Regional Soldiers

The Herald Sun ran an article earlier this year about Australia’s top 5 soldiers. We did some further research.

Thomas Blamey grew up in Wagga, became Australia’s only ever Field Marshall, and later Chief Commissioner of the Victorian Police.

Captain Albert Jacka VC, was born on a dairy farm near Winchelsea before moving to Wedderburn. He fought at Gallipoli and on the western front, and became a champion for the unemployed. Also Mayor of St Kilda.

Colonel Sir ‘Weary’ Dunlop, the surgeon renowned for his leadership in a Japanese POW camp, was born in Wangaratta and schooled in Benalla.

General Sir John Monash, arguably Australia’s greatest soldier, spent his formative years in Jerilderie. He did fantastic work in repatriating Australian troops, and established the Latrobe Valley coal industry.

General Peter Cosgrove grew up in Sydney’s eastern suburbs and attended Waverley College and then Duntroon. He does a huge amount of social service, and is tipped as our next Governor General.

Notice a trend here? Well, except for Cosgrove, they all grew up in northern Victoria or the Riverina. One might say that half the nation came from the regions in those days, but the clustering effect is quite remarkable. Did the rural lifestyle instil some particular characteristics?

Canada’s defence industrial policy for national security

Arvin Jelliss (Ottawa) has forwarded an interesting item by Tim Page president of Canadian Association of Defence & Security Industries (CADSI).

• Harper government has taken steps to rebuildCanada’s defence and security brand internationally e.g. Canada First Defence Strategy.
• Government also commissioned a special report on innovation and defence procurement from an expert panel – Canada to adopt a defence industrial policy to target federal R&D, export and procurement strategies toward key domestic industrial capabilities to help level the playing field for Canadian industry (very interesting!!)
• National Shipbuilding Procurement Strategy announced – clear manifestation ofCanadaacting in its own strategic national interests.
• December 2009 report, prepared by the Canadian Association of Defence and Security Industries, identified key domestic industrial capability areas of national interest. e.g. where Canada has established global champions and economic value – so-called C4ISR systems (Command, Control, Communications, Computers, Intelligence, Surveillance and Reconnaissance), geospatial and intelligence systems, sensors, sonar and mission systems, chemical, biological, radiological, and nuclear detection, protection and decontamination, and personal protective clothing and equipment, along with shelters and containers, simulation and training, armoured land vehicles, military-designed aircraft, composites, avionics, aircraft engines and landing gear.
• CADSI has also identified areas that hold strategic security and sovereign value e.g. systems integration, computer security architectures, ordinance, ammunition and small arms, maritime domain awareness, port and border security.

Leveraging defence expenditure for wider outcomes

 We are currently identifying the scope to leverage defence expenditure for wider economic and commercial outcomes at the regional level. We put a request out to Cockatoo members for any insights and got some very interesting snippets.

 From Stu Rosenfeld: ‘As part of recentFortBragg inNorth Carolina is treated as a large economic hub, if not a cluster in the conventional sense.  The cluster impact is mostly based on meeting the needs of the large and mobile population residing there such as purchasing some local foods, landscaping, refuse collection, hospitality and recreation, transportation, retail, many other services.  But the larger military supply chain for the base, e.g., equipment, technologies, etc. is global.  The defense clusters we typically work with are defense contractors like the Technology Coast Manufacturers Network in northernFlorida.’

 From an ex-senior (very) official in Defence Department (Australia): ‘The trick to industry development would be working around a matrix of (a) niche areas of defence capability that will be in demand over the next 10-20 years, and (b) the fields in which our defence companies have some sort of competitive advantage. But my old department won’t share the information!’

This could be the kernel of a fascinating project. Does anyone know of anything similar in other countries?    

South Australia’s defence cluster

South Australia once ran the best cluster program in Australia. The main architects were Mick O’Neill (until recently Deputy CEO, SA Dept. of Trade & Economic Development) and Hugh Forde (an ex-Irishman). In this series Mick provides Cockatoo readers with an exclusive insight into its origins and performance.

 The sector had evolved over 40 years and had substantial critical mass partly due to the SA government’s role in attracting new companies and high profile projects.

However there was limited engagement with the existing local industry. Through the SA cluster program, a new entity – the Defence Teaming Centre – was formed to facilitate collaboration and address strategic issues such as workforce and capability promotion.

 The State government reluctantly provided funding to support the DTC and gave in-principle endorsement (responding to a forceful pitch from a high profile industry leader). The DTC was subsequently responsible for facilitating more than $100m of new projects and gave the industry a voice and a vehicle for engaging with State and Federal governments.

Nevertheless personalities and politics (small and large P) and burn out took their tolls and the Centre waxed and waned. It somehow survived, retaining a modest level of government funding but always at risk. The Centre and the sector were embraced by a new government in 2002 and a new, well-connected former Rear Admiral (Kevin Scarce, now the State Governor), saw the merits of the Centre as a vehicle for engaging with the industry. Funding was significantly enhanced and the Centre is now a very impressive operation. (www.dtc.org.au)

At this point it is useful to distinguish the cluster from the entity supporting the cluster – and this applies to all clusters. The defence sector/cluster is now recognised as one of the two most significant sectors driving SA’s economy alongside mining. It receives more than 30% of allAustralia’s defence contracts (in a state that is 7% of the national economy). While individual companies face significant challenges related to continuity of projects, the sector is growing strongly. Whether this can be traced to our cluster development initiative or to other forces and interventions can be debated. I believe it is both and that our cluster initiative contributed substantially to the evolution of the sector.

 The point is this – even if the DTC had fallen over previously or falls over tomorrow it is not a failed cluster and the ongoing sustainability of the entity is not a determinant of the health of the cluster (although it may be an indicator).

The process was initiated to “accelerate the growth of the cluster” which arguably it has done. Regardless we can conclude that state government funding and alignment with state government policy has been critical for both the entity and the cluster.

 Regards, Mick O’Neill 0416 079 089

Foley’s short-sighted cuts rock South Australia

SA’s lead economic agency, the Department of Trade and Economic Development, has just copped budget cuts of $100m over 4 years – and staff numbers are to fall from 200 to 120.

SA Cockatoo members are aghast – funding disappears for the nine Business Enterprise Centres, the Small Business Helpline and the SA Youth Entrepreneur Scheme, Innovate SA and the Technology Industry Association. The export and investment attraction functions have also been severely cut.

Treasurer Kevin Foley – facing criticism on numerous other fronts, even his mobile phone bill – said the cuts were to deliver election promises and marked a refocusing of DTED’s priorities around four sectors – cleantech, advanced manufacturing, knowledge-intensive services and resources.

Foley has a very short memory – the SA economy would be up the proverbiall creek had it not won the big federal Defence contracts 3-4 years ago, and the feds have been pumping in adjustment assistance to shore things up. How much longer is the federal government going to do the heavy lifting?

Reconstruction Economics for US Military?

Washington’s approach to rebuilding economies devastated by conflicts and natural disasters is flawed. It should be encouraging US -style entrepreneurism and allow the U.S. military to help.

 Economic growth is critical to establishing social stability, which is the ultimate objective of counter-insurgency campaigns and disaster-relief efforts. Various obstacles – such as insurgencies and inadequacies in infrastructure – have made economic development difficult in these countries, but these difficulties cannot be blamed exclusively on such obstacles.

 A central element in the failure to establish robust economies in war-torn or disaster-stricken countries is the prevailing doctrine of international development, according to which strong economies cannot emerge in poor countries. Yet there is a proven model for just such economic growth right in front of U.S. policymakers’ eyes – the entrepreneurial model practiced in the US and elsewhere.

 The model rests on the dynamism of new firms. Washington’s recent engagements have made it appreciate that post-conflict economic reconstruction must become a core competence of the U.S. military. But this appreciation hasn’t been followed by sufficient enabling actions. The U.S. Army Stability Operations field manual (2009) offers no guidance on what role economic development should play in the United States’ post-conflict strategy or how to help build dynamic, growth-oriented economies. The manual epitomizes the central-planning mindset that prevails in the international development community.

 It is imperative that the U.S. military develop its competence in economics – establish a new field of inquiry that treats economic reconstruction as part of any successful three-legged strategy of invasion, stabilization or pacification, and economic reconstruction. Call this “expeditionary economics.”

 Source: CARL J. SCHRAMM, President of the Ewing Marion Kauffman Foundation and a co-author, with William J. Baumol and Robert E. Litan, of Good Capitalism, Bad Capitalism.

 (Schramm makes good points – but we think ‘reconstruction economics’ is a better term. And such efforts will face huge hurdles where the local citizens (e.g. Vietnam, Iraq, Cuba) associate a foreign entrepreneur with their former foes. Surely a multilateral effort under the UN umbrella is the way to go. – Editor)

Dandenong wins Defence Centre

The Industry Minister, Senator Kim Carr has launched a $21.2 million Defence Industry Innovation Centre. Based in Dandenong (Vic), it will assist Australian defence businesses.

“The Government recognises that businesses across Australia operate in an increasingly integrated international marketplace. A key challenge in responding to this is their capacity to develop strategies to become more competitive in the global community,” Senator Carr said.

The new Centre offers a range of hands-on services for SMEs, including free business reviews and supporting grants to help boost productivity and support the Australian Defence Force.

Our members are asking WHY Dandenong, given that regions like northern Adelaide, western Sydney and Townsville have a claim to such a Centre. The SES officer in charge explained to Cockatoo that some 200 defence-related companies are in the SE Melbourne/Dandenong area, and in any case two of the four advisers are to assist businesses in other regions. We suspect also that the Victorian Government was lobbying for this Centre. www.enterpriseconnect.gov.au

Postscript: Defence is about to ramp-up big expenditure for the Army’s School of Infantry. This has been off-on-off – but Lavarack Barracks (Townsville) and Singleton (NSW) are major beneficiaries.

Think hubs!

Industry Minister Carr has subconsciously recognised the importance of place is because he is quietly funding industry centres and hubs around Australia. For example, a mining technology centre in Mackay, a creative industries hub around UTS in inner Sydney, a defence hub in Dandenong, a clean energy centre in Newcastle.

These examples of ‘localised capability and competitive advantage’ can equally apply to social and environmental projects. Members are advised to ponder the following:

• The feds are currently announcing a spate of local infrastructure spending e.g. $2.4 million for a 15 hectare eco-tourism precinct on the Swan River, $910k for a Marine Discovery Centre at Bondi Beach. This is smart, because the expenditure aligns with local competitive advantage.
• The Jobs Fund is providing another tranche of relevant expenditure ($650 million) right NOW.
• The Building Australia Fund will eventually roll-out like a latter day Super Auslink program, and the city suits will be looking for local competitive advantage, critical mass and alliance partners.

We are excited by the potential for our members to use the ‘competitive hub’ concept to get some very worthy projects off the ground. Indeed, my crystal ball shows real potential for:

• International aid hubs e.g. Cairns, Darwin.
• Food value-adding hubs e.g. northern Adelaide
• Eco-tourism corridors e.g. East Gippsland, Central Ranges (Victoria), Darling Ranges.
• Logistics hubs e.g. Parkes, Shepparton, Ipswich.
• Historical tourism and lifestyle hubs e.g. Braidwood, Chiltern.
• Environmental management hubs e.g. eastern Adelaide, Sunshine Coast.
• Indigenous arts and culture hubs that actually work e.g. Wilcannia, Broken Hill.
• Recreation, health and social service hubs e.g. Wee Waa, Port Macquarie, Port Augusta. 

 Progressing these possibilities is beyond a gopher writing an application. Contact us for further details.

Cluster ScoreCard – Perth Defence-Marine

 

Cockatoo has a Cluster ScoreCard which is basically an advance on Porter’s Competitiveness Diamond – we use it to objectively analyse a cluster, to highlight deficiencies, and to formulate Action Agendas.

 

This month we feature the Perth defence-marine cluster. It rates at 76.9 out of 100 points on an international scale of cluster performance – it compares favourably with other recent ScoreCards viz. Horticulture, Virginia SA (71.5), Mining Technology Services, Perth (70) and Advanced Manufacturing, Adelaide (70.2).

 

Key factor conditions underpinning its development are:

§ Longstanding maritime history centered on the Port of Fremantle.

§ The Two Ocean policy, whereby half the RAN fleet is located at HMAS Stirling (Cockburn Sound).

§ The success of the WA-based America’s Cup syndicate in the 1980s.

§ The establishment of the Australian Marine Complex at Jervoise Bay.

 

Its relative strengths are critical mass of local suppliers (9.7/10), growth prospects (9.2/10) and social capital (8.8/10), while its relative weaknesses are lack of threat (5.0/10) and governance structures (6.0/10).

 

Perth is a world-class location for defence and marine activities due to its deep water port, significant tracts of relatively cheap industrial land, and first port of call for international shipping services. Perth also has a well-developed road and rail system to the eastern states, and good air links to Africa and Asia.

 

It has two under-appreciated competitive advantages – 4 hours closer to Europe, Africa, Middle East etc. than Australia’s eastern states, and its geographic isolation provides relative security for defence installations.

 

Perth has around 370 firms involved in the defence and marine industry – which is greater than for Adelaide, and on a par with Melbourne. The marine/shipbuilding segment in Perth directly employs 2,500, and indirect employment is around 6,000. The defence industry segment accounts for a similar level of employment.

 

There are four major concentrations:

§ Australian Marine Complex (AMC) – especially marine engineering and construction companies.

§ Fremantle – home to 120 companies in the defence, marine construction and marine services field.

§ Perth CBD – head offices of large engineering construction companies, mining houses, defence primes.

§ Eastern Perth (Belmont, Bassendean, Bentley etc.) – major concentration of general engineering businesses, chemical companies etc. servicing the defence and marine industry. 

 

Further details are available at the Cockatoo Network – apd@orac.net.au

 

South Australia’s investment hubs

 

Each month we have been identifying the main hubs that could be positioned as a national investment attraction framework – to date we have 12 in Queensland, 20 in NSW, 11 in Victoria, 5 in Tasmania. So far, no violent disagreement, and our blog has had many hits from overseas folk.

 

Turning to the land of the crow, its defining feature is space, and the dominance of Adelaide. But there are sizeable production nodes outside Adelaide, and some could be attractive investment hubs given the food industry take-off, and the feds and state government get their act together – see article above.

 

Northern Adelaide – the hot spot, almost 70% of SA’s manufacturing industry. Various industrial parks and serious players e.g. defence (ASC, Tenix, BAE); automotive (Holden, Bridgestone, Futuris); electronics (Codan, Clipsal); food processing; optics & opthalmics; chemicals & mineral products (Adelaide Brighton).

 

Southern Adelaide – significant capacity in automotive (Tenneco, BSTG, Wylie); mining services (Minsup, Amdel); food and wine. World-class lifestyle attributes.

 

Adelaide CBD – quality education & research infrastructure, well-entrenched mining services and ICT and biotech companies, and a suite of new companies coming through. A natural for a creative industries hub.

Barossa Valley – processing centre for wine industry. Includes Roseworthy research centre and

Waite Institute spin-offs. World-class food, tourism and lifestyle. Gawler and Adelaide Hills provide the bookends.

 

Fleurieu Peninsula – fast growing region, adjacent to southern Adelaide. Tourism, food & wine, aged care. Includes Murray Bridge, an increasingly attractive home for agricultural equipment and transport services.

 

Upper Spencer Gulf – has a lease of life by virtue of the mining boom and Roxby Downs. Four nodes: Port Pirie – lead, zinc, silver and services; southern Flinders Ranges – tourism, arts. Whyalla – steel & rolled products, heavy engineering maintenance, iron ore, chemicals (Santos, OneSteel). Port Augusta – transport, mining services, retail centre. Downer EDI and Transfield.

 

Eyre Peninsula – Port Lincoln is a nationally significant aquaculture hub (tuna, oysters, kingfish). Region is also a substantial grain producer. Adventure tourism.

 

South East – relatively self-contained region with strong linkages to Victoria – runs from Mount Gambier to the Coonawarra and Limestone Coast. Competitive advantages lie in timber, pulp, horticulture and wine.

SA Riverland – previously covered under ‘Victoria’s investment hubs’ on this blog.