Moving With the Times

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-By John Boley

Now in its 125th year, Varley Group has changed a lot. It all started with George Henry Varley offering ship repair and conversion services in the late nineteenth century at a time when sail was being transformed to steam. With expansion of international trade, not least to the UK, and two major wars, there was always plenty of work around the NSW coastline to keep the company busy, while the mid-1970s first oil crisis provided a further opportunity for conversion work. Ships were converted to search for new oil reserves and exploration.

Then the shipping horizons changed, with the end of state control of the dockyards, the emergence of other, often cheaper shipyards elsewhere in Asia and the general opening up of Australia to competition. This transition hit companies like Varley hard.

It took the company around a decade to find its place in this new world. By the early- to mid-90s, explains current managing director Jeff Elliott, the focus had become more land-based and more vehicle-oriented. The company offered specialised vehicles for fire and ambulance services, for example, and defence applications, which are “highly customised applications. Even if you build a fire truck for New South Wales, Queensland and Victoria will want something different, you can’t just market a set product here.” This affords Varley a measure of protection against imported ranges, although competition in defence vehicles is definitely offshore. Gone are the days, Jeff reflects, when armed forces procurement was locally biased. “Before, they used to have a clearly defined measure – you needed a set percentage of Australian content. Nowadays you don’t. There is no obligation any more.”

Similar arrangements in other countries limit Varley’s export potential, although Jeff says the company’s involvement with the Joint Strike Fighter project (a programme bringing together the UK, US, Canada and other allies to develop the F-35 Lightning II, which will replace various tactical aircraft, including the US F-16, A-10, F/A-18, AV-8B and British Harrier GR7 & GR9s, and the Canadian CF-18. A vast number of companies throughout the countries involved are working on the project under lead developer Lockheed Martin) means it is part of a global supply chain. Defence and aerospace is a growth market as “we are getting more and more tied up in global supply chains. We are now dealing with the major primes, not just here but overseas.”

Jeff mentions some of the bluest-chip names in the defence business. “We are starting to supply direct into the US, into programmes they are building over there.” Domestically, in the immediate short-term there may be a bit of a cutback, “but Australia’s longer-term position on defence looks positive.” Varley benefits from the rigour of project management in this demanding sphere and the lessons learned – such as reporting, QA systems, etc – all cascade down to other, perhaps less ‘glamorous’ sectors of its business. In the last three years, says Jeff, the company has also become serious about ‘leaning’ its business; “it’s something that has made us much more competitive than we were before.”

The electric vehicle market is fairly new and growing, as far as Varley is concerned. “It’s taken us a while to learn and understand the technology,” says Jeff, “and we have recently finalised what our product range will be. Production is under way and we are establishing our distribution network for Australia and New Zealand. When we have all those in place, then we will start looking towards Asia and set up a dealer network there. I think it has good potential.”

Australia is conservative in its uptake on new ideas, Jeff believes, but “we are playing around with a few new things on our electric vehicles. We entered the market with what we think is a fairly basic bread-and-butter product, an industrial workhorse, a tug. If you travel to Europe or the US and keep your eyes open, you’ll see IEVs everywhere, but here in Australia the uptake is a little slow and you find that if people have not had one before, there is a long decision time before they make their mind up.

“But those who have had an electric vehicle before, they make their minds up very quickly. I think there is a lot of upside left in the Australian market; when people start to use them more, there will be more exposure and the market will grow more when the benefits come out.

“We have moved to next-generation technology, which puts us ahead of where our competitors are in many respects. We are now using full AC motors, electric voltage control, full regenerative braking,” not to to be compared to the high-maintenance, unreliable DC-based models lacking regen that were previously available in the electric-vehicle market. “The technology we are using is virtually maintenance-free, especially if you use the sealed battery packs, and we can programme the way the vehicle will behave to suit your terrain or usage.

“We have a significant government grant to develop a rapid-charge urban electric bus – if we make that happen it will have significant impact on the business. One of the limitations on electric vehicles you can’t really overcome yet is range.” That’s due to battery technology and energy storage. Currently the problem is that after, say, 180 or 190 km you have to plug it in and wait for up to eight hours before it’s ready to go, which is presently the limiting factor. “We’re looking to see if we can find a rapid recharge where it can be done in approximately the same timeframe as it would take to sit at the bowser and fill up diesel tanks – around the ten-minute mark for a complete recharge. This is under development now. We will definitely be carrying out physical testing of a bus in January out in the streets of Brisbane.”

Commercial realisation is also imminent for a new range of biomass generators that Varley is co-operating on. Again, says Jeff, the technology of creating energy from biowaste is not only attractive and pragmatic but more readily accepted in Europe than in conservative Australia. He believes these will catch on quite quickly though, because many companies, especially in remote areas, are used to having their own power generation and this represents simply switching to a different fuel source with a very clear range of benefits.

Approaching that 125th birthday, Varley is still, says Jeff, composed of engineers rather than marketing people. “Our best method of advertising is to try to get our customers to come and visit us, so we walk them down on the shop floor and show them what we do. We find that’s the thing that best puts an impression in our customers’ minds.”

Making Sense of Management

Management is the art, or science, of getting things done through people. Sounds fairly straightforward – except for the fact that people are not robots waiting to do our bidding. People have their own minds, motivations, and goals. So how do managers keep operations – and the people behind them – running as planned?

December 19, 2018, 5:31 PM AEDT