How do we transform our “Commodity mindset” into “Let’s Add Value to Everything we do?

Australia generates minerals, meat, wheat and “papers”.

And we process all these commodities adding very little value on the way.

Coal and iron ore, meat, wheat and grains. And even academic papers from our scientists and academics are measured by volume. And rewarded accordingly.

How many papers did you publish this year, and in which journals? Not how much research has been translated into new products and services?

Commodities. How dumb is that?

Even many of the high value students we educate in our universities are shipped offshore. And not employed locally.

All that investment exported elsewhere to support wealth creation outside of the country, not inside. The best engineers, software developers, designers and data scientists…gone. Because there is little for them to do here.

We don’t have the high value industries that need a high value workforce. 

The high value industries that generate high value products and services, high value exports and JOBS.

We could have them. But for that, we have to get smart.

We have to recognise that we can’t continue in the same way we have for the past fifty years. Or we will hollow out the brain, heart and soul of the country. 

We have two problems.

There is no vision beyond next week. Sometimes not even that far into the future.

We fight fires. Literally, as we are at the moment and metaphorically in the approach to everything that we do. No long term planning. No long term vision.

And no consistent support for new industries that can generate new productive products and services. 

We have the ideas. We have the skills. We have the intellectual resources. But we do not have a framework to support the development and nurturing of new productive industries. 

We start the process but then let it go. Often for those embryonic opportunities to then be picked up and transported to California, the UK or Europe.

There is a gap. Because of our commodity mindset. 

Dirt, meat and wheat? How good is Australia?

We don’t fully appreciate or leverage the power of adding value – through design, investment, branding, marketing and advertising.

We could create new industries. And create high value jobs. The components are all there. But the vision and mechanism to connect the bits together is absent.

At a very basic level, we need to connect what is in the academic “papers” (research and innovation) with the businesses and investors that exist here in Australia. We don’t do this well.

Universities are not good at engaging with industry because they are not rewarded for doing so. Publishing papers is rewarded by government, not industry engagement.

CSIRO could be the engine room for this research AND development endeavour, but it is not allowed to be.

The Science and Industry Research Act, defines the purpose of CSIRO.

“To carry out scientific research for any of the following purposes – assisting Australian Industry, furthering the interests of the Australian community, contributing to the achievement of Australian national objectives or the performance of the national and international responsibilities of the Commonwealth, and any other purpose determined by the Minister.

and

To encourage or facilitate the application or use of the results of such research.”

But not “to lead the DEVELOPMENT of new industries based on that research.”

It could, with a bit of help.

And the phrase “and any other purpose determined by the Minister” is potentially very powerful in that regard. So we can always hope. And the budget surplus has to be spent on something...why not spend it on developing new industries that will help deliver surpluses far into the future.

Because, there are some obvious reasons why we need to diversify our economy and expand our export markets. 

Our commodity mindset – selling dirt, meat and wheat (and publishing academic papers) – promotes laziness – “same old, same old”. Adding value requires creativity and effort. And leads to new opportunities.

Having most of our eggs in “the China basket” opens the door to manipulation and interference, which we are noticing in Australia with increasing regularity. 

Spreading risk more widely through the creation of more products and services, and the expansion of markets diminishes that threat. Of course, there is no quick fix for this problem, but the quicker we get moving the sooner we will experience the results.

The ongoing impact of disruptive technologies continues to undermine employment. This problem will grow (47% of jobs under threat) and we have to manage all the challenges from software and automation at the same time that we create new industries, products and services.

Diversification takes time. We have the means. We just need the motivation and the commitment.

Somebody has to take the lead. But we have no obvious innovative industries or Australian corporates to lead the way in this regard. No FAAGs.

But we do have a CSIRO. We just need to unleash the possibility that it represents.

In our top ten companies, we have banks and shops and mining companies. 

In the US top ten companies, there are shops, oil, technology, investment and healthcare.

In the EU there are manufacturers, banks, oil and healthcare companies.

More diversity and more alignment with the way the world is changing.

We just have to turn and face the right direction. Forwards with eyes to the future.

We have the resources we need to succeed. Ministers. CSIRO. Data61. 38 Universities. Innovation “hot spots”. Ideas. Scaleups. Budget surplus.

We just need to bring these resources together with a sharp focus on market diversification, export opportunity and evolving customer need and…

Bingo.