INTOUCH : How to boost innovation

While New Zealand’s innovation “ecosystem” already contributes to our export performance and wealth – it could do lot better.
That’s the gist of recent report from The New Zealand Institute which notes that this country’s R&D spending per capita is well below average for the OECD. It also highlights the benefits of healthy innovation sector by summarising outcomes from the Technology Investment Network’s TIN100.
This estimates that our top 100 technology companies produced overall revenues of $6.6 billion in 2008/2009 with $5.1 billion exported. These companies contributed over 23,000 jobs to the economy with an average revenue per job of $280,000. And they’re growing.
But despite an increase in effort over the past decade, New Zealand’s innovation scorecard rates below that of other small countries headed down the same innovation track. The report identifies four major obstacles to address if we’re to improve on what has already been put in place.
• While the larger, more established commercialisation units work well, smaller ones lack critical mass and there is insufficient encouragement to create businesses.
• There’s lack of leadership talent with international experience to drive global businesses.
• Failure to listen to “voice-of-market” – ie, innovation is undertaken without necessary research into prospective markets..
• Lack of domestic expansion capital. Businesses are often sold because later-stage capital is not available in New Zealand. The report suggests policy adjustments are needed to encourage investment in productive assets.
Get those four things sorted and New Zealand’s innovation ecosystem will then be able to “contribute more to higher productivity, stronger current account and economic prosperity”, the report concludes.