Callaghan Innovation – a critique

By Guest Work 13/05/2014

By Dr Horace Moore

“Bureaucracy destroys initiative. The government solution to a problem

is usually as bad as the problem.”Milton Friedman


Horace Moore
Horace Moore

In its Statement of Intent 2012­ – 2015 released on 24 May 2012, the Ministry of Science and Innovation states that:

“The ministry’s greatest imaginable challenge is to double the value from science and innovation for New Zealand over the next five years.”


The ‘Powering Innovation’ Report [“Improving access to and uptake of R&D in the high value manufacturing and services sector”] prepared by an independent panel commissioned by the Ministry of Science and Innovation, was released on 28 April 2011.

On 12 July 2012 the Prime Minister John Key and Science and Innovation Minister Steven Joyce announced the structure for a new Advanced Technology Institute (ATI) destined to become a ”high­tech HQ for innovative New Zealand businesses.” The primary justification cited by government for creating ATI are the 26 recommendations made by the panel that produced the “Powering Innovation” Report.

The various precursor announcements by government as to the merits of the ATI concept and the techno­economic benefits it would engender were messianic in their fervour, prophetic as to beneficial outcomes, but lacking any credible scenario.

Establishment Board

On  21  August  2012,  the  Minister  of  Science  &  Innovation  appointed  seven  members  to  an Establishment Board [”Board”] tasked with having the ATI up and running by the end of the year; later  postponed  to  1  February  2013.  This  Board  was  to  be  responsible  for  making  decisions regarding  strategic  direction,  infrastructure  and  staff  requirements  and  for  engaging with stakeholders  and  staff  at  a  number  of  agencies  that  are  affected  by  the  Institute’s  formation.

Pending the recruitment and appointment of an ATI CEO theE Board Chair would play that role. The individual members of the E Board were well qualified and experienced in their respective professional fields. However, it was evident that expertise in the theory and or practice of techno­economics engendered by technological innovation was not an appointment criterion. During the 6­month period from 1 February 2013 to 30 June 2013 the Board published several newsletters. They were not reports that enabled the reader to understand the progress being made against an establishment plan. In fact no such plan has existed. During this period only one matter of substance was reported upon, namely the disposition of IRL.

Following is an excerpt from CI Newsletter No. 2:

`“The success of Callaghan Innovation ultimately will be measured by the size of the step­change in profitable “cash register­ringing” in firms from the application of science, engineering, design and technology. The establishment of Callaghan Innovation is about “doing more”.

Such fanciful metaphoric criteria as the above cannot be used to objectively determine the performance of the Board during the establishment phase. The following review of the Board’s formal publications provides the basis for the conclusions reached as to the viability of the CI enterprise and the worthiness of its accomplishments.

ATI Business Case: 1 February to 30 June 2013

This document is a semantically challenging read. Obscurity of meaning abounds. Its purpose is to justify release by Government of the funding that has been appropriated to support CI. The question immediately arises as why a 65­page [26,192­word] script was required to justify the release of funds that had already been appropriated? In any event, since it is not presented in the context of a business plan this ‘funding justification’ has no basis in reality.

CI  Statement  of  Intent  [For  the  Three  Years  to  30  June  2016  [58  Pages;  19,007 Words]

The bulk of this document is a regurgitation of previously published statements as to CI’s mission, responsibilities, and objectives. Basically it is a list of loosely defined action items sans any associated implementation plans. The Foreword to this document summarises a schedule of activities that CI intends to undertake and/or accomplish during the three years to 30 June 2016. In consideration of the complex nature and extent of these activities this forecast lacks credibility.

The content of the section titled “Motivating Innovation Culture” comes across as a litany of superficial promises reflecting minimal understanding of the complex socio­cultural issues confronting CI, both internally and externally. Did the Board really believe that seasoned business executives would be motivated by such trite slogans as “Better by Big” and “Go for Growth”? As for “Take Your Child to WorK Day”, how innovative can one get?

CI Annual Report to 30 June 2013

Screen Shot 2014-05-13 at 11.00.57 AM

This document is basically a financial report. However there is a Foreword, the second to last paragraph of which reads as follows:

“Finally, in developing the Business Case, we had the following focal point: a connected innovation system, where the emphasis is not just on ideas, but faster commercialisation of those ideas; where innovative businesses have access to the markets, skills, capital and technology they need in order to accelerate the commercialisation of their innovations”.

The Board’s claim that its focal point, when developing the CI Business Case, was “a connected innovation system” is not supported by the content of that document. Nor do the CI’s Statements of Intent project a singular sense of innovative purpose. The reason for this nebulous state of affairs is obvious – the putative Callaghan Innovation has been operating without a business plan that explicitly states its primary objectives with related time­lines. Without such a plan, progress cannot be measured nor management accountability ensured.


“If you’re not the best at what you’re doing, don’t bother.” — Sir Paul Callaghan

1. CI, as established by the Establishment Board, is a government orchestrated bureaucracy wherein CI, rather than being the playwright/director, is just another actor on NZ’s fragmented innovation stage. Lacking a realistic script this charade could have an early closing.

2. The key reason for this sterile outcome is that few, if any, of the government appointed members of the Establishment Board were recognised experts in any key sector of the complex process that is simplistically referred to as “innovation”. In deed the usage of this word in the Board’s publications is effectively the definition of a “buzzword”.

3. To date there is no explicit evidence that CI has a deep cognitive understanding of the evolutionary history, underlying philosophy, theory, abstractive models, and diffusion of technological innovation in a socio­cultural environment.

4. To initiate the dissolution of IRL [a fully functional entity] and engraft it onto ATI [a self­ designated start­up] was at least premature, if not irresponsible. Further, no plan was published detailing how this disruptive undertaking would be managed. Consequently, IRL is now ‘Callaghan Research Limited’, a ‘subsidiary of CI’, a far cry from being [say] “NZ’s “high­tech HQ”. The emergence of CI with IRL appended inevitably reminds one of the horse designed by a committee. Or was it simply that the Board followed the sage advice of NY Yankees’ manager Yogi Berra who advised: “When you arrive at a fork in the road, take it.”

5. By ignoring the fact that an embryonic technological innovative ecosystem has been evolving in NZ since pre­colonial days the ATI concept was flawed from the outset. CI’s singular purpose should have been to catalyse the emergence and maturation of the pre­ existing embryonic system to become a world­class NZ Innovation Eco­system [“NZIES”].

Such an enterprise would be characterised as follows:

  • would not directly engage in any R&D activities
  • would be staffed by academically qualified professionals having in­depth knowledge and experience in the following sectors.
  1. national economic policy
  2. technological innovation process
  3. socio­cultural environment.
  4. organisation & management
  • would,  in  consultation  with  all “actors”  produce  and  periodically  update  a  produce  and  periodically  update  a strategic plan for the establishment of a NZ Innovation System [“NZIES”]

6. CI should focus on the following synergistic activities & provide related funding as required to facilitate the emergence and establishment of NZIES.

  • Expediting the implementation of ‘Avatar’
  • Educating ‘actors’ through presentations and conferences
  • Facilitating synergistic interactions & communications between ‘actors’
  • Troubleshooting, advising & mentoring re specific ‘actor’ issues
  • Providing ‘on site’ long term assistance in planning, organising, and implementation
  • Organising periodic NZNIES Workshops
  • Establishing appropriate relationships with international organisations
  • strategic plan for the establishment of a NZ Innovation System [“NZIES”]

Dr Horace Moore is a science and technology consultant. He was educated at Greymouth Technical High School and Canterbury University College. Dr Moore’s extensive career in the world of science and technology is highlighted by the following appointments: Postdoctorate Fellow, Division of Pure Physics, NRC, Canada; Research Fellow in Physics and Member of the Faculty, California Institute of Technology; Vice President & Manager, Technical Operations, Xerox Electro-Optical Systems; Principal Scientist & Area Manager, Xerox Palo Alto Research Center.

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