Australian Centre for Innovation & International Competitiveness

Professor Ron JohnstonProfessor Ron Johnston

Australian Centre for InnovationAustralian Centre for Innovation

University of SydneyUniversity of Sydneywww.aciic.org.auwww.aciic.org.au

DGDG--JRCJRC--IPTS IPTS SevillaSevilla

7 October 20087 October 2008

The Role of Foresight in Structural and The Role of Foresight in Structural and Thematic PriorityThematic Priority--Setting: Setting: two cases from Australiatwo cases from Australia

Structure of the Presentation

1. Current state of foresight/strategic intelligence

2. Unusual Case 1 – structural priority-setting

3. Unusual Case 2 – thematic priority setting

4. The role for quantification5. Conclusions

Current state of foresight/strategic intelligence

A climate of urgency to address the future Increased adoption at many levels and in

many forms Varied roles:

an expert-based policy informing tool; an integral part of policy processes, operating by

forward looking strategic support to informing and co-ordinating functions;

a pacemaker through capacity building for policy intelligence

a tool for impact assessment.

Structural priority-setting in the Australian Innovation Review

http://www.innovation.gov.au/innovationreview

The Review’s Perspective on Innovation

Innovation is commonly described as “creating value by doing things differently”. From this viewpoint we can only identify innovation after the event.

If we are going to influence innovation outcomes we need an active appreciation of the dynamic processes associated with innovation that lead to change. Thus the focus should be on innovating and being innovative.

The Context of the Review

- change of Government after 11 years- a series of reviews of education, universities,

industrial relations, the federal system of government, the tax system, emissions trading, the auto and TCF industries, and the CRC program

- declining investment and performance, particularly in the past 5 years:

A decline by 25% of Govt funding for R&I as % of GDP

Investment in education declined as a % of GDP while other OECD countries were massively increasing theirs

Zero increase in multi-factor productivity

A Systems Approach

The Review takes a systems approach to understanding Australia’s innovation performance and challenges. This means treating all the elements of the innovation system as a dynamic and interconnected whole, not just concentrating on single components.

Issues for Submissions

Can we imagine a better world? Are we asking the right questions?

How do we solve the big challenges we face?

Could we do everyday things better? How do we make it easier for people

to apply ideas in novel ways? How do we educate our people to be

more creative?

The Strategic Intelligence Component

Not a formal foresight process Extraction of views of a desired future

contained in >700 submissions Interpreted through the experiences

and a strong vision of the Committee of Review

Projection of a series of structural targets

Structural targets (quantitative)

Total factor productivity growth >2.5%pa >40% of employees with tertiary education 50% of firms produce new-to-market

innovations pa 70% of firms produce non-tech innovation pa Firm collaboration with PROs >50% Firm collaboration with HEIs >30%

Thematic priority-setting via the CSIRO Flagship Program

http://www.csiro.au/partnerships/NRF.html

National Research Flagships the largest scientific research programs ever undertaken in

Australia – with total investment to 2010–11 of more than $1.5 billion

Flagships recognise that complex large-scale challenges require sophisticated cross-boundary responses that can only be delivered by bringing together the best and the brightest from across the Australian innovation system

Focused on major national priorities

Focused on outcomes. committed to delivering research solutions that target clearly defined goals

They have a larger scale, longer timeframes and stronger focus on adoption of research outputs than other programs

Nine Flagships Energy Water Health Light metals Oceans Food Climate adaptation Minerals Niche manufacturing (nanotechnology)

Energy Transformed Flagship

Goals: To halve greenhouse gas emissions double the efficiency of the nation’s

new energy generation, supply and end use

position Australia for a future hydrogen economy

by 2050

Some Activities SolarGas™- a new energy source which contains 25%

more energy than the natural gas used to feed the process

Post Combustion Carbon Capture Enhanced Coal Bed Methane extraction The Ultra Battery Responsive intelligent distributed energy network Distributed generation CO2 sequestration in coal CO2 behaviour in deep saline aquifers

The Crucial Steering Mechanism - The Energy Futures Forum

The Energy Futures Forum brings together Australia’s energy and transport stakeholders to identify plausible scenarios for energy in 2050 and their implications for the nation’s energy future.

Stakeholders included energy suppliers, generators, distributors, major energy end-users, financiers, government and community representatives.

Eight scenarios were developed from a base case with variants incorporating nuclear, renewable energy, distributed energy and ‘deep greenhouse gas cut’ scenarios.

The Role for Quantification in Foresight – important qualifiers Quantification does not provide

greater truth or precision unless the supporting theories and models adequately reflect underlying structures and relationships

Processes (like foresight) are largely defined in qualitative terms eg management, strategy, but can be supported by metrics

Some Quantitative Approaches being used in Foresight

Process and decision-models embedded in software eg scenario generation

Simulation tools Complex adaptive systems modelling Cross-impact analysis Gaming Data mining Impact evaluation

Conclusions Foresight/strategic intelligence

processes, tools and applications are multiplying

Practice is far in advance of an adequate theoretical conception

There is need for both radical and incremental development of both qualitative and quantitative approaches