I retired from personal blogging in July 2008.
But you can find me over at http://blog.xero.com.
I was at a meeting last night with a number of senior people in our ICT industry. One of the discussion threads was what aspirational goals should we have as industry.
Buoyed by the broadband discussion last year I think we’ve seen that you can actually change things if you get coordinated.
Some of the general themes we’d like as an industry would be around
- Encouraging more people into the industry
- Certification programs
- Immigration
- Education
But what would be some specific and measurable things we could achieve if we worked together?
Here are some that I’ve been thinking of.
- Establishment of an ICT procurement ombudsman, so that procurement issues can be raised without the vendor being penalized in the market.
- A work visa program between New Zealand and Silicon Valley so that we can send our talented people up to work there for a few years and bring experts down here tightening the relationship between ourselves and the center of the tech universe.
- R&D tax credits limits lifted if you are exporting products developed from that R&D.
- The industry supporting Government initiatives on Online Identity Management for individuals and businesses facilitating electronic commerce. We could lead the world here.
What do you think? What else could/should we do?
blog
Absolutely agree there’s potential to do things in NZ where our small size and (relative) ease of co-ordination can allow things not easily done elsewhere.
An example? Opening up and sharing of public data and datasets to allow people/companies to do all sorts of interesting things.
Re relationship between NZ and centre of tech universe, that’s also something that events like Webstock can contribute to.
Slush fund for start ups with commecially sound business propositions
Mentoring and support programmes for start ups
Tax credits / relief for the ICT sector (think Ireland)
University programmes on innovation, ICT and export
A national stance around follow the sun support or software development (isn’t the ideal time to fix code when the major markets are asleep?)
You say:
Establishment of an ICT procurement ombudsman, so that procurement issues can be raised without the vendor being penalized in the market.
So - a straw poll.
How many SMEs are actually brave enough to complain about the procurement process - especially if they are justified in their complaint?
How confident is the vendor marketplace that they will not get penalized?
Agree with much of the above, although I doubt we will see sector specific targetted tax credits any time soon.
Because I’m doing a tech start-up at present, it has been instructive identifying exactly what practical help is available from govt. agencies. Although I’m philosophically opposed to direct cash handouts for new businesses, I do agree with providing tax credits and research funding for technology R&D. I would like to see the ICT industry lobby to ensure that the share of govt. funding for ICT R&D is not diminished.
Added value industries in the agricultural sector are important, because NZ has a huge natural competitive advantage already and we should support that, but it’s not the only game in town.
http://geniusnet.blogtown.co.nz/2008/03/12/fast-forward-fry-up/
I’ve often wondered why NZ does not play on the countries strategic position a little more. Berkeley is certainly the center of the thought and creation part IT universe, but on the other side of NZ is the center of activity and development in our IT universe. (in the form of SE Asia, China, India).
From a time zone point of view NZ sits right between the two and would be an ideal place to manage projects and communications, while adding NZs own value through local skills and people.
Physically NZ could be considered by some as a little remote, in a connected and more virtual world however there should be an opportunity to play a very different and significant role.
Government shouldn’t be involved in giving cash to business. That is the job of investors.
What I’d quite like to see is some tax relief on investing in start ups. In the UK years ago we had the BES scheme where you could claw back up to 40% of any investment. Now that would encourage more private investment into start ups and more innovation.
As a start-up entrepreneur type just starting out, blundering into mistakes like a drunken elephant knocks down trees, can I ask a pretty simple question?
Who should fund the period of time it takes me to get from point A (cool idea that I think will work, but may/probably won’t) to Point B (successful business, ie, growing revenue, managed expenses etc) or Point C (failed business, but learnt a lot of lessons, ready for the next time!).
Should it be me? Should it be the government? Should it be investors?
Interested in responses.
As a note to Rods first question, I think as an industry, one of the biggest issues is simply the type of ICT developed here. Not sure if anyone has stats, but my feeling is the vast majority of ICT spending in NZ is support based systems (essentially anything done by government or major vendors). Very little is allocated towards product development (a la xero, peace, orion etc). As any developer will tell you, product dev is exciting. Support is not. And selling a product has got to have a greater flow on effect than support development.
How do we push more development into product? remove the penalties for failure (ie, some startup funding, tax creds etc), faster broadband, incentives for established product players to assist new entrants into product dev. Insist government be more accountable for the current massive wastage in IT spending. Fund think tanks from large external markets. Does anyone here really know whats required in those markets? Love the work visa program idea for that reason.
have more ideas, but will leave open to others!
Rod
a quick look at the website for “The Worshipfull COmpany of Information Technologists” http://www.wcit.org.uk might point you towards the type of organisation needed to get some traction on your concepts through ‘the establishment’. It took ages to get off the ground in the UK, but might be quicker here given our do it now attitude.
On another front, you will have much more traction getting exchange programmes working with India than with silicone valley, and that is the current centre of software excellence in my view. For some reason (as I found when I was helping out the Computer Society, they go overboard about meeting and working with NZ Software people, even if they are (as in my example) still learning their craft in school!
We need to have national ICT internship programme for accelerating the development of graduates.
There are a number of independent programmes working across the country eg. Summer of Code, Aceerlate Auckland, CSI academy. They to be united under one banner. This help would to set some standard conditions for all the programmes. ie. Rates of pay are different from one programme to the next. Also, this would provide the ability to leverage resources to lobby sponsors and govt.
Drive down costs of operating an ICT business. Affordable connectivity costs, but more especially, eliminate data caps.
Have exceptions to zoning rules so that the garage-based startup is a recognized reality.
Transparent Government procurement process at all levels, LATEs included.
Mr Cleg
I believe the Company of INformation Technologists has started something along those lines. It’s an interesting concept, as the basis of a “City of London Company” is in the traditional ‘crafts’ of history. (e.g. silversmith, goldsmith, saddler, builder, architect, candlemaker, etc..) The ethos being a certification of progressive levels of skills through to a mastery of the craft. Given that there is no way that we can construct an acceptable theory of professionalism for software engineering, a craft designation makes sense, and the concept of a skill progression that blends academic and practical learning (in the same manner as nursing used to do) would seem appropriate to me, and the others who held the society’s initiation dinner back in 1989.
Something similar, or even a direct derivative of, the Company might be a first step along the road to recognition and self regulation here in God’s Own.
> A work visa program between New Zealand and Silicon Valley so that we can send
> our talented people up to work there for a few years and bring experts down
> here tightening the relationship between ourselves and the center of the tech
> universe.
I’ve always thought the “Work USA”/J-1 visa programme is a huge opportunity for tech students/graduates. Even more so when I just discovered there’s now a 12 month option available. (It was only around 4 months when I participated in 2002/2003.)
Most people tend to do summer camp work but we should be encouraging students in technical fields to head to Silicon Valley, New York or whereever. Better still, we should be helping students to gain internships at US tech companies or just get working for some startup. The perspective gained from actually being in the Valley is hugely valuable and there’s no easier way I know of to be able to work legally in the US.
–Phil.
I would suggest that a liaison officer from the ICT be established to communicate regularly with Universities and also with the Foundation of Research Science & Technology Department. Mark Ripma of FRST informed attendees during a recent seminar at Auckland Business School, that if any startup or software company have any problem they want to solve but they lack expertise in, FRST can help. They can connect you to experts in those fields wherever they are in the world. The liaison officer can also solicit ideas from University about a new startup company called X which develops a product called Y to see if they’re aware of a better method (architecture, algorithm, etc) from what they’ve seen in R&D worldwide or their own idea of how to improve Y for startup X in order to make Y a competitive global product.
IMO, a liaison officer from as a representative of the ICT industry is a good idea.
gee - are we all doing startups this year …. will there be enough VC money to go around ….. :-)
Seriously though - we talked about employee stock options at FooCamp this year - having worked in SV for a couple of decades before moving back to NZ I know how powerfull an incentive they can be for hiring and keeping those people you really need
But from what people were saying it seems that, well, very very few people in NZ have ever really made a bundle on traditional SV-style ESOPs - there’s no pics in the SST of smiling millionaire receptionists, and 25 yr old geeks with impossible sports cars who worked for that local company that made it really big. But there are in the wider trade papers - it’s one thing that draws our best and brightest away
There are also complex tax issues which seem to screw people and in some cases people have been screwed during buyouts.
I don’t want to pay my employees less, but I do want them cheering for the team and putting their all in because the upside is enormous
[...] Drury, CEO of Xero, shares some insight into discussions taking place in New Zealand around how to encourage increased growth in the local IT industry by [...]
@ Paul C:
Not everyone is looking.
The research shows that very few start-up businesses actually score “VC” funding (especially in NZ).
One approach is to market validate the technology and prove that the business model actually makes money first. Mitigate the risk and you have a real proposition on your hands and a better negotiating position.
The only equity being invested in here at present is the damp and smelly variety.
yeah I know - certainly one needs something more concrete than stuff I’ve taken to VCs in the US in the past - that means sinking more of ones own time and money in up front, which is not necessarily a bad thing
I’d rather put in the extra effort so that a startup I do in NZ gets NZ funding though rather than going back to those same offshore sources and having the resulting upside not coming back here (got to have something real to push the NZ dollar up with rather than the carry trade)
Mind you these days just about anything has to be a better investment than leveraged real estate …… we ought to be rolling in it :-)
—-88—-
Does anyone have any evidence of that (vendors who raise procurement issues being penalised)? My experience (from “inside”) is that a vendor who complains on reasonable grounds would not be penalised in any way. What would happen, would be that they’d be dealt with scrupulously. Not that it’s a bad idea (it would be efficient and less disputative I imagine), but I think there’s more fear than reality.
I’d concur with Paul S that the way to go is to validate your technology before making a pitch. VCs are notoriously hard to deal with and will want 25-40% of your business and will set strict milestones with accompanying penalties for not being achieved.
I met some interesting ones but no one I’d actually like to work with. The NZ VC market is dead but there is plenty of Angel money around so I’d suggest starting there and hope that takes you through to a point where you are in a position to collect revenue or at least have a sound proposition for doing so.
AAAAAAAAAAAAAAAAAAAAAAAAAAAaaaaaaaaaaaaaaaaaaaaaaaahhhhhhhhhhhhhhhhhhhhhhhhh
I just read an article in STUFF that will give some luddites a warm glow. It reads (on stuff)
Well, you could pin a ponytail on me and call me Sally the Cynic, but Telecom turning corporate good guy and backing down from a scrap with a couple of preschools? Sounds like another contract for the Tui graphic artists to me.
How about this for a more likely scenario: Telecom plays for time, pours more lobbyists than all the beef farmers in Texas into John Key’s ear and waits for the year-end change of government.
Sometime in 2009, out comes a tweak to National’s communications strategy declaring mobile broadband technology to be in the national interest, meaning the development of cellphone facilities are not bound by the usual planning constraints.
If Telecom really is prepared to give priority to the welfare of the little kiddies of Atawhai and the concerns of their parents and teachers, how about it does the following:
Write a letter, personally signed by the chief executive and board chairman and delivered to everyone in the land, unequivocally guaranteeing the safety of the technology, confirming absolutely that there is no possibility of anyone, ever, being harmed by it;
Promise to pay compensation of, say, $10 million to anyone proven to the satisfaction of a court to have had their health compromised, at either a cellular or sub-cellular level, by the radiation from a cellphone tower;
Promise to compensate landowners if the presence of adjacent cellphone towers can be shown to have reduced the value of their properties, in the event of health problems surfacing in the future.
The same position ought to be demanded of the Government, whose first duty is surely to protect its citizens from harm.
Basically, if the idiot who wrote this had been around at an eartlier point in history he would have wanted written guarantees from the purchasors that no one would ever be injured, maimed or killed by an automobile.
I think that person, whoever they are, should be dropped into the wilds of McKenzie Country, armed only with a pair of hands and two kiwi skins, and forced to live in the manner of an antideluvian for six months. After that I would expect them to become a major supporter of progress.
Any one know this Alan Clark person from Nelson? If so we should send him a cut-off notice for his phone, cell phone, electricty, gas, sewerage, and all other utilities!
Awesome to hear your comments on Online Identity Management.
We wholeheartedly agree here and have posed the question to many people that “given our strong and well recognised privacy laws would NZ be able to position itself as the Switzerland of Personal Identity Information?” A safe haven where individuals knew that their information was well protected and where they retain control.
Better visa ties with the US would be great. It seems its easier to work in the US if you’re Australian than a Kiwi. This should be rectified.
Government sector is pretty much the big spender in NZ so has a lot of opportunity to drive developments. So on that:
Would like to see more favour given to local players by the government. More privatisation of crown IP (by that I don’t mean selling it off for nothing, but possibly developing publicly owned companies around), when smart people in the public sector develop something there should be the ability to capitalise more on that.
In that regard more centralisation of some government IT (but not overboard, tactically bit by bit, not one big huge mammoth centralisation project garunteed to fail like all the others), perfect example is the network developments of BCL, Transpower, KAREN, Health, Education, Police, Defence, GSN, etc. all being independant. Ridiculous.
Across the board (public and private) more efficiency in how IT spending and how we do IT projects. We’re a small country with less capital that others, so we need to be smarter about how we use it. Sadly we’re not that smart in many places. Private companies have nothing to gain by decided to duplicate effort, it justs costs them both twice as much. But thats me being idealistic.
More can do attitude in general from our leaders (including business leaders), the announcement by national that they’ll do FTTH is great, but Labour should’ve had the courage to do this earlier. I think perhaps they didn’t have the knowledge of how feasible it really is and hence were led a little too much on a journey down the garden path with LLU and all the bickering in the industry.
So proper science and technical advisers to the public sector that sit outside of the political realm and deal with simple facts, with proven credentials, make em sit a test and be interviewed by the industry or something. They should have grey hair, white coats, pasty complexions, and run screaming from political crap and kingdom building mentality of most public servants.
Smarter use of the good people we do have (and we have heaps of them), this is about better management, don’t know how you fix that, find good managers!
Establishment of goals and provide some actual backing. So when ICT leaders get together rather than just blowing a whole lot of wind, come into it with the purpose of setting goals, and then require working groups to be set up to follow through with them.
Here in Perth (where I am at the moment) they have this nice idea to do a singapore style technology park, with flashy buildings, and all that. The video was very impressive but I can’t find it right now. Would love to see a similar development in NZ, but naturally there’d be bickering about where it’d go.
Brings next thing I’d like to see, more emphasis on developing centres of excellence. Yes, some regions might lose out, but silicon valley has produced so much tech spin offs for a reason.
Education…
According to the World Internet Report there are two major things that imapact peoples behaviour on the net…
1. “Broadband changes everything”
and next
2. “Mobility (in terms of laptops vs handhelds at the moment)changes everthing”
New Zealand missed the boat in terms of broadband and is playing catch-up.
So what about mobility and getting laptops into the hands of our kids at school?
My nieces and nephews in the USA go to school (age 12 plus) with laptops.
They don’t know anything different - computers are just part of their schooling - part of their lives.
My opinion is — get back to basics — give people access to technology (the tools) — kids and the workforce.
Put a laptop in the hands of every NZ kid and see what happens (OK you have to dream big :-)… No doubt they will figure out what to do with it.
Also, I would also urge anyone that is commenting on this post to their thoughts on the NZ Digital Strategy.
@astralnym Oh yes. Have an beer with anyone on the Wellington ICT scene and listen to the stories.
Rod: I would like to see a marketing & sales tax credit scheme, to thereby address the weak link in the NZ innovation chain: commercialisation. The government of Quebec, Canada brought one in a few years ago.
Interesting. I was just talking with an experienced export consultant and he said he didn’t think we need more developers coming out of universities in NZ. He thought what we need are people trained like in the US to be professional sales people and treat it as a career. This will then help market and sell the software and hardware that is already coming out of NZ companies.
Lots of good ideas fall on fallow ground due to a lack of marketing and selling.
Dermott, I would disagree. I think this is a short term thinking in terms of recruitment. ie. dealing with the problem that we have now. (IMHO, this is one of the reasons we have a skills shortage)
We have a shortage of skills across the board. If we don’t put time in to getting more developers AND sales people then we will have little or no programmers coming out of universities and we’ll have to outsource all our work.
John, my point was or at least the person I was talking to (and I would change what he said slightly) -
we don’t need more developers; we possibly need the same number who understand more accurately what it means to work in IT and who have decent communication skills (because developers need good communication skills)
Plus
we need people who can sell what we are developing.
His point was there was a real lack in this area.
This person has lots of hands on practical experience in dealing with this issue with NZ software companies. So his comment was merely a throw away comment off the top of his head.
@ Elyssa Timmer
There is all sorts of research that points to good and bad outcomes arising from use of laptops at schools (hence some (private) schools mandate them at certain levels whilst others have gone away from that). Having just visited a school with kids at age 11-13 using laptops in class to hook into a school learning network alongside their hands-on science activities, I agree with you though. Your post reminded me of something I saw at DSE that seemed pretty cool (although not as radical as the OLPC project http://laptop.org/laptop/) for under $500 - see http://tinyurl.com/6encs5). Wireless, lightweight, linux based, with apps such as skype, google docs, open office etc pre-loaded. hmmm, worth getting one just to try it out!
I don’t the US model is a good one to emulate. Having a good sales force and head office in one country while all your development is offshored isn’t ideal.
We can do better than that by having both. If Rod’s still reading this i’m sure he’d agree that we need more CEO’s who know how to run startups, more Sales and marketing people who know who to do that on a shoestring, more people cutting code, more people selling that code globally, and more use of our unique advantages like being on the other side of the world…
[Regarding vendors penalised as a consequence of their complaining] It’s true that we’ve probably all heard stories, in the process of having a yarn with people. In my experience, when I hear those stories and have a bit of a dig I find very little of anything except a distorted view of events based on FUD.
I’m not saying that vendors are always dealt with fairly (if only it were a perfect world right?), I’m saying that I’ve seen no evidence of them being dealt with less fairly if they complain, which is a very different proposition, and one I’ve never seen any evidence for.