How to reverse Australia's declining R&D spending?

Circuitwise CEO Serena Ross recently participated in a webinar organised by auManufacturing on “Towards 3% R&D”. The event was facilitated by auManufacturing's editor Peter Roberts. Panellists included Jefferson Harcourt - Executive Chairman of Grey Innovation Group, Nicola Purser – Research & Development National Leader, BDO, and Dr John Howard - Executive Director, Acton Institute for Policy Research and Innovation and Visiting Professor, UTS Institute for Public Policy and Governance.

Webinar participants clockwise from top left included Peter Roberts, Jefferson Harcourt, Serena Ross, Nicola Purser, Dr John Howard, and host Ryan Pollet from BDO

The event's key theme was a discussion on the decline in Australia's investment in research and development (R&D), which has declined significantly from 2.24% of GDP in 2008 to 1.68% today. Reasons for the decline ranged from macro-economic trends toward globalisation and Australia becoming a service economy, failure to bridge the historical industry-academia divide, through to shortcomings of government support systems, including the R&D tax incentive and inconsistency in innovation policy.

Panellists suggested Australia need to learn from successful initiatives launched by other countries and cited examples such as the US SBIR program which facilitates government procurement from small businesses, and Germany’s Fraunhofer Model where a government-funded institution partners with industry to commercialize research.

Companies like Tesla and SpaceX, which took decades to reach their current success, were cited as successes of long-term thinking in both government policy and private investment, and said the traditional short-term focus on immediate returns stifles innovation in Australia.

Serena’s main contribution was to call for a greater emphasis on internal R&D that focused on continual improvement to avoid reliance on risky deep-tech style innovation or the need to follow the strict R&D tax incentive guidelines. She cited Circuitwise’s inventory management system as a key example of its approach to “small, incremental” innovation and emphasised the need for an organisational culture that encouraged team members to suggest and drive their own automation initiatives.

You can read more about the Circuitwise approach in an earlier auManufacturing article and you can view the webinar, also via the auManufacturing website.