Great products fail in weak companies. Mediocre products win in strong companies.
CSIRO invented the core wireless system design that is the basis of all high-speed WiFi generations. The breakthrough emerged from Australian research excellence, achieving technical validation and patent protection. Sydney startup, Radiata, licensed the patent and produced the world’s first high speed WiFi chips. Yet WiFi only became ubiquitous after Cisco acquired the technology and deployed it through global distribution networks, enterprise customer relationships, and 24/7 technical support infrastructure spanning 165 countries.
The difference at Cisco wasn’t technical capability. CSIRO’s research was world class. Radiata’s chip technologies were ground-breaking. The difference was commercial infrastructure to translate technical innovation into market reality. Australia’s innovation policy consistently overlooks the fundamental reality that commercial success depends as much on who’s commercialising the innovation, as what’s being commercialised.
Time and time again we see excellent technologies languishing in organisations without strong commercial expertise. Equally we often see mediocre products with significant market share due to the commercial experience of the supplier.
Current policy obsesses over Technology Readiness Levels while ignoring this critical commercial dimension. The missing element in Australia’s innovation evaluation is recognising that innovation success operates on two dimensions, not one.
Beyond linear TRL thinking
Policy frameworks treat commercialisation as the logical next step after technological development, extending NASA’s Technology Readiness Levels toward “commercial readiness” as if success follows a predictable sequence: reach TRL 9, attract customers, demonstrate market viability, generate commercial outcomes.
This linear thinking partly explains why Australia produces world-class research that struggles to yield commercial value. We evaluate technologies independently from the organisations attempting to commercialise them. Research institutions excel at advancing TRL levels. Policy makers fund demonstration projects proving feasibility. Yet the assumption that commercial adoption will follow technical validation is naive.
It is companies, not projects that carry innovations across the valley of death. Projects end regardless of technical success; companies endure, navigating commercialisation with the capabilities and discipline necessary for sustained market development.
But not all companies possess the capabilities to commercialise all innovations successfully. The critical question isn’t just whether the technology is ready, but whether the organisation commercialising it has capabilities aligned with what that innovation needs for market success.
The multiplication framework
The success of innovation depends on two factors, technical readiness and commercial maturity. We use a horizontal axis to represent traditional TRL progression from laboratory concepts toward market-ready product. But we also have a vertical axis, which policy frameworks consistently underemphasise, that represents the commercial maturity of the organisation attempting to commercialise.
Combined Innovation Success Potential = TRL × Company Commercial Maturity
This is multiplication, not a linear progression, and the distinction matters.
Commercial Maturity describes the organisational capabilities needed to convert technology into market value. These vary by industry, but typically include five critical dimensions:
- Market Access includes distribution channels appropriate for the product category, customer relationships in key target segments, the right geographic presence in relevant markets, and expertise in navigating industry regulations.
- Technical Integration covers supply chain management, manufacturing know-how, quality assurance systems for the product category and integration with existing market.
- Financial and Operational Infrastructure; this is the funding capacity for scale, working capital for inventory and receivables, the operational systems and processes supporting the business model, and appropriate risk management systems.
- Organisational Culture, which includes decision-making alignment with market dynamics, attracting and retaining the right talent in relevant domains, flexibility around innovation and incentives aligned with success.
- Brand and Market Positioning is the relative competitive positioning. It defines the target customer segments, brand alignment to the value propositions, responsiveness to market changes, and customer relationship management systems.
Organisations with high commercial maturity can successfully commercialise technologies at lower TRL levels. Equally, technically mature innovations will fail when the commercialising organisations lack the core capabilities needed to serve the market.
Why multiplication matters
Strong technology cannot compensate for weak commercial capabilities in relevant domains. If we extend the logic literally, if we multiply TRL 8 with Commercial Maturity 3 our combined score is 24. Compare this to TRL 5 × Commercial Maturity 7 = 35. The moderately developed technology in a commercially capable organisation has higher success potential than advanced technology in a commercially weak organisation. Strong commercial capabilities can overcome moderate technology gaps but cannot commercialise non-functional technology.
The WiFi story demonstrates the pattern. Research produced TRL 8-9 results with a functioning technology and enforceable patents. Yet WiFi only reached global scale when Cisco’s enterprise customer relationships and existing networking infrastructure turned this patent into market reality.
The multiplication framework explains why Australian innovations are consistently lost to international companies with relevant commercial capabilities, returning as imported products developed from Australian IP. Our research capability is sound, we are missing the translation partner.
Patterns across industries
In pharmaceuticals, small biotechnology companies develop breakthrough drug discoveries that achieve technical validation through early clinical trials, but rarely deliver products without partnering with large pharmaceutical companies. Phase 1 clinical trials require $100 million-plus of investment, and production facilities must comply with stringent quality requirements. Companies need global distribution networks to serve hospitals and pharmacies.
Big Pharma’s commercial maturity for drug commercialisation includes regulatory expertise developed through decades of submissions, combined with sales forces with established physician relationships, and the ability to navigate insurance reimbursements. Technical innovation alone cannot navigate this commercial complexity. Small biotech consistently partners with larger pharmaceutical companies because drug commercialisation requires a high degree of commercial maturity.
This is consistent across most knowledge intensive sectors. While specific capabilities differ by industry, technical readiness alone is not enough to achieve commercial success.
Australian evidence of multiplication effects
In Australia we see this in medical devices and biotechnology.
Cochlear entered hearing implant markets with technology at approximately TRL 7, facing significant technical challenges. Cochlear invested in commercial infrastructure for medical devices including international regulatory navigation experience, clinical validation partnership capabilities, and distribution networks connecting to audiologists and ENT surgeons. They enabled technology refinement while also investing in building a dominant market position. Competitors developed technically superior alternatives but none captured comparable market share. Technological advantage alone doesn’t determine commercial success in medical devices. Cochlear’s commercial maturity in dimensions relevant to hearing implants multiplied the value of incremental technology improvements, creating competitive advantages that pure technological development couldn’t match.
ResMed’s success follows a similar pattern integrating technologies developed through research collaborations with the commercial maturity to manage the regulatory approvals for medical devices, clinical evidence development, distribution connecting to sleep clinics, and customer relationship management. Their technologies might have remained research results without the right multiplier effect.
CSL’s biotechnology leadership shows how relevant infrastructure translated research into products generating billions in revenue. The company’s capabilities in clinical trials, regulatory pathways, and manufacturing scale-up for biologics delivered results few competitors could match, despite others having similar technologies.
These Australian companies did not succeed because they possessed superior research capabilities compared to universities. It was their commercial maturity in dimensions relevant to their industries, multiplied by the value of their technologies.
Scale doesn’t equal commercial maturity
Large incumbents are not automatically commercially mature for every innovation. Traditional automakers had far reaching capabilities but they were optimised for internal-combustion vehicles, not electric ones. Yet Tesla achieved a dominant position in electric vehicles despite the incumbent apparent disadvantages.
This apparent contradiction actually strengthens the multiplication framework. Traditional automakers had the wrong type of commercial maturity – capabilities aligned with internal-combustion vehicles, not electric ones.
Vast dealer networks became liabilities when franchise agreements prevented direct sales, and dealers resisted electric vehicles with lower service revenue. Expertise in engine and transmission building proved irrelevant for electric powertrains. Supply chains built around ICE components required complete reconstruction. Engineers specialised in combustion could not easily pivot to battery chemistry and software integration.
Tesla on the other hand built commercial capabilities aligned with electric vehicles. They brought software integration expertise from Silicon Valley rather than automotive experience from Detroit. Tesla established a direct-to-consumer sales model avoiding dealer conflicts and a vertically integrated battery supply chain, with charging networks treated as a product. Their brand was making sustainability aspirational rather than sacrificial.
These examples intend to demonstrate commercial maturity is not simply about size or incumbent position. It is having organisational capabilities aligned with what specific innovations require for market success. In this example we can see traditional automakers had the wrong type of commercial maturity.
There have been similar patterns in other industry transformations. When you look at Nokia, Kodak, and Blockbuster, they all had scale yet lacked the ability to forecast change. Their commercial maturity was for the wrong product architecture. In the case of Nokia they possessed commercial maturity in hardware-focused mobile phones, but lacked capabilities for software ecosystem management. Kodak invented digital cameras but maintained commercial infrastructure optimised for film sales. Blockbuster had extensive retail presence when video streaming required different capabilities entirely.
We often see scale and existing market share as anchors to legacy operating models, which fail to move fast enough to anticipate change. Sunk costs in existing infrastructure and compensation structures tied to legacy measures, combined with decision-making processes for mature markets all work against developing capabilities aligned with new innovation requirements.
Commercial maturity is capability alignment with specific innovation requirements and market needs, not simply size or market position.
Policy implications for evaluation
Research policy in Australia evaluates technology readiness but overlooks the commercial requirements necessary for them to succeed. Grants reward TRL progression because success is measured by technical milestones. The commercial capability of the proponent organisation or their partners is rarely examined.
A fundamental change is needed. Evaluation must instead consider both axes. Assessment criteria should explicitly examine whether potential partners possess:
- Market access capabilities,
- Technical integration and manufacturing know-how,
- Financial and operational infrastructure,
- Organisational alignment, and
- Brand credibility in the relevant market.
These predict commercial success more accurately than TRL alone. Policy frameworks need to incentivise research institutions to partner with commercially mature Australian companies to enable research to create meaningful impact.
As competency analysis has established, research excellence requires different skills from commercial translation. The multiplication framework provides evaluation methodology for leveraging these complementary capabilities rather than expecting individual organisations to excel at incompatible competencies.
The Australian opportunity
Australia has both world-class research capabilities and commercially mature companies across multiple sectors. The WiFi story demonstrates both strengths and the gap between them. The issue is not research funding or TRL advancement but connecting research excellence with local commercial capabilities.
Countries such as South Korea, Taiwan, and Denmark demonstrate economic resilience comes from linking these two dimensions. Australia can do likewise by recognising both technology readiness and commercial maturity, prioritising support for partnerships that combine them. Then we can measure outcomes across both dimensions so that we can tell what is actually working, like how many technologies became products, what revenue did they generate, how many Australian companies were able to scale and grow.
WiFi succeeded globally when Australian technical excellence met global commercial capability. Applying this principle across all innovation will turn great research into lasting commercial success.