Does Australia need a National Innovation Policy? A recent initiative by the Victorian Government to create a co-ordinated national approach to innovation suggests the country's top policy makers believe that it does.

The argument underlying the initiative suggests that Australia's current contribution to the global pool of knowledge (2 per cent), is not enough to sustain future growth or maintain current levels of social and economic prosperity.

In the climate of industrial-age driven economic boom, which positions Australia as a satellite economy fuelling its growth through primary resource exploitation, innovation is a term that mainly refers to the innovative ways of increasing productivity levels to satisfy short-term economic demands. The real challenge, however, lies in developing the national ability to respond to long-term challenges Australia is facing not only as an economy, but as a society as a whole.

Whatever that means in the collective mind of Australia, the intuitive recognition of the national need to innovate could indeed be the unspoken winner of the Kevin 07 campaign. As the ALP strategist Steve Blume pointed out, the underlying social current that got the Rudd Government over the line was not simply that of the restless nation in need of political change. It was the one that responded to Rudd's promise he would lead a government of ‘fresh ideas'.

Those at the heart of the national innovation debate, such as the Australian Society for Knowledge Economics (SKE), believe ideas alone will not do. Theirs is a belief that rests on the understanding that innovation is not simply a synonym for more invention. Innovation, hence, lies beyond the simple notions of increasing funding for research and development or reshaping the ways it is currently done.

Together with senior government, academia and business representatives currently participating in the Victorian Government Fora on the National Innovation Agenda (NIA), SKE has suggested that the current innovation policy themes should revolve not only around the need for more innovation in business, better infrastructure, development of skills and collaborative ventures, but should also emphasise the need for fostering a whole new style of leadership and a culture conducive to making the necessary changes.

If this suggestion smacks of an Orwellian intervention, then sporadic proposals that the Rudd Government should create a stand-alone ministerial innovation portfolio, may sound even more so. Innovation, after all, is not a noun describing a specific, precisely defined process of ‘innovating' that can be boxed, funded, regulated and taxed. It is a mind-set that opens up social and organisational ability to respond to challenges in new ways hence creating growth with both economic and social returns in mind.

The crucial difference lies in our understanding of innovation as creative thinking alone. According to the Australian Bureau of Statistics (ABS), only 35 per cent of Australian organisations "actively engage in innovation". This finding should not be surprising, if "innovation" is understood as a single-stream, vertical activity.

In this sense, Australia is not considered innovative simply because it contributes only two percent to the global pool of knowledge. Increasing that contribution alone, however, does not constitute a satisfactory response to Australia's key challenge - to adapt to the challenges of the post-industrial world. Innovation, in fact, is a collaborative application of knowledge, whatever its origin, across all areas of social, political and economic activity. What Australia is missing is a co-ordinated approach to facilitating such forms of collaboration.

A National Innovation Policy, or, indeed, a stand-alone ministerial portfolio, that brings together multidisciplinary, over-arching responses to the challenge of creating future economic and social growth is, therefore, an innovative idea in its own right.

It borrows from the open innovation model to create a non-vertical, collaborative policy response where stakeholders jointly identify opportunities to boost Australia's innovation capabilities by fostering collaborative hubs and connections to enable innovation. If this portfolio had an inter-departmental, across-portfolio reach to help co-ordinate such activities at all levels, it could well contribute to fostering the culture of innovation that would ultimately produce better social and economic outcomes for our future.

The associated risk of any such exercise, of course, is its ability to become disruptive. And although ‘disruption' is a pre-condition of any significant change, the question is weather the Government (or the society, for that matter) have the stomach to absorb that risk.