If Australian businesses collaborated on innovative activities to the OECD average we could expect an increase to current gross domestic product (GDP) of $8 billion from productivity improvements, according to a new report by PwC Australia and Advance, a network of expat Australians and alumni worldwide.
The report ‘Out of sight, Out of Mind? Australia’s Diaspora as a Pathway to Innovation’ reveals the injection to GDP over the next 10 years would be $23.5 billion if Australian businesses collaborated to the level of the five best collaborating OECD nations.
Collaboration between businesses, government, higher education and global markets are key metrics that drive innovation. Australia is towards the back of the pack on every indicator of collaboration among OECD countries and is facing a significant collaboration deficit. This will have a real impact on individual businesses and see the nation fall further behind our global counterparts on innovation, which is a key driver of growth.
The report shows that a fraction of Australian businesses collaborate with international firms when they are innovating products and the same applies when it comes to collaboration with higher education or government institutions.
“Global competition is heating up as trade barriers are reshaped and improvements in tech allow innovation to be diffused and implemented more quickly. For Australia, it is imperative that we utilise and leverage our network of global Australians and Alumni to collaborate and drive growth,” said Yasmin Allen, Chair, Advance. “Our diaspora are risk takers and adapters. This know how is critical for our success and we need to leverage and harness these connections for the benefit of Australian companies and our economy.”
PwC Partner, Kristin Stubbins added: “Collaboration is critical to innovation and we must put in place the systems that support our transition to a knowledge economy. While the economic impacts of collaboration will not have the same productivity benefits as comprehensive tax reform or increased female participation in the workforce, our modelling shows that there is significant economic upside and this is low hanging fruit - other countries do this better than us.”
Expat Australians and Alumni key to uplift in collaboration
In developing the report, Advance and PwC surveyed 1,039 expat Australians and alumni worldwide to better understand their connection to Australia and test the hypothesis that Australia’s diaspora can accelerate collaboration.
The survey found 58 percent of Australians currently overseas see benefits associated with engaging with peers back in Australia. Of these, they identified benefits from their engagement, including new or streamlined operational processes, innovative solutions to problems and productivity benefits.
The survey also found 94 percent of Australians who have returned home continue to associate with peers overseas. These returnees were most likely to bring back new ways of thinking and methods of working.
Advance Global CEO, Serafina Maiorano said: “One million expatriate Australians (that’s about 5 percent of our population), 2.5 million Alumni of Australian universities and numerous returnees are an invaluable asset to Australia’s future. We often see departing talent characterised as a ‘brain drain’. Global mobility should instead be celebrated as an opportunity to lift our national success and international networks.
“These individuals are an asset to Australia because they promote our national interests overseas. They act as soft power and an innovation conduit for the country and they bring valuable new and diverse ideas and perspectives to the table. They are an important part of Australia’s global smart grid of talent, which underpins our continued growth and prosperity and should be part of our innovation agenda,” Ms Maiorano said.
The modelling in our report hones in on improving the quantum of collaboration. The increase to Australia’s GDP would be even bigger if we could improve the quality of collaboration as well.
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