the ventilator program ourselves and will invest further. And that was a relatively straightforward decision for me to make.

But I also, I sit on the board of a public company in Queensland as well and so I see it from a completely different point of view there where, where far more answerable to a group of group of, a group of shareholders, as you can imagine. I think the, the trust in the leadership of the business is essential. You've got to have somebody who is leading the businesses.

I think yeah, I can see with Ty and Luke here who are backing themselves. That's the first and foremost. Nobody's going to back you if you're not prepared to back yourself. And that is not necessarily backing yourself financially, you've got, you've got to emotionally back yourself as well. So, if you've got the ideas and then you're able to sell the ideas.
Actually, money's never been cheaper. I mean, I'm the senior citizen here and and lived through quite a few quite a few downturns in Ireland, the UK and over my lifetime and money has never been cheaper now. It's not always that easy to get. That's a separate, that's a separate matter, but there is a there is, I believe, lending environment in Australia right now, or an environment that lends itself to lending if you've got the right propositions and certainly I mean on, on another level I just put a proposition to the people we bank with.

They were very quick to say they'd come to the party on investing in another level of machinery that we would like to have it here on our premises in Banyo.

So first and foremost, someway, you’ve got to back yourself.

Leanne Kemp

Now Luke you’re a consumer facing brand, there’s a question that's come in and says can we, should we, promote a label or a marketing initiative that goes beyond just made in Queensland so that consumers can identify with those products far more readily than maybe just a hashtag on a Twitter campaign today?

I'm certainly a big proponent for this. I think the transformation efforts in labelling and enabling the product to speak its journey, especially as we start thinking about the impact on planet and people. Um, so what do you think about that?

Luke Swensen

We kind of do already with the Australian made campaign, so I think they’ve experienced a lot of growth.

We’re actually in the process of adding that to our products as well. But, utilising technology onto consumer face products I think is a massive thing because people becoming more interactive with products. So, you can go up and scan something and it will tell you a bit more or where it’s from. Like we try to get everything, we, all our products we manufacture and come back to making manufacturing sexy again. We actually have a really unique proposition where we actually try and make our consumer feel sexy and look good so they can have confidence and go out in the world and take action from that. So, we try to source all of our local ingredients from local Queensland or other parts of Australia and if we can do that, it's a bit of an add on to the Australian made thing. I think the best way is to keep it simple.
Japan's where the best place where they actually utilised that interactive labelling process. RFI technology coming around where you walk past and it shouts out it’s an Australian made components. So these things are all going to help.
As well as, I know there's a lot of groups getting around on Facebook now that we’re about 2000 people with the Australian made products component. Now there are over 200,000 and there's also big a push, big pushes for whole aisles to be Australian made aisles, which is I think a really good idea.

Ty Hermans

Leanne, this is one thing for me. Kmart selling a $7.50 toaster.

Luke Swesen

Yeah

Ty Hermans

This is where sustainability comes in. That toaster is going to be in in landfill in t-minus nine months. It's not going to get to the 12-month point. And when the, and this is where I think government can actually have a massive effect. People shouldn’t be, part of the reason why so much stuff got offshored is because we can't make a $7.50 toaster in Australia. But part of the problem is that that toaster only needs the last for 12 months and half the time for $7.50 people won't even drive back to Kmart to replace it. They'll just bin it and go again.

So, I think there's a, there's a policy piece here that comes into the labelling. You know to the prominence of the products and making sure that there's actually, Australia needs to step up and says we're not going to allow us to sell $7.50 toasters. We're going to sell a $49.00 toaster that's going to last for the next 25 years and when it end of life, it's being dismantled and being recycled properly.

Leanne Kemp

You know that my entire businesses about prominence, circular economy, the extremality of costs upon the citizen and community, particularly as it comes to waste, is a huge hidden cost to society that certainly needs to be embedded. We have examples here in the co-ex scheme that at least puts the burden of that waste onto the manufacturer, whether that be Mount Franklin water bottles or even Coca Cola cans and so you are right. I think there is something that's to be deliberately hit on here. In my role as the World Economic Forum as well, there's certainly been an extended conversation globally about even extending labelling to include the use of water. These natural resources that are finite. The CO2 footprint of that product to be put on labelling. We are seeing it from very large fashion labels in the world under the caring group. We work with Alexander McQueen's as Everledger.

So there are initiatives globally that are well underway. In Davos when I was with advanced manufacturing, the leaders of some of the larger manufacturing companies in the world. There was a large conversation about responsibility around carbons. So, there is a question in front of me about would a carbon neutral tax offset assist in your sector and is it possible? Is there any thoughts about this?

Ty Hermans

In in manufacturing, like in in my game where we are in, we’re in a constant battle with cheap offshore manufacturing and that's not going to change overnight. Any additional cost is something that pushes products back overseas again. So it has to be, it has to be cost neutral or cost beneficial. We had the union sniffing around here the last two weeks for whatever reason. Maybe because we've been in the news. And my point to him was if you bring value, you're welcome, if you don't bring value you need to go somewhere else. Because manufacturing in Australia is already tough enough without you here, adding additional costs to the business. If it was cost beneficial, yes, but unfortunately my clients, are looking at their bottom, bottom line as well and making sure that their business is also sustainable as other Australian manufacturers downline. And if I was to propose that the price is going to go up by any means that they could may be pass that on the on the, the channel in the consumer would eventually absorb that. It would be a difficult conversation.

Leanne Kemp

So, I've got about 5 minutes to the wrap-up, there's a few more questions coming in. I've got one for you Luke and probably a great end question for you Roland. Um, firstly, Luke, when we think about innovation and the pivot and our ability to see a new demand sector, there's a question here that says how critical are relationships, not just only within your organisation, but externally to navigate through that concept to implementation process. And of course there's very different stages in innovation.

One of course is how do you actually create a new product, but then there's the scalability. Can you speak a little bit about that - the relationships, the resources, the coordinated efforts that sit well beyond the four walls of your own organisation.

Luke Swensen

It is essential. Like without these relationships you can't get anything done. Because you can have the best idea in the world, without execution, it just is an awesome idea.

So, for example, when we went from concept on a Friday night, we already had our packaging manufacturers leveraging that relationship to make sure that we could get more based on forecasted sales.  So, then we leveraged our label supplier who is a local Queensland company as well. They produced us labels within 48 hours, pretty much like it was unbelievable. And then reaching out for ethanol. We had no idea where that was.

So, it was building those new ones and that was literally picking up the phone and, in some cases, like I said, driving out to these places to actually meet with people because I wouldn't have the time to see because they were just as busy. One of the biggest things we can do, especially in my manufacturing sector, is actually shooting off and doing meet ups like this, so hopefully now I've got contacts in Ty and Roland after this 'cause I've got another idea Ty, might be able to work with you. But networking out to all the different branches and even interstate because some states will have different resource capabilities that Queensland might not have, and open all those connections up is just essential part of it.

Leanne Kemp

Yeah Roland you have seen a generations of manufacturing in decades. This question for you is what have…how do you see tomorrow's manufacturing become more sustainable, um and most certainly, what do you think are the social, economic, and cultural factors that will lead to an incline or have actually led to a decline in manufacturing in Australia?

Roland Dane

Well, actually think that you can, you can hone a lot of this in on the point that Ty brought up. The fact is that we've got addicted to buying products that are too cheap and one of the issues is that we do not have, unlike the European Union, a proper end of life policy. So an end up end of life starts with the most visible consumer product that most people in Australia will buy on a regular basis and that's a motor vehicle. There is no end of life policy around motor vehicles right down to toasters. And it's so fundamental and we are so far behind we’re two decades behind the Europeans on this and if we set our minds to it, then we create an environment that allows us to manufacture products that are sold at a higher price and a better product, because people will think of them as longer-term products.

My sister, who's only very slightly younger than me and lives in the West of England, she still uses the sewing machine that my mother used in Adelaide in 1955. So, it's made its way over to the other side of the world and is actively still in use, making hand masks for her, sorry face mask for her family right now. But it's a mindset and and it's the, that comes from the ability to recognise that products such as these should not be thrown away on an annual basis. So, I would start with absolutely getting on top of the end of life situation. Regulating that properly and quickly and well, learning from the experience of other countries and that will help us enormously.

Leanne Kemp

Roland you're a gentleman and a scholar. I want to say thank you because there were incredible insights that have been delivered out of every one of these conversations.

The right to repair, the end of life policy. Of course, these exists in other places of the world. If our global borders are closed, China is no longer accepting waste, what will we do that? How do we transform waste to value streams? How do we think about supply chains and distributed manufacturing?

Labelling, there is another huge call out and significantly we know that we have skills. A skills transfer and a skills currency that exists in our manufacturing capability today and as Ty so rightfully said, the demand is really at the forefront of the concern here in this economy. So how will we think about the next way of customer engagement.

I want to thank everyone for participating today. The questions came in thick and fast here and there's probably a few more that we weren't able to answer but we tried to of course, drive directly to the heart of what is a critical component of our next generation of not only jobs, but also the economic transition post-COVID.

I'm going to encourage everyone to spread the word about Queensland Government COVID supply chain and the supplier portal that supports businesses across the COVID-19 recovery period and expands on supply chain. The portal exists to help connect buyers with suppliers who are manufacturing, facemasks, hand washing gloves, just to name a few and we've seen three examples in every one of those categories. And the links going to be provided to everyone on the PowerPoint slides of course and I'd like to hand back over to our MC Filly Morgan who are going to provide some of the closing remarks. Thank you everyone. Gentleman, scholars, great work.

Ty Hermans

Thanks Leanne

Luke Swensen

Thanks guys.

Roland Dane

Thank you.

Leanne Kemp

You're on mute Filly.

Filly Morgan

Sorry, there were two buttons there. Sorry, I'll say it again. So, thanks everyone for joining us this morning on our first virtual Speaker Series and for engaging in the discussion and for all of your questions. Luke, Ty and Roland, thanks so much for sharing your experiences, your expertise and your passion with us all.

Is, it was very inspiring to hear about your innovation, your connection to your teams, your professional connections across the world and how you've innovated during this COVID, during COVID. We really appreciate you making the time to come and join us today. So, thank you very much.

To Leanne, thank you so much for again for great facilitation today. Really appreciate it and thank you to everyone who joined and all the attendees today and have a good day. Thank you all.

Leanne Kemp

Thanks everyone.

Contact

Organiser: 
The Department of the Premier and Cabinet
Email: 
OrgCulture [at] premiers.qld.gov.au

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