R&D early priority in new MD’s work

Jon Condon, 11/07/2011

Given that Meat & Livestock Australia's new managing director Scott Hansen does not attend his first MLA boardmeeting until Thursday this week, he remains understandably guarded at this point over his vision for the service delivery company’s strategic direction.

However he was prepared to share some of his broader thoughts during a recent ‘opening gambit’ interview with Beef Central (see yesterday's story “Big challenge ahead for MLA’s new chief”).

“Obviously there is a significant amount of community and stakeholder trust rebuilding that must occur, given recent events in Indonesia,” Mr Hansen said.

“There are significant lessons in that for us, as the industry’s service delivery company, and as an industry generally, in terms of our crisis management response capability. How we step-up and assist the industry to defend itself during any future episodes like this needs to be carefully examined,” Mr Hansen said.

“There were two areas in which we’ve been exposed. The first is that we made incorrect assumptions about the level of understanding among MLA members, government stakeholders and the broader industry community about MLA’s powers and roles in such issues.

“We need to re-emphasise the role of the entire supply chain in issues management. In reality MLA only plays a relatively small role in helping facilitate outcomes, and some of our messaging in the past may have appeared to have given MLA greater influence over outcomes than is the case.”

His comment did not just apply to the Indonesian live export episode, Mr Hansen said, but to a host of other areas.

Marketing outcomes, for example, often depended not only on MLA’s activities, but equally heavily on having an exporter or exporters prepared to commit to a new program, and to deliver to that program 365 days a year.

Similarly, the ultimate success of MLA’s research and development activity could only be measured by the degree of uptake of new systems and technologies by producers. But that meant the adoption of the tools also rested heavily on the receptiveness of producers themselves.

R&D early priority

Mr Hansen has clearly signalled that the entire industry R&D portfolio will be an early priority in his new management role.

“Putting the immediate live export events to one side, I believe the industry’s marketing effort has had a fair degree of scrutiny placed on it. That’s come through two rounds of levy reviews; the intense nature of the annual market task-force planning process involving a range of stakeholders; and simply through the fact that delivery of those marketing programs often involves commercial partners, who provide a constant level of scrutiny.”

While marketing now appeared to be on a solid footing, there was a good opportunity now to re-examine the ‘other half’ of MLA’s primary function, in managing the industry’s on-farm R&D effort.

Recently, MLA appointed Peter Vaughan, formerly managing director of the Value-Added Wheat CRC, to replace Ian Johnsson as general manager of livestock production innovation.

“Peter’s arrival provides a great opportunity to re-examine the R&D portfolio, in partnership with industry groups like the Northern and Southern Australian Beef Research Councils, and Cattle Council,” Mr Hansen said.

Reassessing attitude to risk

There were two key areas worthy of scrutiny, in his opinion.

“The first is the portfolio balance, in terms of risk. Currently, incremental gains in productivity are barely keeping up with the rising costs of production, or increasing global consumer demand for beef products,” Mr Hansen said.

“So one of the issues I’m keen to examine is whether the industry has a greater appetite for risk in its R&D approach, in order to try to unearth some of those big-ticket research breakthroughs that could really make a difference.”

“It’s something we have to ask ourselves, as an industry.”

He recognised that there might be a difference in responsibility in approach to R&D risk in spending socialised industry funds, as opposed to corporate funds, but at the same time the industry needed to ensure that it did not simply have ‘safe-bet’ portfolios that had 12-month, direct-deliverable R&D outcomes.

“The answer may be more evolutionary, rather than revolutionary: a balanced portfolio that covers all three horizons – short, medium and long-term.”

Mr Hansen said the other big challenge was in finding new and better ways to simplify and make more transparent the outcomes from R&D investments already being delivered.

“If producers don’t know a tool exists, then they can’t use it. So much of what MLA does means nothing unless it is utilised by an exporter, in terms of winning a slice of trade in a new market, or by a producer, in terms of making a productivity improvement,” he said.

Another opportunity to emerge from this was in the national strategies for R,D&E currently being formulated for cattle and sheep industries, through state and federal governments, CRCs, CSIRO and others.

“It’s a good debate for MLA to be feeding into at the moment, because there is a general atmosphere of review and consideration going on,” Mr Hansen said. 

One of the big challenges for MLA in both its R&D and marketing portfolios was the broad range in the stakeholder spectrum.

“While there may be common elements for a cattle producer in the Kimberleys and another on Flinders Island, there are also many disparate needs and priorities. This industry has such a diverse range of shareholders and stakeholders, it represents a constant challenge in balancing the interests of all concerned,” he said.


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