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New Opportunities in the United States and how to be competitive

Published , from BusinessNZ

I was fortunate to represent BusinessNZ at the annual conference on global competitiveness, this time hosted by Productivity Canada. On the way to Canada I called in to see some key people in Washington, including Vicky Whitlock – NZTE Trade Commissioner in Washington. 

One of the strengths of the Washington Office is supporting NZ firms selling to the US Government, e.g. law enforcement, intelligence community, border security etc. 

The new WTO Government Procurement Agreement (GPA) that NZ is signing will allow access to the GSA schedule. It essentially pre-qualifies companies for selling to the US Government. Up until now, companies have had to manufacture or assemble in the US or a country that is compliant.

The GPA should create opportunities for health care companies as well, e.g. veterans health. Vicky sys the opportunities in the security market are huge, with lots of emphasis on Customs and border protection.

For utilities suppliers there is work related to protecting the grid and in Houston there is work from the oil and gas sectors – everything from work-boots to security.

In the Marine "work boat" space there will be opportunities, and NZTE partners with the Marine Industry at the annual trade show in New Orleans. 

In response to the question about what successful companies have in common, Vicky says a presence in market is important. "In the Government procurement space you need to be seen as a trusted advisor and it's hard to do that if you do not have a local presence to build relationships." NZTE also encourage NZ firms to partner with systems integrators like the Lockheed Martin's of the world. 

There are US grant programmes which NZTE can help firms to tap into and they can be significant. 

Companies need products/services that really stand out. They need enough capital to keep going and develop the market as it can take a couple of years to win the first contract. Sales cycles are long and you need to be able to service the product. A good idea is to talk to companies already doing it and NZTE can facilitate that. 

The US economy is definitely on the upswing, and the military spending and homeland security seems to go on regardless of the economy. 

Any technology that increases efficiency and cuts costs is of interest.

Meeting with Dr Cynthia McIntyre – Vice President at the US Competitiveness Council.

My discussions with Dr McIntrye focussed on how to get the small to medium sized firms to engage more with the science and R & D system. A good case study has been done by the US Competitiveness Council on how to get the larger firms helping the smaller firms lift their competitiveness. John Deere was the large firm in the pilot. They are well networked with Government research capability and know how to access the right help from the right places. Their smaller supply chain companies don't. John Deere can see who in their supply chain could benefit from the science and innovation ecosystem and helps gets them started. This is something we could look at in New Zealand with the cooperation of our larger companies.

The US Government is putting in place public private partnerships. Government, Original Equipment Manufacturers' (OEM's), State of Ohio. Using super -computing and simulation technology. There are case studies on how it worked. Once they saw what advanced computing and modelling could do their innovation took off. This is something we will explore with the New Zealand Government.

In terms of interactions between research organisations and business, those with strong Masters Programmes in Engineering are a better fit for industry.

NCSA – supercomputing (University of Illinois) basic science, applied science, engineering. Have a long standing private sector programme.

Some Manufacturing is definitely coming back to the US. Concern with IP protection off-shore, and labour costs are less of an issue as wages rise in China.

Global Federation of Competitiveness Council's Meeting in Alberta – 11-13 December 2014.

Alberta compares themselves to other resource rich economies, through formal benchmarking.

Comment was made that the US and UK have turned a corner to growth in 2014, but same can't be said for other industrialised economies. Oil dependent economies are facing large price drops in commodity prices and this highlights the need to diversify their economies.

Have had four years of 4% GDP growth, next two years likely to be 2%, but they are in good shape employment wise.

Panel Discussion – Innovation and Competitiveness

Dona Crawford, Computation Associate Director, Lawrence Livermore National Laboratory – High Performance computing and national security. Use high performance computing to test things that to test in real life would be too expensive or too dangerous, e.g. nuclear power/weapons.

Dr Ray O Johnson – Chief Technology Officer at Lockheed Martin. On R & D investment – you get what you celebrate. In the US too focussed on instant gratification and there is a need to invest in next generation solutions. Also a STEM (science, technology, engineering, maths) educated workforce is the key. US has benefited from that in the past.

National laboratories rely on big computing and Government needs to lead that investment because private sector won't. Private sector comes in behind. Need more National Goals.

Government investment in R & D is pre-competitive. They use big computing for large problems. High Performance Computing (HPC) for manufacturing is the next thing they are going to be doing at Livermore. For example they used big computing to compare attributes of helmets for football players compared to army helmets. Found they were quite well matched, but a relatively small change would significantly improve the performance of army issue helmets. With high performance computing, need the people that can run it and the software. Could be a useful investment for the NZ Government?

Lockheed Martin work with the Universities – they don't want the IP any more, just the rights to work in the areas they are interested in. Makes things less complicated. Also the IP landscape is changing because the technology is moving so fast.

Dona Crawford said clean water will be a challenge of the future – wars will be fought over water.

The observation was made that entrepreneurs that reach out to the innovation system are the ones that grow the fastest.

Upgrading Competitiveness – the role of the Regions – Dr Cristian Ketels

How do you create capacity and infrastructure at regional levels? Microeconomic competitiveness is helped by cluster activity and the sophistication of companies.

In clusters, specialisation patterns matter. Regional neighbours matter – can collaborate with your geographic neighbours to create a bigger movement.

Stronger clusters = stronger economic outcomes.

Need good quality business environment, including Universities, infrastructure, investment etc.

Regions need to specify their value proposition.

Ireland – science parks outside of Universities have worked well for Ireland. Helps gets innovation out of Universities and into the market.

Mr Jim Phillips – serial entrepreneur

Nanotechnology is the next revolution, as digital was to analogue.

Nanotechnology can be applied to anything, e.g. textiles, solar power, oil and gas extraction (lubricants)

China, Russia, Germany, Japan – all investing heavily in nanotechnology.

Interdisciplinary work amongst experts is what creates novel inventions – need to get rid of silos.

He ended with a memorable quote "Culture eats strategy for Lunch"…

By Catherine Beard

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