Food Innovation Australia Limited An Industry Innovation Precinct. Annual Report

Transcription

1 Food Innovation Australia Limited An Industry Innovation Precinct Annual Report Last updated 9 December 2014

2 Contents 1.1. Foreword Executive summary Opportunities and challenges Reporting against activities and targets The Industry Innovation Network (IIN) SME engagement Members and collaborative partners Core partners and other members Other collaborative partners Program performance measures Communications Precinct Governance Intellectual Property (IP) Management Risks and impediments Financial statements Certificates of currency Confidentiality Privacy and Freedom of Information Attachments A FIAL Meet FIAL I Report B FIAL Core Partners C FIAL Case Studies D Audited Finanical Statements and Reports Submitted to ASIC E Certificates of Currency Page 2

3 1.1. Foreword The past year was exciting with the launch of FIAL in July 2013 by the Australian Government with the aim to support commercially driven collaboration and innovation in the Australian food and agribusiness industry. Stakeholder consultation across the industry presented rich insights on the challenges, gaps and opportunities for the way forward and provided the backdrop for FIAL s strategy. Harnessing this positive energy and optimism across the industry where many stakeholders identified market opportunities and volunteered themselves to participate in initiatives organised by FIAL, highlighted the great opportunities waiting to be realised for the sector. At the same time, it was also a very challenging year trying to deliver programs of value and relevance to the industry during a period of uncertainty surrounding the future of the Precinct program. There was also some scepticism and hesitation by particular industry stakeholders to participate in FIAL s programs because of its closure on 31 December Despite these testing times, it was encouraging and rewarding to know that the market insights and information gathered through FIAL were used to inform the Entrepreneurs Infrastructure Program Government s new initiative to support Australian businesses in a simplified and streamlined way. A further testament of the strong work of FIAL and its partners in highlighting the importance of the sector s contribution towards the economy was the recent Australian Government announcement 1 that they will invest $188.5 million in Industry Growth Centres to pursue global excellence in areas of competitive strength, of which food and agribusiness was identified as one. 1 Page 3

4 1.2. Executive summary FIAL was established with the support of Federal Government, 52 core partners and industry to be the catalyst for collaboration, integration and solution sourcing to help industry be a resilient and a quality supplier of food and beverages. Knowledge, capabilities and connections were identified as the essential pillars of how to facilitate this transformation. Initial focus for FIAL was on understanding industry s current capability and capacity. This was done through consultation with the sector and inviting feedback whilst providing intelligence on FIAL s strategic focus and activities. Simultaneously exercises on mapping capabilities to identify strategic industry gaps like channel readiness were done. Every FIAL initiative was identified through consultation with industry and markets, developed in partnership with multiple and diverse stakeholders, who have a desire to innovate, collaborate and experiment. Pilot programs were developed, tested with industry for their relevance, and their feedback used to improve them such as the Are you ready for export? training module. Government and other network support, an important resource for and contributor to the industry, also underpinned all initiatives. Some of the key activities launched and/or delivered during the reporting period were: Developed a database of 1474 industry stakeholder organisations, consisting of 1140 enterprises, of which over 80% are SMEs. Established FIAL s website with focus on information, innovation and markets where over 5000 have visited the site, of which 58% are unique and 42% are returning visitors. Instigated over 40 workshops across Australia on various topics. o Introduced the collaborative circle concept to help industry address challenges where over $22M of potential value was identified in 5 workshops o Created a readiness training module on export following 5 pilot workshops. ecommerce, food service and retail modules are in progress. Also, Food Futures Innovation Program for future leaders and businesses is currently in development. Initiated over 30 research and other collaborative projects. o Piloted the SME Solution Centre concept, designed to help industry access research facilities and training, involving 13 SMEs and 1 MNE to create over $28M of value. o Coordinated an in-bound mission with 128 companies meeting Asian buyers and resulting in over $1M of new sales orders and the development of an export focused Australian supplier ecatalogue. FIAL used $2,459,468 of $4,800,800 grant funds to deliver activities in , with a profit of $35,033 at the end of the period. The remaining $2,340,532 has been treated as deferred revenue. All personnel expenses including Board represented 39% of the total; program expenses were 35%; and the remaining 26% was for travel, administration and other expenses relating to activities during the year. Core partner contributions were $1,093,809 ($7.5K cash and $1,086,309 in-kind) with labour greatest at 60%, which was used to support FIAL s initiatives during the period. Matched industry funding of $468,000 from projects in the SME Solution Centre pilot resulted in a total contribution of $1,561,809 for all activities undertaken by FIAL during FY Page 4

5 1.3. Opportunities and challenges The Australian food and agribusiness industry is well placed to leverage the enormous wealth of intellectual and technical capital and agricultural resources for businesses and other industry stakeholders to generate economic benefit for the country. There are many options available on how to do this, and FIAL had the discerning task of determining the best way forward. It was through the MEET FIAL events (see Attachment A), industry and domestic and export market buyer consultations that provided the answers. These events were the most important activities FIAL undertook during Through them the areas of focus: information sharing, capability building and connecting to market and other opportunities were identified see Figure 1 for key words from industry feedback. This process of consultation has also sent a clear message to industry that FIAL is not only listening, but is doing something about the challenges faced by industry. Such an approach of consulting with industry and markets to seek their input has resulted in the highly targeted initiatives launched by FIAL during its first year of operation. Figure 1 Word cloud of key words from the MEET FIAL events held during Information on markets and other intelligence was the initial focus of FIAL, as this ranked highly from industry feedback. Various work on capability mapping and market reports were commissioned, some of which have made available on FIAL s website and distributed through FIAL s news bulletins. The collaboration between Australian Institute of Food Science and Technology (AIFST) and FIAL produced the Australian Food Map a brand new online directory of the entire food industry, searchable by geography and contacts across 13 categories. This Food Map is a new guide to the Australian Food Industry designed to help food industry participants and stakeholders make new connections, grow business, solve problems, access services and Page 5

6 expand networks. It is a centralised database that represents the industry from the farm gate through the value chain to the end product. Other mapping on packaging and research capabilities is still in progress because of the complexity of finding the right information in a timely and cost effective way. Insights gleaned from the Asian buyer visits early in 2014 have also been shared at the Export Readiness and other workshops held across the country. This intelligence was used to inform the web-based facility being developed for FIAL members to access market data and information which will provide insights and aid decisions relating to export food products and target markets, particularly in South East Asia. Other knowledge based opportunities are currently being explored on how to build mega databases of tailored information that will inform industry and help them to share and respond with new products and services to meet the demands and desires of consumers in Australia and overseas, for lifestyle preferences, diets, etc. The other focus of FIAL during was to deliver programmes and activities that expanded and strengthened the industry s skills and capacity to meet the demands of markets in Australia and Asia. It was interesting that the development of skills and education courses was ranked very low by industry and very high by Government. Such a result was not surprising considering that industry are generally fire fighting and focus on short-term issues, as supported by their feedback that had a short-term focus. Many suggestions that involved the development of people were also ranked low. To ensure long-term industry success, skills and leadership development were identified as vital and became a priority for FIAL whether it was highlighted or not by industry. Readiness tools were also identified as important mechanisms to raise awareness and encourage industry to consider other channels to market, like export, to diversify their business and/or product portfolio to reduce their reliance on key buyers, thereby improving the sustainability of their business. Such tailored tools for the industry currently do not exist and often generic training programs are developed that are not targeted or of apparent value to the industry. Are you ready for export? is a great example that illustrates FIAL consultative approach to ensure information is right and targeted to industry needs where several workshops with industry, particularly small to medium enterprises (SME), were organised and used to shape the final module. Underpinning these readiness tools is FIAL's Food Futures programs for both businesses and leaders for innovation which have been developed to equip entrepreneurs and businesses with the training and skills needed to find their next consumer, customer or product for export. Another important aspect of FIAL s role has been to identify systemic challenges faced by the industry. Through the different meetings and forums either organised by FIAL or coordinated in partnership with another organisation like the Produce Marketing Association of Australia and New Zealand (PMA) Fresh Connections in Auckland, stakeholders within the industry identified a shortage of particular skillsets like food safety, packaging, project management and business leadership. Page 6

7 The industry s desire, capability and know-how for innovation must transcend the traditional incremental innovations seen to date and a way to connect industry to new world innovations is through the SME Solution Centre 2. This is a pilot initiative currently being trialled by FIAL and the research providers at CSIRO and Department of Agriculture, Fisheries and Forestry in Queensland (DAFFQ), that reduces the cost and other barriers of SMEs to access critical plant, equipment and expertise to address technical challenges and/or for scale up. It also provides invaluable training in either a technical or business area that will improve commercialisation success rates of an idea. Different intellectual property (IP) models like that proposed in the Industry Collaboration Fund that encourages access to and sharing of knowledge and IP for the benefit of multiple stakeholders through simple commercial arrangements and exercise rights built into contracts to ensure IP is commercialised are also being explored in this trial. A surprising outcome from this pilot was the matched cash contribution by every company participating in the program. It counters the myth that industry expects Government handouts and supports the proposition that industry are willing to invest in quality and valuable projects. Such an observation is encouraging for industry and Government because it reduces exposure for both. Being ready for export is important but there must be a critical pathway to market for products and services developed by the industry. In June 2014, FIAL led a high-end supermarket in-bound mission because a national approach was required to attract the critical mass of overseas senior buyers and local diversity of suppliers. This was a gap identified in the market that was not being filled by any one company or organisation in Australia. Senior overseas buyer feedback also support a national approach as they were only interested in coming to Australia to see what Australia had to offer, and not just a region. The success of this mission provided valuable market opportunities for 128 Australian suppliers who also received feedback on their products. Feedback was also obtained on how to improve future missions which has led to the development of the ecatalogue. This is an easy to use searchable on-line catalogue, which buyers use to review and assess export focused supplier profiles from Australian businesses. The catalogue provides an important platform for the connection between Austrade and Australian businesses, and can also be used by Austrade to attract inward investment in the future. Coupled with the emerging opportunities, there were also some challenges identified through industry engagement. One was the multitude of duplication both within and between different companies and Government and other organisations across the country. Most alarming was that some of these organisations or stakeholders within an organisation were not prepared to cooperate or share information that was not commercially sensitive, even though they were funded by taxpayer money. 2 SMEs were the target market although it was opened to large or multi-national companies, with one being selected for the pilot. Going forward, SME will be replaced with another appropriate word that reflects it is open to enterprises of all sizes and turnover. Page 7

8 Uncertainty facing the future of FIAL further fuelled this behavior and hesitation to work with FIAL. Such behavior posed a major hurdle for FIAL to determine, who to work with, what information was relevant, and how to proceed. Consequently, projects took longer to establish, as was found with the web-based facility for market intelligence on South East Asia. The set of norms developed by FIAL for projects were used to encourage a way of being that engendered a culture of collaboration for this project, among others initiated by FIAL. This meant that some stakeholders were excluded from the initial project scope because they did not display these norms and project started without further delays. Regular meetings with Federal and State Agencies and other organisations led by FIAL in the past year, is another way forward to encourage information sharing and improve communication to reduce unnecessary duplication and resource wastage across Australia. Another challenge was the focus on engagement with SMEs at the perceived expense of large or multi-national enterprises (MNE). The following challenges made it difficult to be relevant to all stakeholders during the first year of operation: uncertainty surrounding FIAL s future with the change of Government; insufficient time to develop a compelling value proposition; and FIAL s limited resources to address the conflicting needs of the different sized businesses,. As a result, FIAL predominately focused activities targeted at assisting SMEs, and left the Australian Food and Grocery Council (AFGC), a founding member of FIAL, and invaluable partner, to address major challenges faced by larger or multi-national businesses. Despite some barriers experienced by FIAL in its early days, a significant number of industry stakeholders are open to sharing either knowledge or expertise for the benefit of the industry. This was best demonstrated in the collaborative circle workshops held on export and packaging challenges where companies offered solutions to their peers issues. This is encouraging and needs to be nurtured for the future growth of other ccollaborative and targeted industry-led initiatives. The alignment and mobilisation of the tremendous resources of Government and other agencies to industry needs, is also instrumental in supporting the growth and transformation of the industry. FIAL has established the essential pillars of knowledge, capabilities and connections that will transform the industry and contribute towards shifting the culture within the industry from being restrictive and short-term focus to experiential, growing and long term sighted. Page 8

9 1.4. Reporting against activities and targets This section outlines FIAL s activities completed and/or in progress during , and the outcomes/impacts of those activities with regards to those activities and targets outlined in FIAL s Business Plan. Please note that the original business plan was to be revised following the completion of FIAL s 5 year strategy. This business revision never happened due to the change in Government. As such, some of the measurables are obsolete as the circumstances changed during the year. Each activity has also been aligned with the objectives of the Program: 1. Helping to build the quality and scale of industry in areas of competitive advantage and emerging opportunities; 2. Forming a cohort of growth orientated businesses; 3. Fostering new collaborative partnerships that build trust, lead to innovation and deliver commercial benefits; 4. Achieving greater alignment between the strategic needs of industry and government investment in research as well as business support and innovation; 5. Establishing a stronger culture of innovation and collaboration amongst Australian firms; 6. Improving and accelerating the translation of Australia s research investments into positive economic, social and environmental outcomes; 7. Positioning Australian enterprises and businesses to participate more fully in global supply chains; and 8. Establishing new trade and innovation relationships, enhancing and forging new international networks and collaborations, and improving Australia s reputation internationally. Page 9

10 Goal 1 Industry s self-confidence, capacity and capability for success Industry organisations have the resources, skilled workforce and associated capabilities to develop an innovative, cost-effective and efficient food industry. Activity Detail Collaborations/ Partners Impact Alignment with program objectives Develop a directory that shows current resources available to assist, or give access to, the industry to address challenges or needs. Report on the Australian food and beverage market Sept The University of Queensland Industry has market information to carry out their work 1, 6 & 7 Report on Asian Market Insights (Sept 2013) and summary of market visit to 8 Asian markets are available. University of Newcastle Industry has access to market information to carry out their work 1, 6, 7 & 8 Export Product Data and Information Network May 14 in progress Institute for Supply Chain and Logistics, Victoria University Industry has access to market information to carry out their work 1, 6, 7 & 8 Australia s Food and Beverage Innovation Capability Mapping Nov 13 - In progress Department of Industry Industry has access to market information to carry out their work 1, 6 & 7 The Australian Food Map a new online food industry directory searchable by geography and 13 categories AIFST Industry can access market information more efficiently and effectively to carry out their work 1, 6 & 7 Page 10

11 Federal and state funding options relating to innovation and business support listed with links Jan Apr 14 Work is currently underway to see how to link FIAL s mapping with Government grant finders - in progress Lynea Advisory Department of Industry Industry has market information to identify funding opportunities to carry out their work 1, 6 & Stakeholders have access to tacit knowledge or IP that has been shared or developed through FIAL and/or a range of other mechanisms FIAL was nominated as the lead in the technology transfer and adoption subcommittee for the National food and nutrition research and development, and technology transfer strategy. Plans are being developed on how this initiative can become the platform for sharing IP developed in Australia Jan 14 in progress AIFST, AFGC, CSIRO, DAFFQ, DEPI, MLA, SARDI, UQ & UTAS Businesses will have access to current intelligence on the latest emerging innovations to broaden thinking and able to use this for commercial benefit 1 & Review and summarise the intelligence gained from a scan of the environment (locally and overseas) for new technologies, emerging technological trends or radical innovations and themes, including exemplar behaviours that recognise achievements of staff and that enable other businesses to use this as a basis for learning and change of relevance to the industry. Map of the food and beverage industry showing the dynamics shaping the industry was developed and used to inform the strategy Dec 13 - May 14 FIAL Board, Employees and Industry Stakeholders Underlying systemic challenges facing the industry are identified 1 & 4 Page 11

12 Leverage the information by using it as a catalyst through forums to facilitate the innovation process and uptake of technology. 5 Collaborative circle workshops on export readiness (X4) and packaging (1) were hosted where companies provided solutions to challenges presented by their peers March June 14 New South Wales Business Chamber, DSDBI, AiGroup, Northlink, the Plenty Food Group, DAFFQ, Business Foundations & DAFWA 60 business and/or industry stakeholders identified over $22M of value of contributions for businesses if solutions were implemented 3, 5 & 8 Hosted joint workshop on water management and environmental benefit/ profitability to identify focus areas and/or provide solutions May 14 - in progress Victorian Centre for Sustainable Chemical Manufacture Industry will have solutions they can use to reduce costs and improve water utilisation and sustainable practices 3, 5 & 6 Web based allergen calculator a world first. Allergen data will also be collected overtime to identify new health and other trends Feb 14 in progress Allergen Bureau of Australia and international partner(s) Businesses will have access to an on-line calculator for better management of allergens and a mega data set will allow new insights on allergens 1, 3, 6 & Develop a shared sense of purpose and accepted norms for collaborative projects as earlier. Norms and ways were defined in FIAL s strategy. A selection criterion was defined for the SME Solution Centre. Commercial agreements were developed and available for industry use. Available upon request Agrifood Skills, La Trobe University & RMIT Industry will more easily be able to access relevant expertise, infrastructure and the latest technologies to innovate and develop products shifting the beliefs and mindsets towards forging new collaborations, innovations and local and international networks. 3, 4, 5 & 6 Page 12

13 Develop, communicate and implement plans that will address these dynamics. SME Solution Centre - 14 companies identified for the pilot by June 14. FIAL has provided $468K of support, which has been matched with company funding. Launched Jan 14 in progress CSIRO and Department of Agriculture, Fisheries and Forestry Queensland 14 SMEs / MNE will utilise Government supported research facilities and access relevant expertise, infrastructure and the latest technologies to innovate and develop products with potential to generate >$28M of new sales from launch of concepts. These businesses will also upskill through tailored training courses and hands-on involvement in technology development and transfer. 3, 5 & 6 Food Futures for businesses and leaders Launched May 14 in progress Agrifood Skills, Catalyst, Hargraves Institute See Section 3.5 for list of other partners A cohort of catalysts for change will be identified and up skilled on best business and innovation practices. Businesses will be benchmarked to best practice, highlighting areas for improvement. Novel jointcollaboration projects will result that will create new ways of thinking and innovations of great value to the industry. 1, 2, 3, 5, 7 & Work with stakeholders (eg associations) to identify, See Activity for details Page 13

14 develop and deliver programmes for skills and capabilities required for industry to realise opportunities. See Activity for details Workshop on food and beverage centric R+D tax concession training June 14 in progress AusIndustry NSW & Enterprise Connect Tailored module for the Agrifood and beverage industry will raise business awareness of what is required for R+D tax concessions and encourage further innovation spend. 1 & Work with industry associations to develop a recognition and reward programme for businesses that demonstrate major changes in skills and capability development. 1. Supported AIFST to identify skill gaps for food industry (June 14) 2. Co-funded workshop to identify safety challenges facing fresh produce industry (June 14) 3. Supported Australian Export Awards in NSW & Qld to identify how best to develop mentoring program and optimise impact for winners and runners up April 14 in progress AIFST PMA Export Council of Australia & Food Supplier Advocate Industry s confidence for export is demonstrated through increased participation in export activities leading to new and increased export sales for businesses. New collaborative partnerships form as a result of the mentoring program, giving rise to new market opportunities and investment in the sector. 1, 2, 7 & Use intelligence gleaned through activities in Objective 1.1 to identify changes in value chains of relevance to the industry. See Activity Page 14

15 Leverage the information by using it as a catalyst, through forums, to facilitate the uptake of market intelligence and develop a range of strategies for market access. An on-line tutorial in the form of a Vodcast on Free Trade Agreements is being developed that will explain what they are; how to benefit from them; and who to connect with. April 14 in progress Austrade, AFGC, PWC and Australian Business Limited Industry has the knowledge and confidence for export, demonstrated through increased participation in export activities leading to new and increased export sales for businesses. 1, 2, 7 & Market/ other insights gained from activities in Objective 1.1, among others, to address market conditions and emerging opportunities of importance to industry. Key insights identified include: industry needs to better understand markets prior to entry ability to visualise buyers and opportunities to improve success rate Austrade Industry has the knowledge and confidence for export that is demonstrated through increased participation in export activities leading to new and increased export sales for businesses. 1, 2, 7 & Develop mechanisms i.e. forums, meetings, etc and strategies of how best to encourage uptake of market intelligence for market access. Are you ready for export? Workshop will be the key channel where market intelligence will be shared with industry (in progress) ecatalogue invites companies to be part of and participate in export opportunities (in progress) 8 FIAL s news bulletin have been distributed with the latest important information for industry Website is a valuable source of latest information. Export Council of Australia & AFGC, Austrade & BDC Market Intelligence Industry has the knowledge and confidence for export that is demonstrated through increased participation in export activities leading to new and increased export sales for businesses. 1, 2, 7 & 8 Page 15

16 Goal 2 A culture of connected and collaborative players An industry that continues to proactively seek and utilise collaborations for national and international success. Activity Detail Collaborations/ Partners Impact Alignment with program objectives Use the information gained from exercises in goal 1 to determine relevant stakeholders and establish collaborative initiatives of importance to industry FIAL s website was launched and refreshed to include activities and other market intelligence of importance for industry Sept 13 in progress Collabforge Industry has access to market information to carry out their work through FIAL s website. Traffic was measured from 14/10/2013 to 30/6/2014 with a total of 5218 visits recorded. Each visitor spent on average 4.21 minutes viewing 4 pages per visit. 1, 6 & 7 Customer relationship management database was established, with 1474 stakeholder organisations of which 1140 are enterprise associates. Feb 14 in progress Sugar CRM Industry receives market information targeted to their interest and able to use this to carry out their work Objective 4 Precedent of FIAL leading national meetings involving State and Federal Agencies to share information on market activities has been established, with 2 meetings organised to June 14 Austrade, Dept of Industry, DAFFQ, DAFWA, DPI VIC, DPI Tas, DEDTA, DMITRE, DSDBI, Enterprise Connect, Food SA, NSW T&I, PIRSA, QLD T&I, Food Supplier Representation from State Government / Departments at State-wide meetings facilitated by FIAL shows cohesiveness across States towards initiatives and programmes for Australia. Improved coordination of major initiatives i.e. in bound supermarket mission, eliminates duplication and Objective 4 Page 16

17 Advocate & UTAS leverages Government resources for maximum benefit to industry Meet FIAL events have provided the opportunity to engage with industry and consult on initiatives of relevance See Attachment A for report Hargraves Institute Industry has been informed on key stakeholders messages and concerns and used FIAL as the channel to communicate messages to Government / other organisations 4 & 6 A review of 8 Asian markets and jointly hosted the Hong Kong Trade Development Council in bound mission highlighted the need for better coordination of inbound missions. This led to the national inbound supermarket mission organised in June 14 by FIAL. Austrade, HKTDC & State Agencies 128 companies had meetings with buyers where 75% have had ongoing dialogue with the buyers since the mission, and 40% of these companies have secured new orders. 4, 7 & Identify emerging patterns of the cultural dynamics shaping the multiple stakeholders within the industry. Emerging patterns have been shared during consultation with industry and used in FIAL s strategy. April 14 in progress Industry were informed of emerging cultural patterns sharing the industry during the 14 Meet FIAL events held across the country in major cities and regions Objective Leverage insights on emerging cultural patterns to support the development and delivery of programmes that will encourage upskilling and improve the capabilities of workers and Market diversification program including retail and foodservice modules are currently being developed April 14 in progress Supplier Advocate Companies will better understand which market channels they are best positioned to target. Retail and Food Service Readiness Workshops will 2, 7 & 8 Page 17

18 managers for the good of the industry. companies the tools to successfully compete in these channels ecommerce Readiness Module is currently being developed April 14 in progress Institute for Supply Chain and Logistics, Victoria University Companies will have the tools and better understanding of how best to enter this channel. 2, 7 & 8 Goal 3 Effective government policy and support An industry cohesively supported in current and emerging needs by relevant state and federal governments. Activity Detail Collaborations/ Partners Impact Alignment with program objectives Coordinate forums, conferences, workshops, etc. to meet with industry associations, relevant academics and determine key themes, messages and communication strategy. See activities carried out by FIAL which have all been used to determine key themes, messages and communication strategy Consult with multiple stakeholders to determine government instrument to be addressed and develop action plans around key areas of focus Feedback obtained through website and initiatives have been used to improve initiatives for industry Initiatives launched through FIAL are of relevance to the industry, as demonstrated through the high participation of initiatives 1, 4 & 6 Page 18

19 The Industry Innovation Network (IIN) The IIN was an integral component of FIAL s engagement with the industry. Together the IIN with FIAL s websites, were going to provide the platforms for building a community of innovators and technologists. This would help firms and industries in the precinct connect, communicate and collaborate, (a) with each other, and (b) with other people and organisations in Australia and across the world to improve the way they innovate to achieve better business outcomes. Key was a common online platform and tools including practices for collaborating and building communities to allow a connected and innovative industry. Due to the change of Government in August 2013, the Managing Director of FIAL was the key employee for the first 6 months 3, and therefore a decision was made by the FIAL Board to focus on delivering a simple website to allow stakeholders to connect with FIAL and keep abreast of its development. The member-focused website was also deferred as FIAL wanted to use insights from it s consultation with industry during August-November 2013 for the construction of the member website. FIAL was, therefore, not in a position to drive development of the IIN in FIAL s website was officially launched in September 2013 on an early Drupal software version. As more program information was needed due to the launch of new initiatives in 2014, an audit of the site was done to understand the technical challenges of further site development. The site was found to have a number of issues including limited functionality, instability when content was updated, presentation of content and look of the FIAL site was poor and it was difficult and costly to work with, as best practice coding was not used and there was unfinished coding. A decision was made in May 2014 to migrate FIAL s old website to the updated Drupal platform built for Meta and the IIN where some of the above issues had been addressed. Content was updated to include FIAL activities and the look and navigation system was also refreshed to allow easier access to information. During the reporting period, FIAL also fully collaborated with the Department of industry on a separate scoping document for a food and beverage industry portal that looked in depth at the technical design requirements of stakeholder information for the industry. At that point in time, due to the uncertainty of FIAL s future, it made sense to support and share the strategic planning and architecture already done by FIAL for the department s project. An industry portal was an identified industry need and FIAL recognised it should be developed by an organisation at some stage in the future. It was also recognised that a scoping document could always be used in the future as an additional technical information or reference point for the portal. In the meantime, META was leading the development of the online collaboration space, online hubs and closed project group with the appointed Commonwealth agent Collabforge. In parallel, work was also being done on the IIN platform that was to be the common and generic collaboration, information and tools for all precincts and was known as Project Leap. Work on 3 All General Managers commenced in December 2013 Page 19

20 Project Leap, however, was stopped at the end of March 2014 following a decision by the Government to end the Collabforge contract and discontinue supporting further development of the IIN. Due to the discontinuation of the IIN platform, FIAL only used some of the functionality built for the IIN to deliver its activities and/or achieve its goals in SME engagement FIAL targeted industry-led initiatives for SMEs who have a desire to innovate, collaborate and experiment. An integral part of this process has been to raise awareness of FIAL s objectives and identify key challenges facing the industry through the Meet FIAL events held across the country. This consultation process has resulted in the development of programs of relevance for the industry, particularly SMEs, with a total of 657 SMEs and 93 large or MNEs that have participated in FIAL s initiatives for the reporting period. Other organisations made up the difference. FIAL Initiative TOTAL SMEs LARGE / MNEs Meet FIAL I Meet FIAL II SME Solution Centre Collaborative Circles Export Challenges Packaging Workshops on Are you ready for export? Hong Kong Trade Development in bound mission, Mar 14 High end supermarket in bound mission, June 14 TOTAL Members and collaborative partners Core partners and other members FIAL had 52 core partners or foundation members when the company was incorporated in June This list of core partners and other details are summarised in Attachment B. Membership from Victoria was the highest at 18; followed by 13 in New South Wales; Tasmania and Western Australia were each equal at 6; there was 4 from Queensland; 3 from the Australian Capital Territory and 2 from South Australia. Please note that this geographical distribution was based on the location of an organisation s headquarters and some of these organisations have national representation like CSIRO for example, so the count for each State or Territory would increase if the counting principles were changed. Of the 52 core partners, 19 were from research and development 4 organisations which also includes universities; followed by 17 enterprise associates 4 Other members of the company as defined in FIAL s constitution are associates. Different categories of associates include enterprise; network; government; research and development; and any other category of associate as determined by the Board from time to time. Note that associates are not members of the Company. Page 20

21 (both SMEs, large and multinational companies); and the remaining 16 were networks who represent the interest of a group of stakeholders like Australian Food Grocery Council. Following incorporation in June 2013, core partners were required to sign an application for membership outlining their total contribution (cash or in-kind) including payment of an establishment fee of $250 inclusive of GST. There were a total of 39 partners that signed the application for membership; 10 did not confirm in writing; and 3 resigned. Of the 39 core partners that signed the application for membership, 33 partners paid the establishment fee to cover the administration costs of membership. La Trobe University was the only foundation member that was required to sign a core participant s agreement as per the requirement in the Commonwealth Agreement because their total contribution exceeded $150,000 5 in value (cash and in-kind). The universities support in hosting FIAL and helping the organisation to establish its operation was invaluable, particularly human resources for recruitment, administration for setting up the business and legal assistance for advice on various contracts including the development of employment and other contracts. Please note that membership of all core partners admitted before 25 December 2013, expired on 24 June 2014 as per FIAL s Constitution. Core partner membership was allowed to expire because of the budget announcement that FIAL will cease operations on 31 December 2014 and confirmation about continuing beyond this date was not received by 24 June Due to the uncertainty of FIAL s future, FIAL did not open membership to associates beyond core partners. Details of the membership structure were also not confirmed because the board resigned in Nov 2013 and FIAL was also awaiting clarification from the Government about the future direction and focus of the Precinct. During the period from November 2014 to June 2014, FIAL encouraged industry stakeholders including all categories of associates and core partners to join the FIAL community and industry database. This allowed stakeholders to receive FIAL s newsletter and other relevant news about the industry such as training and inbound missions. There are currently 1474 organisations in the database, which is continually updated as new stakeholders are introduced to FIAL. Of the 1474 stakeholder organisations in FIAL s database, there are 1140 enterprise associates; 123 government departments; 124 network associations; and 87 research and development associates which also includes universities. Over 80% of the 1140 enterprise associates are SMEs Other collaborative partners In all of the programs FIAL has introduced to the industry, FIAL has engaged and worked with as many Federal and State Government Departments as possible, to improve the quality of programs and to minimise duplication thereby leveraging resources for the maximum benefit of industry. More specifically, the Food and Chemicals Branch, Industry Division, Department of Industry led by Ann Bray was instrumental as a partner in many of the programs identified by FIAL for the industry. John Murray through the NSW Division of Enterprise Connect was pivotal in introducing FIAL to many industry stakeholders and working with FIAL to ensure initiatives were of relevance to industry. Through the support of Sally-Ann Watts at Austrade, FIAL was able to connect with overseas markets and better understand some of the challenges facing Australian businesses. All State agencies actively promoted and worked with FIAL to ensure Australian businesses got the opportunity to participate in initiatives. 5 Board determined a significant contribution (cash or in-kind) to be $150,000. Page 21

22 FIAL has also engaged with other collaborative partners such as other industry organisations, service providers and research partners, to better coordinate service delivery and/or improve industry-research alignment during the reporting period. Every initiative FIAL undertook in the reporting year has been done in collaborative partnership with another organisation to ensure the contribution and insight of the partner organisation enhanced FIAL s programs to improve their relevance and interest to industry; to minimise duplication across the industry; and improve FIAL s reach through the partner organisations networks to ensure greater awareness, participation and benefit from each initiative. Examples below illustrate FIAL s collaborative approach in the development of initiatives for the industry. Export product data and information network developed in partnership with Victoria University, Institute for Supply Chain and Logistics will generate a range of quantitative and qualitative reports using various Australian information sources like ABARE, Austrade and other country market intelligence to address FIAL member information and insight needs for access to Asian and other markets Food Industry Supply Chain Index (FISCI) - a diagnostic framework to assess a company s capability and readiness to enter (or grow) different channels to market i.e. retail, foodservice, route, export and ecommerce is being developed in partnership with Enterprise Connect, Food and Beverage Supplier Advocate and Victoria University, Institute for Supply Chain and Logistics Export readiness modules including a self assessment diagnostic tool were developed in partnership with the Export Council of Australia and in consultation with 45 food & beverage SME s and 15 Government State Agencies, AFGC and other service providers Leading, high-end supermarket buyers from Asia and the Middle East were hosted in collaboration with State Government Agencies and Austrade where 404 food and beverage companies filled in an expression of interest form to participate, of which 128 companies had meetings with buyers. SME Solution Centre - a one-stop nationally integrated centre of excellence pilot providing solutions for SMEs including larger or MNEs with potential to innovate and grow. This collaborative partnership between CSIRO, DAFFQ and FIAL is testing a model of providing both technical services and training to 13 SME and 1 MNE ingredient and consumer goods manufacturers operating in Australia, so they can value add to products and/ or technology Food Futures Innovation for Businesses and Leaders is a pilot to test innovation, design thinking and collaboration techniques with 120 food companies, supported by a diversity of partners including Agrifood Skills, Business Foundation, Catalyst, Central Coast Connect Food Cluster, East Gippsland Food Cluster, FoodSA, Hargraves Institute, Mondelez, Port Lincoln Council, Printing Industries Association of Australia, Produce Marketing Association Australia and New Zealand, Schweppes Australia, Sydney Water, Tamworth Regional Council, and Wiley & Co. These partners either promoted, hosted or attended events held across the six states of Australia, i.e., QLD, VIC, WA, NSW, SA and TAS. The objective is to learn what works and be able to share these lessons with the whole food value chain. The pilot will focus on export readiness and export success. Page 22

23 1.6. Program performance measures FIAL has gathered all relevant information through the Precinct s activities delivered in wherever possible, which FIAL understands will assist the Department to measure the Program s performance against the program outcomes below. It is important to mention that in some cases it is premature to measure the deliverables, as they have not been achieved as yet. For example, it takes time to get a sales order from an overseas buyer, and/or to realise the benefits of commercialising a produce or service. As such, FIAL has made a best estimate where appropriate of the potential value to industry. increase sales, revenue and profits of Australian firms participating in the Precincts; o Through the SME Solution Centre, 14 companies will generate an additional $28M+ of revenue from the commercialisation of their products o Collaborative Circles - 60 business and/or industry stakeholders identified over $22M of value of contributions for businesses, if solutions were implemented o Inbound Mission - 62 companies received new orders within first 3 months of trade mission with an export order value in excess of $1M increase the number of Australian firms exporting and quantity of exports; o Through the SME Solution Centre, 3 firms are directly targeting export from solutions improve employment opportunities and contribute to the creation of quality jobs and a skilled workforce; o FIAL has no deliverable to report under this outcome. increase foreign direct investment; o FIAL has no deliverable to report under this outcome. increase the level of industry-led research and the transfer of new knowledge to industry; and o Through the SME Solution Centre, 2 companies have entered into research which they have never done in the past o Collaborative circles - 60 business and/or industry stakeholders identified on average between 2-3 valued responses to their peers issues deliver substantial economic, environmental and social benefits to Australia. o 1 small dip manufacturer has benefited from collaborative buying with a MNE to get a significant saving on key packaging o 1 company is now combining back loads and transport providers to reduce their cost base for key ingredients and delivery to warehouse o 3 firms have started the R&D tax incentive process while 2 are reviewing their Tradex option and 1 has applied for Tradex o A company was able to continue operations with the support from FIAL on finding an alternative contract manufacturer Page 23

24 1.7. Communications FIAL s Stakeholder Engagement Strategy was focussed on growing national connectivity between stakeholders to encourage proactive engagement and interaction creating a highly invigorated, performing and successful industry. Following the Federal budget announcement to cease FIAL funding by the end of December 2014 in May, a specific six-month tactical plan was developed which focused on supporting activities to be delivered by the end of 2014 and ensuring stakeholders were kept informed about FIAL s programmes and latest industry information. The Brand Strategy for FIAL translated the strategic vision and objectives into a conceptual framework, language and design. This enabled compelling and consistent messaging to the industry for all communication opportunities. It allowed a clear awareness, understanding and engagement with FIAL s vision and purpose, what we do and how we do it - the brand essence: Connect the Dots. This was a conceptual framework, not a slogan that guided all communication styling and messaging. It also reflected the facilitative role of FIAL as a catalyst in the industry, with connections and collaborations, being key elements to accelerate growth of the industry through information, tools, market and other opportunities. The Communications Strategy defined how the audience, content and channels interrelated, with the aim to inform and engage stakeholders with each other, on industry topics and with FIAL activities. It also aimed to grow the community, or database of stakeholders to maximise FIAL s reach across the value chain. Key stakeholder audiences were identified and value propositions developed to reflect associate categories as per FIAL s Constitution. Initially messages were sent to the industry as a whole, with more targeted messaging as the database and knowledge of stakeholders grew. Core partners were treated in a special way because of their important role in establishing FIAL. All communications were firstly sent to them, as they were a source of invaluable feedback and a key influencer and supporter in the industry, before messages were distributed more widely. Audience priority was then centred on the industry networks and Government associations where key people were identified to assist with dissemination and endorsement of messages to their respective member base to increase FIAL s reach more effectively and widely across the industry. These associations were also critical because of their linkages and personal relationships with enterprises of varying sizes. They were also the gatekeepers for forwarding FIAL s communications to their members and forming a relationship with these key people was an important aspect in the engagement with these groups. Direct communication was also important to the growing stakeholders who requested information through the website and/or personal contact with FIAL employees. Communication to other enabling stakeholders such as science organisations, educators and universities, as well as other stakeholders within the supply chain and consultants was a secondary focus because of their weaker enterprise and overseas buyer connections compared to networks and Government associations. FIAL used different channels to convey specific messages to different stakeholders. Active controlled channels were an important pathway for information to be received by stakeholders because content was controlled by FIAL but stakeholders actively used these to gather knowledge and intelligence about the industry. The most common active channel was through FIAL s public website, as it outlined FIAL s core information, activities, events and industry news including how to contact us. During Oct 13 to June 14, there were a total of 5218 visitors to FIAL s website where 3026 were unique and 2,192 were returning visitors. The average pages visited per visitor were 3.8 pages where each visitor spent on average a time of 4.21 minutes reviewing content. As Page 24