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Check the OECD or any other index and it will tell you Australia is lagging behind its global peers in innovation – a depressing state of affairs considering the efforts being made to brand ourselves as an ‘innovation nation’.
But self-flagellating methods of narration aren’t exactly helpful when it comes to spurring national productivity – nor do they expose what’s actually happening beneath the surface.
“It’s like standing on a set of scales and labelling yourself as ‘overweight’, when in actual fact you have a heavy muscle build. It entirely misses the point,” says Deloitte’s Innovation Strategy Lead, Andy Bateman.
Bateman, has spent the last 25 years helping brands, businesses and teams around the world drive growth through innovation.
He believes that Australia doesn’t have an innovation problem, more a commercialisation problem. “If anything we have too many ideas. The issue is our ability to bring them to market – and quickly,” he says.
But what about the countless acceleration and incubation programs? The potent investor appetite and Federal Budget support?
“No,” says Bateman. He doesn’t believe access to capital, R&D incentives or mentorship is the simple answer either.
It’s all in the method
Blame is an easy trap to fall into. You have an idea for an innovative product. It’s a product – so naturally you should want to apply a standard product development methodology.
First, you’ll want to conduct extensive research and establish a market; next have someone champion it internally; and then carefully construct a business case.
The trouble is by pushing it through such a laborious process – waiting for investment sign off – you just have to hope that the idea you had in say February hasn’t already been launched by some startup in Europe. And that the R&D-intensive approach might pay off.
Bateman believes this method of innovating is cumbersome, superfluous and counterproductive.
“The problem with this stage-gate approach, is that it’s all premised on the idea that we launch our new offering and that we launch it at scale. But as 35 years of innovation discipline in our Doblin headquarters have taught us, commercialising innovation doesn’t work like that. Innovation warrants an entirely different methodology. An entirely different approach. It warrants an innovation culture.”
Moving from R&D (Research & Development) to ‘Research and Do’
The waterfall vs. agile debate has been under academic scrutiny for years, and it’s stimulated cascades of literature in the process.
But when it comes to innovation, Bateman’s experience shows that an ‘agile’ business model is the closest way to create an ‘innovation culture’ – and it’s by far the most effective way to bring ideas to action. And ultimately, income.
He refers to the world’s poster boys and girls of innovation – the likes of Facebook that launches up to 250 mini innovations each day; and Ali Baba, up to 1200.
“Most of them don’t work, but some of them, like Facebook Messenger do. It’s all about agility and speed; killing off the bad ideas quickly,” says Bateman.
The method works with tangible products too.
“McDonald’s Charlie Day had an idea one day that his chain should try serving coffee at breakfast. His approach: ‘Try it in a couple of stores and see how we go.’ Nike’s Chief Executive anointed five people and said: ‘Go and invent me the next shoe.’ They came back with Nike Air.”
“Rather than evaluating and business-casing in siloed departments, they just go and try stuff. They don’t need to invest any money in the process.”
Broadening the definitions of innovation
At last year’s AFR Innovation Summit 2017, Australia’s Chief Scientist, Alan Finkel, spoke about the concept of ‘hidden innovation’, using the ubiquitous avocado as an example.
He said, “A decade ago, an avocado was only used for salad and guacamole. To develop the industry, we had to reimagine the fruit as an all-round indispensable daily staple.
“Farmers reengineered the production chain to raise the quality, ensure supply and lower the price. At the same time, cafés built the Aussie brunch into a global brand, with the avocado as the undisputed star – on toast, in smoothies, and in baking.”
“In just a decade, the retail value of the Australian avocado industry almost trebled, shifting from $340 million to $920 million p.a.”
Looking around the corner
Deloitte’s 10 Types of Innovation publication, provides further definitions and examples of innovation – with applications extending from new business models through to supply chain and logistics.
“The ‘R & Do’ approach isn’t exclusive to product development,” says Bateman. “We’ve got to get out of the mindset that innovation equals products and services. And we’ve got to change our approach to making our ideas a reality.”
Andy Bateman will join a panel at this year’s AFR Innovation Summit -30-31 July 2018, Sydney – alongside senior representatives from Finistere Ventures, HealthKit, Commtract, Sydney Angels and Telix Pharmaceuticals.
Minister for Jobs & Innovation Senator the Hon Michaela Cash, ISA Chair Bill Ferris and Shadow Minister for Employment Services, Workforce Participation & Future of Work Ed Husic are among the 50+ high profile speakers already confirmed to attend.