Exclusive: Under new management, DFAT dumps innovation role

CANBERRA — Innovation within the Australian aid program has taken a major hit with the departure of Sarah Pearson, the chief innovation officer, chief scientist, and first assistant secretary for InnovationXchange. Pearson has confirmed exclusively to Devex that the position is set to be abandoned.

“They [Australian Department of Foreign Affairs and Trade] will maintain the iXc but won’t have a FAS lead,” she said. “They’ll still have leadership and continue to pursue driving innovation across DFAT and Frances [Adamson, secretary of DFAT] will continue to push innovation and new ways of working.”

Former foreign minister Julie Bishop introduced InnovationXchange in 2015 as a unit within DFAT. The unit was tasked with developing innovative and more effective and efficient ways of delivering Australia’s foreign aid program. Pearson took on the newly created role of chief innovation officer in 2018 as it moved into the second phase of its development — its “operational phase.”

Less than two years into the position she has moved from Canberra to Brisbane with a new role as the deputy director-general of the Queensland Department of Innovation and Tourism Industry Development.

As of Feb. 14, Pearson was still listed on the departmental organization chart, despite having departed from the role on Jan. 15. But her departure was not unexpected — Pearson made the decision known late last year providing an opportunity for DFAT to plan the next stage of its innovation agenda. When questioned by Devex on who was taking on responsibility for Pearson’s former role and the decisions DFAT had made for the position, DFAT refused to provide a direct response.

“The iXc has a distinct identity within DFAT,” a spokesperson for DFAT said. “In line with the department’s Innovation Strategy 2018-21, the iXc continues to promote innovation across the Department’s activities including engaging with and promoting new technologies, new partners and new approaches to development challenges. There are no reviews planned regarding the role of the iXc within DFAT.”

DFAT insiders have told Devex that scrapping the innovation leadership role is one of many steps the department is taking under new political leadership to remove the legacy of Bishop and former Prime Minister Malcolm Turnbull — a decision that is being seen widely across other departments in the Australian government as well.

“The decision to abolish the role of chief innovation officer and head of InnovationXchange at DFAT is a retrograde step,” Emeritus Professor Roy Green, special advisor and chair for the University of Technology Sydney Innovation Council, told Devex.

iXc provides scope for evidence-based thought leadership and transformation, but it requires strong leadership that appears to be missing, Green said. The decision made by DFAT, he said, is part of a “clear trend” to reduce government interest in research and innovation, and diminish the role of public service expertise more generally in policymaking.  

Concerns are high that the current political landscape and inability of DFAT to provide surety for the future of iXc beyond the 2020-21 financial year is the final nail in the coffin for this experiment in doing aid differently.

Understanding the dynamics of innovation

Danielle Logue, acting director of the Centre for Business and Social Innovation, collaborated with iXc to produce a “Social Entrepreneurship & Impact Investing Report” and told Devex innovation units like iXc were important to provide important “safe spaces” for experimentation and testing in any type of organization.

“They can take on projects with higher than normal risks and provide new ways to convene and connect with different stakeholders,” she said.

“Innovation units are a helpful mechanism or channel for introducing new ideas and change into existing organizations and institutions. But they need internal champions in the unit and more importantly in the wider organization to actually adopt and take up the new ideas, hence why the backing of the former Foreign Minister Julie Bishop herself was so important in the early days.”

For long term sustainability, Logue said introducing new positions or titles — such as chief science officer — need to address a compelling organizational need to be sustainable in the longer term to build wider buy-in.

“Innovation is a collective process,” she said. “While it is very helpful to have internal champions and leaders, innovation isn’t just a top-down process — it needs buy-in, participation, and shared purpose to sustain. And innovation isn’t just about big disruptive changes. Incremental innovations can be just as transformative in the longer term, as they become taken for granted ways of working.”  

The approach to setting up innovation within an organization can also create challenges, with a decentralized approach risking duplication while centralization can be perceived as too separated from an organization's core business.

“The advantage of centralization is that you can concentrate resources without the day-to-day pressures of delivery,” Samuel MacAulay, senior lecturer at the UTS Business School, told Devex.

But this can be distanced from products, services, and needs of the “here and now,” MacAulay said. “If you centralize too much, you can be disconnected from your core business — and this can create resistance from the business groups on the frontline.”

MacAuley said that the response to Turnbull’s innovation agenda in Australia appeared to be focusing on a disconnect between future thinking and the needs of here and now, and this public perception may be encouraging the shift toward decentralization of innovation in the aid program.

What does this mean for Australian aid?

For the Australian aid program, Logue does not believe the loss of Pearson and potential loss of iXc will mean the loss of innovation in Australia’s aid program.

“Innovation in the aid program will continue — reduced budgets, changing forms of contracting, increasing inputs from managing contractors and NGOs in design, and agendas of other donors and multilateral agencies are — for better or for worse — already driving innovation and change in the aid program,” she said.

But she was concerned that the loss of space to experiment and test new ideas, will leave Australia reliant on its partners to provide those types of insights. And this could lead to inefficiencies and missed opportunities to have a greater impact.

Among Australia’s NGOs, the news of the departure of Pearson and loss of her role was met with surprise and disappointment.

“InnovationXchange and innovation leadership is critical,” Marc Purcell, CEO of the Australian Council for International Development, told Devex. “So we are perplexed as to why this position has been abandoned.”

The emphasis by Bishop on innovation in development systems, Purcell said, had been welcomed by Australia’s NGOs as it brought new ideas to respond to growing development and humanitarian challenges.

“To me, leadership matters,” he said. ”Bishop in creating InnovationXchange and having a Chief Innovation Officer and Scientists was creating leadership that could drive change and shake things up.”

Purcell speculated that not filling the role could mean DFAT is “cash strapped” and unable to fund a replacement, or there is no longer a champion for innovation and the role of science in development policy at the leadership level. But he said science and innovation had an increasingly important role in Australia’s aid program to combat and respond to climate change, as well as support countries in the Indo-Pacific that face the challenges of population growth and increased urbanization.

“It’s startling that, after DFAT have just created the role of chief scientist and combining that with innovation last year that, but they have pre-empted the outcome of the current aid review and abandoned the mission,” Purcell said.

“They haven’t used strategy in coming to this decision. While DFAT does have many brilliant people, the culture is risk-averse overall. And this hinders innovation when we need it most.”