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Research Summary - Research on Growth & Innovation

Research Summary

Research on Growth and Innovation

Prepared by the Growth & Innovation Advisory Board

Ministry of Research Science and Technology

19 April 2004


The Growth and Innovation Advisory Board (GIAB) is a government-appointed body which was established in June 2002 to provide the Prime Minister and senior economic ministers with informed perspectives on how the Government can best promote its growth and innovation programme. The Board:

- Contributes to the evolution of the growth and innovation framework by identifying new opportunities for government and private sector actions;

- Identifies emerging international trends on which New Zealand might capitalise;

- Gives independent perspectives on priorities for future action in implementing the framework; and

- Acts as a sounding board for groups charged with the implementation of the framework.

When it developed its work programme, the Board placed an emphasis on culture, as it believed that culture is a vital ingredient for growth and innovation.

Rather than talking amongst themselves, with the danger of coming up with the same old explanations and ideas, the Board decided to identify what New Zealanders think and give voice to their attitudes and concerns. Accordingly the Board commissioned research on how to make growth more self-relevant to New Zealanders.

The intention is to use the research to support the role of leaders across government, business, community, education and academia who are already active in advancing growth. GIAB wanted to encourage more leaders and groups to take up the challenge of stimulating growth culture by creating greater shared meaning around key goals, and stimulating a national conversation between groups and individuals about what growth and innovation mean.

This paper contains both topline results and some commentary on the results. The research involved desk research, and both qualitative (creativity groups, focus groups and depth interview) and quantitative (national survey) techniques with the intention of deriving a well-rounded and reliable view of issues relating to growth, innovation and the cultural factors that shape New Zealanders' attitudes to growth.


The research, conducted by independent researchers UMR, was made up of:

1. Desk Research - reviewing past research

2. Ideas Generation - brainstorming with four creativity groups, which are groups of informed people with an interest in the subject. There were two groups 25-44 years, one group 18-24 years and one made up of sixth and seventh formers.

3. Ideas Testing - using six general public focus groups from varying socio-economic groups and a combination of Auckland, Christchurch/Canterbury and New Plymouth locations

4. Further Ideas Testing - 15 business depth interviews in Auckland, Wellington and Christchurch

5. General Public Survey - 18-69 years, nationwide, booster samples of business (300) and Maori (300)


What is Important to New Zealanders?

New Zealanders today appear to be far different from the passionless people they were branded several decades back. They indicate clearly defined goals and values that come through strongly in the research data.

A clear majority of respondents in all three groups - New Zealanders in general, Maori and Business - rated the following lifestyle and personal factors as most important to them:

- quality of life
- quality of the environment
- quality of education
- quality of health services

These form a "top tier' of priority that is evident not only in the survey information, which is presented in the following graph, but is even more strongly reinforced in the qualitative elements of the research programme.

Also important, though not with quite the same intensity of conviction, is a second tier of factors which are largely financial and vocational such as potential to increase personal wealth, employment prospects and the level of wages and salaries.

While the previous graph (Graph 1) provides a rating of personal importance, respondents were also asked to rate "New Zealand" on these same factors. The following graph (Graph 2) presents how they rated New Zealand compared with personal importance ratings across the same factors. For ease of illustration we have presented just the positive category (scores 7-10) for comparison.

[Note: the boosters samples (Employers and Maori) were re-weighted so they were not over-represented in the general public sample]

Respondents rank quality of life and quality of natural environment (together with quality of artistic and cultural heritage) very highly both for personal importance and for New Zealand's performance in these areas. On most other factors they rank "New Zealand' well behind personal importance. Of particular note is the poor rating for New Zealand for the public health system and level of wages and salaries, compared to personal importance.

From the focus groups however, it was evident that most New Zealanders held a generally positive view of New Zealand, which was driven by satisfaction with the factors rated highly in the quantitative survey - quality of life and quality of New Zealand's natural environment. Satisfaction with these two factors tended to overshadow concerns on other issues.

The quantitative survey did find however, that personal importance ratings for economic growth are well ahead of how New Zealand rates on this issue, suggesting New Zealanders would like to see better performance in economic growth.

Given this result, a key question for the Board is whether this "expectation gap' represents enough of an opportunity for motivating New Zealanders around economic growth.

To put this point slightly differently, does this expectation gap represent a foundation to build on, a potential "burning platform" from which to motivate New Zealanders around growth and innovation? The research does not appear to strongly endorse this approach. When looking at intensity of opinion on the issue (the "10's on the 0 to 10 scale used where 10 meant very important and 0 meant not important at all) - economic growth ranked 10th across the list of 12 factors with only 10% rating economic growth as very important to them personally. In comparison "quality of life' recorded 46% on the same indicator. These results are outlined in Graph 1.

Another finding relevant to this point is the reaction of respondents to other "burning platform" propositions of the past. In particular, many respondents in focus groups reacted adversely to predictions of approaching economic crisis or the threat of falling living standards as a potential motivator. They describe predictions of dire economic gloom variously, as being overly negative, measuring New Zealand by the standards of other countries that are not comparable and motivated by agendas about austerity and hard work with the prospect of little reward. They also believe they have not seen these predictions borne out in reality.

In a similar vein, focus group responses indicated indifference to narrowly-focused economic measures of success, such as achieving a rating of "top half of the OECD", in favour of more holistic measures that have more direct personal relevance, such as those especially in the first, but also the second tier outlined above.

Economic Growth

A question of great interest to the Board is whether economic growth is a motivating idea for New Zealanders. To be a motivator there needs to be a consensus around the definition of growth, its impacts and perceived outcomes.

Economic growth is an idea with which New Zealanders are very familiar. In focus groups respondents talked about it easily. They saw it in terms of growth of the economy, growth in wealth and growth in population. They were aware of discussion of economic growth in the media and the need for New Zealand to grow steadily to maintain living standards is a well established idea.

Not surprisingly therefore, in response to a first up question about support for economic growth, New Zealanders generally responded in the affirmative. Their response has the character of "polite support' and lacks passion. Graph 3 illustrates this point. Few register as opposed to growth, but a significant number are at the "lukewarm' end of positive.

However, this apparent familiarity and support belies deeper concerns. Once questioned in depth, particularly in the focus groups, attitudes to economic growth become more fragile. For example, when asked who they see benefiting from economic growth a significant majority say younger New Zealanders and future generations. This response is open to two interpretations. One is that New Zealanders are genuinely concerned about creating a positive future for their children. Another is that they don't see the benefits being available now, for them. If this latter interpretation is correct, and we believe it is a significant factor, then this would partly explain the attitudes of those who are lukewarm. New Zealanders are going to be less motivated to support and pursue growth if there is little prospect of a pay back to them personally.

An interesting and slightly disturbing corollary is that younger New Zealanders sampled in this research do not share this optimism. They regard the level of economic growth as less personally important. They have less belief in economic growth resulting in better life and they have lower support for an economic growth goal.

The survey then looked at whether respondents believed growth would result in tangible benefits in such key indicator areas as better health and education, more secure jobs, more interesting and rewarding jobs, better pay and conditions of work. While a majority believed this would happen, a substantial minority, around 40%, is neutral or negative. This neutral/negative response climbs to around half when asked if growth will result in a better health system. This is a significant level of doubt making it difficult to build consensus messages around growth, as it is currently constructed or viewed.

Many of those who are pessimistic about the benefits of growth refer to the experience of the 80s and early 90s when they believe there was little or no dividend from the policies of austerity. Communication around growth would have to create a clear separation from these policies.

The real clue to the ambivalence around growth arises from the qualitative focus group data. Respondents identified major concerns in the area of side-effects of growth. Focus group discussion on these spin-off effects makes it clear they represent major reservations around the growth proposition. This could significantly diminish the power of economic growth as a motivating concept.

The qualitative findings were backed up by the quantitative survey, where a number of negative factors were seen as likely to eventuate from economic growth, including deterioration in the balance between family and work life, increased traffic and congestion, a growing gap between rich and poor, more stress and pressure on the average person, a more materialistic culture, damage to the environment and more immigration. These findings are outlined in Graph 7. More telling perhaps, was the fact that two of the negative factors scored greater intensity of agreed likelihood than any positive factors (10 on a 0 to 10 scale where 10 meant it was very likely that economic growth would lead to that factor and 0 meant it was not likely at all), namely, more traffic and congestion and a growing gap between rich and poor.

Economic growth as a motivating concept for New Zealanders has been weakened by past associations and negative perceptions. It is at its strongest when associated with the achievement of lifestyle, environment, health and education benefits, that is, when it is self-relevant. It is at its weakest when it is perceived as a remote idea with little connection to daily life and shared values - for example, top half of the OECD.

Economic reforms of past decades have turned off a lot of Kiwis. They see economic growth coming at too high a price or as way beyond their capability to influence.

A conclusion that can be drawn is that economic factors alone will not motivate New Zealanders. The country will prosper only if it can create a distinctively Kiwi vision of growth which is meaningful to New Zealanders in the context of their daily lives and the values that they clearly prize.

New Zealanders may have many reasons to be optimistic about the future, but a shared vision of growth and economic success that sustains and unifies New Zealanders appears still to be lacking.


On the other hand, innovation is a motivating and consensus concept. It is an idea New Zealanders in general, Business, Maori and young New Zealanders, all support. Innovation is very closely tied to core attributes that they hold as important such as "giving it a go", "resourcefulness" and "being practical". Innovation is also associated with achieving international success, whether in sport, arts or commerce. Support for innovation is often connected to a passion to perform, particularly on the international scene, and especially when it reinforces Kiwi values.

That said, the process of innovation in a business sense and what it actually involves is not well understood by New Zealanders. For example, members of focus groups found it difficult to name specific New Zealand innovations, and where they could, their examples reflected a narrow interpretation of innovation, concentrating on areas such as electronic and mechanical technology. However, there was also an interesting acknowledgement about the innovations in traditional agricultural industries, particularly what biotechnology could create.

The proposition that New Zealand needs to export more added-value products is well understood and supported. Respondents see innovation as key to adding value and focus group respondents generally rate New Zealanders very highly as innovators. It is seen as part of the New Zealand character.

Indications from the employer booster sample indicate that employers likewise see themselves as innovators. They see opportunities to grow their business and claim to have plans in place to do so. At the same time, they are uncertain about the growth of their business. They see barriers such as difficulty in finding staff, demands from customers and the sheer energy and commitment required to grow a business.

While innovation is a consensus concept - New Zealanders believe it is a good thing - there is a need for a commonly held definition. Many respondents regarded innovation as being complex and technical, something that others do. Some had a far more generic interpretation such as good ideas and new ways of doing things. To build energy into innovation it will probably require a broader definition so that more people can place themselves in the innovation picture.

There was concern that innovation by New Zealanders would soon be exported through sale or transfer to off-shore companies resulting in loss of benefit for New Zealand and reward for those who developed the idea.

Personal Effort and Ambition

There are indications of a strong theme of ambition that runs through the New Zealand character. Large numbers of respondents claim they make considerable personal effort to improve their life. For example, 59% said they had undertaken study while working full or part time, 35% said they had moved to another area for a better job or to get a job. A surprising 34% said they had taken a pay drop for a job with better long term prospects. These are actions of committed and passionate people.

There is a strong theme of self improvement and personal responsibility in these findings. The result is common across all New Zealanders, Maori and Business suggesting that these attitudes are significantly imprinted into the Kiwi culture.

At a personal level there appears to be no shortage of motivation and ambition. This striving for self improvement is generally associated with positive attitudes to innovation and optimism about the future.

While it is unlikely respondents will answer negatively to questions about self-improvement, focus group discussions also indicate New Zealanders take personal improvement very seriously. This contradicts a widely held stereotype that the attitude of "She'll be right" still pervades the Kiwi culture.

It is possible that the growing ambition evidenced in the research is still latent because as many as 68% say that they are happy with their life the way it is. This could also be seen as another illustration of concern that economic growth could result in negative impacts on their life. The latent ambition evident in some could become more active with the right stimulation.


If innovation and self-improvement are strong drivers, involvement in business is seen as an increasingly important vehicle to achieve them. Attitudes to business presented as very positive, in sharp contrast to other research in recent times. While involvement in a personal business is the ambition of relatively few (and perhaps a fantasy of a few more), those New Zealanders see business as a realistic vehicle for them to achieve both wealth and personal satisfaction. This figure is an increase on that from 1999 research conducted by UMR Insight.

Policies and programmes to encourage business success, particularly small business, have strong support from New Zealanders. In short, being involved in business is becoming "cool".

The key to understanding the enthusiasm about business is that more New Zealanders see being in business as within their grasp, and more importantly, business is seen to represent core Kiwi values such as "being your own boss", "hard honest work", "practical", "resourceful", "teamwork", "innovation", and even a touch of entrepreneurship. We tested out the notion of people building businesses from passions and hobbies, and that resonated in the focus groups. People were very positive about the idea of building businesses from creative interests - music, film, writing.

The key point is that New Zealanders see business as a primary vehicle for success.

There is, however, great concern about "big business'. Whilst recognising that "big business' contributes jobs, opportunities for small business and innovation, there is a strong residual concern that they do not "give something back" (a core Kiwi value), that New Zealand innovation may be taken overseas by these companies for the benefit of others, not New Zealanders, and that workplace relationships can be stressed.

The focus groups identified willingness to "give something back" as a key mitigating factor for a large enterprise. In particular they identified businesses exhibiting social and environmental responsibility as being more acceptable.

A key finding of this research is the distinction that New Zealanders appear to be making between the idea of business (as enterprise), for which there is great support and which is generally associated with small to medium-sized enterprises, and "big business', about which there is considerable ambivalence, though nevertheless, recognition of the contribution this level of enterprise makes to growth and the economy.

There is also concern about businesses growing larger. On the one hand there is a realisation that New Zealand businesses must grow to be able to compete internationally. On the other hand New Zealanders fear a level of disconnection with larger enterprises.


Attitudes to the workplace are generally positive. The workplace, like small and medium business, is seen as a vehicle for personal growth and self improvement. It would be fair to say that employers probably have a more positive view of the workplace than employees, but for all that there is a remarkable level of unanimity.

The following graph draws comparisons between employer and employee attitudes. The poorest rating by employees relates to recognising or rewarding employees that raise new ideas that help the organisation, at 47% positive responses. This rises to 64% when asked if employees are encouraged to put forward new ideas.

The focus groups detected a lingering lack of trust between employers and employees in the workplace. Respondents talked of a legacy of mistrust stretching back to the 1980s, although that does not explain those same attitudes in young people.


Leadership is very important, and the most credible leadership arises from New Zealander's own networks. For example people "close by" such as friends, workmates, family and employers are regarded as credible - together with academics.

Those who are regarded as more remote such as politicians, the media and trade union leaders are less trusted.

There is a very positive implication of this finding as it indicates that New Zealanders respond strongly to those around them to motivate their personal and professional lives. They respond to collective and communal leadership in the home, the workplace and the social environment. They respond less well to national or remote figures or information they cannot trust by referencing through people close by them.

This suggests that any strategy to encourage a growth and innovation culture must operate through networks close to people, through trusted relationships.


1. Values are paramount

Core values that focus around lifestyle and environment are paramount, closely followed by health and education. Understanding this is the key to understanding what motivates New Zealanders. Unless growth and innovation are seen to contribute to enhancing these values, in fact, that they are value-based, then they will lack impact and influence with New Zealanders.

2. The Kiwi Character

There are attitudes and attributes that are deeply ingrained in the Kiwi character - perhaps more than we have previously realised. Such attributes as resourcefulness, practicality, fairness, cooperation, and "give it a go' attitudes, are defining and are an important foundation for growth and innovation.

3. Focus on added value

New Zealanders generally understand the added-value proposition, though many do not know how they can contribute, and a portion, though a relatively small portion, don't see it as important.

Most would support business and Government initiatives that combine values and the pursuit of added value.

4. New Zealanders want to be part of New Zealand's success

The idea of individual and collective contribution to success is very strong, although success is defined in very specific terms relating to lifestyle, environment, health and education

5. New Zealanders have latent ambition and are committed to self improvement

This provides a sound platform on which to build a growth and innovation culture. It suggests that New Zealanders try to do their personal best and with the right sort of support they could better their personal best.

6. New Zealanders have a vision of what they value, but it is yet to take shape as a coherent vision of the future

It is no exaggeration to say that in economic terms our "New Zealandness" is now our greatest competitive and comparative advantage. The very values and attributes this research has identified are what make New Zealand's people, products and services attractive. Our values are a form of branding that can add to our bottom line in terms of a price premium for our exported products.

The Board believes we need to build a vision of growth that is authentically ours, that is true to our character and values and clearly enhances the things in life that New Zealanders hold dear. It needs to reflect our passion, our generosity, our lack of cynicism, our selfless teamwork and our boldness. If New Zealanders believe they have some control and investment in growth we believe many of the reservations about growth will evaporate and will simply become challenges and situations to be managed.

7. Building a Vision for Growth

A vision of growth based on Kiwi values and in keeping with our character is essential for success. This vision needs to be shared with leaders at all levels of the community. Every member of the community and every business must be included in this vision and be challenged to work out how it can apply to their lives. Growth is not just something that happens to us as a country. It's something we must make happen as a people. It's not just about adding value. It's about having confidence in what we value.

8. Values and Value

The strength and clarity of what New Zealanders value is itself an asset. By looking through a "values" lens New Zealanders will see and take hold of opportunities that the world now offers. This is because many consumers around the world are looking for meaning and value. They are seeking products, services and experiences that are "natural", "authentic", "genuine", etc. A focus on values can lead to value add and greater value for New Zealand.

A focus on New Zealanders' values can create the value ($$$) that enables us as a nation to preserve and enhance (pay for) what we value: a virtuous growth cycle.

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