We’re lagging in innovation

 We’re lagging in innovation

Vince Chadwick

January 19, 2012

Cutting edge … countries with the best reputation for innovation.

WHEN it comes to innovation, Australia seems to have an image problem.

That’s the assessment from studies released by Thomas Edison’s old company, General Electric.

The GE Global Innovation Barometer ranked Australia’s status as an innovation leader 16th out of 30 countries. Only 2 per cent of 2800 senior executives surveyed worldwide mentioned Australia as an innovation champion.

However, 18 per cent of Australian business leaders nominated their own country.

”There’s a disconnect between local reality and international perceptions,” said GE’s Australian vice-president for strategy and growth, Michael Ackland.

He cited the 86 per cent of local executives who agreed that innovation was the main lever for a more competitive economy, though 92 per cent did so globally.

Another study commissioned by GE from the Milken Institute, an independent researcher, found Australia led the world in five of seven innovation indicators such as university-industry collaboration and research and development spending.

According to the Innovation Barometer, however, only 28 per cent of Australian executives said research and development corresponded to their personal definition of innovation. Globally the figure was 41 per cent.

Before 2008 the Milken study found business was the main driver of research spending in Australia.

”With our spending at 2.2 per cent of GDP, Australia still comes in below the OECD average, but it is rapidly closing the gap,” the study said.

Thirty-one per cent of Australian executives felt the innovation environment had worsened in the past five years, while 66 per cent said government support for innovation was not efficiently organised.

This was despite the federal government’s 2009 white paper Powering Ideas: An Innovation Agenda for the 21st Century.

The dean of UTS Business School, Professor Roy Green, said the government’s research and development rebate was having some effect, but he said the commodity boom was breeding complacency.

”I’m not surprised if the perception is we are well down the ladder,” he said. ”Behind the massive returns from our terms of trade, we are witnessing the structural deterioration of our economy.”

Professor Green said that Australia’s ”high-cost, high-dollar environment” underscored the importance of emulating countries such as Sweden, which produced high-quality products.

”If we’re going to compete on cost, then we’re finished,” he said. ”We must move up the value chain and plug into global supply and global markets.”

The US took out top spot in the Global Innovation Barometer ranking, with 65 per cent

Read more: http://www.theage.com.au/small-business/entrepreneur/were-lagging-in-innovation-20120119-1q7bn.html#ixzz1nAUzD3gI

 

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Catalyst Project

catalyst project

Yesterday, Prime Minister Kevin Rudd was in Tasmania, where he announced 31 projects which would receive a share of the $100 million that has been set aside for economic diversification in Tasmania.  The 31 projects were selected from a pool of over 400 projects from around the state.

One of the projects which received a funding announcement was the Macquarie House Innovation Hub, which has received a commitment of $3 million, which will be used to renovate and fit out the Macquarie House site.

http://catalyst-project.com.au/

Australian manufacturing is not dead

Here are 3 case studies how some Australian manufacturers are coping with the high Australian dollar and high labour costs on Australia.

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Diversification the key to survival for Australian manufacturers

Is there a place for old-style manufacturing in Australia’s future? Spring-making may seem like old fashioned manufacturing, but like many of the businesses we’ve heard from this week, to survive and be a success the Jubilee Spring company at Ourimbah on the New South Wales Central Coast has had to adapt and innovate. Managing director John Guest’s advice is: diversify. MORE

08:24:00 21/06/2013

Weir Minerals relocates to exploit mining boom

Times are tough for Australian manufacturing even though the Australian dollar has fallen from its recent highs. But while some companies are struggling to survive by going off-shore, a big US company is reversing the trend. Weir Minerals has moved its divisional headquarters to Australia to be closer to the production phase of the mining boom. MORE

08:26:00 21/06/2013

Manufacturing workforce shrinking

The Prime Minister’s taskforce into manufacturing found that 100,000 jobs have been lost since 2008. Those companies that aren’t struggling or have gone under are operating well below capacity. It concludes that Australia is looking down the barrel of imminent danger of large job losses and a loss of capabilities as the workforce shrinks. Shane Infanti is the CEO of the Australian Manufacturing Technology Institute. He’s not sure if Australia is over the worst of it and he says there needs to be more industry-led research. MORE

ABC – AM 21/6/2013

Questions

  1. What are the problems faced by Australian manufacturers.  Make sure you give examples in your answer.
  2. What strategies are being used by successful businesses in these difficult economic conditions?