Can innovation save manufacturing in Queensland?

By Rowan Gilmore

THE MEDIA has been quick to explain why the last three big car manufacturers are pulling out of Australia. High costs, poor innovation, manufacturing is dying.

Is there any hope for a renaissance among smaller more agile firms that embrace innovative design and smart manufacturing?  

For example, EM Solutions, an innovative Brisbane-based firm designing and manufacturing broadband microwave radios for telecommunications and satellite links, exports more than 70 percent of its products. 

The company recently released the world’s fastest commercial radio transmitter and receiver, for carrying data traffic 20 times faster than the fastest mobile phone. Intended to carry heavy traffic in mobile or internet networks, the radio recently passed its acceptance tests on a trial between Brookfield and Springfield with flying colours. 

Technological innovation is important to compete in an industry such as telecommunications.

But home grown innovation is a tough sell, with our big telecommunications companies content to purchase equipment from large multinationals to reduce their commercial risk.

Innovation is often not enough. EM Solutions struggles to sell its products to large corporations and government agencies here at home, even while blue-chip customers overseas seek it out.

Why?

If taxpayers are spending $40 billion to lay a broadband network across Australia, why aren’t local innovators thriving on the back of that?

If Australian Defence is spending billions upgrading its telecommunications equipment, why is most imported?

It seems our large corporations don’t like to take risks, to work with SMEs, to nurture home grown innovative firms.

Even when prices are lower.

They work instead with accredited suppliers, other large organisations they think are more trustworthy than small local businesses.

One solution to prevent the further hollowing out of manufacturing in Australia is indeed to innovate; but another is for our big corporations to innovate in their technology procurement, and better manage the risk of working with small business.

The Queensland Government (through its Queensland Health payroll fiasco) has learned that ‘buying big’ did not protect it against failure, and is now adjusting its procurement practices to buy from small businesses that innovate. 

Being more innovative in their own procurement is one trend all Queensland corporations should emulate.

www.emsolutions.com.au

 

Rowan Gilmore is the managing director of EM Solutions Pty Ltd and a former CEO of the Australian Institute for Commercialisation. EM Solutions is also a current member of Queensland Leaders, the organisation helping to foster leading companies in Queensland.

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POSTED MAY 24, 2014.