Tag Archives: Australian innovation news

the cloud

The cloud: understanding opportunities

This is an edited transcript of a speech titled, ‘The cloud: understanding opportunities and challenges’, which was delivered by Dr Balan-Vnuk to the Committee for Economic Development of Australia (CEDA) in May 2016.

The conversation I’d like to have with you is around, “What is the cloud?” – but more importantly, “What is the potential of the cloud to power your business, and what innovation is available to you?”

I’d like to take you back about 150 years, to the invention of the steam locomotive. You can imagine that back in the 1860s people were used to horse drawn carriages – it was nice and quiet, and things moved at a certain pace. And then all of a sudden you had these upstarts with brand new technology that was quite frankly loud, scary and sometimes exploded.

People didn’t understand this new technology – they didn’t understand how steam worked – and so they were incredibly scared and incredibly nervous.

I’m not sure how many of you are aware of the Red Flag Act that was passed in 1865. The most intriguing aspect of that Act was the fact that someone had to walk 60 yards in front of a locomotive with a red flag to warn everyone that it was coming.

I think sometimes we might be a little bit like those folks who saw the first steam locomotive when we come across the cloud. What is it? We don’t understand it. Is it scary? How will it help me?

Embracing a safer future

If we fast forward about 150 years, we see these beautiful new driverless cars that, quite frankly, we would like to drive in. And the reason I think driverless cars are so incredibly important is because the car will be able to brake and react faster than any one of us in the room can.

How does that work? Through hundreds of sensors placed on the car – the tyres, the body of it – testing what surface that car is driving on? Is it bitumen, gravel, or sand? Is it wet, dry, or is there an oil slick? What objects are around that car? Are they stationary, are they moving? Are they moving towards the vehicle? It will react as it needs to in order to keep us safe.

But not only that. This data is also being sent up to the cloud. It’s being aggregated, analysed, dissected and the learnings are being sent back to every single other driverless car so that everyone can benefit from the same learnings to be safe.

My two girls are eight and six, and I’m pretty sure they’ll still get their driver’s licence. Not long after that we’ll probably be driving for fun, taking the car out for a spin, because these cars will actually keep us safer and get us places we need to go in a much more effective manner.

But not everyone has the luxury of having a Tesla, or a beautiful driverless car, for that matter.

Building solutions for those who can’t

I’d like to take you to somewhere very different, to a woman in a Sudanese refugee camp carrying a very heavy load of sticks, who is quite obviously pregnant. Unfortunately this is a scene we’d see in many parts around the world, including Australia. People who have no access to education, to healthcare, to sanitised water; they are at a real disadvantage, and their lives could be at risk.

Two medical students came across some really important information. Maternal anaemia accounts for 20% of maternal deaths globally. And that, in stark figures, is around 115,000 women every year dying from what is actually a preventable disease or condition.

These two students didn’t stop there. Of course the most reliable way to test, “Have I got anaemia?” is through a blood test. But if you can’t do that, the colour of the inside of your eyelid will apparently give a pretty good indication as to whether or not you might be anaemic.

And so these two students – not fazed by the question of, “How do I access technology?” – built a solution on the cloud. In fact, they built a selfie app.

They built an app where you hold on to your eyelid and, with the right lighting conditions, you take a photo of the inside of your eyelid. It gets sent up to the cloud, analysed, aggregated, and then the results come back to you and tell you the probability of you being anaemic.

Now, imagine you’re up in the Coober Pedy, APY lands, you’re pregnant, your nearest doctor is a few hundred kilometres away. You’d want to be able to tell pretty quickly if you’re anaemic and you need some medical assistance.

So these two students from Melbourne won Microsoft’s global Imagine Cup Competition, which is about young people solving solutions of the world using technology. They spent time with Bill Gates and Satya Nadella and they’re well on their way to commercialising that application.

This is the true power of the cloud. It’s the democratisation of technology.

You don’t have to be a BHP employee or an FBI agent or a NASA whiz to access really complex sophisticated technology. You can now access the bits you need to solve the problems that you’re interested in solving.

Blurring the lines between the digital and the physical realms

The Fourth Industrial Revolution is incredibly topical. I would direct you to read an article by Klaus Schwab, who’s one of the co-founders of the World Economic Forum. Schwab really defines the fourth industrial revolution as this blurring between the digital and the physical spheres.

I’m not wearing one, but has someone got a Fitbit on? Or Garmin, a Health Band? We’re using these devices now; it’s testing our heart rate, whether we slept well, whether we’re getting enough exercise. If it’s not already connected to health insurance providers, it’s in progress. Maybe they’ll give me a rebate because I exercise every day.

All of this information about our physical condition is now being sent up to the cloud so we can learn from it. But there are some other really fundamental changes that are happening in this period.

Reaching a market value of $1 billion

It used to take a company around 20 years to reach $1 billion in market valuation. Think about Snapchat and Airbnb; it took them two to three years respectively to reach $1 billion dollars’ worth of valuation.

I can promise you they didn’t do it by signing up and by building on-premises infrastructure. They leveraged the power of the cloud to build a truly global innovative solution that solves major challenges.

Let’s refer to a pyramid, a model you’re all familiar with: Maslow’s Hierarchy of Needs. It’s from humanistic psychology and really saying, look, for us to evolve as people, as humans, we need to get the basics right. The basics are food and shelter. Then once I’ve got that I feel secure, I’ve got a safe place to be. Then I have friends, family, I have intimacy in my life. At that point I’m confident, I’ve got self-esteem, people respect me. And at that point I can really realise my own full potential.

So I’d like to make a comparison to that model, as a framework for thinking about what the cloud can deliver for you and your organisation.

Recognising what the cloud can deliver for your organisation

The very first layer (and this is not discounting the fact that many organisations have on-premises infrastructure, and it’s likely that’s going to have to stay. You’ve got mainframes, there is old legacy technology that needs to stay where it is, and that’s fine. But there are certainly new ways to take advantage of what the cloud is doing.)

The first layer, which is Infrastructure as a Service, we kind of like to call the plumbing. That’s the servers, it’s making sure you’ve got geo-redundancy, you’ve got the patching in place; that the system and the environment itself is healthy and operating successfully.

For many people this is the first step; they’re taking the infrastructure they’ve got on-premises or with a hosting provider and they’re moving it to a cloud that’s global and scalable. But it doesn’t stop there.

The next one is Platform as a Service. One of the Chief Information Officers I work with in the South Australian government said to me, “Look, I’ve got a great information technology (IT) team – fabulous. But they’re busy running IT. I want them to deliver business value. I don’t want them patching servers. I want them working on the business applications that deliver value to our internal stakeholders and to our citizens and our customers”.

So Platform as a Service is really saying, “Someone else takes care of all of the plumbing. I just need it to work, and I build my intellectual property (IP) and my value on top of that”.

Now, getting to Software as a Service, who’s using Twitter, LinkedIn, Hotmail, Gmail? Everyone. That software is a service. It’s there. You sign in, you log in, you use it for what you need to and then you sign out again.

And now this is a really interesting point. If you think about the two medical students, their product is called Eyenaemia. That is Software as a Service. They can make that globally available to anyone and they can earn some money from it.

Equally established businesses now would consume Software as a Service for a customer relationship management solution, or for a productivity and collaboration platform. But equally you can develop services that you can sell and thus create a new business model for your organisation.

Building value from a template

Now, where I think it gets really exciting, is when we start talking about things like machine learning and artificial intelligence (AI). What’s really important about all these things? This is about the commoditisation of data science.

This doesn’t mean we don’t need data scientists. We desperately need more data scientists. But what we then need these people to do is to build value on top of a template.

Why start from scratch if you need to build a fraud detection system? Take a template that exists and customise it with your domain knowledge and expertise, and tailor that for your internal organisation.

Your time to value is incredibly fast, because you’re not starting from scratch. All of the grunt work has been done. You tailor and customise.

There’s an amazing amount of data we’re getting; data could be seen as the new oil in terms of an unlimited resource. It’s how we harness it, and how we use it to glean insights that we’d otherwise have no idea even exist.

Hailing the democratisation of technology

And the part I guess I get most excited about is artificial intelligence. This is where you start to see really interesting things such as conversation as a platform. What does that mean?

Say I’ve got a claim; I don’t want to get on the phone to talk through it because I know I’m going to be on hold for about an hour or two or three. Instead I go to the company’s website. There’s a little bot there that says “chat”. I start to have a conversation.

That’s not a person sitting there. That’s artificial intelligence learning what the intent is behind the questions that people are posing, and responding and trying to probe to give me the information that I need in response. We’re going to see more and more of this, and there are some amazing new APIs and ways of testing and experimenting.

This is true democratisation of technology. You don’t need to be a big player to access this technology and build the billion-dollar data centres. Anyone, students, start-ups, existing businesses, everyone can test this and try it out and see how it works.

So hopefully that gives you a framework of how we see the evolution and the growth of the cloud, and I’m sure there will be more layers above that, which we haven’t even invented yet.

Experimenting within your organisation

If we boil it down to real essentials, the business leader is there to grow profit for the organisation, to retain and grow shareholder value. If you’re a government agency, it’s about delivering effective and efficient customer and citizen services.

How do you do that? With the speed of change that we’re in at the moment, you need to really be very proactive and agile in grasping the opportunities the cloud presents to you.

I’d like to share an example of how some organisations are creating that petri dish of experimentation within their organisation.

I think many of you would know Zara, the fashion house. Their manufacturing line runs at 75% capacity. And you might say, “Well, that’s corporate suicide. Why only run at 75%?”

There’s method behind their madness. When I go into their store, there are video cameras tracking what I’m doing. They’re watching what I look at. They’re watching what clothes I take off the hanger and what clothes I put back. When I walk into the change rooms, what clothes do I choose not to buy?

And you know what? The staff are trained to ask me, and I say, “Well, I didn’t like the jacket, the way the lapel sat, the colour wasn’t quite right”. And they will go back and actually redevelop and redesign their clothes on a four weekly cycle so that they’re much more closely attuned to what their customers want.

In this way, 75% capacity is perfect, because it gives them room and flexibility to be agile and to meet the needs of the customers that they want.

Remembering the value of people

What about our people? It’s challenging in a very, very fast moving time. Our lives, personal and professional, are blurring incredibly. I don’t know how many of you check your phone in the morning for email, check it late at night for email, and maybe in the day you’re doing something personal. Our lives are really blending together.

And so how do we help our people make sure that they don’t get lost in this cacophony? Some of our colleagues out there in the IT space are quite nervous because in reality this means a ton of change for the way that they operate and the way they deliver services and value back to the business.

So I would like to do a very shameless plug for one of our start-ups in Adelaide called Teamgage. They work with us through the Microsoft Innovation Centre.

The team was founded by some people who worked in some incredibly toxic teams. And it was a miserable work environment. And we all know the story: people join companies and they leave managers.

Their premise was, “Well, hang on. Surely if the manager knew or the team leader knew how toxic the environment was, they could have done something about it”.

So they’ve created this amazing 20 second survey. And it truly only takes 20 seconds – we’re piloting it in the Adelaide office, for the team to give feedback.

A dashboard gives me colour charts to see “How is my team feeling?” We take this to our branch meetings and we discuss as a team what the challenges are. What do we need to change? What do we need to address and do differently?

This is an amazing organisation, Teamgage, building an incredible solution, Software as a Service, on a platform where they don’t care what the infrastructure is. They only care about being able to develop their application to serve customers around the world, not just in Adelaide.

Taking advantage of cloud opportunities

We are riding this incredible wave of opportunity. There’s a ton of change. Some organisations are going to coast along the crest of that wave to amazing success. And some others are not going to make it.

We all know the Kodak example. They didn’t make it because they didn’t innovate, they didn’t challenge themselves, they didn’t disrupt themselves and say, “Someone else is going to cannibalise my business, well, I’d better do it first, otherwise I’m totally out of business”.

So as business leaders, as new business leaders and students, really the onus is actually on you to experiment and to try to see how can you take advantage of these technologies for your own business benefit – by delivering profit, shareholder value, and great citizen services that we all expect from our government.

Dr Eva Balan-Vnuk

State Director for South Australia, Microsoft

This speech was first published by the Committee for Economic Development of Australia (CEDA). Read the original text and more of CEDA’s top 10 speeches on disruption and innovation here

Read next: CEO and Managing Director of Blackmores, Christine Holgate, looks at innovation that goes beyond the digital realm.

Spread the word: Help Australia become digital savvy nation! Share this piece on digital disruptors using the social media buttons below.

More Thought Leaders: Click here to go back to the Thought Leadership Series homepage, or start reading the Women in STEM Thought Leadership Series here.

innovation

Innovation breathes new life into old business

Featured image above: the Minister of Industry, Innovation and Science delivering his address at the AFR National Innovation Summit 

Innovating isn’t just about creating new businesses – it’s also about transforming the old.

This message formed the crux of the Hon Greg Hunt’s speech at the Australian Financial Review’s 2016 National Innovation Summit as he presented plans for his portfolio as Minister for Industry, Innovation and Science.

“Innovation is about the new firms absolutely, unequivocally…but also the existing firms,” said Hunt, insisting that the latter should be innovating through “new or improved goods or services, new processes or new business models.”

Pointing to Dulux, CSL, Telstra and BlueScope as examples of Australian veterans who are thriving through investments in R&D, the Minister warned that less-savvy business won’t be bailed out.

“We can’t prop up existing, failing services,” he said. “They have to be able to compete.”

The need for speed

According to other leaders at the AFR Innovation Summit, the window of opportunity is closing for some of Australia’s oldest and largest corporations.

Data61 CEO Adrian Turner says he returned to Australia after 18 years in Silicon Valley because he was concerned about Australia’s pace of change. He believes Australian businesses don’t have long to get on board the age of digital and data-led markets.

“We have a five to 10-year window,” says Adrian.

Chairman of the Australian Advanced Manufacturing Council, John Pollaers, pointed out that although the world has moved into the fourth industrial revolution – the merging of the physical and cyber worlds – many companies are still working their way through the second and third industrial revolutions of electrification, automation and IT.

“If we underestimate technology we will fail,” says Pollaers. “If we underestimate the resistance to change and innovation, then we’ll also fail.”

Maile Carnegie believes companies need to stop ‘hand-wringing’ and start taking action.

“Our financial institutions, if we don’t get them moving, are in for a world of hurt,” says the former Google MD, who recently joined ANZ as Group Exec of Digital Banking. “Banking is a massive data play – those industries are getting disrupted.”

“We know what we need to do so we need to move the conversation to doing it…At the end of the day strategy is all about making some choices.”

So how can old businesses achieve innovation?

“Fail fast, fail cheap, pivot,” suggests Suzana Ristevski, Chief Marketing Officer and Head of Strategy & Growth for GE Australia, New Zealand and Papua New Guinea.

With speed and agility considered vital to innovation but difficult in large businesses, CommBank has turned to partnering with startups.

“They have the agility, we have the scale, so it’s a pretty great marriage,” says Tiziana Bianco, head of the CommBank’s Innovation Lab.

Corporate law firm Gilbert and Tobin have also invested in ‘self-disruption’ to avoid becoming obsolete, positioning themselves as a ‘market disruptor’ and increasing their stake in startup LegalVision to 20% at the start of August.

BHP Billiton, who was forced to cut its dividends by 75% in February this year, has moved to a five-point plan (see The big three drivers to job growth).

  1. Hastening production
  2. Accelerating technology competencies
  3. Creating innovation hubs to address innovative solutions to specific challenges
  4. Setting up programs to build from the inside the company
  5. Forging partnerships with unis, CSIRO, and CRCs

When asked at the AFR Innovation Summit what would happen to jobs if they innovated through automation, BHP’s CTO Diane Jurgens said her company is upskilling existing workers; taking them off machinery and teaching them to operate machines from the safety of a control room.

Group CEO & Managing Director of Domino’s, Don Meij, told the summit’s audience that if we don’t take our skills ‘upstream’ in this way, we will simply miss out on the market altogether.

– Elise Roberts

research commercialisation

Research commercialisation is push and pull

‘It’s not me, it’s you’, is the message from universities to industry in terms of success in partnering and commercialisation of research and development.

Dr Leanna Read, Chief Scientist of South Australia and the founder and former CEO of TGR BioSciences, says universities are unfairly “bagged” for not pulling their weight in collaborating with industry and in fostering the development of research commercialisation partnerships.

“Our surveys have shown there is a strong interest in commercialisation and a willingness [in university research] to engage with industry,” she told the Australian Financial Review’s Innovation Summit in Sydney today.

“One of the issues is the nature of our industry sector. We are dominated by small to medium enterprises and we tend to be low in the level of innovation happening at this level. We have a problem here where research has all the will in the world to knock on doors of industry – the trouble is they’re not going to get a terribly good reception,” she says.

“We need to grow an innovative culture in these companies.”

TGR BioSciences focuses on drug discovery assay technologies and applies its core skills in cell biology to the development of new biodetection technologies.

Universities willing to engage

Emeritus Professor Jim Piper AM, President of Science and Technology Australia, and previously from Macquarie University, says there is a “high awareness” in universities to “encourage commercialisation”.

“There are impediments, however.

“One of the issues is the silo-isation of research which has been aided and abetted by the funding mechanism of universities.”

Many people forget that the university system is a service industry driven by international reputation, Piper points out. International students choose universities based on their impact factor and international reputation, and Australian universities rely heavily on liquidity from international students.

Shifting to a focus towards research commercialisation-based funding, or key performance indicators based on partnership success, the so-called ‘partner or perish’ is a massive shift in this context, he says – but one that universities are willing to make.

“One thing you can say about university researchers is they really chase the money. If that is in collaboration, then that is where they will chase it.

“One of the issues with unis is that, in most cases, commercialisation officers don’t have critical mass and there are challenges.”

For example, there are challenges in sharing and applying intellectual property (IP), he says.

“At Macquarie University, students at the start are invited to assign their intellectual property rights to the university so the uni can negotiate on their part. Often [in other universities] students keep their IP and this can be very complicated,” he told the summit.

Practice makes perfect

The problem may lie in experience in negotiations, says Professor Ian Frazer AC, Chair of the Medical Research Future Fund and inventor of the cervical cancer vaccine.

“We probably aren’t experienced enough at this negotiation [between academia and industry],” says Frazer. “There are excellent examples of industry-uni partnerships working, but there needs to be a lot of talk to make this happen.

“We’ve got to change both sides of the equation, for industries and universities. For example, the health sector relies on unis to provide input to research. We need to ensure that there is engagement between health researchers and industry, but industry needs to realise that research is critical to what it does,” he says.

Dr Steve Jones, global head of research and development at Australian R&D spin off cancer company Sirtex – a medical device company providing a radioactive treatment for inoperable liver cancer – agrees that universities have “had a rough ride” to make dramatic changes to the way they incentivise research to promote collaboration and research commercialisation.

Sirtex has approached universities to work on research but found that it worked best when they had an identifiable problem to take to the researchers, he told Science Meets Business.

Unis have work to do too

Read acknowledges that universities also have work to do, with funding for projects traditionally focussed on research project grants rather than looking to the issues faced by customers, the business approach controversially emphasised by CSIRO CEO Dr Larry Marshall, who also spoke at the summit.

“We need more of a ‘what is the problem and how do I solve it’ approach – this is what Cooperative Research Centres do well and we need more of that kind of research,” says Read.

More pull less push towards research commercialisation

Chief Defence Scientist Dr Alex Zelinksy says any successful negotiation “needs to be win-win” for both university and industry.

“There is a push and a pull element. There is a pioneering spirit (do it yourself) rather than an entrepreneurial spirit in terms of business and commercialisation of research. We need everyone to come together.”

He agrees that one of the barrier is around intellectual property. “Access to IP needs to be on fair and commercial terms.”

– Heather Catchpole

Read more: Collaborate or Crumble

Innovating Australia

Australia faces a challenging period in shifting towards an ‘innovation economy’, with a drive towards greater participation in science and technology; an increased focus on commercialisation success; and partnering research with industry. But how will we get there?

In this unique series, leaders from government, industry and academia share their vision for Australia’s innovation future, including Australia’s Chief Scientist Alan Finkel, Telstra’s CTO Vish Nandlall, CEO of AusBiotech Anna Lavelle, entrepreneur, surgeon and inventor Fiona Woods, Chief Defence Scientist Alex Zelinksy, and the Vice Chancellors from QUT, Peter Coaldrake, and Western Sydney Uni Barney Glover, and many more.

Read the Thought Leadership Series: Australia’s Innovation Future, here. Commentaries will be published throughout the week.

The path forward

There is no doubt that Australian R&D often punches far above its weight for the size of the nation’s population. But for too long Australian invention has stalled at the crucial points in moving research from lab to marketplace. From a nation of thinkers, there has been too little product. Buoyed by the rich resources in the landscape, we have rested on our laurels, riding the sheep’s back or relying on our mineral wealth.

There are notable exceptions. Most Australians, for example, are familiar with the success of the cochlear implant, invented by Professor Graeme Clark and pioneered with a team of surgeons at Melbourne’s Royal Victorian Eye and Ear Hospital. This clever little device is now distributed in over 120 countries and has helped over 320,000 hearing-impaired patients. In the inaugural 2016 Top 25 Science Meets Business R&D spin-off list, this and other less familiar success stories – including companies just starting to make their mark – were noted and celebrated.

In December 2015, the Turnbull government pushed an agenda on innovation – the so-called #ideas boom. The innovation agenda clearly indicates that Australia must move from a resource-based economy to a knowledge-based economy. It highlights the poor track record of research commercialisation, and low rates of collaboration between industry and research organisations. The Organisation for Economic Cooperation and Development rates Australia as last or second last on the level of collaboration against other developed nations. So how much further forward does the ideas boom push us, and what more can be done?

The December 2015 agenda throws $1.1 billion towards steps to address stagnation in research commercialisation and business growth in STEM. This includes $200 million industry incentive to work with the CSIRO and Australian universities, and a 20% non-refundable tax offset for early stage investors. There’s also money for Australian businesses looking to relocate overseas, bonuses for universities collaborating and resources allocated towards raising awareness of the importance of STEM in education.

While the money sounds great, transitioning towards a knowledge economy is more than just a fiscal move – it requires a fundamental shift in the notion of what it is to be Australian. The pathway towards this mental reimagining is far from clear, and will involve people in business, education, research and communication industries to change their thinking, develop ideas and set in motion a totally different model of achievement.

In this thought leadership series, those stepping up to deliver on this challenge describe their vision of science, technology, engineering, maths, and medicine – in the way we do the research and in how we benefit from these fields – to describe their first step towards this brave new world. – Heather Catchpole

Read the Thought Leadership Series: Australian Innovation Future, here.

Contributors

Dr Alan Finkel AO, Chief Scientist of Australia

Dr Anna Lavelle, CEO and Executive Director of AusBiotech

Professor Peter Coaldrake AO, Vice-Chancellor of QUT

Dr Krystal Evans, CEO of the BioMelbourne Network

Professor Peter Klinken, Chief Scientist of Western Australia

Professor Barney Glover, Vice-Chancellor and President of Western Sydney University and Dr Andy Marks, Assistant Vice-Chancellor (Strategy and Policy) of Western Sydney University

Dr Cathy Foley, Chief of CSIRO’s Division of Materials Science and Engineering

Dr Alex Zelinsky, Chief Defence Scientist and Head of the Defence Science and Technology Group

Vish Nandlall, Chief Technology Officer of Telstra

Professor Fiona M Wood, FRACS AM, Director of the Burns Service of Western Australia and the Burn Injury Research Unit at the University of Western Australia

Everyday this week

John Pollaers, Chairman of the Australian Advanced Manufacturing Council

Robert Hillard, Managing Partner of Deloitte Consulting

Kim McKay AO, CEO and Executive Director of the Australian Museum

Philip Livingston, Founder and Managing Director of Redback Technologies