PODCAST: Transforming SMEs through collaboration with research bodies

PODCAST: Transforming SMEs through collaboration with research bodies

cathy foley

This week on the Defence Connect Podcast we discuss the pivotal work of research bodies in transforming the defence industry in Australia and the need for SMEs to engage with research bodies.

Science director and deputy director of manufacturing at the CSIRO Dr Cathy Foley joins us to discuss the importance of understanding and developing the capabilities of SMEs within the Australian defence industry, and how CSIRO and other research bodies can turn ideas into technical capabilities.

Foley also discusses research bodies making a difference in industries with new to the world ideas and concepts, the commercial tangibility behind research, industry and product, and how SMEs can connect with academia.

Enjoy the show,

The Defence Connect team

Listen to previous episodes of the Defence Connect podcast:

Episode 62: PODCAST: The industrial dating service, Peter Webster, Industry Capability Network NSW
Episode 61: PODCAST: Expanding UK business interests in Australian defence industry, Stephen Phipson CBE, DIT DSO
Episode 60: PODCAST: Defending the defence industry, Daniel Mendoza-Jones, Mendoza Legal and Consulting founder
Episode 59: PODCAST: Making industry a fundamental input to capability, Andrew Garth, general manager, CDIC
Episode 58: PODCAST: The shifting sands of AIC, Lee Stanley, Daronmont Technologies
Episode 57: PODCAST: Fostering the future of defence industry, Margot Forster, Defence Teaming Centre CEO
Episode 56: PODCAST: Propelling Defence through advanced automation – Andrew Seal, Siemens head of defence and marine solutions
Episode 55: PODCAST: Exports key to the future of Australia’s defence industry, Richard Marles, opposition spokesman for defence
Episode 54: PODCAST: Mining boom to defence boom – Minister Paul Papalia, WA’s Defence Issues Minister
Episode 53: PODCAST: Gearing Victoria for growth, Greg Combet, Victoria’s defence industry advocate

Full transcript

Speaker 1:

Welcome to the Defence Connect Podcast with your host Phil Tarrant.

 

Phil Tarrant:

G'day everyone. Phil Tarrant here from Defence Connect, your host of the Defence Connect Podcast. Thanks for tuning in. I'm really enjoying the rapid rise of the Defence Connect Podcast. We always thought we would resonate with defence industry but we never knew that it would maintain the acceleration that it has done both within the industry itself but also within interconnected areas in industry, in particularly government. But also a lot of the research, university and other research bodies here in Australia. What I thought I would do is look to engage that particular component of the market, of the industry. I'm very fortunate to have in the studio today Dr. Cathy Foley who is a Science Director and Deputy Director of Manufacturing at the CSIRO. Cathy how are you going?

 

Cathy Foley:

Good. Great to be here.

 

Phil Tarrant:

We were just having a quick chat off air and I felt like there was a ... We're both doing the same thing but very different things. Defence Connect is very pro-industry, we're pro-developing the capabilities of the SME sector within the Australian defence industry and also championing the work of the major primes. The very quick conversation we had off air, the work that the CSIRO is undertaking, in particular your role as well, is about really trying to understand the capabilities of the SME space in Australia when it comes to defence and how CSIRO and bodies like yours can really underpin those capabilities and help translate that into technical capabilities.

 

Cathy Foley:

Wow. You should get a job with us, you said it perfectly.

 

Phil Tarrant:

Okay. Excellent. I'm on mission statement am I?

 

Cathy Foley:

Look, particularly in the manufacturing area in CSIRO our aim is not to have glory amongst us. To create the new widget that will make a difference. That's one part of our work, new to the world ideas and concepts which is one aspect of the work we do. The more important part particularly in manufacturing is looking at how we can make sure that the SMEs, which are 97% of the companies in Australia, are able to be competitive so that they can go and bid for tenders with the majors and be able to then be part of the supply chains. Not just locally but globally.

 

Phil Tarrant:

From the very quick, we only literally met five minutes ago but the conversation we've had just then and off air has been very commercial.

 

Phil Tarrant:

Who would have thought that?

 

Cathy Foley:

Who would have thought someone with a PHD in physics is here talking about things commercial.

 

Phil Tarrant:

It's very commercial. I imagine from the top of the CSIRO there is that commercial tangibility behind research and industry or product. Is that a new thing for the CSIRO or it's always been there?

 

Cathy Foley:

No, we've always been there. In fact CSIRO was set up 101 years ago to solve major problems for Australia. Originally it was things like the prickly pear. We introduced a cactoblastis moth in order to eat it up and we don't have prickly pear. Rabbits, calicivirus, and then as things went by we ended up doing work which is really pivotal to industry in Australia. During the time when we were riding on the sheep's back we had huge impact on research and development in fibres. That fibre technology research which is in manufacturing now is looking at developing new carbon fibre and new woven and new non-woven fabric for example which are used by Textile Technologies in nappies. They now are supplying all the fibre material to go into newborn nappies for Kimberley Clark. That was because of some work which we did with that company under one of those research or in business programmes some years ago.

 

 

That's allowed that company to set up advanced manufacturing that allowed them to then compete globally. They supply the world for Kimberley Clark with materials for their nappies. That's just one little example of the stuff we've done from history of when ... From the sheep's back and worrying about wool and cotton and fibres like that to actually translate that into something which is much more modern and needed now.

 

Phil Tarrant:

In many ways you hear a lot of rhetoric and there's a big shining light on it right now in terms of, "How do we extract this research or academic talent in Australia and turn that into something.

 

Cathy Foley:

That's really important.

 

Phil Tarrant:

It is, but you've just given me two or three examples which highlights that. Many people might not realise or recognise it but the process works, we can take stuff  out of the lab into the hand of our war fighters.

 

Cathy Foley:

Oh, absolutely. Look I think probably in CSIRO's case maybe we've been too modest and kept our light under a bushel.

 

Phil Tarrant:

I think you have done.

 

Cathy Foley:

I think the other thing is we're really busy. We're actually quite a small organisation, most people don't realise we're only five and a half thousand people. We're spread across the country so we're a national body. We don't get caught up in state rivalries or anything like that, it's all about the nation. What we aim to do is get in there and make a difference so that we're always really busy. I think we sort of forget to promote ourselves enough. Every now and then we pop up with something. We have been successful in winning awards for some of the stuff, I guess most people may or may not realise that some years ago, it'd be probably 20 years ago we decided people who were working radio astronomy said, "Let's do something really commercial and let's come up with a wireless LAN thing." They actually focused on doing that, made the first in the world of being able to have a true wireless communications.

 

 

Of course that's the wire LAN now which is used all around the world. Luckily for us it took quite a good royalty return which has allowed us to re-invest in a whole lot of science in Australia.

 

Phil Tarrant:

The couple of examples you went through were very much geared towards our economic prosperity at a time when you talk about riding on the back of a sheep's back or prickly pear et cetera, it's very agricultural. Australia has advanced quite a lot in terms of its income generating as a nation. Mining et cetera has been big over the last period of time. Now financial services and becoming a service economy is big. Where does defence fit within that whole wider ... Is it a major focus for the CSIRO or is it just something that you're working on amongst a whole bunch of other things?

 

Cathy Foley:

We don't see ourselves as a defence research organisation because we've got the defence and science and technology group. That's their role. We are augmenting that on two aspects. One is the idea of we have capability that they don't have and we might be able to come up with a new to the world concept to be able to help them do something they can't do at the moment. We've got things we've done in the past like magnetic sensing, which is my own research area, and superconducting electronics we've been developing with them because they don't have that capability. That's one aspect of it and universities fit into that area too where they do a lot of research on new to the world materials and processes and things like that that defence needs. The other side which I think is unique in the way we approach things in CSIRO is actually looking at how we can help to translate that research into something that businesses can use and also their processes and approaches.

 

 

Things like advanced manufacturing can be introduced so that we're a high-cost nation in the sense our salaries are reasonably high. Therefore it means we have to be smart in what we do, add a lot of innovation, a lot of know how, a lot of cleverness in order to be competitive. As most of the companies in Australia are small that means that they have to be really smart. But when you're small it's really hard to know where to reach out. One of the things we're working on is, I'm calling it an industry outreach programme where we can't work with every SME but we're setting up hubs and engagements, connexions with places like SADIG, which is the Sydney Aerospace and Defence Industry Group, and many other of those sorts of industry hubs in order to be able to let them know where they can go in order to get assistance with things like 3D metal printing.

 

 

We've got an open access hub down in Melbourne where people can come there, learn how to do things, test things out, maybe make small products they need. They might even be able to do all their product line there. It depends because quite often you only need a small amount. We've engaged with a company called Roma Engineering in western Sydney where we've co-purchased a 3D printing system which has also got five accessing and C-machine, which is the only one in Australia. We've got one day a week which is open access for anyone to come and use it under the CSIRO banner and Roma used it for the other four days. We're working very closely with them. In Linfield, our site just up the road from here, we've just got an industry innovation hub which the New South Wales government's given us a bit of money for where startups can come in or existing companies can come in and do some prototyping.

 

 

Access specialised equipment from whether it's clean rooms to characterization equipment or just a really nice little prototyping lab and get some cheap office space or lab space to be able to do this and get some cheap office space or lab space to be able to do this stuff, and even connect down to Melbourne via video links to design their doodad, send it down there, get it sent up and be able to prototype things with a real fast turnaround.

 

Phil Tarrant:

It's very modern in terms of outside of your area or even defence, if you go into other money there's startup spaces where people sit and collaborate and it's all-

 

Cathy Foley:

That's right but they're mostly software. We're hardware.

 

Phil Tarrant:

Yeah you're hardware.

 

Cathy Foley:

We're the tangibles. Data 61 in CSIRO is the intangibles with software and analytics and stuff, which is absolutely terribly important. We work very closely with them particularly since a lot of opportunities for improving productivity for companies from things like monitoring where on components and stuff is this thing of the internet of things where you sensor everything up and it gives you informatics and magically it ... Probably putting it I should say cleverly as able to go through and give you information so that you're able to monitor your processes really well and fine-tune them and have product maintenance in a way which makes it much more cost-effective. Partnering with our data people in the internet of things is what we're about as well.

 

Phil Tarrant:

My understanding of research organisations, a lot of the culture of that comes from academia and people who are involved in academia. There is a certain culture and rigour around how academics collaborate and the process to get to a point where they can have some findings. I find it quite intriguing, I like the culture but it's quite foreign sometimes to a commercial workforce and a commercial work environment. Can you just give me some commentary around how ... The SMEs who are looking to embrace these opportunities in working with the CSIRO or other academic foundations, do they need to change the way they are a little bit and be, "Yes they're commercial," but how can they better connect with the type of people they'd be working with, like academics?

 

Cathy Foley:

That's a really good thing to raise. I think CSIRO's been in the game. We have to earn a lot of our money from engaging with industries so we've had to become very connected and really understand that it's not about us, it's about the customer. Our success is really when they're successful. We have to listen to what they're saying and what their needs are so we are delivering to them what they need, not what we think they need. Sometimes we have to use the knowledge we have because you don't know what you don't know until it's put in front of you. Sometimes we have to be subtle in the way of being able to present to them opportunities. I always say it's sort of like McDonald's, they try to sell you fries or scale up with a fizzy drink or something when you buy a hamburger. We sort of have to do that too in the sense of saying that, "We've done this for you and do you realise you could also have this and it would make things better for you?"

 

 

It's that customer relationship, building that trust is really critical. CSIRO isn't measured by the numbers of papers and citations and stuff which are normal academic measures of success although we see them as something which is a means to an end. I don't know anyone who wants to come and work with someone because they're the second best or third best in the world then something ... People want to work with the best and we only really want to do stuff which no-one else can do because otherwise they can go to where else they can get it. Why would we want to waste money doing that? It's very precious, anything we've got. We use citations and publications for two things. One is, are we doing good stuff and is it state-of-the-art, world class so that people can have faith in us delivering something they can't get anywhere else? The other thing that's really important is the peer review process is really critical.

 

 

Otherwise you can end up fooling yourself, and that's something in science and engineering and technology development which is a really critical part of academia where you have to ... You come up with some science, you usually write a journal paper which is sort of like the Women's Weekly or something like when you're at school writing up your science report. It really is more like your science report, but you send it into the equivalent of the Women's Weekly for a particular research area. They have editors who, like I edit the Superconductor Science and Technology journal which I'm sure you read every week.

 

Phil Tarrant:

Every day.

 

Cathy Foley:

It's an international journal and it's based in the UK, but then there's a whole editorial team who then send it out to experts who then review it. It's very rare you ever get it back saying, "Oh great, publish as is." Usually they put some input in, say, "Have you thought about this, or have you interpreted this correctly?" Sometimes, unfortunately too often, "This is rubbish and you actually haven't done the science right. You've misunderstood the measurements, you've interpreted it incorrectly." It's absolutely shattering to get that as a researcher but it's really good to know-

 

Phil Tarrant:

Got to earn your stripes, take it in your stride sort of thing.

 

Cathy Foley:

Also that they guide you as to what you need to do so that I know as an editor I often have to then see these absolutely soul-destroying referee's reports, and then as a next step these are things you need to do, go away and do that and then resubmit the paper after you've taken that on board. You see that quality rise, and science is all about being as correct as you can be on the day because you don't know what you ... There's thing you can't measure yet because we haven't worked out how to measure it more or how to understand it or do an experiment in a certain way. Research is meant to be presented as best as possible at the time. That academic aspect of it is all about making sure you get as correct as you can be with the knowledge that we know at that time. The thing that's really important is that peer review process allows you to get global acknowledgement that this is the best we know.

 

 

It's not just one referee. You usually have several referees looking at it and usually a good journal will try and get people who give it a hard time and really look into it. There's a lot of volunteerism in research because people are looking across each other's work. It's got the problem of commercialization, of keeping things secret. There's always that balance of, if you want to keep things to have a commercial edge but you don't want to have something which is nonsense science too, that's always a bit of a challenge between industry and academia. That peer review process is important and in CSIRO we actually have an internal peer review process so if we don't want to send it to a journal because we're worried about IP-

 

Phil Tarrant:

Commercial

Cathy Foley:

Is really important. We actually do very strong internal peer review, even if it's for just an internal report or every customer report goes through that process as well but just with a smaller pool of people.

 

Phil Tarrant:

It's really intriguing. A different sort of question, but what do you identify yourself as? If I say, "What do you do for a living," you say, "I'm a scientist?"

 

Cathy Foley:

I do actually. It's really interesting you asked, when you go overseas and you put what your occupation is on it-

 

Phil Tarrant:

On a passport thing, you put scientist?

 

Cathy Foley:

I always put scientist. Probably most people, especially my team always say I'm very good at editing papers and coming up with ideas and getting funding and making connexions with industry and coming up with solutions. That's what for me being a scientist is these days, is I don't go into the lab and twiddle the dials or do the experiments because I guess I've sort of earned my stripes and passed those onto others. I can see my value in creating the opportunities and looking for where things can happen. It's still that creativity of science linking into industry. I don't see myself as a manager. I guess I'm more of an enabler.

 

Phil Tarrant:

Do you think a lot of scientists are able to make that step?

 

Cathy Foley:

No, absolutely.

 

Phil Tarrant:

Essentially you've got your foot in two camps-

 

Cathy Foley:

Yeah, sure.

 

Phil Tarrant:

Science and business, or science and politics if you put it that way.

 

Cathy Foley:

I think there's three sorts of scientists and some people can be all of them and some of them can be one or two, but most people are just one of them. There's a creative person, lots and lots of ideas of which mainly only one every thousand is probably worth following. They're these creative people, they usually drive me nuts from a management perspective because they're always coming up with a new idea. They never finish anything, they never write anything up and they always feel their ideas are being stolen by someone else, which is true because they never actually take it to the end. They're absolutely critical to create that new idea in innovation. They're the ones who create the new to the world ideas. And then the next one is, I call the solid scientist and they're the ones who are absolutely critical in the sense that quite often they will have some ideas.

 

 

They're often more incremental but they take those great ideas and turn them into really quality science. The last one is the entrepreneurial scientist who then sees how to use it and apply it and thinks of ways of doing deals and getting it so that they're able to push to get things from that solid science thing into getting it out there. They often drive the solid scientists nuts because they cut corners and they're doing things a minimum viable product and it's not perfect but they want to get it out there. A good team will have all those three.

 

Phil Tarrant:

All of those.

 

Cathy Foley:

A rare person has them all, not very many. All of them can take on a leadership role if that's what they want to do, but usually you'd have to have people follow their passion. People find their place in the organisation. One of the things I like about CSIRO is it's actually quite egalitarian. I think some of the most valuable people in our organisation are our technical people who are ones who make the stuff because they often come up with solutions on how to transfer a science experiment into something which is tangible and transferrable. To me they're the gold that often is needed to be able to make that difference from something being a great idea to actually being an outcome which you can then make translate and it makes a difference for someone.

 

Phil Tarrant:

It's talking about the gold, so I agree. Not being a scientist myself but I agree. I can see it's the same in business. You have those three different types of people and you need everyone to create.

 

Cathy Foley:

Yeah. You just have one of them.

 

Phil Tarrant:

What's the currency within the world of science or the world of research or CSIRO. Do you, and I say in inverted commas, "Lose people" to industries? Do you find you get these great scientists and then they'll chase the money and end up in industry or is that something you like to happen?

 

Cathy Foley:

Oh we'd love that, we love that when that happens. Actually they tend to at the moment go to universities because universities have a lot of funding at the moment. They're being really successful in building themselves up over the last decade where each university is a billion dollar plus company. Their international student programme, their really big-picture thinking at the moment and they've got extraordinary resources to be able to really push things along and they're pretty exciting places to work. Their role is for teaching and research and so you've got a ... Want to work in that sort of environment. Pretty cutthroat, and probably you're only as good as your last nature publication to some extent because academic excellence is absolutely everything. To attract international students they have to be academically excellent and so that's one aspect.

 

 

With industry, we probably have some people going into industry but more as succumbents. Mainly because they go and do a task maybe under one of the government programmes and then come back again. We've had quite a few people actually going out and starting to spin out companies. That's a new trend for us.

 

Phil Tarrant:

The real entrepreneurial scientists.

 

Cathy Foley:

That's partly too because of our current strategy and Larry Marshall, our CEO, is really encouraging that. We're seeing more and more of that happening. We were med tech through to new materials and stuff. Also the ability to have a bit more flexibility of still working in CSIRO and then trying to start up at say an incubated company. We've got quite a lot of different business models going on. We've also got the On Programme, which has been introduced where you've got an idea and you pull the team together and you go through this sort of lean launchpad type thing. We have business gurus giving advice. You learn how to pitch, you go through and test your value propositions and go through trying to say before you actually invest in it, "Is this actually what the market wants?" We've had a huge explosion in that in the last two years and that's really paying off.

 

 

We're now beginning to see more of our staff start up companies actually than probably move to companies but they still do that. For me, if someone leaves our organisation on good terms and they ... That's fantastic, there's our new ambassador. It means we can have someone fresh coming in and we can hopefully train then up in a way to realise the wonders of not just working in research but research that makes a difference and that you're engaging with industry. People love coming there and working for us and they never want to leave.

 

Phil Tarrant:

I think research that makes a difference is the key point. A lot of people like to do research that makes a difference. It might be some medical situation, a difference to how people live their lives. I guess the difference with research into manufacturing which might have in a defence application is that the difference it offers us in a tactical situation, in an operational climate.

 

Cathy Foley:

Oh absolutely.

 

Phil Tarrant:

Which probably would appeal to some people which probably wouldn't appeal to some other people.

 

Cathy Foley:

That's so true.

 

Phil Tarrant:

Defence is a funny one like that.

 

Cathy Foley:

It is, it's really interesting because ... And we still have that now where people say, "I'm not sure I want to work on a defence project." It's interesting. When I talk to them saying that, "Wouldn't it be great if we lived in a world where human nature is that you don't fight and no-one fights but just out of curiosity do you ever fight with anybody, have a difference of opinion about things?" They always say, "Oh yeah of course." You say, "Well just magnify that." There's two things, you can look at it as one saying you can be idealistic and say, "Okay, we won't have a defence force and somehow everything will be fine." But defence actually is more than just pointing a gun at someone, or the idea of trying to take over territory or something. It's got a much broader requirement from disaster management, you bring in the defence forces.

 

 

With climate changing the way it is and extreme weather events happening or earthquakes and things like that in other nations not so much in Australia, it means that a strong defence force is actually able to really get in there and help in disaster management. There's also one of the things I love about the Defence White Paper is it's being used to see as a stimulus both in putting research dollars into new to the world concepts and through the DST Group's programme and also the idea of having these big contracts which will allow the stimulation of the economy by getting SMEs to be part of the supply chain. That's sort of a different emphasis in the past. I think defence in the past always went for best value for the dollar. I think now the Defence White Paper is saying, "No. We're going to see defence procurement and government procurement, the NISA thing, the government's National Innovation and Science Agenda is also saying the same thing.

 

 

Where government procurement has to buy local and use their procurement to stimulate manufacturing. That's the first port of call and with that that means you're creating opportunities. A lot of new technologies which we take for granted like GPS started off as defence things.

 

Phil Tarrant:

Absolutely.

 

Cathy Foley:

And lots of sensors and devices. I think the way defence will happen in the future will probably be more virtual probably as we get more sensors and more drones and more things where you take the humans out of it. It'll possibly be a more autonomous thing.

 

Phil Tarrant:

We'll have to lean on our scientists to get that sorted out then.

 

Cathy Foley:

Yeah but there's a whole lot of ethical issues as well. I must admit my dealings with defence and security areas have been they're the most amazingly ethical people. I think as I always point point out to my colleagues is sort of saying that people don't go in and join the defence forces because they want to have a punch-up. They actually go in there because they really believe in the idea of pursuing things to help the nation. I think that thinking you really get ... They sort of see it differently. I think there's sometimes that very naïve way of thinking about defence stuff. It's very rare that we have someone who doesn't want to work on a defence project.

 

Phil Tarrant:

You touched on this point very briefly, and I agree that governments change their mindset towards the way in which they're going to procure the best stuff to equip our war fighters with. I see today that, and speaking with government is that profit used to be a dirty word. It used to be crying down on price, get it for as cheap as possible. Now there's been a flip on the thinking that it's okay for people in defence industry to turn a profit because if they're turning a profit it means they're reinvesting in greater technologies. They're able to hire more people, more talented people to develop-

 

Cathy Foley:

That's right.

 

Phil Tarrant:

Ongoing products and capability. It's a real-

 

Cathy Foley:

Absolutely true.

 

Phil Tarrant:

Motherboard issue, and it's okay for defence businesses to turn a profit because it's just a perpetual snowball affecting increasing capabilities.

 

Cathy Foley:

If you look at some of the most philanthropic or most socially minded countries in the world, they have very strong defence industries and those defence industries are actually operating that way because they're the actual foundation and underpinning the whole economy. You look at say Scandinavian countries, anyone puts that up. They have extraordinarily strong defence industries there and strong manufacturing even though they're quite small populations like Australia. Admittedly we have the problem, we're sort of spread out very thinly across our continent.

 

Phil Tarrant:

A bit more condensed over there?

 

Cathy Foley:

Yeah but technology is making us smaller in the sense that it's very easy to get around in Australia. Flights are pretty cheap, roads are improving constantly. It's probably still a bit of a hassle going across the country from Perth to Sydney.

 

Phil Tarrant:

No-one likes that red eye.

 

Cathy Foley:

But still it's not too dreadful, but the thing is telecommunications means that you can do an awful lot of stuff where you don't have to jump on a plane and I know personally if you think we're meant to reduce greenhouse gases by what, 20%, 30%. I say, "Well if I reduce my travel by trying to make one in three meetings a virtual one then that's my contribution to trying to pull things down. It's sort of thinking in those terms. Just saying, "You can bring things closer together with really strong telecommunications and really build on that and be an exemplar." You start seeing that probably at the expense of one industry but that's the whole thing is that you're always repositioning. As one industry takes over, say virtual telecommunications and you might even be able to have holographic-type meeting rooms where you feel like you're in the same room as someone rather than on a video screen.

 

Phil Tarrant:

That's the future.

 

Cathy Foley:

That will come.

 

Phil Tarrant:

Well it's here.

 

Cathy Foley:

Absolutely, but it'll become something which is more ubiquitous and cheaper and easily accessible. I'm sure the airlines won't be so happy in that, but then instead of being the business market they'd possibly be more tourism because you're still ... I don't know that we'll ever want to have complete virtual tourism.

 

Phil Tarrant:

No, no, no we don't, no. On the point of competitiveness of defence businesses. It's an extremely competitive industry. The tender process.

 

Cathy Foley:

Absolutely, in fact it's extraordinary. I think probably more than any other industry area.

 

Phil Tarrant:

It is, the tender process, the vigour of tender responses, it is expensive business and it's draining and demanding business. Within the prime market the competition for major contracts is huge. It all comes down to point of difference, competitive advantage, which exists in any type of business and also in academia. We talk a lot on Defence Connect about people in uniform making a transition to defence industry and how defence industry and the businesses within it need to be thinking about how they engage uniform from very early on and their perception of their business because that's how they attract the absolute best talent. What's the reverse of that for defence industry trying to attract the absolute best researchers, best academics to give them a competitive advantage in terms of product development or tender proposals?

 

Cathy Foley:

The nice thing about connecting with the innovation industry in Australia, so universities and say government labs like CSIRO is that they can access that without actually having to employ them. I think that's where the opportunities are for SMEs because in order to have researchers and scientists in your business, which is there's nothing ... I really encourage that but the thing is you also have to have the infrastructure around it in order to make the most out of them. In some cases it might be possible because it might be developing new electronics or something like that, or doing integration which is terribly important as well and testing and all that. If you're looking at trying to do some of the research that's needed to be able to create the product the fact that they can partner with CSIRO or a university partner but talking from CSIRO's perspective our goal is alone for them to be successful.

 

 

There's so many great government programmes that will allow them to have access, whether it's through open access programmes within innovation hubs or research for in businesses that yes, money has to be paid but they don't have to have the whole cost that goes with trying to import or employ a researcher. I guess when you're talking about people who are coming with a product from say CSIRO. We've got people developing new broadband antennas or new magnetic sensors and they say, "Okay, this would be great. I want to spin out a company and do that," chances are they would still have to partner with more medium companies. Say in an antenna you might want to partner with something like CEA or someone like that who makes antennas because it's unlikely that you can build that up alone unless you've got amazing investors. But that just doesn't, as you said, that doesn't work that way.

 

 

If you think about the way with the tender process that they do want to have certainty of supply, small little people starting up are not necessarily going to give you a whole lot of confidence and trust that they're going to be there in ten years' time. Working out how to use those partnerships and doing things via collaboration I think is more likely the way to go, rather than actually people just trying to do it all alone on their own.

 

Phil Tarrant:

This is also practical stuff. What would be the first step that a SME, a medium size company or even a large company, if they're looking to perhaps look into the talent pool within the CSIRO and see whether or not there's some connectivity there or some support they're looking for what should they do?

 

Cathy Foley:

Okay so the first thing is really easy. Sounds like an advertisement here.

 

Phil Tarrant:

It does. It's not a plug by the way. I'm just quite interested.

 

Cathy Foley:

It's a really important question. People say, "Where's the front door to innovation in Australia?" You go to a university, there’s not even a reception. If you could turn up to CSIRO there is at least a reception.

 

Phil Tarrant:

A reception there.

 

Cathy Foley:

We have a website, CSIRO.au and there is an inquiries there. They have a commitment to answer anything within 24 hours of business. The idea is that they will then filter that through to the right person and then we go and see if we can make that. We've had quite a lot of our business come through that. The other is we hold events all the time, we go to networking events. I think particularly in the defence industries they have an awful lot of stuff. We've even hosted many things ourselves, and engagement through industry bodies. If you're an SME and you're not part of your local defence industry group then you're just missing out on so many opportunities of engaging across a whole lot of things. For example in Sydney the SADIG Group is I think fantastic. They've done amazing things since they started up, we went to their first meeting in Bankstown and we were sort of thinking, "Oh well this is a good idea. We're not sure what to do." It's got to a point where their real focus point-

 

Phil Tarrant:

There's a lot of momentum behind it.

 

Cathy Foley:

And so that even then you get in touch with that group and go to one of their meetings and you'll be sure there'll be a CSIRO person there. If we can't solve it or be the right person we can often do referrals to the right place. One of the things that's useful for us is that because we do have government funding covering part of our costs it means every minute doesn't count where we have to worry about, "Is there money coming in the door?" We can therefore create those networks and linkages and be aware of what's going on. There's also CSIRO has a small to medium enterprise connect office and that is there. It's actually sort of on behalf of the government and it helps SMEs navigate what the different opportunities are to leverage what investment they have with some of the government support programmes that can then help them really solve problems and have enough money to fund that process.

 

 

That's possibly one of the things we do once we work out who the researcher is they need to talk to and it looks like there's something there that could solve their problem. We then introduce them to the SME Engagement Office and work out what's the best business model to make that happen so that we can solve their problem.

 

Phil Tarrant:

You guys have really thought about this haven't you?

 

Cathy Foley:

Oh yeah. It's really important, it is.

 

Phil Tarrant:

That's good. It's nice to know that it is there and there is actually a genuine attitude for collaboration, but it's actually translating in this stuff as well. That's the good bit.

 

Cathy Foley:

We only measure really the success as when we can say for example in the med tech area, we've got really good tangible examples there such as there's a company called MDI who makes a green whistle. You might have seen it, it's that emergency medicine thing for acute pain. That company had the Australian market, well it's the only one in the world that has it. For people who don't know it's a green whistle which has an analgesic in it.

 

Phil Tarrant:

Yeah, give it a pull when your legs hurt.

 

Cathy Foley:

If you break an arm or something you don't need to ... It can be used by a paramedical or even someone who's just got a very low level first aid training. You can't OD on it because of the delivery system, if you suck on it it's like a whistle. If you get drowsy you drop away and so you can't overdose on it. Apparently also people have low allergies to it too so that doesn't seem to cause any allergic issues. The company can make it in selling in Australia, they wanted to go the global market but they couldn't make the chemistry work to scale up. They came to us saying, "We've got no money. We've got this great idea which you helped us develop and we want to scale up for the world market." What we did was we had a thing called the Australian Biotech Growth Partnership Programme where we were able to say, "Look, we've got an idea of how to do the scale up." We took the risk and said, "We'll pay for the research and then you can pay us back if it's successful."

 

 

That's what happened. We worked out how to do it and we made it so it was increased yield, reduced cost, it was a nice process.

 

Phil Tarrant:

All the important business metrics.

 

Cathy Foley:

All the things that you want to do. It worked like a charm and now that company went over a period of time from being a $3 million annual turnover, it's now 300. It's probably more than that, $300 million a year. Its turnover, it's just about to start delivering to Singapore, France, UK, USA, and it's now taking on a global market.

 

Phil Tarrant:

Great Aussie story of innovation.

 

Cathy Foley:

That was just because they came in the door, knocked on the door saying ...

 

Phil Tarrant:

It sounds to me that you guys have created the structure facility to make it happen but it's incumbent on the business to look how it works.

 

Cathy Foley:

It's not as though we're going to run your business for you because you don't want a bunch of scientists running your business. You know your business, but we do know enough about business to know what's needed for you so that you're successful. We also know enough when a business isn't a good business and we are still investing some government funds so that if a business looks like its using us as a crutch we're not really in a position to do that. We're there to help lift and be able to be competitive but we're not there to run their business for them, no.

 

Phil Tarrant:

Be their partner.

 

Cathy Foley:

You don't want me running your business, no.

 

Phil Tarrant:

You sound like, as I said before, you've got your foot in both camps. The scientist and the commercial person.

 

Cathy Foley:

I come from a business family, so my dad was an accountant.

 

Phil Tarrant:

We're running out of time. Sort of final question, so Defence White Paper last year was put out. $195 billion investment, ten years, lot of money. Do you think that we're doing enough as a nation to ... The scientists that are going to be around in ten years, in 20 years. Do you think we're doing enough to cultivate that talent, attract that talent so we're hedging our bets?

 

Cathy Foley:

Who's going to be doing it in 10, 20 years?

 

Phil Tarrant:

It's sovereign capabilities. Who's going to be doing it? Our STEM Programmes and all that sort of stuff. What's the talent like coming through? Are you guys excited about it?

 

Cathy Foley:

Well last year in December we had the Australian Institute of Physics Congress up in Brisbane and had ... It's where all the physicists across Australia come and I must admit I was so excited to see all these young people who were presenting at the conference. I thought, "Oh I wish I was young again." It's so exciting to see the people coming through but I think that they're, and not everyone wants to be a physicist and we don't need too many physicists but we need enough. In general, in engineering and in technical trades and stuff like that the world is changing a fair bit so things which we might have thought as traditional, particularly in working class areas and particularly the areas where people contribute to the manufacturing side of things those skills are going to have to change. The sophistication level of education needs to be listed.

 

 

Year 10 with a TAFE certificate dealing with high-class technology might be tricky. That idea of lifting the goals and aspirations of people who might not normally have that because they come from a culture and a family where they have a picture of being engaged at a more technical level, that's the area which I'm worried about the most. If we're going to be putting automation in we're going to have things which are much more conflicts, that means they do need to have a higher level of education. It might still be what's taught at TAFE and it might be an undergraduate engineering degree but it's less likely to be able to be learnt on the job. That's the thing which worries me the most is just in getting people to think technically. One measure is primary schools these days. They're doing these things called coding clubs, where kids learn how to code and stuff like that.

 

Phil Tarrant:

Just on that note I've got one of my daughters, she's nearly three years old. We bought her, it's like a Fisher Price thing right, it's like a little worm and it teaches her coding. You stick bits in this worm together to tell it to go a particular way and do a particular obstacle course. Someone said to me, "Teach your kids coding, it's going to be like your touch typing."

 

Cathy Foley:

It's a way you think. It's like my kids 20 years ago or whatever, the first mobile phone 25 years ago or whatever they somehow or another knew magically how to go through menus and stuff like that. How your brains form, and kids know that swipe technique. Babies learn that because they learn it straight away. It's that way the plastic brain is getting information. That's great. Looking at coding clubs, if you go on the internet and say, "Okay, where in Sydney is the coding club? I want my kid to go to it after school." That's just something to, again, add to that thinking and the way of thinking. It's not necessarily meaning every person's going to become a software engineer although that's probably a very good direction to go in. Knowing that'll be a bit like knowing maths in the future I think. Lots and lots of dots on the map on the eastern seaboard.

 

 

As you go further west fewer and fewer dots, and that's the thing that worries me. Is that I think we need to possibly have more intervention of making sure the extracurricular stuff that is not just what's in schools, the schools are doing a really good job there. It's the extra things that I know whether it's through scouting or whether it's through things where people engage that we make sure that we get that awareness in areas where that's not an obvious thing because they may not be as I guess economically advantaged enough to have those opportunities. That's where I think we've got to be really careful because otherwise what we're going to have is a dichotomy in our society. You know any society that has a bigger and bigger gap between the richest and the poorest is a bad society and it causes unrest. We don't want to have that, it's-

 

Phil Tarrant:

We don't want it, it's such a great place to live, Australia.

 

Cathy Foley:

No, that's right.

 

Phil Tarrant:

So we don't want to be cultivating that.

 

Cathy Foley:

The other thing which I'd love to see, and I'm not sure if this is the right model but we're also seeing people who are technically train displaced because they don't need as many fitter and turners or people who've learnt on the job with their skill sets. That particular mode of manufacturing is closing down, like the car manufacturing or something like that. Having a way of re-skilling them in maybe ways that are less formal because we were saying before those technical people are usually very creative. The number of times you hear, "I've got this great idea for this thing." They're actually potential entrepreneurs of the future and I'd really love to see how we can capture those people and retrain or give them open-access workshops so that they can make prototypes and then access to the way of being able to say through these On Programmes that CSIRO's running which are now open to the world, to Australia through that NISA Programme.

 

 

Programme can come in and say, "Okay, I've got this idea of a product. How do I commercialise it," and helping people to do that. I think there's some real opportunities there.

 

Phil Tarrant:

I see defence having a role to play as well.

 

Cathy Foley:

Absolutely.

 

Phil Tarrant:

Because defence encapsulates both sides. I think there is still a lot of banging of metal in defence, when you think of the major shipbuilding work coming up we need people who perhaps used to work at a Toyota plant to come in, re-skill-

 

Cathy Foley:

That's absolutely right. The car industry skills there are very transferable and you're seeing that. You're seeing that people are transferring into other industries but in some cases we're going to have to have people making their own jobs by taking that risk and realising that they don't have to lose their house or put everything on the line. Yes, you have to take a level of risk-

 

Phil Tarrant:

There is support there though.

 

Cathy Foley:

But it doesn't have to be one where you've got a dichotomy of either being rich or poor, hopefully there's something which is a middle road.

 

Phil Tarrant:

On this sort of skills talent, do you see any particular role for defence industry to play in building tomorrow's scientists and technical-

 

Cathy Foley:

Oh absolutely. In fact it's really interesting to see DCNS have a really ... The submarine contractors, they see that as very important and they've got a whole component about education. I know I sit on the Questacon Advisory Board. When DCNS were announced as being the submarine contractor I got them talking to Questacon to say, "You guys have to talk so that you're able to have something in Questacon so that all schoolkids in Australia go through Questacon and they've got to see how defence sustainment and industries and stuff is part of a potential career path for people, because at the moment people think about lawyers, doctors, firemen, that sort of stuff.

 

Phil Tarrant:

It's a war for talent. When you look at the output of a really strong defence industry, it serves all of Australia.

 

Cathy Foley:

Absolutely.

 

Phil Tarrant:

So we've got to get the right people in there.

 

Cathy Foley:

I'm hoping that what we'll see is the educational long-term investment, and that's one of the nice things I think we're seeing with the Defence White Paper, is a really clear long-term investment. It means that we've also got to have the full picture, so you've got to have ... We're not going to be around in 30 years' time but the next generation will be and we've got to make sure that they see where that pathway is. They need to see it at schools so that they can see the value of doing their maths and sciences at school, and that they can see that there are pathways. That it's not a pathway to unemployment, which some kids feel the media is saying everything. Manufacturing is dead, and it's just not the case. It's just changing.

 

Phil Tarrant:

It's just changing. That's really good Cathy, I enjoyed the chat. It was good.

 

Cathy Foley:

Fantastic. It was great talking to you too.

 

Phil Tarrant:

Yeah, I feel like I've learned a lot about CSIRO-

 

Cathy Foley:

Oh good.

 

Phil Tarrant:

And what you guys do and-

 

Cathy Foley:

Well tell your friends. Come and see us.

 

Phil Tarrant:

We're telling the world through the Defence Connect Podcast, but-

 

Cathy Foley:

Oh I'm looking forward to everyone knocking on my door.

 

Phil Tarrant:

Final question, real quick one. If there was anything that you would recommend defence industry read to be better at understanding research and how it works, what would it be?

 

Cathy Foley:

That's a really good question.

 

Phil Tarrant:

Throw you right at the end here.

 

Cathy Foley:

I could give the cynical one where I've just actually recently reviewed a novel by Thomas Barlow called the Theory of Nothing, which is a complete satire on the way big projects are done. That's sort of fun in a way because it shows ... It's sort of the academic side of science in its worst. That's one extreme. For something about what to read and how science is done, I actually think there's actually quite a lot of YouTube stories or TEDx talks where scientists have got up and talked about their story. Just drifting through those you can sort of see there's lots of examples of either great discoveries and how they've done that, and the other one is how I've transferred my discovery into something that's useful and made a difference. That's probably hearing it rather than reading it, that's quite good. Yeah, that's a good question. I'm going to have to write something aren't I?

 

Phil Tarrant:

Definitely. I think for our listeners what I would take away from this and I feel as though I've got it through this chat is a better understanding of how research works. That transition from laboratory to banging metal, that's it. If you're building products to deployment of that somewhere, so yeah. If you've got any questions for Cathy please, you can email us, This email address is being protected from spambots. You need JavaScript enabled to view it. and we'll pass that on to Cathy. Cathy mentioned a number of websites where you should be going to to ensure that you can open that gateway into CSIRO and research. That was CSIRO.au.

 

Phil Tarrant:

That's pretty simple.

 

Cathy Foley:

It is, yes.

 

Phil Tarrant:

Go and check it out, thanks for tuning everyone. Remember to go to Defenseconnect.com.au. If you're not yet subscribing to our newsletter please do, you can do it there on the homepage on the right-hand side. You get all the information that we're sending out daily around defence and defence industry. We're on all the social platforms, Facebook, Twitter, LinkedIn. You can follow me if you like @PhillipTarrant. Do you have a Twitter handle, Cathy? Do you know Tweet, do you Twitter?

 

Cathy Foley:

I don't actually, Twitter.

 

Phil Tarrant:

No, no, okay.

 

Cathy Foley:

I do have a handle, it's Cathy Foley too.

 

Phil Tarrant:

Yeah I think there's an @CSIRO so you can keep abreast of what CSIRO's doing.

 

Cathy Foley:

Yes, I always say I invented it, I don't use it. Or then you could sort of say because of security and stuff you sort of don't use it.

 

Phil Tarrant:

You can't have it, yeah. That's all from us. Thank you for tuning in, we'll see you next week. Bye bye.

 

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