Government must meet high-cost ‘new normal’ by fostering ICT innovation

Regardless of whichever government is elected on September 14, Australia’s ICT policy makers will need to engage better with Asian peers and stimulate local innovation, Australian Information Industry Association (AIIA) chairman Kee Wong has warned.

Speaking at the launch of the AIIA’s SmartICT Election Platform, Wong – a self-professed “serial entrepreneur” who is also managing director of technology consulting firm e-Centric Innovations – said it was incumbent on government bodies to stimulate Australia’s entrepreneurs, and to keep them innovating through their careers rather than simply cashing out of their first big success story.

“We have great entrepreneurs that may have created one or two businesses in their lifetime, and they retire to savour the fruits of their labour,” Wong said. “When surrounded by highly ambitious, hungry and capable populous neighbouring countries in Asia, we cannot rely on this model in the future; we need our 35 year olds to be starting their fourth or fifth business.”

“By the time they are done, they will have started another five or ten – and even when they hang up their boots, they will continue to foster and help other entrepreneurs that come behind them.”

Building this culture will not only help promote the spirit of innovation in Australia, but will help the government build up a domestic capability that is going to become increasingly important in helping Australia fight off competition from lower-cost companies like Malaysia, which he said has a skilled workforce and costs around one-third as high as in Australia.

“Malaysia and Australia form a synergy that is pretty obvious,” Wong said. “We need each other because we have no scale in our own right. It’s a no-brainer for Australian companies, if they want to look at the Australian market, to look at how we can partner with Malaysia for market access to Asia.”

Such partnerships will help Australian companies build out their capabilities and add value that will make up for Australia’s higher price structures, which can make local companies uncompetitive if they’re left unaddressed.

“Our high cost is going to be the new normal of doing business in Australia,” Wong said. “So, in order for us to compete globally, we either have to offer something that the other countries in the world need and don’t have enough of – like our resources – or we compete on competencies and innovation that keeps us just a little bit ahead of the curve.”

That decision needs to inform government ICT policy going into the future, Wong said. “Our future post the resources boom will have to be in products and services,” he explained. “That’s based on high tech and smart ICT: we have to encourage our local companies to think globally about their businesses.”

For political taskmasters considering the best way forward, Wong said the key is to not lose track of the role technology plays in delivering these outcomes.

“In an election year, what we need is for both sides of politics to get the importance that technology plays in Australia’s future prosperity,” he explained.

“We need policies that make it easy for entrepreneurs to start a business, get funding, and grow and expand both locally and globally. We need to allow high skilled professionals from overseas to come in to help fill gaps that will be needed to power our economic growth.” – David Braue