Medtech resonates with report
A large number of small businesses are born from local research in the medtech sector*
October 30th saw the release of a significant report from the Office of the Chief Scientist, Boosting High-Impact Entrepreneurship in Australia, charged with the objective of addressing the role of our universities.
The essential message of the report is a simple one. Australia needs research to result in high-growth businesses with global scope and a focus on technology-driven solutions, disrupting large markets. The missing link is the entrepreneur.
So what is an entrepreneur and where do they come from?
How we choose to define an initiative and measure performance determines whether you perceive an initiative to be a success or not. The report says if you view entrepreneurship as the act of starting a new business of any kind, then Australia has performed quite well.
It is a commonly held truth that small business drives the economy. Again, how we measure performance is critical. It is true most Australians work in the SME sector and the sector creates employment.
This is very true for the Australian medtech sector where a large number of small businesses are born from local research and provide employment.
The report, however, presents a higher-level, broader economic perspective gleaned mostly from studying successful entrepreneurial nations including USA, UK, Israel, Singapore and South Korea.
The report claims “the entrepreneurs who create the greatest economic impact are those who build high-growth businesses with global ambitions and the ability to disrupt large markets using technology”.
Given this definition of high-impact entrepreneurship, Australia does not perform well and particularly in the medtech sector. It would be fair to say ResMed and Cochlear have gone down that path but there is a huge gap behind them.
So what does a high-impact entrepreneur look like and what do they do?
The report states that “high-impact entrepreneurs are those who start and grow businesses that are innovation-based, tackle large opportunities, and if successful, grow rapidly to create large numbers of jobs and deliver significant economic impact.”
The World Economic Forum puts forward criteria to define high-impact entrepreneurs in relation to what they do: they innovate usually with new-to-world products and services; they create jobs and in large numbers; they create wealth for both people involved in the business and more broadly for the economy; and they have societal impact solving significant problems.
The report does, however, offer solutions to Australia’s problem.
Firstly, stating both STEM and entrepreneurial skills are required, with Australia enjoying a “strong STEM base” but suffering from a significant lack of high-impact entrepreneurs. Secondly, the solution offered is in keeping with the situation in many of the entrepreneurially successful nations – develop STEM graduates into high-impact entrepreneurs.
This picture is very representative of the Australian medtech sector. The sector has a large number of researchers, inventors, scientists, engineers and clinicians with significant STEM skills and experience working on seeking solutions to medical and surgical problems.
I think it’s fair to say the vast majority have not been exposed to, or learnt, entrepreneurial skills. Importantly, I see a high degree of commitment to their projects and inventions, a genuine desire to see it through to commercialisation.
Finally, if we are looking for disruptive technologies with large market opportunities, well they do exist, I have seen them, and we must make sure they progress.
Therein lies the role of Australia’s universities. Applying best practice to the Australian system, ensuring STEM students are immersed in an entrepreneurial system and culture, thereby becoming entrepreneurs able to create new high growth businesses with a global footprint.
And therein lies the challenge.
As the report says, “a significant effort is needed to boost the capabilities of Australian universities to teach high-impact entrepreneurship and produce entrepreneurially-minded graduates.”
Government actions to overcome this challenge will include reviewing university funding and incentives, developing a national innovation and entrepreneurship policy, making a clear distinction between high-impact and other entrepreneurship initiatives, gaining appropriate commitment from universities to establish best practice and finally engaging industry to assist universities with this journey.
The question is can this be done? It requires a massive change in culture and established university practices and it’s a long-term solution. We still have today’s challenges to solve.
To put the entire argument into perspective, however, the report quotes a study from PricewaterhouseCoopers (PwC) that says “technology startups could contribute over A$100 billion of additional GDP by 2033, but only if we increase the number of high-impact entrepreneurs by a factor of 20”.
When an initiative has the potential to result in that level of transformative change to the benefit of the economy and therefore the nation as a whole, we have no choice but to do it.
Philip Nowell is a globally experienced medical device executive, guest contributing to InnovationAus.com.
*Photo Credit: Gustav Solberger via iStock