Australia’s goal is clear. We need to build a more prosperous and harmonious society by creating products and services the world values enough to pay a premium for.
That means solving difficult problems that others have not solved. It means turning research into commercial outcomes. It means stronger investment in business-led R&D. And it means building globally successful companies that employ Australians in high-value jobs at high wages.
This is why the Strategic Examination of Research and Development matters.
The SERD report, Ambitious Australia, has performed a national service by stating plainly that our research and innovation system is fragmented, underpowered and not delivering what the country needs.
Its central concern is not academic. It is economic and social. Australia’s weak business R&D, low manufacturing share, sluggish productivity and declining complexity threaten future living standards.
The panel is right to call for a systemic response. The proposed architecture matters. Better coordination, clearer priorities, stronger national capability and more effective pathways from research to application are all necessary.
But architecture alone will not solve the problem.
The next stage of the conversation should focus on how this architecture connects to businesses in a practical way.
That is where outcomes are determined. It is inside firms that decisions are made to invest, to take risks, to solve hard problems and to compete in global markets.
If SERD provides the architecture, we now need the operating system that makes it work for business.
That is the missing layer in much of Australia’s innovation debate.
Businesses do not begin with a desire to do research. They begin with a need to solve a problem.
A manufacturer wants to reduce waste, improve precision or cut energy use. A food business wants longer shelf life, better traceability or access to new markets. A mining company wants safer operations, better recovery rates or lower downtime.
These are commercial problems. If solved well, they create competitive advantage. That is where research becomes valuable.
Too often, however, our system starts from the supply side. It begins with programs, institutions, disciplines and research capacity, then asks business to engage. The better starting point is the reverse.
Begin with the hard, valuable problems facing firms. Then connect those firms to the research capability, capital and support needed to solve them.
That is why business-led R&D must be at the centre of implementation.
This is also why the R&D Tax Incentive remains so important. The RDTI is not a side issue in the SERD discussion. It is one of the few policy instruments that works directly on business decision-making. It reaches into the firm.
It influences whether management chooses to invest in solving a hard problem, developing a new capability or pursuing a new product or process. That is a major strength.
The issue is not that the RDTI is demand driven. The issue is that it is not guided well enough towards the kinds of problems and opportunities that build enduring competitive advantage.
Some firms use it for worthwhile activity. Some use it for work that is incremental. Many firms that should be pursuing ambitious R&D do not know where to start, how to frame the opportunity, or who to work with. In that gap, too much potential is lost.
This is where a helper system should come in.
A helper system would sit between the architecture proposed by SERD and the day-to-day decisions made by businesses. Its role would be practical.
Help firms identify strategic problems worth solving. Help them assess the commercial value of solving them.
Help them find the right research partners, technical capability and pathways to execution. Help align RDTI support with opportunities that can lift productivity, create new export income and strengthen Australia’s industrial base.
In short, it would make the system easier to use and more likely to produce results.
This is not an argument against the SERD framework. It is an argument for completing it.
The report points in the right direction with its emphasis on coordination, mission focus, national priorities and stronger links across the innovation system.
But the system will only succeed if it becomes meaningful to firms that are under competitive pressure and must decide where to place scarce capital.
That is the practical test.
A well-designed helper system would also strengthen other parts of the SERD agenda. It would improve the value of place-based ecosystems by grounding them in real business demand.
It would improve collaboration between universities and industry by starting with problems that matter commercially. It would improve the effectiveness of public support by directing resources towards opportunities with clear economic potential.
Most importantly, it would return the innovation debate to first principles.
The point of fixing Australia’s innovation system is not to produce a more elegant policy structure. It is to help Australian firms solve harder problems, build stronger capabilities, win premium markets and generate the prosperity that supports a stable, confident and harmonious society.
That should be the focus now.
If Ambitious Australia provides the blueprint, the next task is to build the business-facing mechanism that turns intent into action.
We need a system that does not just support research but helps businesses use research to create competitive advantage.
That is how the report’s ambitions can be made real.
Russell Yardley is a long-time participant in the Australia tech and innovation community in different roles – from founder to executive to director. He is currently a non-executive director on several boards, and is chair of AirHealth, a tech company being commercialised out of the University of Melbourne and the University of Tasmania.
Do you know more? Contact James Riley via Email.