In this new content series, Food & Drink Business takes a closer look at the opportunities inherent in the fast-evolving food processing industry, with insights from leaders at companies which have signed up to exhibit at APPEX 24.
This month we speak to Milan Bawa, Factory Automation general manager for Siemens.
The Australian manufacturing sector is at a critical juncture as it seeks to grow onshore capacity and capability while remaining globally competitive. With reference to your business, what do you see as a) the key challenges and b) the main growth opportunities inherent to this dynamic sector.
Many organisations in the Australian manufacturing sector are currently going through digital transformation and IT-OT convergence. However, most organisations are still focused on the topic of digitalisation with a closed mindset and that has an opportunity cost associated with it.
In my view, there are three key reasons why organisations take a closed mindset:
- Financing: focusing on the production floor to increase the output offers simple ROI and therefore financing is easier for such modernisation projects. With cost of capital increasing, projects with greater effort and lower ROI are not making the cut, even if these projects are highly attractive for company’s brand value (e.g., companies are not investing in decarbonisation if the perceived ROI is more than 3 or 4 years).
- Workforce: finding the right talent at the right price is challenging in the current economic environment. This means that SMEs are cautious about implementing solutions that require upskilling or hiring of new talent.
- Lack of know-how: organisations are good at what they do but are not always poised to take a holistic view towards digitalising their facilities. For this, a joint and collaborative approach is required. Collaborating with internal stakeholders and external subject matter experts is the optimal way of overcoming any knowledge and experience shortfalls.
Using automation technologies there are huge growth opportunities for SMEs to optimise their demand side energy management, digitalise their production facilities, and introduce new business models to their industries (for instance, product as a service, manufacturing as a service, or recipe as a service).
Data extraction and connectivity is the first key step when focusing on digitalising and decarbonising the facility. The effort that goes into combining the digitalising and decarbonising approach is far less than focusing on only one or another, because the technology needed to achieve the first key step of data extraction and connectivity largely stays the same for both.
What role has automation played in growing your business and advancing your customers production performance?
Automation is the backbone of manufacturing organisations, whether it is in the digital marketing space or the production floor. Siemens manufacturers a large portfolio of products all around the world and we proudly use our own automation technology to accelerate our manufacturing goals in factories such as our Programming Logic Controller factory in Amberg, Germany.
Furthermore, our manufacturing facilities take advantage of our own IT-OT integration solutions to enhance our output capability.
Our experience using our own technology in manufacturing – serves as a great reference for our customers. We can relate to their key challenges and continually seek new solutions to address these problems.
What innovative technology/product/solution has your company brought to market recently that sets you apart from your competitors?
Siemens is always driven to be the best in its field. With a focus on coupling the key topics of digitalisation and decarbonisation, Siemens has launched SiGreen as a web-based platform that allows companies to capture not only the scope 1 but also scope 2 and scope 3 emissions.
The focus on decarbonising the supply chain is increasing, and Siemens has products (such as SiGreen) and solutions (such as energy consulting) that allow organisations to capture their product carbon footprint (PCF).
The integration of our automation systems with our energy management systems and our SiGreen platform sets us apart and makes us a key technology provider for many industries.
Working with your customers, what key trends are you observing unfold in the Australasian food and beverage processing sector?
From our observation, sustainability and decarbonisation are overpowering the industry trends in food and beverage. Larger organisations are heavily investing in technologies and processes that enhance their brand-value when it comes to sustainable manufacturing. SMEs are slower in capturing the benefits of this trend as they are heavily squeezed by higher cost of capital, energy costs, and workforce challenges.
APPEX is a new, all-encompassing trade show for the processing and packaging industry. Your company has signed up as an exhibitor at the inaugural show in March 2024, what made it a compelling platform for your business?
Siemens sees this as an excellent platform to exhibit and educate the industry about power of technology in digitalisation and decarbonisation. We also see immense value in being part of the various subject matter experts under the same roof and discussing the key challenges that are prohibiting Australian SMEs from accelerating their growth.