Synergies with the Defence and Resources Sectors: Prospects for Collaboration

Home grown WA firms with expertise, an innovation culture, and agility, can supply Defence as well as the resources industry, a gathering in Perth heard in October. The event was staged jointly by WA DEFENCE REVIEW and the American Chamber of Commerce and featured three local firms and two local educationalists on the subject of synergies between the defence and resources industries.

Epitomising the “can do” attitude of many SME’s in WA’s resource-rich State, Erich Hofmann, Managing Director of Hofmann Engineering, showed just how flexible his company was in meeting the needs of both sectors.

“Basically, we change the shape of metal and add 10% for profit” Mr Hofmann quipped, going on to illustrate with a diverse range of sometimes massive customised products ranging through steering boxes, pump parts, turbine surrounds, valves, gears, heat treatment, capstans, windlasses and railway bogies.  Hofmann is the largest gear manufacturer in Australia and believes it is exporting the largest gear made in the country to China.

Commencing as a backyard family concern in 1969, today Hofmann boasts facilities in Perth, Bendigo, and Newcastle, as well as overseas in Canada, Chile, China, India and Peru, working 24/7 to manufacture components that cannot be purchased off the shelf; to them the end client for the product is not an issue.  The company manufactures for aerospace, cement, gearing, manufacturing, mining, and rail sectors and lays claim to exporting the largest gear made in the country to China.

Hofmann explained that he had added Defence to his list of clients after a conversation with a senior Defence official who challenged him to produce for him as if on a wartime footing.  Hofmanns’ rose to the challenge and turned around major pieces of kit in five days.  “Some aspects of a submarine are identical to a haulpack truck”, he noted.

Speaking for Watmarine, a much smaller firm founded by family in 1989, Simon Watson also demonstrated his firm’s agility. Now employing 35 people, Watmarine has concentrated on meeting quality and skills certifications required to be competitive across sectors and maintains a section of its Fremantle workshop specifically for research and development.

A different assessment came from John Meldrum, Engineering Manager of BAE Systems Australia.  He pointed out that for a large prime contractor there is a significant shift between defence and resources industries. Some of the hurdles experienced by BAE have included vast differences in project gestation times from concept to contract, traceability requirements, documentation, and risk profiles. Defence projects often come with facilities and technology provided by Defence, which is not the case with the resources industry.  However, on the positive side there are operational synergies such as project management skills, materials management, safety procedures and a culture of working to standards.

Few WA businesses come close to the magnitude of a defence prime contractor and for them Erich Hofmann’s advice is to allow for the long-term nature of getting into defence work. “It takes years, so maintain your cash flow, keep your resources work going, don’t put your eggs in one basket, engage with the primes, and get your quality systems done.”

A WA training college that has been servicing both sectors, and many others, for decades is South Metro TAFE.  One of its projects is a partnership with ASC to supply training services at the Submarine School at HMAS Stirling.  Darshi Ganeson-Oats, Director Strategic Partnerships, said that the College works with 4,500 employers to train to industry requirements. An outstanding example is the Australian Centre for Energy and Petroleum Training (ACEPT), where a number of oil and gas employers cooperate with the training provider to meet their skills needs.  Darshi suggested that this model could also be applied to a cadre of employers in the defence sector.

Erika Techera of the Oceans Institute, University of WA, also spoke, focusing on big data and how this applies across resource and defence sectors.  She noted the need to obtain social licence for industry’s use of the oceans – referring to past conflicts with groups such as Greenpeace – and she advocated for better engagement with stakeholders.

The two hour breakfast meeting at the Parmelia Hilton provided a stimulating way to start their business day, being well moderated by Colleen Yates, CEO Regional Development Australia-Perth.

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