Buildings leaders for our futures

I am not a fan of failure.

I am a huge fan of preparing our businesses – and our future corporate leaders – for success.

First, in brief, the failure. There is a recent report from the Canadian Chamber of Commerce entitled “Fragmented Systems: Connecting Players in Canada’s Skills Challenge”. The report is very blunt. It quotes a McKinsey & Company Canada survey: “Over half of graduates and around two-thirds of employers felt that graduates were unprepared for employment. In contrast, the vast majority of education providers – fully 83% – felt their graduates were employment ready.

Let’s underline that: half of our grads don’t think they’re prepared for the jobs they are moving into. Two-thirds of employers agree with that pessimistic assessment. But educators are on an entirely different wavelength, with more than 80% saying the grads are job-ready.

That is a huge gap. Most employers say grads aren’t job-ready; most educators say they are. That’s a fine recipe for failure. I’m one of the employers. And I agree with that assessment.

But I don’t agree that it’s entirely up to the educators to find the answer. This is a situation calling out for collaboration at the highest levels.

A key recommendation of the Chamber of Commerce study is: “Strong collaboration between post-secondary institutions and business will be a crucial driver in supporting a knowledge and skill-based economy.”

I am a big fan of the kind of educational systems one can find in countries like Switzerland, Austria and Germany. I am a product – I like to think, a successful product – of the German dual education system of training and apprenticeships with employers and the options offered by the system to transition into a career path in engineering.

I became an apprentice at the age of 17, upon completing high school. My apprenticeship was in power electronics, with one of the largest mining companies in Germany. After qualifying as a fully licensed power electrician, I did my compulsory stint in the military, and then went on to obtain my degree in electrical engineering – and was able to support myself by working in my trade on weekends and during holidays.

But don’t take my word for it. In recent years, many experts have called for Canada, and the United States, to adopt the German approach in a much-needed effort to close the skills gap.

For instance, as early as 2013, a Bloomberg report was very clear: “If America wants to remain competitive, we have to keep our young people engaged. Germany has the right formula. U.S. business and political leaders should learn from the German approach and invest in creating and supporting a German-style vocational education system. Businesses will get the skilled workers they need, young people will see new career opportunities open up to them, our middle class will be strengthened, and our economy will benefit.”

In 2014, Maclean’s Magazine featured an article about the German system and quoted Sarah Watts-Rynard, the executive director of the Canadian Apprenticeship Forum: “In Germany, you have a culture where employers feel it’s not only their responsibility to train, but their right,” she says. “The education system is designed to train workers to meet employers’ needs.”

Clearly, I am not alone in believing that Germany offers a very good example that Canadian educators, manufacturers, and government should be following if we hope to close the skills gap and ultimately, strengthen our advanced manufacturing sector.

Our people, our planet, and sustainable profit

Once upon at time, success in business – and especially in the industrial sector – was measured almost entirely on the basis of profit. If the business made money, it was succeeding. End of story.

Except, in those days, these “successful” businesses were all too often built on a tragic foundation of disregard for the safety of workers, disregard for any environmental concerns, and frequently, a shocking lack of business ethics when it came to relationships with competitors and customers.

I’m proud to look around me at the Canadian business community of which I am a part, and see that this has all changed, dramatically, and totally for the better. Today, successful businesses are built on a balanced strategy that considers what is best for people, our planet, and sustainable profit.

This produces results that are wins for everyone – for employees, for owners, for customers, for our neighbours near and far, for this planet we call home. It also ensures that this “win” will continue, as we develop and implement sustainable practices that not only protect our environment, but also the future of our businesses.

We know we are not there yet, but we are very focused on the goal. At Siemens, for example, our stakeholders – from our team members to our customers – know that we’re engaged in best practices in every area – people, planet, or profit. And we also realize that it is impossible to separate these categories – what is good for people is also good for our planet, and vice versa; and unless a profit model is sustainable, in every sense, the profit soon dwindles.

I’m proud to be part of a company that aims to be the world’s first major industrial company to achieve a net-zero carbon footprint. Our plan is to reach that goal globally by 2030, but much sooner than that – by early 2020 – we will have cut our carbon dioxide emissions in half. Over the next three years, Siemens is investing funds globally in order to reduce the energy footprint of our production facilities and buildings across the globe – and our Gold LEED-certified Siemens Canada headquarters has set the standard for our company, world-wide.

Another way we at Siemens have developed to accomplish these goals is called Zero Harm Culture. Workplace safety is absolutely central to success for any company, but none of us can claim 100% success in this area. Overall, Canada’s workplace health and safety record is a complicated, “good news – bad news” situation. There is some good news – the number of workplace injuries and deaths has been dropping over the past several decades. However, in the most recent year for which statistics are available, there were more than 245,000 workplace injuries in Canada, and almost 1,000 deaths.

Put another way, about 672 workers were injured every day in this country.

Surely, none of us can think this is acceptable. Health and safety has long been considered an important topic – but I want to suggest that it needs to be fundamental element of every business’s strategy for sustainability and success. All of us need to be improving our employee health and safety programs –setting ambitious targets and, much more importantly, putting in place the right programs to make them a reality.

This is the only way we can live out the truth that our people are by far our most important asset.

Canadian businesses are, of course, very focused on being green. There is no question that sustainability is vital in our imperiled world. The good news is forward thinking businesses will discover that becoming sustainable can also be a key to becoming sustainably profitable, as we create green innovations.

But this “people, planet, profit” triad must not be broken apart, so that even as we seek to be green and growing, we must also be creating a safe environment for our people. A Zero Harm Culture has to be front of mind, all the time. We talk about “continuous improvement” in our technology and production systems, but nowhere is it more important than in health and safety.

Recognizing Organizational Silence and speaking up with impunity

I’d like to share what I consider one of the highlights from a recent meeting with my fellow Siemens CEOs from around the world. It’s called “Organizational Silence” and it’s something that companies everywhere needs to overcome.

More and more employees are speaking up, and they should be applauded for voicing their opinion; it’s my earnest hope that everyone will become comfortable doing so.

It’s critical that everyone feels they can speak up to voice ideas, concerns and views, because organizational silence is one of the biggest barriers to organizational development and change. Regrettably, it’s all too common within organizations.

Research among Fortune 500 companies shows the negative impact of organizational silence. It can generate anger, cause lack of confidence, lower morale, increase stress and even foster staff turnover. It can stifle creativity and innovation, and lower productivity and profitability; it can even undermine a company’s reputation.

There are case studies where organizational silence made a huge impact on the bottom line. Look at Detroit’s Big Three automakers. One in particular paid a steep price for organizational silence when the company pushed aside safety concerns and actively discouraged speaking up. A culture of complacency was blamed for a decade-long delay in recalling millions of faulty vehicles. Market share was lost. Public confidence waned. The Columbia Shuttle disaster in 2003 is another example where organizational silence was a factor.

It’s important to recognize organizational silence for what it is – a barrier to creativity and growth – and to actively speak up. Companies need their employees’ skills and abilities to prosper, as well as their ideas and perspectives.

Management can help by encouraging employees to speak up, by practicing active listening and actively supporting employees. Management needs to tolerate failure and recognize that valuable lessons can be learned. In failure the seeds of future success are often sown. The best creative minds are not afraid to fail.

I encourage you as leaders to become champions in overcoming organizational silence, to help others find their way, by following these simple 7 Habits:

  1. Show visible leadership
  2. Promote team spirit
  3. Empower your team
  4. Appreciate good work promptly
  5. Be transparent
  6. Use your team meetings wisely
  7. Point out your own mistakes

Speaking up is one solution to this common problem, and it’s something easily within our grasp.

 

 

Proud to be in good company

At Siemens Canada, we take the holidays very seriously. We joyfully wear our holiday sweaters and celebrate the season – as a corporate family, and with our friends and family. But I’m most proud of the way the Siemens team embraces our community, working together to help those in need at this time of the year.

Corporate Social Responsibility (CSR), as discussed in my last blog, is a cornerstone of our Siemens Canada philosophy, and December is a month in which we especially focus on CSR. This month, we participate in our annual Hope for Holidays campaign, collecting funds, toys and food to be distributed by the Salvation Army’s Syrian Refugee Relief Effort. We are also partnering with the Canadian Red Cross to provide food, household items and health services to refugees in Syria, Iraq and Libya. Internationally, Siemens has made a €2 million donation to assist refugees.

I know we are not alone in this – Canada is home to hundreds of businesses that are responsible, caring corporate citizens. In the past few weeks, I have again been made especially aware of this, with the announcement of a number of corporate awards.

It has been announced elsewhere, so I won’t go into detail, but I am very pleased that Siemens Canada has won three national awards, named as one of Canada’s Top 100 Employers, honoured as one of the country’s Best Ten Companies to Work for, and also chosen as a Greater Toronto Area Top Employer.

In this, we are in very good company. I congratulate all our colleagues and friends for their achievements, including our neighbours here in Oakville, the Ford Motor Company of Canada.

I am grateful for the organizations that sponsor these corporate awards, because they create an immediate network of excellence. Each of us can learn from the other companies honoured. The awards list is a virtual handbook of best practices – innovation, creativity, efficiency, sustainability, adaptation – all the attributes needed for success in this ever-changing environment. Siemens Canada is privileged to be numbered among this impressive list of the best in the nation.

Why do these awards matter? They stand for the work the Siemens Canada team has done together, and the culture we have developed over the last few years.

They underline the importance of being responsible as a business – a lesson that corporate Canada has learned very well, and one we cannot forget, for the good of this wonderful country.

I appreciate all the honours, but I must point to the Top Employer award as something very, very special, because it recognizes that we have created an excellent workplace environment – and that means we have an excellent team. Our Vice President of Human Resources, Kim Velluso, expressed a fundamental truth very well: “We are proud to be recognized for our commitment to our greatest asset – our employees.”

I believe that these awards not only honour our present-day employees, they also set the stage for this company to attract the best talents in the future. And that bodes very well indeed for Siemens Canada.

I am very, very proud of our people, and of our company. I am also proud of the corporate community in Canada, and I encourage all of our colleagues to continue to make the kind of difference recognized in these awards, for the betterment of our industries, our economy, and most importantly, of our communities and our country.

All the best in this special season.

 

Celebrating the holidays with Siemens Canada CFO Bo Ouyang
Sharing holiday wishes at our annual holiday breakfast
Serving up breakfast to our employees at our holiday party! L-R Myself, Bo Ouyang, David Hickey, George Ravalico

Corporate Social Responsibility (CSR): Everyone wins!

I like to win. Those who know me well won’t be surprised by this confession. Whether it’s in the corporate world, or on the sports fields, I play to win.

But “winning” can mean a lot of different things in our complex world. For instance, I played in an October soccer match between Siemens and NB Power. The final score, however, was 5-0 … for NB Power. I must say, I have a difficult time disclosing this result, but…

The good news is, we all came away as winners, because this is an annual charity match, and the losing team donates money to the winner’s charity of choice.

Better still, the winners also donate money to the charity chosen by the losing squad.

So it’s not hard to see that everyone involved comes out as a winner.

I believe that sports can teach us a lot about the right way to do business; the values that contribute to a team’s success translate perfectly into the corporate world: teamwork, competitiveness, fairness, and perhaps most importantly, collaboration.

This annual soccer match – and I very much enjoy playing in it, every time – is a great example of something that lies at the heart of the Siemens Canada philosophy – our commitment to Corporate Social Responsibility (CSR).

This commitment plays out in a number of ways. Often, the result is very hands-on… Siemens employees have our support – including paid time off – as they volunteer in charitable and community opportunities, like Habitat for Humanity builds. We encourage our people to identify the causes they most care about, to follow their hearts to make their communities a better place.

Last year, we donated more than $350,000 to Canadian non-profit organizations, ranging from Cystic Fibrosis Canada and the Salvation Army to Food Banks Canada. We donate to dozens of other charitable and community causes as well.

When it comes to Corporate Social Responsibility, though, our contributions of time, energy and funds to worthy causes is only part of the picture. As I have written in previous blogs, Siemens has expended considerable resources in the areas of education, creating and sustaining programs to better prepare young Canadians for the careers that await them – and I believe that these and other educational programs are truly a mark of Corporate Social Responsibility.

Siemens Canada is committed to act in the best interest of coming generations. That’s on all fronts: economic, environmental, and societal.

All of this is why I am so delighted to participate in the soccer match with NB Power. While this event does raise important dollars for charity, it’s also a great symbol of the bigger picture. NB Power is one of Siemens’ Trusted Partners; our relationship goes far beyond that of supplier and client. We are indeed partners in every way, and together, we are committed to developing and supplying sustainable power across the province of New Brunswick.

I was very pleased to read some comments about our partnership, made by Brad Wasson, Program Director for Reduce and Shift Demand for NB Power. Brad spoke about our partnership, saying, “We have a shared vision… If you want to change the world, what better way than to find the world’s best partner to help you do it?” And I have to return this compliment to our partners of NB Power, they are awesome in by all means!

That’s the result of Corporate Social Responsibility at its very best. Everybody wins!

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The Future Is Now

There’s a lot going on right now in the Canadian advanced manufacturing sector. The month began with the Canadian Wind Energy Association annual conference and exhibition. October has also been designated “Manufacturing Month” by Canadian Manufacturers and Exporters. And according to Canadian economists, October – and the remaining months of 2015 – should bring good news for all of us in Canada’s advanced manufacturing industry.

Good news is always welcome, of course – but in the midst of the positives, I still want to sound a note of caution. It’s simply this: we must take nothing for granted. Nothing.

Instead, to quote the Roman poet Horace, “Carpe Diem” – it is time to seize the day.

Let’s look at the CanWEA conference for a moment. Siemens was proud to sponsor this important event, it is Canada’s largest wind energy conference, and I was pleased by this year’s focus: “Cutting-edge technology and innovations that will help solve the industry’s biggest problems and pave the way for a more efficient, effective, and sustainable energy future.”

That’s the kind of thinking that we need right across the Canadian advanced manufacturing sector. But it’s crucial that such intentions are not just rhetoric – “big-picture” statements that are printed in our reports, written in our blogs, and spoken in our projections, but which never make their way into the heart of our businesses.

All of us with a stake in the Canadian manufacturing sector must go beyond words – we must adapt, innovate and accept change as a way of life – or our manufacturing sector as we know it will be dead and gone.

This transition is essential. Continual innovation is now at the very heart of the manufacturing sector, and in my view – the urgency of change is the one thing that will not change.

There is indeed some optimistic news, reflected in a report last month by TD Economist Dina Ignjatovic, who wrote, “Canadian manufacturing sales kicked off the third quarter on a high note, rising by 1.7% in July. This marks the third consecutive gain in manufacturing activity… Overall, after weighing on economic growth during the first half of the year, the manufacturing industry is on track to improve over the remainder of 2015, and should help to lift overall growth.”

Of course, this is positive news. But let’s be clear that this is a short-term report – all it says is that our industry is doing better in the second half of 2015 than it did in the first two quarters.

However, in the Ivey Lawrence Centre report I referred to last month, there is a more somber context: “Since 2000, manufacturing employment has declined by over 500,000 workers…[and] the decline in manufacturing exports has let to an overall decline in exports by Canada. Over the period 2000-2014, overall exports declined by 6.4%, while manufacturing exports declined by 26%.”

So while we may feel reassured by the current uptick in manufacturing, there is clearly much to be done to ensure the recovery and long term viability of our business.

The CME’s theme for Manufacturing Month sums it up in four words: “The Future is Now!”

Yes, it is. And the shape that future will take – the success or the failure it will bring – is entirely dependent on our willingness to change, adapt, and innovate – starting right now.

We have entered an exciting, dynamic, new, world-wide, fourth industrial revolution. A digital transformation is reengineering everything about manufacturing.

However, when I say “we”, I want to stress that unfortunately, our participation is not inevitable. “We” only enter this revolution if and when we opt into the thinking and practices that have sparked it. We have to choose to participate – and to foster the changes that facilitate that participation

The window of opportunity is open

I had the pleasure of participating in two important events in September; both were discussions about the state of Canadian manufacturing.

The first was a panel discussion hosted by Siemens and the Lawrence National Centre for Policy and Management at the Ivey Business School with Linda Hasenfratz, CEO of Linamar, Jayson Myers of Canadian Manufacturers and Exporters, and moderator Paul Boothe, Director of the Lawrence National Centre.

The following day, I gave the keynote address at a CD Howe Institute event. The theme was “Rethinking Canadian Manufacturing”. Both of these events generated lively and thoughtful discussion about the manufacturing landscape in Canada, and we were able to focus on what Canada needs to do to be competitive in our rapidly changing global marketplace.

The discussion at Ivey was sparked by an important new report on the future of Canadian manufacturing, jointly prepared by the Lawrence Centre and Siemens. Click here to download report, ‘The Future of Canadian Manufacturing: Searching for Competitive Advantage’.

The report highlights that the private sector is primarily responsible for growth of Canadian manufacturing, but within a collaborative context. As I said during our panel discussion, we must collaborate with our customers, sometimes even with our competitors, with government entities on all levels, with universities and colleges, and with industry associations.

I was pleased that the report also says Canadian manufacturers need to focus on high value-added, high-quality goods and related services. Today, customers are demanding faster time to market, faster development of innovations. If we are to succeed, we must innovate faster, but we also must bring those innovations to market at record speed.

The report also points out that talent is our most important resource. There is an overwhelming need for a collaborative, innovative approach to training and education, to create a new workforce genuinely prepared to take on the new challenges of advanced manufacturing. Siemens Canada is leading the way in this area, through our Siemens Academy and other initiatives.

In my address at the CD Howe Institute event, I also referred to the same report, which includes some startling insights. It says Canadian “manufacturing was hard hit by the deep and prolonged recession that followed the global financial crisis of 2008-2009. Manufacturing GDP declined by almost 11% over the period from 2000 to 2014, while the rest of the economy grew by 41%.”

During the panel discussion, we agreed that the current challenges are a call to action for all of us. The window of opportunity is open, but will not remain open forever. If we do not act now, it will close, and manufacturing will go elsewhere.

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Robert Hardt, Linda Hasenfratz (Linamar) and Jayson Myers (CME)
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Paul Boothe (Ivey Lawrence Centre), Robert Hardt, Linda Hasenfratz (Linamar) and Jayson Myers (CME)

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Integrity, transparency and honesty – key to being a “Trusted Partner”

At Siemens, we know that our success is founded upon a dual focus on innovation and relationships. We cannot succeed by stressing one without the other.

We know that developing a completely digitized, integrated operation is vital to our ongoing success. We embrace this strategy wholeheartedly, and we’re proud that Siemens Canada has taken its place at the forefront of innovation.

But our approach is also a very human strategy, focusing on people – our customers, business partners, communities and team members – and on building sustainable relationships.

And that’s why Siemens Canada is celebrating our “trusted partner” relationships with our customers, our expression of commitment to collaboration. The phrase “trusted partner” is much more than a branding exercise – it is a statement based on shared values, and a clear strategy for going forward.

We are a partner with our customers. We are co-collaborators. They can come to us, based on trust. And that trust is based on our values. We make a commitment to our customers, and our customers can rely on us to fulfill it.

We are just as proud of our partnerships as we are of our industry-leading innovations and technologies. These two factors are entirely interconnected, of course – a key reason that our partners can trust us is that based on our technological expertise and innovation, we can create the right solution for them, every time.

This really is all about relationships. I can promise that Siemens’ representatives will never simply try to sell you something, right off the bat. We recognize that we need to get to know our customers, to understand your basic strategy, and the context in which your company works. As we work together to find the right solutions for you, this relationship – over time, because I’m taking nothing for granted, here – will evolve into the kind of trust I am talking about. It doesn’t happen immediately, but it will happen, as customers experience Siemens’ execution, implementation and innovation, meeting their needs, solving their challenges, making them more competitive.

We all know that not everything is perfect. In order to improve the experience for our customers, we have to be brutally honest with ourselves. We have to listen to our customers, be completely transparent, share with them what we hear and see, and include them in our actions to drive their satisfaction with our performance to a higher level.

Honesty is based on full transparency. Integrity is based on full honesty. We recently conducted our annual customer satisfaction survey. We received very positive results from our customers, but we also had customers give us valuable feedback about where we should and could improve. I see this as an opportunity as it guides us on our way to excellence and to becoming a trusted partner for all of our customers.

I know this without doubt, because we can identify many Siemens Canada customers who have embraced the idea of a “trusted partner,” and are happy to tell the world about our relationship – customers such as the TORONTO 2015 Pan Am/Parapan Am Games; New Brunswick Power; Calgary Transit; Algonquin College; and the Town of Tillsonburg, Ontario. You can read more about these relationships – including some very positive comments from representatives of these partners – on our website, www.siemens.ca/trustedpartner.

The themes that emerge in their comments include a celebration of our trusted partner relationship, and a conviction that Siemens has become a very real part of their operation.

I mentioned above that this is not merely some kind of branding exercise. It’s not. Nor is it a “management plan” conceived in a brainstorming session, and floated as a nice idea.

No, earning the right to be a “trusted partner” is something we are building right into the bones of Siemens Canada. It’s part of our corporate culture, and everyone, from my office out, is working to ensure that each and every employee understands this. This is true in our factories, across our offices, throughout our sales staff, in our tech teams, and it’s built right into the training and education we are offering starting with our newest recruits.

To each employee, we’re stressing that it’s not enough to do a job for a customer; we also have to do it the right way. That means being honest – saying, if necessary, “I don’t have the solution right now, but I will go back and find the right person and they will call you.” That kind of integrity builds trust. Siemens is committed to build our business on exactly that kind of integrity, and we demand it from our service people, our sales team – and me as the CEO.

Being a trusted partner means just one thing: our customers can rely on this company.

Proud to be a trusted partner to the Toronto 2015 Pan Am/Parapan Am Games

The TORONTO 2015 Pan Am and Parapan Am Games are coming and I am very excited.

I’m excited because I am a life-long sports fan, and I especially value the kind of sport that challenges an athlete to perform at his or her personal best.

I’m excited because the Games provide its partners – including Siemens Canada – with an opportunity to be seen at our very best.

And I am also excited because of the lasting legacy the TORONTO 2015 Pan Am/Parapan Am Games will leave on the region. Siemens has been a part of many of the new athletic facilities that will not just be used for these events, but will continue on as places where Canadians can gather to engage in sport.

It is truly inspiring for me, personally, to be part of the Pan Am/Parapan Am Games story. Siemens Canada, as Official Supplier of Medical Imaging and Video Security Equipment, is providing ahead-of-the-curve medical technology (ultrasound and X-ray), and a video surveillance system to the CIBC Pan Am/Parapan Am Athletes’ Village, where 7,000 athletes will stay.

Our medical imaging solutions help the Polyclinic (the main medical clinic) provide state-of-the-art care, contributing to rapid diagnosis and treatment of injuries. The video surveillance equipment is an ultra-high-resolution, real-time video monitoring system, and we have installed these not only at the Athletes’ Village, but also at some of the Games venues as well.

We’re not simply providing equipment – we’re providing expertise, consultation, advice, and a lot of sweat equity, as the Siemens Canada team puts in countless hours making sure everything is exactly right.

For example, our healthcare experts have helped to configure the examination room and have also trained medical practitioners on the use of the diagnostic devices we have supplied, and we’ll be there, 24-7, providing tech support. Our security specialists are providing technical support as well, including being instantly available throughout the Games.

When you care for sports, as I do, the very fact that the Pan Am/Parapan Games are taking place in our communities is reason enough for excitement. The athletes demonstrate the very finest attributes of humanity, as they strive to perform at their very best.

And while that attitude is most obvious on the playing fields, it is reflected right across the organization of the Pan Am and Parapan Am Games. The host city of Toronto and 14 other southern Ontario communities have the opportunity to showcase themselves to the world, and they have seized that opportunity with enthusiasm. I applaud this, and I am thrilled that Siemens is so deeply involved, providing infrastructure technology such as power distribution equipment and building automation technology at several Games sites.

On every front, from athletics to organization to technology development, the Pan Am/Parapan Am Games provide a tremendous opportunity to showcase the potential for what people are able to create.

As a trusted partner of the Games, we’re committed to our relationship with the Games’ organizers, and all of us at Siemens Canada are eagerly anticipating the most exciting athletic events of the year.

Let the Games begin – Siemens will be there, every minute.

Meeting PACHI at our annual town hall meeting! (L-R Saad Rafi, TORONTO2015; Robert Hardt; Lisa Davis, Managing Board Member, Siemens AG; Maria Ferraro, CFO, Siemens Canada.)
Meeting PACHI at our annual town hall meeting! (L-R Saad Rafi, TORONTO 2015; Robert Hardt; Lisa Davis, Managing Board Member, Siemens AG; Maria Ferraro, CFO, Siemens Canada.)

Connecting the dots – from innovation to commercialization

Someone recently asked me, “What do you do in your spare time?” Two passions take up most of my out-of-office hours: sports – especially soccer – and reading about history, technology and business publications.

The latter may sound a bit obsessive, but I enjoy learning about the latest innovations in the business world, especially in advanced manufacturing. Change is inevitable, and necessary, and I want to be sure to chart the changes, and even anticipate them.

In my last blog, I cited a new study by the Brookings Institute and JP Morgan Chase, subtitled “Lessons from Germany”. This paper highlighted some of the best practices that have originated in the highly successful advanced manufacturing sector in Germany, and are now having an impact here in North America.

The overall take-away from this study is clear: partnerships will be the key to success in our industry – partnerships between the private sector, government at all levels, R&D and educational institutions.

The introduction to this study immediately captured my attention, because it suggests that the North American manufacturing sector, often written off by “experts”, can in fact be a solution to economic woes. The authors write, “Business, civic, and political leaders… are rediscovering manufacturing as a source of good jobs and lasting economic growth.”

That will not be a surprise to any of us in the industry. But it’s also not a statement we can take for granted – because industry as we know it today will never be that “source of good jobs and lasting economic growth.” We will only see these positive results if we take up the urgent challenge to innovate, to adapt, to embrace partnerships, to establish ourselves in a global marketplace.

As things stand today, Canadian advanced manufacturing is not ready for the future. Why? My weekend reading has included a study by Deloitte that makes it clear Canadian manufacturing is underinvesting in research and development – which almost guarantees that we are ill-prepared for the rapidly changing environment we are in. The study found that the investment in R&D by Canadian private-sector firms totals one percent of our Gross Domestic Product; that’s less than half of comparable investment levels in the United States. That same study found that more than a third of Canadian businesses believe they are investing more than their peers – but they aren’t. They are investing less.

The countries that are building innovative, forward-looking advanced manufacturing sectors – like Germany, with its emphasis on Industry 4.0 – are not afraid to invest boldly in R&D, and to nurture synergies.

I also recommend a new study by The Boston Consulting Group, “Industry 4.0, the future of productivity and growth in manufacturing industries”, which supports the argument that our future as advanced manufacturers relies on excellence and productivity, powered by ongoing connections between manufacturers, R&D and educational institutions. “Connectivity and interaction among parts, machines and humans will make production systems as much as 30 percent faster and 25 percent more efficient, and elevate mass customization to new levels.”

This study stresses the need for partnerships right across this collaborative spectrum.

Canada needs to connect these dots and create advanced manufacturing hubs, where stakeholders come together to form environments that provide the support needed to turn innovation into commercialization.

I spend many out-of-office hours reading reports and books. But the most important things happen back in my office – where I implement these absolutely crucial principles and practices. At Siemens – and at companies throughout the Canadian advanced manufacturing industry – if we’re willing to do what it takes, we can truly be “a source of lasting economic growth.”