Australia in the global network economy

Last week The Bulletin, Australia’s premier newsweekly magazine, ran an interesting article on the role of technology in the future of Australia, drawing heavily on an interview with me. The broad topic of how Australia – and all other countries – can be successful in the swiftly evolving global economy is taking much of my attention, and I anticipate spending increasing time on this theme. In an intensely connected and interdependent world, it is impossible to stand alone. The idea of creating products, services, and ideas at home and then taking them to a global market is increasingly dated. All aspects of the innovation and commercialization process need to access global best-of-breed talent from the outset. Australia certainly doesn’t suffer from a lack of talent. Australians are well ensconsed in the most sophisticated business, technology, and academic circles around the planet. An interesting statistic is that 6% of open source coders hail from Australia, making it the most heavily-represented country in this domain relative to its population. However, with some notable exceptions, Australian technology innovation isn’t positioned to capture global markets. Part of the issue lies in the size of the economy. With 20 million people – not to mention the reality of geographical isolation – there is a mentality of economic self-sufficiency. Countries such as Singapore, with 3 million people, and Finland, with 5 million people, have no illusion of self-sufficiency and so seek more actively to integrate themselves into the global economy. A key theme that is brought out from my quotes in the article is that of specialization. As scientific and technological progress drives deeper specialization, we must as individuals, organizations, and indeed countries, very carefully select the domains in which we specialize, where we can have a reasonable possibility of being world leaders, and then who we will collaborate with to create value from our expertise. Very likely those collaborators will not be in the same country as us. We must form ties with whoever in the world provides the best complement to our skills. Building and leveraging the supporting networks is a critical skill that Australians – and others – must develop. We live in an increasingly location-independent economy. If you have deep specialist expertise, and connect and collaborate well, you can create massive value, wherever you reside.