Skip to main navigation Skip to content Skip to footer links
 

2.5 The significance of 'hidden' ICT production

The term ‘hidden’ ICT production is a reference to a situation where a company elects to design and develop its own ICT. The interviews indicated that the reasons for this include where the required components, applications and services are either not available, unsuitable, or too costly to source from other businesses. From the companies interviewed in the study, examples of ‘hidden’ ICT include:

  • Hardware – where companies develop their own integrated circuits and control devices for use in their own and related production processes and products (for example, Robert Bosch).
  • Software – where software applications are integral to business and product functionality, and companies develop their own software to operate hardware devices (for example, Orica Mining Services, Vision BioSystems, Bluescope Steel).
  • Services – a range of professional services firms and research organisations develop ICT applications that become part of their product and service delivery strategies. The software becomes a ‘product’ that is intended to support professional advice and consultancy – and may be marketed separately (for example, Proteome Systems).

Two examples from interviewed companies illustrate these points.

 Vision BioSystems

Vision BioSystems (VBS) is a medical equipment manufacturer that relies heavily upon ICT. Indeed, standard Dell computers are built into some products. Almost all of the software that is core to the company’s product performance is developed in-house (either within VBS itself or within the larger group of companies to which VBS belongs).

Eight software engineers are employed in Melbourne (out of 120 staff in that city and 220 staff world-wide). The capacity to develop software in-house acts as a catalyst for leveraging the capabilities provided by brought-in systems and sub-assemblies.

As an innovative, high technology company, Vision BioSystems provides an example of the way ICT production is ‘hidden’ in the process of manufacturing medical devices and in the functioning of the devices themselves.

The production, manufacture and use of ‘hidden’ ICT also has had the effect of making traditional ‘old economy’ companies, such as mining equipment and services companies, appear as ‘high tech’. Orica Mining Services provides a good example of this transformation.

Orica Mining Services

Orica Mining Services manufactures commercial explosives and detonators for use in the mining, quarrying and construction industries. ICT is used to innovate in several key aspects of blasting technology and to control production plants for explosives.

Innovations in blasting technology involve the development and use of software to mathematically model geological structures and explosions in order to optimise blast designs. Detonators now incorporate microprocessors, allowing the more precise timing and sequencing of blasts that is necessary to optimise and predict the explosion process.

Blast optimisation and safety are also enhanced by using mobile manufacturing units (MMUs) with custom designed, computer-based process control systems to manufacture and deliver bespoke explosives compounds on-site.

In combination, these aspects of ICT-dependent blasting technology deliver greater cost-effectiveness and lower risk in blasting operations.

In-house developed software is used whenever existing systems cannot deliver the required functionality. The development of these proprietary software systems has been assisted by collaboration with publicly funded research organisations in Australia.

In these examples, ICT is an integral part of the manufacturing transformation process and provides the basis of product functionality and service delivery. That ICT has been largely developed in-house. Yet, companies are, respectively, in the business of manufacture and sale of medical devices, and manufacture and delivery of services relating to explosives.

Feedback from the companies covered in the study indicates that engineers, rather than ICT professionals, are frequently involved in writing and enhancing programs for use in devices and equipment and in industrial design and production control systems. In an overall sense, therefore, the extent of this ‘hidden’ ICT in manufacturing is difficult to gauge.

 

 

Back to 2.4 ICT utilisation | Table of Contents | Forward to 2.6 The knowledge base of ICT investments

  • Document ID: 29063 |
  • Last modified: 5 February 2008, 10:29am