Archive for the ‘Engineering’ Category

Inland Rail is THE opportunity to build capacity, says Silverhawk

October 7, 2009

The Regional Economics Conference (Parkes NSW) in July 2009 saw Silverhawk speaking about the ‘Out of Sight – Out of Mind’ syndrome – or how the Sydney-Canberra-Melbourne triangle forgets those outside it. Other speakers in the session – demographer Bernard Salt and RDA Chair Sandy Morrison – ran complementary themes.

Silverhawk’s basic proposition was that the economic and population stagnation of inland NSW can be turned around. To explain it away to the Drought, the lure of the big cities and the Seachange effect is simplistic and defeatist.

The Inland Rail project is a litmus test. The early analysis is that it is “not financially viable as a standalone commercial entity.” Minister Albanese has thus asked the consultants to now examine how to (a) generate additional tonnages (b) lower capital costs (c) identify funding via different sources.

Re the low rail tonnages, no surprise. There is a serious lack of value-adding industry in the regions – check the trade statistics, or the imported foods on the supermarket shelves! Silverhawk suggested that councils along the route build an agenda with federal and state governments around:

  • Inwards investment missions.
  • Global supply chains.
  • Infrastructure and industry portfolios talking to each other.
  • Development zones and locational incentives (these are not heretical concepts). 

Re lowering capital costs, the cost of the Inland Rail project is around $2.8 to $3.6 billion – the figure might be nearer $2.5 billion if you weed out the ‘cost plus’ thinking. Also opportune to revisit the rail-road tax regimes. If heavy trucks paid full tote odds for the road damage, deaths, pollution, congestion they cause, rail MUST be more attractive.

Re the funding from different sources, the Building Australia Fund and super funds are loathe to finance the public interest. Silverhawk suggested they measure the public interest, and determine an equitable share for each level of government? EXAMPLE – assume the public benefit of the Inland Rail is $500m, and local communities derive $200m of this via rising property valuations, jobs etc. A cost-sharing formula might determine who should pay what along the route. Imagine – Wangaratta ($10m), Albury-Wodonga ($25m), Wagga ($25m), Junee ($5m) Parkes ($15m), Narromine ($5m), Dubbo ($25m), Moree ($10m), Toowoomba ($25m) etc. Then imagine a COAG session with 20-25 Mayors putting the deal on the table.

Life Sciences network begins in Melbourne (BEST PRACTICE)

November 12, 2008


Hi Cockatoo, trust you are well.  I’d be grateful if you could make mention of the new network that has been established in Melbourne recently, the ICT for Life Sciences Forum.


Much has been written in recent years about the so called convergence of difference disciplines and the medical and life sciences and how this convergence has the potential to lead to new breakthroughs that could impact health and welfare. In 2006 the Victoria Research Laboratory of NICTA, with funding support from the State Government, undertook to build a new research program which would demonstrate the enabling benefits that ICT could bring to the medical and life sciences. 


Computing and engineering can now be increasingly applied to address issues facing medical and life sciences researchers. These range from providing superior productivity – for example, by speeding up the time it takes to analyse masses of data – to taking advantages offered by the microelectronics revolution to enable the emerging field of medical bionics, where implants and prostheses are able to sense the performance of bodily functions and in some cases restore their function.


We are recruiting a large pool of engineering and PhD students, approximately 50, to undertake research on how engineering can enable medical research.  This is an exciting development, but it has its challenges, the foremost of which is the communication required in this multidisciplinary collaboration. This has led us to work with research institutions, mostly in Melbourne, involved in multidisciplinary research.  


The principal focus of the ICT for Life Sciences Forum is to network local researchers from the different research disciplines. 


The prospect of breakthroughs from multidisciplinary research will only remain a prospect unless the doers – the research scientists – can effectively work together and understand each other.  We are hoping that by networking researchers across Melbourne, we might start to see the benefits emerge downstream with novel solutions in the market. 


There is a lot of excitement about the initiative among the research community, and we will be holding many events and presentations in the coming year.  We held what will become the Forum’s major annual event, the Graeme Clark Oration, in late October. The Oration honours the work and achievement of Professor Graeme Clark, the inventor of the bionic ear. His perseverance and achievement should serve an inspiration for young researchers. Your support in raising the profile of the Forum would be very much appreciated.


Regards, Luan Ismahil, Melbourne –

China is the new Germany

November 12, 2008


Mark Peterson Arkansas USA ( has sent us this quaint little story.

At the end of the Second World War, Germany was an “emerging market”. It was industrializing rapidly and producing brisk economic growth. Today, Germany is a mature “developed market” that grows slowly if it grows at all. Today, China is the new Germany. The industrial dynamism that produced Germany’s post-war success is moving to the East… piece by piece.

One of the largest steel mills in Germany was the ThyssenKrupp mill in the Ruhr Valley, the heart of Germany’s industrial area. At the turn of the millennium (2000), mills and factories in Germany began to close, unable to compete with lower wages in the developing world. A Chinese company bought the ThyssenKrupp mill, and soon 1,000 Chinese workers arrived to take it apart – they worked 12 hours a day, 7 days a week, and dismantled the plant in less than a year, two years faster than the Germans anticipated.  The Germans complained, so the Chinese took a day off. Over 5,000 miles away, the Chinese then put together the 275,000 tons of equipment and material, and the plant now produces as much steel as the entire production of China in 1975.

When the Chinese departed, they left the makeshift dormitories and kitchens they occupied for a year neat and clean. There was, however, a single pair of black boots left in one of the dormitories. It carried the brand name of Phoenix, which was also the name of the plant the Chinese just took apart. The boots also carried the label “Made in China”.

Source:  Chris Mayer, Whiskey and Gunpowder, 6/3/08

Cluster ScoreCard – Adelaide’s Advanced Manufacturing cluster

September 22, 2008


The Cockatoo has a Cluster ScoreCard which is basically an advance on Porter’s Competitiveness Diamond – we use it to provide an objective analysis of a cluster, to highlight deficiencies, and to formulate Action Agendas.


We analysed Adelaide’s advanced manufacturing (AM) industry cluster in 2006, and it is still very accurate according to local players. The cluster rates at 70.2 out of a maximum 100 points on our Cluster ScoreCard, which encompasses 10 performance criteria. Excerpts from the analysis are as follows.

Attribute 1 – Critical mass of local suppliers – rating of 7/10

§          Reasonable concentration of companies. Adelaide ranks 3rd behind Melbourne and Sydney. The core comprises 25-30 companies, near vehicle manufacturers and Technology Park.

§          Only 25% have significant global supply chains. Moderate beacon for investors, technology, venture capital. Good technical back-up, but banks are not attuned to financing needs.

Attribute 2 – Specialised infrastructure – rating of 9/10

§          Adelaide is an attractive industrial location due to its compactness and the good road, rail, sea and air services. Substantial flat land, and building costs are very competitive.

§          Considerable R&D and education infrastructure – arguably an over-supply of this infrastructure.

Attribute 4 – Social capital – rating of 8/10       

§          Elizabeth and Mawson Lakes are attracting interest because of examples of inter-firm collaboration.

§          Social capital quite strong. Economic adjustment since 1990s led to stronger sense of community.

Attribute 6 – Governance structures – rating of 3/10

§          The majority of the companies and development agencies don’t think of it as an industry.

§          Adelaide’s key industries are seen as automotive, defence, electronics, information technology and perhaps food processing. AM firms are seen as suppliers to these industries.

§          The roles of the various development agencies are not understood by the industry.


Attribute 10 – Existence of Threat – rating of 8/10

§          Biggest threat is the possible closure of Mitsubishi Motors Australia (subsequently occurred!)

§          Other threats are shortages of skilled labour, and low cost-competition from Asia.

As a result, companies are diversifying into medical equipment, defence,  food processing & mining.

Mao-tai diplomacy

June 2, 2008


Australia’s minerals export boom to China did not happen overnight. In 1986, our Ambassador to China convinced Canberra to organise a series of technical missions to advise the Chinese on the best technology for their ageing lead and zinc smelters, alumina refineries, steel mills etc.


My job was to be the government person on the non-ferrous mission, along with the mining engineers and metallurgists from CRA, Western Mining, BHP, CSIRO etc. Eight of us literally bounced into Beijing, and for the next 21 days (except Sundays) the mission members gave free advice to the management of sixty plants across the length and breadth of China.


We saw unimaginable amounts of machinery, concrete, ores and metals, all the while advising on what type of minerals processing technology could deliver better productivity. Much of the plant was old Russian or local stuff, so Team Australia was merrily recommending they purchase particular equipment from Sweden, USA, Canada, Japan and Italy. Strange, I thought.


After a week, we were knackered – lack of sleep, long train trips, cat-sized rats around our feet,  copious amounts of food and Mao-tai (like metho mixed with soy sauce). After two weeks, we were fading, and one mission member was even packed off home. After three weeks, we emerged at Guangzhou in a state worse than knackered.


We recuperated in Hong Kong, and finalised our mission report for subsequent translation and dispatch to the Chinese agencies. When I got back to Canberra, my big boss called me in for a de-brief. He was less than impressed when I said not to expect a spike in exports of Australian mining equipment to China. He stared at the far wall for an eternity, and then asked why I was even on the mission (the same thought had crossed my mind somewhere around Zhuzhou).


Those were the days when the big mining companies literally told our equipment suppliers to ‘get out of the way’, and they in return lobbied government for local content arrangements. The federal agencies were similarly aligned. Indeed, Australian equipment sales counted for nought with my hard-nosed mission members. No wonder they created enormous goodwill with our Chinese hosts.


While we never sold much mining technology to the Chinese, they began to make significant investments in Australia – the Portland smelter was one of the early investments. Then the massive sales of iron ore, gas, nickel, lead, zinc, copper began to take shape.  


Lessons? – You can’t beat mutual self interest. The Chinese are patient and gracious people. Our foreign service is seriously professional, but we failed to roll our mining equipment into the equation.



Collaborator Profile – Paul Frater (NZ)

April 13, 2008


Who and where are you?

Paul Frater, Director, Enterprise & Innovation, NZ Trade & Enterprise, Wellington. 


What’s your job

Responsible for the identification of mature NZ R&D (private & public resourced), triaging it for its possibility to be built into a technology platform for NZ industry under a Technology Innovation Partnership Programme (TIPP).  For priority projects, TIPP will undertake a range of initiatives including assistance with enterprise formation, feasibility and scoping studies, Technology Road Maps and market-catalysing demonstration projects.  The aim is to build innovation systems around the technology and help the core NZ firms become members of the innovation leadership group of key global value chains.  


What’s exciting you at present?


3 key projects are in an advanced stage of partnership engagement, and entering full scale production activities over the course of 2008:


1. High Temperature Superconductivity (HTS). A series of technologies are being built upon this NZ-developed IP, which is now integrated with technology developed under research programs resourced by the US Dept of Energy: equipment using high strength magnetic fields (e.g. NMR); HTS cables; cryo-cooling; specialist components incl. current leads & stable power supply systems.  

2. JAIN SLEE Industry Forum (JSIF). JAIN SLEE is a telco middleware that integrates the management of telecom network traffic from different technologies (e.g. mobile, internet, fibre, copper etc) and executes the inter-company call administration, billing and reconciliation. The core company is Open Cloud (Cambridge UK, Madrid & Wellington bases).  JSIF has been assisting other NZ ICT firms to exploit this market leadership to build their own international applications businesses. The software handles high volumes of simultaneous activity on a fault tolerant/high reliability basis. Open Cloud has activities in Europe, North & Latin America, Asia and Oceania.  

3. Titanium Alloy (Titap) Powder Metals. This is a new, low cost, environmentally friendly powder metal technology, which avoids the difficulties of handling the pure metal form of Titanium (explosive in certain situations). The alloy powder process is able to produce the strongest form of Titap alloys, the gamma phase. This technology opens many new market segments for a wide range of engineering firms, including bio-medical, coatings and specialist product forming. The opportunity is being taken by NZ firms to introduce a range of new powder metal consolidation technologies into their businesses, expanding their production capabilities & capacities. 



Three new technologies have entered into the process, but as yet are not at the same level of maturity: 

§ 2nd &  3rd generation bio fuels, including algae-based & industrial gas exhaust streams.

§ integrated sensor technology systems, including environmental sensing. 

§ nano-pore technology, with in-service aperture adjustment.  



What collaborative projects do you have to interest Cockatoo readers


The TIPP program is based on the establishment of trust relationships and the building of partnerships.  International partnerships are a key element to the program, and strong links have been established with technology partners in Europe, the US & Asia.  The 3 key projects are now in a position to explore a new level of international collaboration, and are well placed to make a significant innovation contribution to a number of international industries.   


Louisiana Shipbuilding & Metalworking

April 4, 2008

From our archives, we have accessed a very interesting overview of Louisiana’s approach to this industry. It was highlighted by at The Competitiiveness Institute conference in Tucson a couple of years back by David ‘Preacher’ Dodd, the US economic development and cluster expert. Herewith a summary of his riveting story (excuse the pun) and please note that this was pre-Katrina. 

 What happens when cluster logic takes hold organically? In early 1998, the shipbuilding boom in the bayou region of southern Louisiana was creating serious problems that posed a threat to the future of the industry – based in the local government areas of St Mary, La Fouche, Terre Bonne and Assumption.  

Due to robust growth in the shipbuilding and oil/gas industries, a serious skills shortage had developed. The subsequent poaching of staff, active and strident competitiveness, bidding wars, development of “fly in- fly out” labor teams that gave nothing back to the resident communities, and the impact on labor costs had all the earmarks of serious industry and community dislocation.

In addition, the geography of this wide marshy area of the Mississippi Delta meant there was physically no room for expansion to service the burgeoning demand. This was compounded by the cyclical nature of these businesses, which caused only very cautious investment capital to be available. 

Vic LaFonte is the economic development professional of the South Louisiana Economic Council. Anticipating serious economic impact, he contacted me to brainstorm some solutions. The suggested solution was to motivate the metal working sector in Northern Louisiana to join forces to meet the demand in the south. The north still had under-utilised capacity from the 1980’s oil and gas boom. There were still skilled workers in the region.

The plan was to integrate clustering dynamics to form a network in the north to respond to the need in the south, and nurture collaboration between the two networks so they could develop the trust and identify common needs that would accelerate cluster development. Using funds from the Department of Economic Development, the project started. 

The first meeting was at Minden and in attendance were 15 firms, whose employment ranged from 10 to 500. The atmosphere was conservative and guarded. There was an identified concern about being in the same room with competitors to discuss industry development opportunities. However, after careful explanation, a second meeting was agreed at which the issues would become more specific.  

The second meeting saw 12 firms in attendance. It was polite, but no progress until one business owner, Brad Reynolds of Reynolds Machinery, clicked to the concept. He told his peers that he was sick to death of each of them trying to cut each others’ throats when the real competition wasn’t in this room but from the world market. He told them he was “in” and he hoped they all would join him.

This was the turning point. The others quickly agreed to a meeting with the southern shipbuilding industry sector. A membership agreement was drafted and reviewed at a 3rd meeting. Before the meeting, the industry hit a serious downturn…the pressure that created the opportunity was released – this removed the opportunity to fill a gap, since there was no longer a gap in demand for labor and resources.  

Members of the initial group, having formed to identify broader opportunity, continued their dialogue after external facilitation stopped. They truly understood the need to collaborate. They formed the Ark-La-Tex Businesses Consortium by teaming 3 companies. Together they have weathered a cyclical industry and are quoted as saying “the key ingredient is trust”.

This is a useful example of facilitation being a catalyst to cluster development but the real core activities MUST be driven from within. 

David Dodd,

Harvard pointers on global innovators

December 21, 2007

Corporate R&D labs used to be the key for companies to create competitive advantage.

But now innovation is moving across the globe.

That’s why Harvard Business School professor, Alan MacCormack, believes that a real source of competitive advantage is skill in managing innovation partnerships.

Innovation is increasingly driven through collaborative teams due to product complexity, availability of a low-cost but highly skilled labor pool, and advances in development tools.

Collaboration adds to the top and bottom lines by shortening development lead times, increasing capacity, and facilitating access to skills, capabilities, and IP that a firm does not possess internally.

Many efforts at innovation collaboration fail because they begin with the goal of lowering costs.

Successful collaboration programs develop a strategy aligned to their business needs. They also organize for effective collaboration and invest in building collaborative capabilities.

Previously many companies secured competitive advantage by investing in internal R&D.

But today “not invented here” is becoming a badge of honor…and a source of competitive advantage.  

To design the 787 “Dreamliner” (initial flight in 2008) Boeing lashed together 50 partners in 130 locations. These firms aren’t just manufacturing partners – they design the components they make. “Boeing’s source of competitive advantage is shifting – its unique assets and the way it orchestrates, manages, and coordinates its network of hundreds of global partners.” 

Go to Innovation through Global Collaboration: A New Source of Competitive Advantage. Source: Harvard Business School, via Superfactory.

Investment and innovation? See these EC and Canadian examples

November 10, 2007

From our archives, we have retrieved a very instructive note from Tijs Creutzberg, editor of the slick OREDI newsletter – part of the Program on Globalization and Regional Innovation Systems, Munk Centre for International Studies, Univ. Toronto. He gives some good examples of collaborative industry initiatives in Europe and Canada that could stir the interest of readers.  

Multimedia pole in Montbeliard in Franche-Compte (France) – Over the last decade, a territory better known for its automotive industry has developed competencies and employment in multimedia. Each year, over 150 international designers and artists are hosted in the Montbeliard area to develop their projects. The local universities support developments in the engineering of virtual applications. This is a good example of economic modernisation of existing activities by exploiting synergies.

Global Village in the Arcadian Peninsular (Canada) – the economy of the Acadian peninsula (francophone rural region) depends on seasonal activities. The population lives in small villages with very few services. An ICT-based program offers “intelligent integrated services” concerning the economy, education, governance, health services and francophone networking in Canada and beyond.

ICT for development of peripheral regions (Denmark) – the Danish Ministry for Science, Technology and Innovation launched the “North Digital Program” to develop the ICT industry – 89 projects have been selected, covering digital administration, e-learning and qualification, culture and multi-media, industrial development. The program has helped make the region a dynamic learning territory.

Naval industry, Haute-Normandie (France) – 24 vertically linked enterprises decided to join forces following the loss of their principal client company in 1999. With the support of the trade unions and public authorities, they created the Industrial and Naval Centre of Normandie. The collective structure allows them to exploit the knowhow acquired by their employees.

Biotech cluster (Germany) – in 1996, the Federal Ministry for Research launched the Bio Regio program, and the Rhine Neckar triangle (Bade Wurtemberg Länder) has benefited. On the basis of its scientific resources and of existing enterprises, this cluster has now become one of the most creative in the field of biotechnology.

Mechanical sector cluster – transnational partnership between Tunisia & Languedoc Roussillon (France) – cooperation is underway between enterprises in the Metal Alliance Club for Industrial Development (CAMDIB) of the Beziers Region and some Tunisian SMEs. Mutual advantages derive from the sharing of markets and through the development of new opportunities on emerging markets.

See Tijs’ newsletter at 

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Time to move on investment hubs

November 6, 2007

A US colleague recently asked me where the main investment hubs were in Australia. She said she knew about Sydney, Melbourne and Perth, but after cruising the various websites she was more confused than never. A week later a chap from Switzerland asked roughly the same question.

I replied that there’s no consensus or considered view on this. However it got me thinking – investment is the key to economic development. So could we develop a framework of investment hubs that could be marketed to local and foreign investors, both large and small? In coming months, I will address all states and territories.

 Here are my initial impressions of the competitive advantages held by the main hot spots, and the themes around which investment hubs could be positioned. First up is Queensland. The key point here is that the state government is pretty aggressive about its ED agendas, and is one of the more ‘regional thinking’ states.

Let’s start at the Top End and work south. I figure there are 10 latent investment hubs there.

Cairnswhere the competitive advantage lies in co-location of tropical reef and rainforests; international airport; proximity to Asia and the Pacific Islands.

  • Hub angles – sustainable tourism; tropical health & medicine; aviation (including Outback); marine industries; international aid.

Townsville – access to Barrier Reef; Defence bases; Mt. Isa connection; international airport.   

  • Hub angles – minerals processing; defence technology; tropical health & medicine; aviation.

 Mackay – proximity to coal and mineral resources; access to Barrier Reef.   

  • Hub angles – minerals processing; mining technology; export of containerised food and agricultural product.

 Gladstone – minerals processing & energy facilities; port infrastructure; civic buildings.  

  • Hub angles – as for Mackay, but with additional energy aspect.

 Sunshine Coast – natural beauty; environmental icons; educated, well-heeled population; lifestyle image.  

  • Hub angles – education; environmental management; creative industries; smart Internet-based companies; new age technology (food, construction etc.)

 Brisbane – Australia’s third city; climate; competitive cost of living; excellent airport and adjacent precinct.

  • Hub angles – financial services; aviation; ICT; biotechnology and wider life sciences; education; logistics; construction.

 Ipswich Road corridor – engineering capability; competitively-priced land; access to Brisbane port and airport. 

  • Hub angles – heavy engineering; building and construction; logistics.

 Toowoomba – service centre for Darling Downs; climate; rural lifestyle.   

  • Hub angles – food processing; agricultural and water equipment & services; environmental management; light engineering.

 Logan Corridor – access to airport & port; manufacturing capability.

  • Hub angles – light engineering; food processing; logistics.

 Gold Coast – natural beauty; tourism icons; lifestyle and entertainment.

  • Hub angles – as for Sunshine Coast, but wider-scale e.g. marine engineering, medical services.

 These are indicative only, and we welcome any additions or comment. Contact us at for further information