A visit to the Clayton headquarters of Bosch Australia provides a readymade metaphor for the company’s renaissance in recent years.
A 1950s office building, now partially demolished, comes into view first, but is quickly eclipsed by their new, state-of-the-art office complex: a 40-million-dollar affirmation of Bosch’s commitment—to customers and employees alike—that it plans to be part of this country’s future.
It’s a far cry from the dark days of 2011. That was the year Bosch began moving its locally manufactured automotive products to facilities in other countries. By 2013, only the diode production line and one low volume assembly line remained.
“Bosch makes long-term strategic decisions very well”, explains Michael Hagan, General Manager for Human Resources, Bosch Oceania. “Our automotive production lines in Australia were relocated overseas before Ford, General Motors or Toyota announced their intention to cease local manufacturing.”
Such foresight comes with a downside: the announcement took everyone by surprise.
“It shook the organisation to its core”, Hagan says, “but Bosch is a values-driven company; we look after our people.”
Finding the positives
Refusing simply to ‘wield the axe’ until an appropriate staff reduction had been achieved, Bosch Australia treated the situation as an opportunity—a chance to look at the talent base it had nurtured, and consider its potential to realise hitherto unexplored commercial opportunities.
“It’s not something every business could do”, Hagan admits, “Bosch is a private company—92% is owned by a charitable foundation—and we have operations all over the globe. This allowed Australian management more time to explore options, and assign staff to other parts of the business or interim postings overseas.”
Not every job could be saved, however. Over a three-year period, nearly one third of the workforce left or was made redundant. But while smaller in number, those who remained became more unified, as the expected loss of morale was mitigated by staff redeployment to other Bosch business divisions, the creation of internal ‘startups’ and opportunities with the global Bosch businesses.
Hagan describes the business as being ‘revolutionised’ by the experience: “We had people working in power tools, thermal technology, and so on, but traditional automotive was always the hero. The company today is still diverse, but we are equal partners across the businesses we operate.”
Redefining the customer
Recognising the value and marketability of what had been predominantly internal services and product lines has been fundamental to Bosch’s resurgence.
Once dedicated to supplying diodes within the Bosch group, but now free to sell to external customers, Bosch Australia has made enormous inroads into China and other Asian markets. Competing on quality and cost, they have 20% market share worldwide with plans to double and invest in a further two production lines.
The company has also commercialised the technical expertise of its in-house manufacturing engineers. Operating as ‘Bosch Australia Manufacturing Solutions, this new and rapidly growing business develops automated processing, packaging and special purpose machines for a variety of industry segments.
Moving with the times
It’s not only Bosch Australia that has undergone a process of renewal, Bosch globally continues to evolve. The traditional automotive business is now a mobility solutions business focused on connected, automated and electrified vehicles.
As Hagan explains, “Bosch remains one of the largest suppliers of automotive components, but it’s also thinking about what mobility will look like in the future, and how mobility offerings will interact.”
Bosch is a huge investor in research and development, registering 22 patents every day on average, in the ongoing acquisition of emergent technologies.
Specific examples—at least those Hagan can reveal—include highly automated driving vehicles such as the vehicle showcased by Bosch at the Intelligent Transport Systems (ITS) World Congress in Melbourne last October and vehicle safety systems such as road sensing braking and stability systems for trailers and caravans. Next generation projects being delivered locally by existing personnel.
Perhaps even more exciting for Bosch is the ‘Internet of Things’: a means of interconnecting physical objects via a combination of sensors, software and services.
Case in point, Bosch has invested in and partnered with agriculture technology company The Yield and is supporting their Tasmanian oyster pilot program. The project, in conjunction with the industry regulator is utilising sensors to monitor water salinity, temperature and tide at oyster farms. The data produced is used by farmers to ensure oysters are harvested at precisely the right time. The initiative has the potential to reduce unnecessary farm closures by 30%. And, the oyster project is only the start—The Yield aims to bring a variety of solutions to the agriculture industry through sensor technology and data analytics.
“Only half of all crops grown make it to the table”, Hagan says, “imagine if the internet of things could improve yields in all forms of agriculture—not just in Australia, but globally. The potential is enormous.”
Statements made by the interviewee have been reproduced with the interviewee’s continuing consent.