Manufacturing Matters- Tuesday Top-Up 66

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Recent key developments in MAKE│NZ

•As we near a wrap on 2025, now seems a grand time to check back on the year past and what we’ve achieved as a Community . With manufacturers from all over Canterbury (and further afar) we’ve had over 12 in person events – including a few site visits, a great big thank you to our gracious hosts. This time last year we had 398 LinkedIn followers, which we’ve now almost doubled! We’ve hosted our now annual conference for the third time at SouthMACH2025.

Familiar faces have stayed and new ones have joined our board of directors, bringing in new energy and big ideas for the future. And as was recently announced, we are working with the ARA Institute on introducing the Earn-as-You-Learn certificate in Manufacturing has to Canterbury in the second half of next year. Thanks to the AMA, Wintech, Hanga-Aro-Rau and the Canterbury Manufacturers Trust, for supporting our work on this.
It really has been a year of growth and we’ve got some plans under wraps for next year that’ll you’ll just have to wait and see…

•Speaking of the impending New Year, what’s your New Years Resolution? Something personal and traditional like getting to the gym more? Maybe taking some time for yourself to relax? Or maybe something professional, growing your business? Finding out how to introduce some new processes or adjust existing ones? We’d love to hear from you –

For us at MAKE│NZ, our New Years Resolution will be focusing on encouraging giving and taking within our Community of manufacturing leaders. We all like to offer a helping hand or a word of advice, helping your fellow manufacturer is nice, right? But it’s easy to let that slip to the back of your mind and become something done as a reaction to a request rather than something done just because. So, we’ll be working on ways over the holidays to set up systems for 2026 that will allow manufacturers to confidently reach out for help and be a guide to others who have gone through similar trials.

•With 2026 will come our 4^th annual conference, this year held in Auckland in conjunction with EMEX. In the spirit of giving and receiving, we’re on the hunt for speakers and if you know someone who might be right for the job we’d love to receive your thoughts on them (and maybe even some contact details). Not to give too much away too early, this year we’ll be focusing on topics like future technology and its challenges, developing the next generation of manufacturers, and the role of start-ups in New Zealand manufacturing, just to name a few. If any of those sound like familiar bridges you or someone you know has crossed, don’t hesitate to lean into the giving spirit of the season and share with us your ideas – dieter@makenz.org or sabine@makenz.org

Recent key developments in New Zealand and The World

•Natural selection, as it was first comprehensively described by Charles Darwin and Alfred Russel Wallace more than 150 years ago, is the most fundamental mechanism of biological evolution and its basic principles are sometimes applied in fields beyond biology. However, Darwin already clearly recognised and articulated the tension between natural selection favouring individual self‑interest and the widespread existence of cooperative or altruistic behaviour in nature.

It took another 70-odd years for scientists to adjust / expand evolutionary theory so it was compatible with altruistic and cooperative behaviour. Seminal papers were published in 1971 by Robert L. Trivers and, ten years later, by Robert Axelrod and William Hamilton.

What is there to explain? Most of us will have seen drivers flashing their headlights to warn on-coming traffic after they have passed a police car parked on the side of the road. Legal and ethical considerations aside, why do something that has absolutely no benefit to you, but has a potential to harm you, for example if among the oncoming traffic there is another police car? If you ask people, they’ll tell you that this action by another driver has benefitted them in the past, or they expect it to do so in the future (or both). And that the expected benefit is (much) greater than the risk associated with this behaviour.

The delay in receiving mutual benefits implicit in the above example is crucial in evolutionary theories of cooperation, because it changes when and whether cooperative strategies can be favoured by selection. In everyday life, (most) people can accommodate such delays, either based on experience, or insight in the principle: I won’t benefit right away, but I know my time will come.

What does all of that have to do with MAKE│NZ? Our members keep telling us that ‘networking’ is the key benefit in what we offer, and a big part of this benefit is the ability to learn from one another. Sharing knowledge, a process of give and take.

We don’t think we’re currently doing enough to facilitate this sharing of knowledge, especially outside of our in-person meetings (Fireside Chats and Production Managers’ Meetings). In particular, making it easier for members of our MAKE│NZ Community to contribute and share. Watch this space in the New Year, but in the meantime – If you have any suggestions for how we can do better in this (facilitating the sharing knowledge), we’d really love to hear from you: sabine@makenz.org ; dieter@makenz.org .

•The ‘P-word’ again … Productivity. In a major study published in October, the McKinsey Global Institute demonstrates that the only sustainable path to increasing wealth is through improving productivity. It explores the potential trajectories for the global economy, which is currently characterised by wealth, debt, and cross-border liabilities growing faster than underlying productive output. The paper uses the global balance sheet to model four distinct future scenarios for wealth and growth:

• Productivity Acceleration: Economic growth outpaces the growth of debt and asset values, allowing the economy to “catch up” with the balance sheet. This is the only scenario that supports both growth in output and wealth while restoring balance sheet health. It is associated with high productive investment.
• Sustained Inflation: High demand and low saving spur inflation, shrinking the balance-sheet-to-GDP multiplier by devaluing assets and debt in real, inflation-adjusted terms. While it brings decent economic growth, it carries damaging side effects for business planning and household budgets. Historically, this is comparable to the US post–oil shock in the 1970s.
• Return to Past Era (Secular Stagnation): The economy returns to weak investment and a savings glut, characterized by ultra-low interest rates and sluggish growth. Asset values rise, creating “paper wealth,” but imbalances persist. This scenario mirrors the US and Europe between the Global Financial Crisis and the COVID-19 pandemic.
• Balance Sheet Reset: This is the worst-case scenario, involving a sudden correction of asset prices and an ensuing loss in wealth, followed by painful deleveraging, recession, or lengthy stagnation. It is associated with historically elevated asset values and debt, which are exposed by shocks to confidence or high interest rates. Japan’s experience after its real estate bubble in the 1990s is a historical parallel.

It is impossible to summarise the entire picture being painted with this report, but this graph captures a lot of why productivity improvements are so important:

Note how, of the three major economies represented here, only China has made majors investments in productive assets in the previous decade.

•Speaking about productivity improvement, 2025 has seen smart people developing some amazing robotics technologies. To pick a few examples out of many:

• High-resolution image analysis, using AI to detect surface defects in castings, for example
• “Speak objects into assistance”, a model system for speech-controlled assembly:

• Biomimetic grippers (‘robotic hands’) with soft, flexible surfaces incorporating sensors in the palm and fingers, enabling adaptive, human-like grasping

Reinforcement Learning is a major tool used in training the robots described above.

However, as this paper explains, unlike in humans the challenge to date has been to retain knowledge when new skills are acquired: “For deep learning-based algorithms, the primary challenge when facing a stream of tasks is balancing the stability and plasticity of the neural networks. A common issue in this context is ‘catastrophic forgetting’. This refers to the phenomenon where the neural network parameters associated with previously learned skills are rapidly overwritten when the agent learns new incoming tasks. Consequently, the agent’s performance substantially deteriorates when revisiting previously mastered tasks.”

The authors of the paper then describe a novel approach to overcome this problem which they call robotic lifelong reinforcement learning. Here is what they have achieved: “In our real-world experiment with a KUKA robot arm, our agent, aided by real-time vision from a RealSense camera and language embeddings from an LLM, successfully completes a sequence of tasks, efficiently accumulating knowledge and demonstrating flexible, autonomous skill reapplication for long-horizon tasks without relying on predefined human demonstrations.”

In the past, when confronted with ‘big picture’ concepts like Industry 4.0, many of our manufacturers would say: “Yeah, great technology, but far too involved, complicated and expensive for SMEs like us!” And, at least as the international statistics on the uptake of comprehensive Industry 4.0 solutions in SMEs are concerned, the numbers would prove them right.

Not so with modern robotics, where improvements can be made for individual process steps. Like with all automation, though, the trick is to pick the right process steps where robots actually improve process flow overall.

•Not sure how many of you are involved in, or planning to get involved in Machine Learning for Safety-Critical Applications– or just interested in the topic? If so this free publication (online version) might be of interest:

https://www.nationalacademies.org/publications/27970

•Continuing a positive note, since pretty much all of New Zealand manufacturing is happening in ‘small business’, at least by international standards, here are the results of a recent Gallup poll undertaken in the USA:

•And, finally: