Innovation: bridging the cultural gap
First published in the Australian R&D Review
Business leaders are often criticised for being either risk averse and unwilling to pursue new ways of doing things, or for taking too much risk and getting into untested business models. Depending on the economic cycle, one or the other form of criticism takes centre stage.
This is not to say that there aren’t executives doing both—breaking new ground and being disciplined—at the same time. However, it can be argued that a globalised economy being reshaped by the economic resurgence of China and India is in need of more people capable of innovating beyond current business models, and who do so prudently. This piece explores the role of research training in development of such human capital.
Individuals undertaking a PhD program, or other forms of research training, need to work at the very limits of their discipline in order to contribute to its knowledge base. At the same time, their findings are subject to the methods and norms of, not only their own, but also often several fields of research, as modern research work becomes increasingly interdisciplinary.
A researcher, over time, acquires the mindset of staring into the unknown and breaking new ground, while also considering each step on the basis of solid reasoning. There are not too many other formal educational experiences that train someone for the development of such capabilities, and it is a skill currently under-utilised by Australian companies, which tend to employ PhD graduates in roles confined to R&D.
To prepare PhD graduates to transition to the business world, universities have to broaden their research training to include skills that are relevant to the wider innovation system.
The case can be made that by employing more research-trained graduates in positions extending beyond R&D, Australian companies can strengthen the national innovation system against the competitive pressures of the global economy. This is also as PhD-qualified managers are more likely to show a preference for other highly-educated employees, thereby raising the calibre of the whole company. Indeed, in knowledge-intensive economies like Germany and Switzerland, PhD graduates are far more common in senior corporate roles. Yet, for such a scenario to become commonplace in Australia, progress will first need to be made on a number of other fronts.
To prepare PhD graduates to transition to the business world, universities have to broaden their research training to include skills that are relevant to the wider innovation system. There are examples, like the Group of Eight adopting its Future Leaders program, and the Australian Technology Network with its e-Grad School initiative, that aim to include generic capabilities in research training. The scope of such broadening of research training skills will be significantly enhanced if the length of the PhD program is extended, as has been recommended by the National Innovation Review.
Companies that are faced with global competition need to innovate in order to stay in the game, and so are likely to be receptive to employing professionals trained to prudently explore new ground. This could be greatly facilitated if there were incentives in place to bridge the cultural gap that currently separates the research and business sectors. A step in this direction is the Researchers in Business initiative under the Federal Government’s Enterprise Connect Program, which will subsidise the employment of a researcher in a business by 50% for a period of up to 12 months. A number of other internship schemes between universities and end users are in development, and increased research collaboration between universities and end users will further assist in bridging the cultural gap in the long-term.
However, even if both universities and the corporate sector were to come to the party—universities by broadening PhD programs, and the corporate sector by employing more PhD graduates—it will be an uphill battle. The Group of Eight submission to the National Innovation Review cites OECD figures stating that Australia produces only 2.3 new PhD graduates per 100 university graduates, compared to 3.9 for Canada, 10.1 for Switzerland and 11.2 for Germany. Australia may simply not be producing enough PhD graduates for placement in the wider economy and to replenish an ageing academic and research workforce – the latter being not only an Australian problem.
In recent years, universities in the West have relied on talented students from countries such as China and India—especially in science and technology disciplines— to populate their PhD programs. A large number of these students used to stay on in Australia after completing their PhDs. However, these countries are now in the process of building their own research capacities, and it is likely that their salaries could match, if not exceed, Western salaries within a decade.
Consequently, the global war for talent is bound to intensify. If Australia is to increase the level of PhD graduates in the economy, it will need to support all possible mechanisms to boost PhD enrolments in its universities. For domestic students, this might mean more attractive stipends and mechanisms for making up lost wages while pursuing a PhD. Waiving undergraduate HECS liabilities is an option be considered. Additionally, extending the scope of the R&D tax concession to encompass employment of PhD graduates is another mechanism worthy of exploration. For international students, it could mean world class research environments, competitive stipends, and ready assistance available to help aid their transition to the Australian workforce upon graduation.
Important, too, is the streamlining of immigration processes to make Australia an attractive place for migrants who already have a PhD. The above discussion has focussed on the relevance of research training to the business world. However, the same argument holds for government and community sectors.
In the 21st century, the ability to stare into the unknown, and to prudently find a path where none has existed before, may be all too valuable a skill to leave to only the academics.
