How to in­no­vate

Qantas - - QBUSINESS. - Martin Hosk­ing For­mer CEO, Red­bub­ble

Why is in­no­va­tion im­por­tant?

Aus­tralia must in­no­vate if we’re go­ing to con­tinue to have strong eco­nomic growth; if we’re go­ing to have com­pet­i­tive in­dus­tries, com­pa­nies, col­lab­o­ra­tion and knowl­edge in­sti­tu­tions; if we want plen­ti­ful jobs that are mean­ing­ful and pro­duc­tive; and, crit­i­cally, if we want a fair and in­clu­sive so­ci­ety.

What is the true state of in­no­va­tion in Aus­tralia?

In 20 years, Ap­ple and Ama­zon have cre­ated more value for share­hold­ers than the en­tire ASX has in 200 years. In­no­va­tion is driv­ing wealth cre­ation in a way in which we have never seen be­fore and which is leav­ing Aus­tralia be­hind. When peo­ple talk about in­no­va­tion in Aus­tralia, they’ll typ­i­cally say, “Look at all the money that’s be­ing put into it.” But they will not talk about what im­pact it’s hav­ing. How many com­pa­nies and how many patents? How many in­ven­tions? Is there enough com­mer­cial­i­sa­tion go­ing on that’s im­prov­ing our sta­tus as a coun­try and lay­ing the foun­da­tion for the fu­ture? Our bang for our buck is not only bad, it’s get­ting worse.

What’s hold­ing us back?

I love Aus­tralia but there are two things in par­tic­u­lar that I’ll point to. One is this at­ti­tude of “She’ll be right, mate.” There is also this no­tion of fair­ness. Google wins and 25 com­pa­nies lose; Ama­zon wins and lots of peo­ple lose. In­no­va­tion dis­pro­por­tion­ately re­wards the win­ners and it is not fair in the in­di­vid­ual sense but it is very fair for the econ­omy as a whole. Our sense of fair­ness means that we’re re­luc­tant to em­brace that idea. The over­all net of this is that 24 years of eco­nomic growth in Aus­tralia have been ab­so­lutely ter­ri­ble for in­no­va­tion. Cul­tur­ally, we need to fo­cus on the cel­e­bra­tion of suc­cess.

How do we get com­fort­able with risk?

If you’re in­volved in the startup world, you may have fail­ures at some level but from a ca­reer per­spec­tive, it’s rarely like that. My com­pany [LookS­mart] failed but I was very suc­cess­ful and that’s gen­er­ally the truth. A startup is the most ed­u­ca­tional en­vi­ron­ment you can be in. You will learn quickly and in many ways get more out of it.

What can we learn from fail­ure?

I learnt ev­ery­thing from fail­ure.

It was a re­ally in­ter­est­ing ex­am­ple of where the wave was so big we couldn’t know how to surf it. And no­body re­ally did know how to surf that wave, with the ex­cep­tion of Google and Ama­zon. We had a very poor prod­uct mar­ket fit, poor strat­egy and poor un­der­stand­ing of who our cus­tomers were so we failed on three lev­els. When I started Red­bub­ble [in 2006], I wanted to make sure that that fail­ure did not repli­cate it­self. We had to be clearer about who our cus­tomers were, what we were do­ing for them and what was the na­ture of the strat­egy.

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