The Cooperative Research Centres (CRC) Program is a government-funded initiative facilitating collaborations between industry, researchers and the community to support the continuing improvement of Australian industries. The primary objectives of the CRCs are to undertake research and commercialise outcomes, coupled with a strong focus on education in the form of graduate opportunities promoting skills relevant to industry needs.
With a pre-defined lifetime of 5 to 10 years, the CRCs represent an excellent opportunity to investigate the most effective ways to start, run and end a multi-million-dollar enterprise.
Adept Technology took the opportunity to undertake a review of a five year, $25 million dollar CRC project as it was in the final stages of closure, producing a detailed report that captured a thorough, unbiased retrospective of the project’s history.
The report provided insights into a wide range of factors from governance and HR to commercialisation and R&D, outlining learnings that have valuable, practical applications both to future CRCs and other business endeavours.
The following is a brief summary of the key recommendations found throughout the course of our review.
Key Recommendations to
Maximise CRC Effectiveness
The Cooperative Research Centres (CRC) Program supports industry-led collaborations between industry, researchers and the community. It’s a proven model for linking researchers with industry to focus on research and development towards use and commercialisation[1].
The CRC programme was originally established in 1991 under the Hawke Labor Government and has flourished through three changes of government – suggesting that it is a programme recognised by governments of all persuasions as delivering ongoing benefits to Australian industry, researchers and the community in general.
While CRCs can be established under a variety of legal structures, the key feature that distinguishes a CRC from most other business enterprises is that is has a pre-defined lifetime of no more than 10 years. The 23 CRCs operating as at September 2019 have defined lifetimes of between 5-10 years of which half are between 5-7 years.
Given that the primary objective of CRCs is to undertake research and commercialise outcomes, 5 years and even 10 years is not a particularly long time. This gives rise to two key considerations for any commencing CRC: Firstly, how bring a multi-million dollar enterprise into being from a standing start in the shortest possible time and maximise the chances of success given the limited timeframe. Secondly, how to bring it to a successful end.
Starting with the End first, there are multiple factors to consider including:
- Staff retention – how to keep key staff and contributors on-board until the last day
- How the CRC will leave its legacy – whether that be commercialisation agreements, establishing spin-off companies, or some other means
- If there are students supported by the CRC (eg. through PhD programmes), will their funding be continued and how
- How any ongoing revenue flows (eg royalties/licensing fees) will be managed
- How the CRC will be wound-up post-completion and who will do it
Clearly these items cannot be planned in detail at the outset – but many decisions made at a governance and management level throughout the life of the CRC will need to have the End in mind.
In terms of start-up and operation, there are several key success factors to consider:
Leverage
Learnings
The CRC Association[2] is a not-for-profit organisation operating to promote the pursuit of science, particularly through the Australian Government’s CRC Program. It is a great resource for CRCs both establishing and established, as are the CRCs in current operation.
Particularly in the start-up phase, leveraging this experience base can considerably shorten the establishment process and maximise the chances of success.
Governance
The Australian Institute of Company Director’s Guiding principles of good governance provide excellent guidance for any Board. Of particular importance in a fundamentally collaborative enterprise is to maintain the independence of the Board from collaboration partners – as much to avoid perceptions of bias as the reality.
Ideally the Board will have been involved in steering the CRC application process so that it can ‘hit the ground running’ at commencement. It is also important to consider that the skills and experience mix needed on the Board may change through the life of the CRC.
Management
While a CRC is a significant entity in an Australian business context it operates without the administrative and management support systems found in research institutions and larger corporate entities. It also carries the full weight of corporate accountability requirements in addition to those association with the CRC programme.
It is important to establish a management capability led by managers experienced in their fields and experienced with working in similar-sized organisations. Growing inexperienced staff into effective managers is a desirable staff development objective but it is not a good start-up strategy.
Human
Resources
Human Resource management can sometime be a secondary focus particularly in research and engineering organisations – but often researchers and technical staff taking on coordination or leadership responsibilities will require support. In addition to basic functions such as performance appraisal and management, salary review, development planning and payroll management, there may also be a student support/counselling component for students being supported via CRC research programs.
Communication
Good communications is vital for maintaining both the internal and external support base, ensuring that all collaboration partners and the wider user community are aware of the CRCs activities, progress and successes. The CRC may also play a valuable role in bringing the user community together to the benefit of the broader industry as well as the CRC.
Commercialisation
There is frequently a starting assumption that R&D outcomes will be commercialized in a particular way (eg licensing). Important flexibility can be gained if the decision about how commercialization will best be accomplished is left to a later (defined) point in an R&D project.
R&D Strategy
R&D Strategy is placed deliberately towards the end of this list because its success relies upon the other elements being in place to support and enable it.
It is vital to commence R&D programmes as soon as possible and this should be guided by the needs of the user community. A structured process of identifying key research objectives and projects early on allows for a rapid start-up and provides a basis for selecting R&D partners.
It’s also important to ensure that selection criteria and conditions for engaging R&D partners are transparent and consistent across all partners, and that payments are linked to deliverables rather than the passage of time – essentially the application of project management and accountability principles to R&D engagements.
Templates
A final note – contract and other templates provided by the CRC programme are a starting point. At all times, it is appropriate to tailor agreements and contracts to ensure they best serve the objectives of the CRC.
