The new research by NAB Group economics, innovation department NAB labs and the Melbourne Institute of Applied Economic and Social Research analysed more than 25 years of data and spoke to more than 500 businesses.
NAB chief economist Alan Oster and his team used the responses from the businesses to create the NAB Labs Innovation Index.
According to the Index, Australian business scored 67.6 for innovation (out of 100).
Transport/storage scored highest (72.1) out of all of the industries, closely followed by retail (69.7) and manufacturing (68.5).
The Index also found that Western Australia (70.1), South Australia/Northern Territory (69.4) and Queensland (68.3) are the most innovative states.
76 per cent of businesses said they were driven by 'opportunities to deliver a better experience/service/product to their customers'.
“Many businesses innovate continuously to survive and prosper but don’t necessarily think of that as innovation, but more likely talk about ‘improvements’, ‘changes’ and ‘adjustments’ to their everyday processes, products or services which is exactly what innovating is,” Mr Oster said.
“While large businesses were most innovative, micro-businesses with less than 20 people were the next most innovative group and they were particularly focused on doing things more cost-efficiently, but their challenge was a lack of time to implement ideas,” he added.
NAB intends to continue working with The University of Melbourne to track how Australia is innovating as a nation.
[Related: NAB backs government’s innovation agenda]
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