It's no secret the Federal government wants to reinvigorate Australian innovation policy.
In the last month alone, the government announced more than 630 submissions have been received towards its Review of the National Innovation System. It also launched a national program of festivals to increase innovation awareness in the wider community.
We know innovation is central to Australia's economic future, arresting the ‘brain drain' and ensuring we continue to build strong, non-resources led, alternative export industries, among other macroeconomic drivers. We also know that government policy provides a strong foundation for fostering and encouraging innovation.
But it's also up to industry and the businesses within them to make incisive judgements on how to best leverage the skills and resources they have to ensure Australia retains a reputation for innovation, particularly on the international stage. Consider these examples.
If we cast our eyes back to the contract manufacturing boom in the late '90s and early '00s, there was a call to action to Australian business to focus on the value-added areas where we are traditionally strong - engineering, design and R&D - rather than on trying to keep dwindling local production facilities open.
The call was a recognition that Australia could not compete with burgeoning South East Asian economies when it came to volume production. Rather, where we could thrive was creating innovative designs that could be licensed back to the volume manufacturers. Australia continues to be recognised as a leader in engineering design, development and commercialisation as a result of the decisions made by industry at this time.
Fast forward to 2008, one of the key issues facing the ICT sector is an integration roadblock. In building up their IT environments, most businesses purchased products from multiple vendors that were considered 'best-of-breed' in their respective markets.
A by-product of this strategy is that, eventually, businesses wanted to link all these individual products together. This created a market for integration services but, like volume manufacturing, these services are now shifting to larger firms in SE Asia that can price them more aggressively compared to local providers.
At the same time, integration is no longer an afterthought in the product development process. Increasingly it's a standard off-the-shelf feature of new and existing products, and the technology platforms they are built on. When products share the same foundation, basic integration challenges (and therefore, the need to engage integrators to resolve them) in many cases can be negated. Customers buy products that can be connected to others easily 'out-of-the-box', and that are interoperable by design from day one.
We know one of the keys to fostering innovation is for industry to constantly and consistently assess what they're good at - and consequently what they can hand off. ICT is fast approaching a time where we must decide whether to continue offering basic integration services locally, or alternatively rely on offshore providers or the products themselves to resolve integration issues natively.
By abandoning generic integration, an opportunity exists for the ICT integration services sector to effectively rechannel its collective skills and efforts into creating new and innovative approaches to business challenges, particularly around emerging Internet services. It is these innovative approaches that will prove most lucrative to long-term growth and business value.
Internet services are a key frontier for innovation moving forward. The impact of social networks, new media, commerce and other innovations targeting consumers on the web barely scratches the surface of the much broader effect that Internet services innovation will have on individuals, businesses and developers. These groups are increasingly demanding customised and seamless experiences across a range of different access points and devices.
Integration between the various elements that make up these experiences - software, services and the web - is critical.
Platform creators like Microsoft have both a role to play and commercial interest in making interoperability and integration a standard part of their tools. To create innovative Internet services, developers need to mash together compositions or loose federations of cooperating systems in a way that can be delivered out to a mesh of devices. They are increasingly looking for common toolsets, development languages and frameworks to simplify this process - and it is in the interests of Microsoft and others to provide the necessary tools and platforms to facilitate a new round of innovation.
In summary, interoperability is an enabler for the ICT and professional services sectors to sideline many basic product and information integration challenges faced by businesses.
Those that embrace it can free up and reallocate valuable skills and resources to create new and exciting approaches to common business challenges. The ensuing wave of innovation, combined with Federal policy improvements, will go a long way to securing Australia's future.
Greg Stone is chief technology officer at Microsoft Australia.