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Kiwi tech innovation - Where to from here?

01 Nov 2011

At the recent Rutherford Innovation Showcase in September, MC Ian Taylor, owner of Dunedin-based ARL, characterised New Zealanders as having a "Number 8 wire mentality”, taken from old, often isolated, farmers who used to make and fix anything and everything out of No. 8 wire. While some say it’s time for the country to move on, Taylor says:"It was never about the wire. It’s about what people do with that wire, and so many New Zealand companies are doing amazing things with their piece of wire.”If the No. 8 wire mentality still works, what perhaps leaves New Zealand lagging is the outdated belief that real innovation happens singularly (i.e. the old farmer in his field/garden shed). Real innovation happens when good ideas are shared, combined and cultivated."Every time great ideas get together, you’re a step closer to innovation,” says John Boon, head of markets for Core Technology, the company behind Aviarc. Innovation is about much more than a big idea: it’s a complex interaction among ideas, inventors, investors, marketers and end-users. Innovation is costly. It takes risk. New Zealand’s current and future innovators face barriers both similar to its global competitors and unique to its own location and environment. But the country also has an immense support base that continues to grow. The Government, and organisations such as KiwiNet, are active in support Research and Development (R&D), with the goal of innovative Kiwi companies pursuing global success."Most SMEs do not value R&D or have it as part of their mind-set, due to their size and lack of resources,” says Duncan Mackintosh, CEO of WaikatoLink, a founding member of KiwiNet. "Companies that include R&D as a core part of their strategy are very committed, and have the people and capital to drive it. The value of R&D can only be fully realised when there is a focused and sustained effort. Incentivising companies to undertake R&D is a positive move.” Collaboration is keyResearch, however, should not be undertaken for research’s sake. Much as the innovator cannot act alone, research works best when it builds on solutions already in existence, of which New Zealand has many. Collaboration is likely to be a key factor in the future success of Kiwi innovation. While the country has a less developed capital industry than many of its competitors across the globe, New Zealand companies receive significant support through the Government’s Ministry for Science and Innovation (MSI) and New Zealand Trade & Enterprise, for instance. The MSI has committed millions over the next three to four years to support New Zealand companies taking innovative ideas and products onto the world stage (see sidebar). However, points out Dougal Watt, chief technologist for IBM New Zealand, "the laggard in New Zealand is business. We are not spending as much here as our overseas counterparts. Corporations should not expect government to continue to exclusively fund R&D.”R&D remains an integral part of innovation, "as ideas need to be transformed into something with real world value”, Watt explains. Today, the problems of the world are complicated and inter-related; those connections must be understood in order to turn R&D into something tangible. The country is so often distant from its markets, that market-driven R&D can be a difficult hurdle. "New Zealand is globally competitive with its technology R&D and innovation, but the challenge is scale. We’re good at what we do, but we need to do more to really lift businesses in New Zealand and increase our international competitiveness,” offers WaikatoLink’s Mackintosh. "To get innovations to market, we need companies and investors willing to take early innovations or products to the next stage. We often want to see all the risk removed.” Other challenges including maintaining and improving New Zealand’s standard of education, countering the "brain drain”, geographic isolation and inconvenient time zones, says Samuel Williams, vice president global business development for Zeacom.Sustainable innovationSustainability arguably plays a major role in the future of innovation in New Zealand. As resources grow more and more scarce, innovation becomes about finding better ways to support social and ecological systems.Earlier this year, the Government announced an Advisory Group on Green Growth, which is directly related to the issue of sustainability and innovation. The group will advise on three topics and report back to the Government by the end of this year:

  1. How New Zealand can grow its economy through leveraging its clean, green brand.
  2. How New Zealand can add value to its export industry through smarter uses of technology and innovation.
  3. How small and medium-sized businesses can sustain productivity while also reducing their carbon footprint.
"The New Zealand R&D landscape is relatively low cost, efficient and fast,” says WaikatoLink’s Mackintosh. As a nation of experienced problem solvers, New Zealand R&D and innovation is characterised by small startups, with a lot of focus in the agriculture, agri-tech and ICT space."When you see the work done by Kiwis in combining the creative and technical fields, you realise that it’s not just the incremental, linear innovation that goes on everywhere in the world, but that here it’s innovations that frequently cross boundaries and combine otherwise unrelated fields to create something staggeringly new and disruptive,” says Core Technology’s Boon. "Real, radical innovation will perhaps be the last bastion of new business creation to keep us as a developed economy, rather than an ‘undeveloping’ economy.”Active, ongoing R&D and innovation will be New Zealand’s ticket to keeping up with a rapidly changing world. The smaller scale and outside viewpoint characterised by New Zealand can be looked upon as bonuses, because they allow a unique approach to situations and challenges faced by people and organisations the world over. Getting to global markets quickly is key, something organisations like KiwiNet, the MSI, KEA Network and Investment New Zealand actively support and encourage.