Australians need to embrace risk and failure for government’s ‘ideas boom’ to succeed: Wyatt Roy

Australians need to be ready to embrace a different approach to risk and failure to ensure the ideas boom is successful, Assistant Minister for Innovation Wyatt Roy says.

Speaking at the CEDA Digital Bytes Series launch last Friday, Roy said a lot still needs to be done before the government’s innovation mandate yields results.

“Australia has work to do. We need to challenge the mindset against risk and failure. Success needs to be celebrated and failure learnt from,” he said.

The Turnbull government’s push for an “ideas boom” focuses on diversifying the Australian economy through technological advancement as the country’s resources boom continues to slow. This new sector of innovation and ideas will drive Australia’s next wave of economic growth and job creation.

The government’s $1.1 billion National Innovation and Science Agenda is targeted at facilitating this shift, with the package pushing for investment to boost innovative start-ups and business research and development, as well as providing tax incentives to businesses willing to invest in innovation and develop the skills of Australia’s future workforce.

However, Stephen Rutter, Manager of UTS Business Practice Unit, says this all banks on a necessary change in mentality.

“Australians have a high tolerance of short term risk,” Rutter told International Business Times Australia. “People feel comfortable losing money on gambling [but] appetites for long term risk ... are not there."

This long-term risk intolerance can be seen in the lack of investor confidence in Australian start-ups and research and development.

Current business expenditure on research and development, while growing, is also relatively low compared with countries such as South Korea (4.15% of GDP), with $18.8 billion (1.23% of GDP) of the gross amount invested coming from the business sector in 2013-14.

While Roy said Australia has many strengths to assist in its transformation to an ideas-led economy, including strong human capital, an ideal lifestyle to attract the globe’s best entrepreneurs and an exclusive access to Asian markets, he concedes the only way to engender true cultural change is to “create an innovative ecosystem that is uniquely Australian”.

This means Australia’s risk averse culture needs to shift, so that more confidence is placed on entrepreneurs who take risk and learn from failure, rather than condemn failed projects and ventures.

Roy added the government will need to be prepared to modify policies on a regular basis to keep up with changes and opportunities presented in the global economy.