Australia’s barriers to innovation and how to overcome them

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Inside the Abercrombie Building at the University of Sydney.

By U2B Staff 

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Australia has long been proud that it punches above its weight in science and innovation. The country has a small population and far fewer top-flight academic institutions than its US and UK rivals and yet still manages to make an disproportionate wave on the innovation scene.

While Australia may lack the scale of physical capital, human capital, and domestic market needed to operate at the international technology frontier under its own steam, it makes up for that through collaboration.

The Australian government contributes just 11 percent of total research and development (R&D) spending in the country, according to a report from the Australia-China Relations Institute at the University of Technology of Sydney. This is in comparison to a whopping 54 percent from businesses.

But there is a disconnect and lack of enthusiasm when it comes to collaborating across sectors and faltering when it comes to the final hurdle of commercialisation.


Commercialising an idea, innovation or great piece of research is a key driver of new sources of revenue, jobs and industries, and the lifeblood of increasingly knowledge-intensive economies.

From universities to start-ups to science labs, Australia is a fertile ground for innovation. However, the one element of successful ­innovation constantly being overlooked is commercialisation. Effective monetisation is integral to sustainability and growth, not just for private businesses but for the whole economy.

A new report from the United States Studies Centre at the University of Sydney looked into why this continues to be an issue in an otherwise thriving innovation sector, finding a series of barriers standing in the way of universities bringing their ideas to the market.

Using the Australian Research Council’s (ARC) Bionic Vision Science and Technology initiative as a case study, the report found some systemic issues that repeatedly cause obstacles to research collaborations.

New report finds a series of barriers standing in the way of universities bringing their ideas to the market. Source: Srikant Sahoo/ Unsplash

While knowledge for knowledge sake is a noble pursuit, it doesn’t pay the bills and doesn’t spread the benefits of this hard-won innovation.

While the cornerstones of innovation are education and research and development funding, all too often the piece of the puzzle that gets missed is finding ways to effectively monetise new products and initiatives. Without this, there’s not much point to innovation at all.

Structural barriers in Australia

A recurring complaint across the board was the Australian political system itself. Those surveyed said the most significant structural barrier to successful innovation is Australia’s three-year political cycle, and accused new administrations of tearing up the rules set by previous governments.

With any new incoming party tends to come a change-up of projects, policies and budgets. While other countries, such as Germany and Sweden, have policy in place to promote continuity in their innovation sector in such matters, Australia does not.

At a time of transition, science and innovation is rarely top of a new administration’s to-do list and is regularly misunderstood in terms of its processes and importance.


With such a short political cycle, the report also notes that, just 18 months after being newly elected, administrations enter into election mode once again.

“As they seek to appeal to voters and maintain the support of critical constituents, short-term thinking prevails regarding policy, programs and the amount of funding allotted to them,” the report reads.

In this environment, long-term national strategies and priorities go out the window, leaving universities as well as the private sector and research agencies in an uncertain position. Planning for the future – and on many collaborations that is essential – suddenly becomes almost impossible.

Constant changes to budgets and funding make allocation to projects difficult and threaten the longevity of research collaborations. This puts pressure on research to be completed within the two to four-year funding envelopes preferred by politicians. This is rarely enough time to complete a project and seek commercialisation.

A major barrier to innovation is the Australian political cycle. Canberra Parliament Building, Canberra, Australia. Source: Taras Vyshnya/Shutterstock

Already in a difficult position, Australian researchers are finding a lack of knowledge from superiors as to how to turn a prototype they may develop into a commercially viable product.

Researchers point out that Australian prototypes often hit an unsurmountable wall in the passage from experimental development to commercialisation. It is so notorious that scientists and entrepreneurs call it “the valley of death.”

With Australia’s talent pool shrinking due to many scientists preferring to look for work overseas, there is a significant expertise gap growing in management.

“At the senior level, too, there are significant gaps in management and translation expertise within the innovation system,” according to the report. “Projects and company boards often struggle to fill positions with suitably qualified people.”

This lack of expertise is compounded by a lack of sufficient funding to finalise the largely government-funded prototypes and to manage the regulatory and intellectual property (IP) hurdles to translation.

The stunted and slow process makes Australia and its universities a prime hunting ground for opportunistic overseas companies wanting to steal IP or head hunt talented innovators.

Cultural barriers

The academic culture in which career advancement is inextricably linked to paper publications breeds an unhealthy competitive environment among researchers and discourages scientists from pursuing riskier but potentially productive areas of research.

Not only are there clashes between researchers, but the bringing together of academia and industry creates a culture clash of its own.

Some respondents to the survey said there was a tendency for researchers to look at business people with thinly-disguised disdain.


The report also found a lack of enthusiasm on the part of industry to collaborate with academics, despite the potential benefits. This is having a material impact on Australia’s innovation potential, as shown in the 2017 OECD STI Scoreboard places Australia last out of 28 nations on the measure of business and research collaboration behind countries like Greece, Estonia and Chile

As it the case in so many university and business partnerships, the differing cultures, motivations, and drivers between these two sectors can pose a large obstacle to effective collaboration.

Rarely is it the case that person has experience in both, so leading projects to cater to both can prove challenging. The added reluctance and lack of enthusiasm doesn’t help the situation.


While the report is realistic about the difficulties facing Australian innovation, it is not all doom and gloom. There may not be a simple solution, but researchers believe by looking at these barriers broadly, it will be possible to make the changes needed to improve performance.

To counteract the political obstacle of ever-changing administrations, the report suggests establishing an independent and permanent agency responsible for developing and overseeing a national strategy for science and innovation in Australia.

Curtin University in Perth, Western Australia. Curtinis a hub for collaboration. Source: EQRoy/Shutterstock

This could link and improve communication between all sectors – both academic and industry, as well as political – and provide a point of continuity for long-term planning and funding.

In terms of improving collaboration and opening up ties, universities are already taking small steps on the path.

Rather than judge academics solely on their publications, universities are changing the metrics to include engagement and impact. Universities themselves are also being judged not just on academic achievement, but also on their impact in society.

This encourages everyone involved to look beyond the safe options and try new innovative research with unlikely partners.

And finally, to smooth the transition process from prototype to market, the report suggests the government “explore the adoption of a single and simplified approach to intellectual property (IP) across the university and publicly-funded research sectors.”

This would streamline the myriad contracts and procedures new products have to go through and reduce the cost of launch.