Although Australia is a developed country with 23.13 million population, 67,458.36 USD GDP per capita and 2,079,666 businesses operating, there is a notable lag of Innovation which is highlighted in the Australian Innovation System Report of 2014.
The report suggests that Australia’s innovation performance is straggling, possibly leaving us less resilient to future global shocks as Australia’s innovation system is a mid-range performer among Organization for Economic Co-operation and Development (OECD) countries.
Innovation is a major tool for generating and capturing value for a business and its customers, which translates into increased productivity and profitability. Still Australia was ranked 24th out of 31 OECD countries in 2008–10 for SMEs and 29th for collaboration on innovation by large firms.
A recent survey found that almost half (44.8%) of businesses surveyed had no specific person or group responsible for innovation within their organization and recorded no expenditure on innovation in 2012–13.
Another issue advancing the innovation concern is, the paramount innovation that occurs in Australian firms of all sizes is the adoption and alteration of innovations developed elsewhere, rather than delivering new-to-market (including new-to-world) innovations.
According to the report, there were only 5.7% of Australian businesses which introduced new-to-market innovation in 2012–13.
The probable reason for Australia’s moderate to low performance on innovation, particularly new-to-market innovation, is a poor business innovation culture; in association with an average to poor management performance and more precisely Australia has poor networking and collaboration.
The report very broadly underlined that Australia has one of the weakest levels of networking, collaborative innovation and business capacity to absorb and exploit external knowledge among OECD countries.
Compared to other OECD countries, Australia has low levels of trade, low participation in global value chains, low international collaboration on innovation, low proportions of researchers in business, and low collaboration on innovation between the research and industry sectors.
Owing to reasons such as globalization and outsourcing, there is an increased thrust for improved efficiency and effectiveness. Organizations need more than good products to survive; they require innovative processes and management that can bring down costs and improve productivity.
Not just for businesses, Innovation is also vital for upgrading the society around the world. New and innovative products can increase the standard of living and bestow people with opportunities to improve their lives. Inventions in medicine and technology are the epitomes of it which have significantly improved living standards around the world. Innovation has also lead to apparent improvements in the way businesses operate and has eliminated the gaps between different markets.
Moreover, demographic and resource pressures, environmental change, technological innovation, increase in information and knowledge, new threats of terrorism and violence, and global economic integration frame new challenges for public policy in the 21st century. These public sector challenges demand new approaches and new and often more collaborative ways of working.
Australia possesses incredible talent, yet, according to the Global Innovation Index (GII) 2013, we fall towards the bottom of the Leaders’ group with an overall GII ranking of 19 (behind countries like NZ, Hong Kong, the UK and Finland, among others).
Thus, we all need to help in retaining the talent that we do have, but that can’t happen unless there is an environment that supports innovation and fosters a start-up culture.