In short :
- During a keynote at FABTECH Canada 2022, Dr. Jason Myers, CEO of NGen (Next Generation Manufacturing Canada), opened up about the challenges Canadian manufacturers face in relation to their largest trading partner.
- Innovation, digital platforms, connectivity, automation and collaboration are key to industrial transformation.
- When it comes to the economics of manufacturing, business practices in Canada and the United States are not identical.
FABTECH Canada was already underway when Canada’s federal government announced it was suspending its mandatory COVID-19 vaccination mandates and random testing requirements for air and rail travellers. News of the policy change would be a welcome development for FABTECH Canada attendees (June 14-16) who gathered in person for the first time in four years since the pandemic put a damper on in-person events.
Held at the Toronto Convention Centre, the show was located minutes from Pearson International Airport, making it a convenient meeting place for fabricators and welders who return to the show every two years to network with suppliers. industry, original equipment manufacturers, importers and opinion leaders. of the whole world. Nearly 40 technology fields were represented at this year’s event, including cutting, lasers, press brakes, robotics and welding machines.
Spanning 80,000 square feet and hosting more than 200 exhibiting companies, the Canadian show is small compared to its American counterpart. In 2015, FABTECH Chicago occupied 732,000 square feet and exceeded 40,000 spectators. Is it any wonder the series of semi-annual events is touted as North America’s largest destination for suppliers of forming, fabrication, tube and pipe, welding and metal finishing?
Engaging keynote and leadership exchange
Over 50 conference sessions, workshops and breakout sessions on cutting, laser, finishing, forming and manufacturing, automation and smart manufacturing, additive manufacturing and workforce development were present for the three-day event. The sessions have been designed to explore what’s new and coming, to tackle today’s biggest challenges and to improve productivity.
The core of the industry’s challenges, albeit from a Canadian perspective, were laid out in a keynote address by Dr. Jason Myers, CEO of NGen (Next Generation Manufacturing Canada), a not-for-profit organization run by the industry that leads Canada’s advanced manufacturing supercluster.
“We have a big skills problem in Canada,” Myers said. “In manufacturing, as a whole, 20% of today’s workforce will be retired by 2030. The under-30 cohort entering manufacturing, or youngest cohort in the industry, represents approximately 6% of the total workforce. You can do the math.
“If we stay where we are in terms of current production levels in the country, let alone grow, we are going to have to increase productivity by around 25% by 2030,” he added. “We’re not just facing labor shortages in manufacturing, we’re also going to be facing very serious skills shortages, because that need to increase productivity is going to drive the need for automation. “
In other words, if automation is seen as a solution to the labor problem, Canada’s labor pool will require different types of skills to match the ability to work with new technologies and to use them productively, as well as in accordance with “good business objectives in terms of competitiveness and growth,” Myers said.
Leveraging strengths Canada’s electric vehicle value chain is a good example that highlights some of the challenges facing the industry. “First of all, the industry today is totally unsustainable,” said Myers, who served as president and CEO of Canadian Manufacturers & Exporters, Canada’s largest industry and trade association between 2007 and 2016.
“The batteries don’t last that long,” he continued. “They don’t go that far. They don’t work very well in cold weather. And here’s the real problem: there aren’t enough product engineers in the world to design, develop, and test all the materials and components and powertrain motors and electronics and vehicles for electric vehicles that have already been announced. So how do we solve these really big innovation challenges? »
Ensuring manufacturers’ R&D and production systems are supported is where NGen’s expertise comes in. The organization invests in advanced manufacturing clusters to support companies and organizations research in the fields of additive manufacturing, robotics and automation and the manufacture of personal protective equipment.
Specifically, NGen focuses on solving long-term problems by funding the scale-up of large-scale production of devices and technologies. “It’s a very important part of Canada’s innovation system,” said Myers. “We often forget how important it is to be able to present manufacturers with technology that is part of an integrated engineering solution, that is cost-effective, competitive, and that they can actually deploy in their own operations.”
The main narrative is that not only are market conditions changing, but the manufacturing sector is also changing. This scenario was evident when Myers visited one of the world’s largest trade shows, Hannover Messe, in early June.
But the solutions cannot be one-size-fits-all, Myers warned. “Companies need to focus on the solution they offer to customers; your customers’ customers should be part of the [manufacturing] customer success story,” he advised. “And that’s a very different type of business model than just marketing a product. A product isn’t a solution if it can’t be managed, if it’s not cost-competitive, and frankly, if it doesn’t see value in it.
For Myers, innovation is at the heart of solving certain industrial problems and companies must focus on value-added propositions, as well as flexibility and agility. In order to respond quickly to changing conditions, he said, innovation is integral to solving problems, as is focusing on the right products and processes.
Canada and the United States are not one
Canada’s true strategic advantage does not necessarily lie in the technology itself. “In my mind, it’s all about strategy,” Myers said. “It’s about identifying opportunities. It’s about differentiation, process excellence, continuous improvement, and getting the technology to do the job.
Myers, a business economist specializing in industrial and technological change, made it clear that this may not be the strategy of European, Chinese or American companies. The United States is Canada’s largest trading partner, but it does not have the same manufacturing structure as the United States, he reminded the FABTECH audience. “We have a lot of small businesses and very few medium and large businesses. Our strategic advantage is not based on volume, but on solutions and engineering, and the ability of Canadian companies to quickly develop solutions, deliver them to their customers, and do so in a very responsive and agile way. . This has been our success so far.
Productivity by any measure
Canada measures productivity differently than the United States, where productivity measures tend to favor high-volume production, Myers explained. In turn, Canadians measure productivity by the price or value of the product when it leaves the factory after it is made.
“If you look at every line on the balance sheet of a US income statement, every line that talks about gross profit before tax, profit after tax, operating profit, Canadian manufacturing outperforms, on average, US manufacturing. I think it’s because we focus on solutions and engineering.
Myers offered a rudimentary description of the differences in productivity measurement. “We measure value by the price or value of the product when it leaves the factory after production,” he said. “The United States takes a different approach. They look at manufacturing companies and they simply deduct their input costs, their services, their products and their energy. Thus, the US measure actually takes into account the services that are provided around the product. We just measure the product itself.
He added that, by definition, the product itself loses value in relation to the services generated by companies around the world and around the product.
Integration is a driving force
The rapid integration of services into solutions, network architectures and the ability to make systems interoperable creates opportunities by providing new capabilities and forcing businesses to operate in very different ways, Myers noted. “Look around pretty much every product and every process today,” he said. “Is it a data platform? This is how businesses can use this data to provide additional revenue streams, additional services, that will be a commercial success for businesses that will thrive and grow over the next few years. Technologies, of course, change the whole environment.
By focusing on current issues facing the industry, Myer’s keynote provided a fitting backdrop for both FABTECH Canada and the co-located CanWeld 2022 conference (June 15-16).
CanWeld is operated by the CWB Group, an industry-supported sector organization that provides welding certification, management systems registration and training services to the welding industry.
FABTECH Canada’s event partners are FMA (Manufacturers & Manufacturers Association, International), SMEPrecision Metal Forming Association (LDCs), International Chemical Coaters Association (CCIC) and the American Welding Society (AWS).