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Innovation in New Zealand is on the decline. It's time to ask: do we really value new ideas?

Innovation in New Zealand is on the decline. It's time to ask: do we really value new ideas?

Jason Smith

Creative Metrics

New ideas are wellsprings for ongoing business success. Innovation in business makes the wheels of commerce go around. In this increasingly technology-driven age, new ideas are essential merely to maintain the status quo, let alone make leaps and bounds of progress.

So brace yourself: Kiwi business ideas could be flowing less abundantly than in the past, as the chart of declining levels of innovation indicate. This is a different innovation measure from the application of intellectual property trademarks, patents and designs. In research by Statistics New Zealand, all four areas of business innovation measures are a trickle rather than torrent. Compounding ideas from the last Creative Metrics column (Idealog #27, page 119) in which the increasing commoditisation of New Zealand's exports was highlighted, concerns about declining levels of innovation of business practices would be well-founded. More and more, there is less and less.

Rather than suggest we are going down the gurgler, though, there may be a blockage in the pipes. Robust research and development (R&D) is required to keep up with the flow. Ideas don't just spring up from anywhere. Two things are occurring at the same time in this space: there is a shift away from dipping into expert professional research for innovation, and a corresponding increase in use of inexpert sources of ideas for innovation.

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Source: Statistics NZ / Graphic: Su Yin Khoo

Paying for new ideas comes hard for Kiwi businesses, when you can get something for free. Lord Rutherford's famous suggestion that Kiwis don't have the money so they have to think still echoes through the country nearly a century on, part of the national innovation story recounted whenever belt-tightening reduces R&D budgets. It's easy to gloss over the fact that Rutherford had to cross the globe to get the resources to pursue his own ideas.

In-house innovation and cheap advice may feel good at the time but in the longer term it is seldom 'cheap' at all. The dangers include groupthink where, closed off from external influences, everyone talks themselves into believing in an unproven notion. As if the tyranny of distance from wealthy export markets weren't enough of a challenge, business innovation practices may be making New Zealand a backwater when it should be in full flood.

Hokey No 8 wire notions may be cold comfort in the era of fibre-optic cables. To swim rather than sink, we need to champion the value of innovation—and be prepared to pay for it. With the right balance between the R&D sources used for innovation, our proverbial cups will runneth over.