Wednesday 2 February 2011

Report: AIC Commercialisation programs worth annual $177M to Victoria


Report: AIC Commercialisation programs worth annual $177M to Victoria

A new report estimates that innovation services provided to business by the Australian Institute for Commercialisation (AIC) could be worth up to $177 million per year to the Victorian economy in terms of additional turnover, exports, and hundreds of new jobs.

The AIC, which commissioned the impact report from an independent economic consultancy, operates across Australia but undertakes a significant proportion of its commercialisation programs in Victoria.
According to the AIC, the report shows the importance of having an efficient and affordable resource with deep knowledge of the innovation system available to local businesses, to help them when they simply do not know how to take the next step.

“It’s a truism but people and businesses don’t know what they don’t know,” Dr Rowan Gilmore, Chief Executive Officer of the AIC, said.

“The difference is that the smart ones recognise this and seek out organisations such as the AIC, when they don’t have the internal expertise to solve a problem, need a new kind of technology, or are not sure how to bring new products and services to their targets markets.

“We have the knowledge, networks and resources to help them, whether that’s introducing them to another business with which they could partner, sourcing university research, or assembling industry partners to solve challenges through facilitated workshops,” Dr Gilmore said.

“This report quantifies the value that the AIC’s activities add to the Victorian economy, and proves that well targeted initiatives, which actively assist organisations to innovate and take new products and services to market, have real and positive economic impact.”

The independent report specifically examined the AIC’s flagship programs, including TechFast, which actively facilitates businesses finding and establishing collaborations with other organisations, such as universities and research organisations, in order to solve product, process or service issues and access technical capability so the firm can accelerate its growth.

Independent economic researchers interviewed participants about results they had already achieved, or expected to see in the future, and concluded that many businesses engaged in these programs would not have commercialised ideas or diversified product lines without the AIC’s assistance.

Others indicated that engagement with the AIC accelerated the entire innovative process by one or two years, just by connecting them with the right people and providing the mechanism to establish their innovation.
A number of case studies have been compiled to illustrate the benefits of the AIC’s flagship programs, which have attracted more than 1600 participants over the past five years.

For example, the AIC’s TechFast program assisted Rip Curl, a global brand synonymous with surfing products and beach culture, to find new technologies and advanced materials to develop its second generation power heated wet suit – the H Bomb. It did this by helping Rip Curl, headquartered in Torquay, find and seal partnerships with the research and private sector that resulted in the production of prototypes and manufacturing capabilities for the new wet suit.

Bangholme –based precision components manufacturer Frontline Australasia turned to the AIC’s TechFast program to facilitate a relationship with the Commonwealth Scientific and Industrial Research Organisation (CSIRO). This engagement subsequently resulted in a licence agreement to use its innovative manufacturing techniques as well as a multi-million dollar collaboration project to commercialise the technology.

Dr Gilmore said the economic assessment quantified the value of the AIC’s work in terms of jobs and sales, but the benefits could have an even wider impact
“We are now in a “triple- bottom line” world, where sustainability and social responsibility take their rightful places alongside financial concerns,” Dr Gilmore said.

“We are very proud of the work the AIC has done since it was established in 2002, and with our achievements now quantified by independent economic modeling, are confident we can continue making a valuable contribution to Australia’s future economy and environment.”

The report also highlighted the importance of innovation and commercialisation to the Australian economy, stating:
“Achieving an innovative and a knowledge-based economy is one of the core pillars of economic development. Creation of a knowledge-based economy relies upon the innovation and then application of technologies in a commercial sense, to produce economic benefits and high value adding jobs…

“Australia is well known for its innovative efforts relative to the size of its economy, ranking twelfth in the world for research and development expenditure as a percentage of GDP. However, high-technology exports from Australia are significantly lower than most developed countries in the world (as a proportion of R&D expenditure), highlighting that although Australia is not underperforming in innovation, its slow rate of commercialisation is a key weakness in the development of a knowledge-based economy,” the report states.

ENDS

Key points from the AECgroup report (this is only a snapshot, please refer to the full report):

The model used to identify the direct and flow on economic impacts of the AIC programs, used four measures:
1)    Output: the gross value of goods and services transacted, including those used in the development and provision of the final product
2)    Value added: the value of output after deducting the cost of goods and services inputs in the production process (net contribution).
3)    Income: the level of wages and salaries paid to employees of the industry under consideration and to other beneficiaries
4)    Employment: part and full time positions generated both directly and indirectly

The report only includes economic activity that would not have happened without AIC assistance.

It estimated that the TechFast program could generate a total annual benefit to Victoria of up to $176.6 (output), 687 new FTE positions, $69.7 in value-added and $43.5m in new incomes each year. This was based on a high scenario (assuming an increase in business turnover of 25%); a low scenario of 10% increase in business growth was also included in the report.

Click here to view the full report

Click here to view a video summary of the findings
 


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