8158.0 - Innovation in Australian Business, 2006-07 Quality Declaration 
ARCHIVED ISSUE Released at 11:30 AM (CANBERRA TIME) 22/08/2008   
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DRIVERS OF INNOVATION

The key drivers of innovation represent the underlying reasons why businesses may initiate innovation. Together with barriers to innovation, they represent part of a continuum of environmental factors that influence innovative activity within a business. Innovation-active businesses were asked to report the drivers for developing or introducing new goods, services, processes or methods. Businesses could select more than one driver and a ranking of importance was not required.

INNOVATION-ACTIVE BUSINESSES: Drivers of innovation(a)(b), by employment size - 2006-07
0-4 persons
5-19 persons
20-199 persons
200 or more persons
Total
%
%
%
%
%
Profit related drivers
72.5
78.5
81.6
84.2
75.9
Competition, demand and market related drivers
Be at the cutting edge of the industry
35.2
36.8
41.6
47.7
36.6
Increase responsiveness to customer needs
48.1
56.5
57.1
64.4
52.3
Ensure the business's products are competitively priced
25.9
31.9
28.1
33.6
28.4
Increase or maintain market share
40.8
49.6
47.4
55.6
44.9
Establish new markets
31.2
41.2
36.8
36.5
35.5
Increase export opportunities
5.8
7.2
8.8
11.6
6.7
Any of the above competition, demand and market related drivers
74.0
80.1
79.1
84.4
76.9
Production and delivery drivers
Increase efficiency of supplying/delivery goods or services
29.8
37.1
46.2
46.5
34.6
Improve quality of goods and services
34.3
40.0
42.2
43.6
37.4
Improve IT capabilities or better utilise IT capacity
20.1
28.8
35.6
39.9
25.3
Increase capacity of production or service provision
18.2
23.4
27.5
25.3
21.2
Any of the above production and delivery drivers
54.7
59.4
67.6
66.1
58.0
Reduce environmental impacts
10.9
12.7
14.4
26.4
12.1
Improve safety or working conditions
19.7
23.0
29.8
36.6
22.2
In response to government regulations or standards
9.9
12.1
15.6
18.3
11.4
(a) Proportions are of innovation-active businesses in each employment size category.
(b) Businesses that were innovation-active were asked for the reasons they had undertaken innovation. Businesses could identify more than one reason.


Across all employment size ranges, Profit related drivers were the most commonly reported reason for undertaking innovative activity. Overall, Increase responsive to customer needs (52%) and Increase or maintain market share (45%) were the next most commonly reported reasons. Reduce environmental impacts (12%); In response to government regulations or standards (11%); and Increase export opportunities (7%) were the least common reasons for undertaking innovative activity overall, as well as across most employment sizes.







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