Productivity in modern Australia

The focus of the 2012 Global Access Partners National Economic Review is Productivity. GAP managing director Peter Fritz explores productivity and future opportunities for Australia.

According to many authors the growth of real income depends on productivity growth and growth in productivity is the driver of per capita income and living standards. Also it has been pointed out by many that increased productivity occurs when there is trustworthy leadership in management, effective communication, encouragement of innovative solutions and employee involvement in decision making.

The relatively low productivity of Australia’s mining industry, highlights the flow in the productivity argument. In this instance it took investment in new techniques and infrastructure to seemingly reduce the productivity of a sector, company, or division of a company.

All this is well and good and the theoreticians can have a field day arguing one way or another. Where the question and argument on productivity fails is in pointing us towards solutions for the future. Take for instance the question of education and teacher productivity. I think the key issue for education has to revolve around outcomes focused on the quality of education.

One generally has the tendency to extrapolate the past into the future. When we are looking at education and education budgets we in fact miss the changes that technology has brought about. The internet has changed the world, it also changed the education sector, yet we continue to project the old costs and funding, missing the role of technology and new methods as if nothing would have changed.

We will never get out of the vicious cycle of underperformance if we continue building with no regard for our future needs. We can’t ignore new technologies or the wants of people tasked with the implementation of our plans. Projects like the National Broadband Network (NBN) create the foundation for growth through infrastructure and new services.

Recently Global Access Partners conducted an enquiry into Music Education.  The budget for music faculties and schools has been reduced by more than half and will be at crisis point if we continue with the same techniques of teaching that we have used up to now. However, by applying e-learning and e-learning infrastructure in some areas of traditional music education we can achieve much better results for much less money. Admittedly it is difficult to adapt and it may have to be a new generation of teachers that will bring us into the 21st Century.

On the issue of productivity obviously we fail on the metric that we use now and this is true right across all aspects of the economy. In order to improve our productivity profile we have to embrace the new technology available. Our attempts of retro fitting legacy processes are very expensive and are ultimately doomed. In order to benefit from disruptive technologies we will have to establish new entities on new foundations, just like Qantas established Jetstar.

There is a great deal of opposition from the establishment to bring about change. When I talk about innovation I am not talking about a generic concept I am talking about a personal endeavor and those of us who understand the changes that have been brought about by the new technologies in communication, in IT and in personal networking will reap the benefits. In that process they will be agents of change in terms of the productivity profile of their organisations and their colleagues.

There is a lot of money to be made in the new areas of publishing, news delivery, retail, crowd sourcing of ideas and implementing them, in just about in every endeavor that can benefit from the productivity increase that the internet facilitates. Good luck to you all who understand the change that we are living. On second thought you won’t need luck, just simply action.

The summit is for us a well spring of ideas that will set us on a course for the next 12 months and beyond. From a personal point of view I am looking for business ideas and opportunities in this new world. From a GAP perspective I hope everyone will achieve some level of better understanding of their own opportunities and beyond. In all eventuality I hope that everyone will have a good time.

Peter Fritz AM is Managing Director of Global Access Partners, and Group Managing Director of TCG – a diverse group of companies which over the last 40 years has produced many breakthrough discoveries in computer and communication technologies. He chairs a number of influential government and private enterprise boards and is active in the international arena, including having represented Australia on the OECD Small and Medium Size Enterprise Committee.