This month, I shall discuss innovation and entrepreneurship.
In a dynamic world, our future health, wellbeing and prosperity depend on our ability to innovate.
Innovation is a key driver for increasing living standards and quality of life. Australian has been a world leader in science, although we often struggle to convert our inventions into innovation.
Engineers play a critical role in innovation and in improving society. This shall become more important as our society transitions to high tech, high value-added activities.
This month I was pleased to meet with engineer and entrepreneur, Matt Barrie, and with Australia’s Chief Scientist Professor Ian Chubb - both of whom are strong advocates for a much stronger focus on innovation and engineering in Australia.
“Inventas vitam juvat
excoluisse per artes”
(inscription on the medals won by Nobel Laureates; taken from Virgil’s Aneid)
“inventions enhance life
which is beautified through art”
(translation)
Creative nation. Creative New South Wales.
Australia has a proud history as leaders in science and innovation.
Australia has the highest per capita achievement of Nobel awards in the world. In all, there are fifteen Australian winners of the Nobel Prize. Our first Nobel Award winners were the father and son team, William and Lawrence Bragg, winning the Nobel Prize of Physics 1915. To name a few others, more recently, there was John Cornforth (Chemistry 1975), Peter Doherty (Physiology or Medicine, 1996), Elizabeth Blackburn (Physiology or Medicine, 2009) and Brian Schmidt (Physics, 2011).
The state of New South Wales is a leader on the world stage. Engineers from New South Wales have a history of achievement and innovation. These include the creators of electronic pacemaker, Wi-Fi technology, the global hit LEGO movie, Google maps, Freelancer, robotic technologies, sleep treatment products, membrane filtration technology, sustainable materials technologies, and solar technologies.
What is “innovation”?
Innovation is more than research and development.
Innovation generally refers to changing or creating more effective processes, products and ideas.
More specifically, innovation encompasses an end-to-end process, which extracts value through its implementation. This might involve creating new activities, products, processes and services, improving existing processes and functions, disseminating new activities or ideas, and adopting things that have been successfully tried elsewhere. Innovation can be diverse; covering minor quality improvements to ‘cutting edge’ products and services. (Engineers Australia, 2012)
Why is innovation important
Innovation is a key driver of productivity and wellbeing. By improving our innovation performance, Australia can increase living standards and quality of life.
Any business can innovate. Being innovative does not mean inventing. For business, innovation can mean changing your business model and adapting to changes in your environment to deliver better products or services. (business.gov.au) Incorporating innovation in your business can help you save time and money, and give you the competitive advantage to grow and adapt your business in the marketplace. Businesses that innovate create more efficient work processes and have better productivity and performance. Compared to businesses that don’t innovate, innovative Australian businesses are 78% more likely to report increases in productivity (DOI, 2014)
Innovation can drive social improvements too. Social entrepreneurship is also essential. The non-profit sector plays an important role in the provision of welfare, social and other services. The latest Australian Bureau of Statistics data from last month reveals that the non-profit sector adds $55billion to the Australian economy and employs over 1 million. (ABS report, July 2014)
Innovation is closely associated with creativity. Cunningham (2006) says creative people are diffused across industries, because there is a need for creativity across the economy and society. ‘Creative’ people can work as Specialists (creative in creative industry), Embedded (creative in other industry) and support (support occupations in creative industry). Using Cunningham’s definitions, the creative industry is our second largest employer, at 5.5% of Australian employment.
You can read more about the comparisons in the resources listed below.
Engineer play a key role in delivering the benefits from innovation.
Looking backwards - Innovation systems and historical progress
I enjoy the work of Niall Fergusson – you might have seen his BBC productions or read his books. He presents a historical view, with an eye to the future.
In “Civilization: The Six Killer Apps of Western Power”, he asks what allowed a small minority of mankind originating on the western edge of Eurasian to dominate the world for the better part of 500 years He concludes the difference was ‘institutional’. There were six ‘killer apps”, identifiably novel complexes of institutions and associated ideas and behaviours – competition, science, property rights, medicine, the consumer society, and the work ethic. This concurs with institutional growth theories – our success longer term shall depend on not only our abundance of resources or the education and cleverness of our people, but also upon our ability to organise and coordinate those resources and people, for a sustainable future. I’d suggest that these ‘apps’ have created a strong environment for engineering, innovation and entrepreneurship to prosper, and to deliver benefits to society both now and for the future.
Looking forwards - Digital Entrepreneurship is changing everything
In a dynamic world, our future health, wellbeing and prosperity depend on our ability to innovate. The world is changing as it becomes more globally interconnected and more mobile and as emerging economies ‘leapfrog’ into new technologies. In Australia, this shall become more important as our society transitions to high tech, high value-added activities.
Last week, engineer, entrepreneur and Sydney Engineering Excellence Award winner Matt Barrie, CEO of Freelancer.com, spoke at the Harricks Address for the launch of Australian Engineering Week in Sydney. Matt is the founder, CEO and Chairman at Freelancer.com. He spoke of the global disruption from new technologies. Matt said all business shall shift to software business. The jobs of today shall change. Entire industries are consolidating as they mature, globalise, and gain benefits from the economies of scale and network effects. Yet, cyber security is the fastest growing area of risk.
As the world changes, engineers shall play an even more critical role in our society.
How does Australia compare?
Australian has been a world leader in science, although we often struggle to convert our inventions into innovation.
A high performing national innovation system is one that delivers productivity gains and social and environmental outcomes, leading to improved living standards. (DIR, 2014)
According to the Global Competitiveness Index, Australia’s overall competitiveness is only moderate compared to other OECD countries (ranked 15 out of 34), and has declined over the past five years. (WEF, 2013)
The OECD “Going for Growth” draft report published this year noted Australia’s growth is slowing. The report identified declining productivity gains (remaining below below those of leading OECD countries) despite relatively high investment in knowledge based capital. (OECD 2014).
These concerns are echoed by others, including Australia’s Chief Scientist. It’s clear that Australia’s level of patenting is poor – patenting levels are often used as a proxy measure of innovativeness. Results at Australian school are declining in the international rankings – education rankings are often used as a proxy measure of future innovation capability. There are low levels of research in industry, and the links between universities and industry need to be improved. We are the only country in the OECD without a science and innovation strategy, we lack the critical infrastructure for research and our entire innovation system needs stronger coordination (Chubb, 2014).
What is next? So, what can we do about this?
As the world changes, we shall be better placed if we involve ourselves to shape the outcomes, rather than let the changes overtake us. To take advantage of these opportunities and so that businesses do not move off shore for talent, we need to be training more engineers and computer scientists in this country, and ensuring they have industrial placement and employment opportunities.
Government
For successful innovation, there is an important role for government and the private sector, and policy settings are important.
Is our government and policy failing us? Professor Jeffrey Sachs is Special Advisor to UN Secretary-General, Ban Ki-moon on the Millennial Development Goals, the globally agreed goals to reduce extreme poverty, disease and hunger by 2015. Sachs argues government has a complementary role to business in a mixed economy. Government must take a long term, active and creative role alongside the private market economy, to enable society to achieve the three main goals of an economy – efficiency, fairness and sustainability (Sachs, 2011). Within a resource-constrained world, sustainability and longer term considerations need to be built into our responses and decisions.
Australia’s Chief Scientist
Speaking this month in Sydney, Australia’s Chief Scientist, Professor Ian Chubb, highlighted the importance of people. Unless we have the people we need, all we can do about the environment is talk about it. Science is ‘a long haul’ and we need a long term approach for science and engineering.
He proposes a national strategy, which he shall be releasing on 2nd September. The strategy is underpinned by four main objectives;
- Competitiveness – science must underpin a differentiated and readily adaptable economy, one that is globally competitive and one that will enable all Australians to benefit from the opportunities that will follow
- Education & training – we prepare a skilled and dynamic science- qualified workforce, and lay the foundations for lifelong science literacy in the community
- Research – Australian science will contribute knowledge to a world that relies on a continuous flow of new ideas and their application
- International engagement – Australian science will position Australia as a respected, important and able partner in a changing world, for both domestic and global benefit (Chubb, 2014)
Government Submissions by Engineers Australia
In June and July 2014, Engineers Australia has provided submissions to the
- Senate Inquiry into Australia’s Innovation System This submission focuses on the role which engineering plays in innovation in Australia, and the need for engineering to be considered under the terms of reference of the inquiry
- Establishment of the Entrepreneurs’ Infrastructure Program
Full details of Engineers Australia government submissions can be found here:
http://www.engineersaustralia.org.au/about-us/government-submissions
Just for fun!
I was pleased to attend in Sydney the recent Entrepreneurs workshop held by Young Engineers Australia Sydney. An annual event, it was pleasing to see that the room was full to the brim with enthusiastic aspirant entrepreneurs.
We are seeking young filmmakers to tell the story of the engineered world. engflick is a short film competition that seeks to increase awareness of the engineering profession and the role that engineering plays in our daily lives. The engflick short film competition aims to generate high quality video content that educates the community about the role of engineers in shaping the modern world. http://engflick.com.au/
Entries are open now. Entries close 5pm 30 Sept, 2014. (AEST)
Are you Australia’s next Entrepreneur? A new TV show on Channel 10 called "New Ventures" is seeking engineers/scientists/inventors to pitch a new idea, product, innovation or invention to a panel of investors www.newventurescasting.com.au
Applications are open now. Applications close 17 Oct 2014.
Engineering for the benefit of community
Innovation capacity is something that is not often ‘visible’, although it underpins what we value as a community. Engineers Australia is constituted by Royal Charter to advance the science and practice of engineering for the benefit of the community. Our vision refers to our role as leaders in shaping a sustainable world. These provide strong foundation for the importance of engineering innovation and entrepreneurship.
“Give me a place to stand, and a lever long enough, and I will move the world. ”
Archimedes - Greek mathematician, philosopher, scientist and engineer
Alexandra Meldrum FIEAust CPEng FIChemE FAICD
President, Engineers Australia, Sydney Division
References and Further reading about Innovation and Entrepreneurship:
- ABS 2014 – Australian Bureau of Statistics (ABS) has produced a study this year of non-profit institutions. The data is based on the 56,894 NPI organisations in Australia registered with the Australian Tax office in June 2013.
- Australian Treasury (2009) ‘Raising the Level of Productivity Growth in the Australian Economy’.
- www.business.gov.au (business.gov.au is an online government resource for the Australian business community)
- Chubb, I. 2014. Speech: 2014 Jack Beale Lecture at UNSW, 13 August 2014.
- Cunningham, S (2006) in “What Price a Creative Economy?”
- DOI, 2014. Department of Industry. Australian Innovation System Report 2014.
- Engineers Australia (2012), Innovation in Engineering Report June 2012
- Engineers Australia Government Submissions: http://www.engineersaustralia.org.au/about-us/government-submissions
- Ferguson, N. 2011 “Civilization: The Six Killer Apps of Western Power”
- Grattan Institute grattan.edu.au
- OECD (2014) Economic policy reforms: Going for Growth, February 2014. Organisation for Economic Cooperation and Development (OECD).
- Sachs, J. 2011 “The Price of Civilization”.
- WEF (2013), The Global Competitiveness Report 2013-14. September 2013, World Economic Forum (WEF) www.weforum.org
This article has been posted by Engineers Australia Sydney Division. For enquiries please email EA Sydney.