Innovation may have been the big buzz word in the mining sector for a number of years, but it has been thrown around so much it has become a vague concept with no real way of measuring its value.

This was the view of VCI CEO Graeme Stanway and is part of the reasoning presented in a series of three reports by the global management consultancy, looking into the true meaning and value of innovation by linking it directly to shareholder returns. 

“We wanted to give companies some cold, hard data and targeted knowledge on where they should be focusing their innovation e orts,” Dr Stanway said. 

“Rather than just creating and delivering innovation, we can now measure impacts – applicable not just in mining, but in any sector.” 

State of Play: Delivering Strategy and Innovation is the first of the three reports, aimed at providing some tangible takeaways for mining companies across Australia to improve their innovation strategies. 

The second report in the series was released at the start of September and looked at the external environments and the ecosystem that shapes the mining industry, with the final report looking at strategy, specific business model shifts and strategic positioning released this month. 

“What we have done with these reports is the classic division of strategic thinking from the external environment to create strategic positioning and enable better delivery of innovation,” Dr Stanway said. “We have started from the back end by releasing the delivery report first, as it’s crucial to think about how you’re going to deliver and drive things forward when you’re creating innovation.” 

The first report suggested companies should look to develop a two-stream innovation program, with an innovation plan to tackle the immediate future and one looking five to 10 years into the future. 

“When we tested this theory with really good leaders we found it made a lot of sense,” Dr Stanway said. “It’s like a salmon swimming upstream, you need to keep going with the urgency of innovations in front of you, but you also have to have your eye on the longer-term vision that’s really going to shift the business.” 

Dr Stanway said it was advisable to encourage different people within the business to drive each of the approaches. 

“The most successful organisations will rely on their strategic thinkers and the board and executives to drive long-term five-to-10-year innovation plan, and then junior staff who are working onsite or are close to the actual operation are empowered to make short-term continuous-improvement innovation to keep optimising operations or improve day-to-day, week-to-week,” he said. 

“Every time we talk about the report with executives in?the industry and board members in particular, it really resonates for them because you don’t just have to think about innovation in one time frame, its best to think in two.” 

With the State of Play: Delivering Strategy and Innovation report suggesting an optimum timeframe for innovation to be delivered, Dr Stanway said Australia, and Western Australia in particular, was at the slower end of the timeframe spectrum, making this a key area for improvement. 

Dr Stanway said WA was a victim of its own success. 

“One thing we found with all of this research is innovation is often lineally proportional to need, and that’s my biggest fear for WA,” he said. “Has WA really capitalised on its success and what good companies have done? Good companies are encouraged to and can create urgency structurally, so there’s no reason why the state as a whole couldn’t do it as well.” 

Looking further afield, Dr Stanway said Australia was a leader on many fronts and was in an excellent position to capitalise on some of the emerging trends externally that were starting to shape the industry. 

In particular Dr Stanway said Australia could take the lead on energy transformation trends and was uniquely positioned to take advantage of hydrogen and solar, as well as being in a good position to tackle social and transparency issues. 

“We’re in a really good position to actually shape that transparent supply chain because of the nature of the scrutiny we have already got in our system,” he said