With the festive holidays just around the corner, it’s time to take stock on the year that was. Let’s look back on the headline-hitting manufacturing stories that shaped 2016 and what we’ve learnt.
Australian innovation flounders
Innovation was a hot topic in 2016. First, global measurement company Nielsen found that successful innovation is the key to delivering real incremental dollar growth in an increasingly competitive food market with its Breakthrough Innovation Report.
Then, the 2016 Global Innovation Index revealed that Australia has slipped in innovation rankings to 19th, two places lower than last year and below other Asia-Pacific nations including Singapore, Hong Kong, Japan and New Zealand. Interestingly, China’s spot at 25th was the first time a middle-income country has joined the rankings alongside highly developed economies. The report also showed that successful innovation means joining the global marketplace to find new markets and knowledge to fuel further innovations.
However, Prime Minister Malcolm Turnbull’s innovation agenda was questioned (again) after both the Coalition and Labor agreed to make cuts to Australia’s R&D tax incentive, an incentive critics have said is critical in encouraging startups to channel funds into innovative technology.
When it comes to innovation, sometimes the best lessons can be learned from outside your own industry, which is why we put the spotlight on electric vehicle designer and manufacturer Tesla and how it innovates to succeed.
Innovation will no doubt continue to be important in 2017, but will Australian manufacturers step up to expectations? And will they be supported in the process?
The drive for Industry 4.0
If the headlines are anything to go by, the manufacturing buzzword of the year is undoubtedly “Industry 4.0”. (Check out what you need to know about Industry 4.0.) This year, Australia joined with peak bodies in the world’s leading early adopter nations – the USA (Industrial Internet Consortium) and Germany (Plattform Industrie 4.) – to discuss adopting common standards for Industry 4.0. The Prime Minister’s Industry 4.0 Taskforce represented Australia at the Hannover Messe exhibition and has since formed five working groups (architectures and norms, research and innovation, security, legal framework, and training) to mirror those in Germany and the USA.
Some industry commentators are excited about the prospect, while others are cynical. The spotlight was on Mix My Muesli as an early example of how Industry 4.0 will look. In the “Muesli 4.0” production line, the muesli box tells the machine what to do and not the other way around. The customer orders the product mix they want, which creates a product identity telling the machine what to put in the bag.
The big question is: will Industry 4.0 continue to be the focus in 2017, or should we just move on to Industry 5.0?
Packaging gets even smarter
If we listed every packaging innovation that hit the headlines in 2016, we’d be here until Christmas 2017, but there are a few that deserve a mention, including antimicrobial packaging and connected packaging.
A startup company, Crossing, is developing antimicrobial active packaging by deliberately and irreversibly attaching preservatives or additives to the inner surface of packaging. Because the preservative is firmly anchored to the packaging surface, the components are not ingested.
Smart packaging has also exploded, with more brands exploring the new ways to connect with consumers. For example, Rum brand Malibu launched “connected” bottles that use Near Field Communication (NFC). The consumer simply taps their smart phone onto a Malibu sunset image on the label to instantly access content and enter prize draws.
Not to be outdone, Nestlé has partnered with mobile app Shazam to create interactive KitKat packaging. Millions of Shazam-enabled KitKat bars have been distributed as part of a promotion asking consumers to join “The Breakers Party” and win “the break of a lifetime”. Consumers simply “Shazam” the packaging, visit the website, and follow the prompts.
This push for smart packaging comes from a consumer desire for more information and connectivity with brands. (Consumers checking authenticity is a great example.) So, we expect what we saw in 2016 to be only the tip of the interactive iceberg. In fact, a new report by packaging industry researcher Smithers Pira predicts the global smart packaging market to grow 7.5% in value annually to about $10 billion by 2021.
Let’s face it; we can’t talk about this year’s global headlines without mentioning Donald Trump’s US election. As shockwaves rippled around the world, Australian manufacturers began to wonder one thing: what does this mean for our future?
Now the dust is starting to settle, commentators are coming out with their predictions. First, there’s the tax and trade policies that could hurt Australia (and the rest of the world). Then there’s his promise to withdraw from the Trans-Pacific Partnership (TPP). And of course, there’s the potential of a future trade war with China, which according to Manufacturers’ Monthly, cannot be good news for Australian manufacturers.
However, nobody really knows exactly how things will play out between Trump’s USA and Australia. For now we just have to wait and see.
What are the stories that shook 2016 for you?
What will you do differently next year, if anything? We’d love to hear your thoughts.
And just for interest, let’s go back a year and look at the manufacturing stories that shaped 2015 and two years to 2014 and what we learnt, plus 2015’s triumphant brands and the lessons they have for us.
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Image credit / Rasica