Download Title

The Role of ICT Innovation and
Technology in Productivity
ABS NatStats Conference
David Skellern
Chief Executive Officer
Farm water - what is the problem?
• Seepage, evaporation and
operational losses mean that
less than 50% of water gets to
the plant
~50%
lost
Part of a solution:
 Improved planning
 Integrated water resources mgmt
 Modernized infrastructure
NICTA Copyright 2010
From imagination to impact
2
Water Information Networks
Channel System
Commercial
Regulator
main
Gate
Repeater
node
Central
node
(data model)
Water managed from reservoir to plant
On farm
experimental
NICTA Copyright 2010
Farm nodes
From imagination to impact
3
An example of what can be achieved
WIN-1 innovations in sensing and real-time closedloop control on the farm have end-user benefits:
• Dairy (irrigation for dairy pasture production)
– 26% water savings per irrigation season (ML of water)
– 27% improvement in water productivity (tonnes of dry matter /
ML of water)
– 38% improvement in gross margin (AU$ / hectare / year)
– Lower peak demand on irrigation water distribution system
• Horticulture (irrigation for ‘Pink Lady’ apple orchard)
– 73% increase in gross returns (AU$ / hectare)
– 74% increase in economic water productivity (AU$/ML of water)
Source: VIC STI Program “Regional and economic benefits through smarter irrigation”,
2005 - 2008
NICTA Copyright 2010
From imagination to impact
4
ICT influence on productivity & wellbeing
ICT increases productivity and improves our
wellbeing by
• Creating new-to-world products, processes
and services - often accompanied by new
industries
• Increasing the efficiency of personal,
business and government transactions and
processes
• Triggering transformation of existing
industries through enabling new business
models
NICTA Copyright 2010
From imagination to impact
5
Lending Industry - Home Loan Process
Mortgage
broker
Credit
bureau
Lender
Loan
customer
Property
Valuer
Mortgage
insurer
State revenue
office
Settlement:
Customer’s solicitor
Seller’s solicitor
NICTA Copyright 2010
Land titles
office
From imagination to impact
6
Going online has major benefits
• Some highlights
– Increased speed/efficiency of transaction processing
 Commonwealth Bank reports* that the time for
approving a home loan extension has moved from 1422 days to 14-15 mins.
– Increases participation through reduced complexity
e-Application reached 89% over 3 years to 2008
Before: $1 billion spent on the loan approval process every
year in Australia
Now:
• Savings* min $68 of $450 average loan approval cost
• FY2009 total savings* in range $46-107 million
* Australia’s Digital Economy: Future Directions ©
Commonwealth Bank of Australia and the Commonwealth of Australia, 2009
NICTA Copyright 2010
From imagination to impact
7
The industry is transforming
• Going online leads to Industry Structural Change
• Growing trend in advanced lending process is
outsourcing
• Mortgage Broker aggregators
• Property Valuers
– scaling from a dozen in-house valuers to 100+
contract valuers using mobile apps & Web
services remotely
– readying for the first National Valuer Network
(aggregator)
NICTA Copyright 2010
From imagination to impact
8
The Cost of Australia’s ICT Trade Deficit
NICTA Copyright 2010
From imagination to impact
9
OECD findings on R&D and Productivity
• Strong relationship between R&D and
productivity (16 countries, ~20 yrs)*
– 1% increase in business R&D corresponds to 0.13%
increase in productivity
– 1% increase in public R&D corresponds to 0.17%
increase in productivity
(av increase in MFP over study period = 0.8%)
• Australian relationship #
– 1% increase in business R&D corresponds to a
0.11% increase in productivity
– 1% increase in public R&D corresponds to a 0.28%
increase in productivity
*Gullec & Van Pottelsberghe, From R&D to productivity growth: Do the Institutional Settings and Source of Funds Matter?, OECD 2001
# Sources of Knowledge and Productivity: How Robust is the Relationship, OECD 2006
NICTA Copyright 2010
From imagination to impact
10
Australian investment in R&D (2006/07)
• Australia R&D expenditure: ~$21 B; 2.01% of GDP
–
–
–
–
OECD average 2.26% of GDP (Australian gap ~$2.6B)
EU target 3% of GDP by 2010, likely to achieve 2.6%
Many countries invest over 3% (eg Sweden, Japan,…)
BERD: 59%, GOVERD: 14.5%, HERD: 26.5%
• Australian ICT R&D expenditure: ~$2.3B (~11%)
– BERD: 84%, GOVERD: 5%, HERD: 11%
(EU >20%)
• We’re under-investing in ICT R&D
BERD: Business Expenditure on R&D
GOVERD: Government Expenditure on R&D
HERD: Higher education Expenditure on R&D
NICTA Copyright 2010
From imagination to impact
11
Collaboration
NICTA Copyright 2010
From imagination to impact
12
Collaboration - Firms
Firms collaborating on innovation activities by size, 2004-06
Turkey
United Kingdom
Australia (2006-07)
Italy
New Zealand (2006-07)
Norway
Slovak Republic
Spain
Germany
Luxembourg
Portugal
Ireland
Netherlands
Large firms
Poland
Czech Republic
France
Sweden
Greece
Estonia
Austria
Belgium
Slovenia
Finland
80
70
60
50
40
30
20
10
0
Denmark
SMEs
Hungary
%
OECD Science, Technology and Industry Scoreboard 2009 - OECD © 2009
NICTA Copyright 2010
From imagination to impact
13
Thank you
NICTA Copyright 2010
From imagination to impact
14