TAKING a planned approach, embracing innovation and transformation, supporting our youth and nurturing a healthy indigenous business sector will ensure a return to stability for the long-term.
Making Plans for the Future
As the summer draws to a close, one of the next big things in the political and business agenda is the Budget. The traditional Budget ritual, falling as it did at the beginning of December, always had an end-of-year feeling to it. I think the earlier date will have a positive impact on the rhythm of the business world.
For the retail trade, Christmas is crucial to the survival of many businesses. It is critical that consumers have the confidence to start to spend again – back on the High Street and online with local companies, where possible.
An earlier Budget will help in this regard, as, at a minimum, consumers and businesses will know where they stand well ahead of the Christmas purchasing season, facilitating their own business planning and forecasting.
Many organisations held off for as long as they could on technology investments. But there is a sizeable portion of them that are now beginning to plan for the medium term.
Many of these are companies that have innovated and transformed themselves over the past number of years. Adapting to ensure relevance to the new economy and they are now positioned for growth and success.
Transformation and Innovation
Being willing to transform and innovate is essential for the success of the economy. As an individual, you should always look at how to ensure that your skills remain relevant and in demand – you have to invest in yourself and as a company – critical evaluation of what you offer is required. You need to adapt to the evolving needs and demands of your customer.
My own personal career path has been defined by transformation. I have been with Microsoft for 28 years but my role, responsibilities and skillset is unrecognisable from when I first started there. The company too has continued to change and reinvent itself – leading, driving and instigating change through its commitment to innovation.
Ireland – as a country – also needs to be open to change and transformation. The economy, as we know, is not what it was and the over-reliance on the property sector is something that I hope we will never see again. The shift from being a manufacturing centre for global companies to one that is the home of choice for the world's tech and digital leaders is impressive and rewarding. It didn't happen by accident. It was the result of hard work and a successful strategy by the IDA and the governments of the day.
But what's next? The Government has committed to becoming a centre of excellence for cloud computing and has invested significantly in attracting IT and pharma companies but in 10 years' time, will that still be the right strategy?
In addition to having people look after what is needed today, we also need to ensure that some of the brightest minds are out there looking at what could be the next big thing and putting in place the right policies and business environment to ensure that Ireland is front of mind when new investors are considering where to locate. It will require a few gambles and they won't all pay off but we need to place a few bets and take a long-term view so that we are never again vulnerable to the performance of one sector.
Importantly, we need to ensure that the focus isn't just on multinationals. We've learnt the hard way that the economy can't survive solely with the presence of multinationals. Critical to Ireland's long-term success is the presence of a healthy indigenous community of companies.
There is a vibrant and dynamic start-up community in Ireland. At Microsoft, we work with more than 500 of them through our BizSpark programme. Despite some perceptions, Ireland is alive with entrepreneurial spirit – there is no shortage of creative minds and risk-takers. There continues to be a trend toward opening of innovation centres all across the country but particularly in Dublin. This is to be welcomed. It's exciting and encouraging to see some amazing ideas coming from Ireland. What is needed is a focus on supporting those with real potential to grow and scale.
Enterprise Ireland's High Potential programme helps to nurture a certain proportion of start-ups but with the advent of cloud, there is the potential for many more to become international companies very quickly. Being at the heart of the technology sector and the cloud revolution, we are seeing how cloud is changing the approach that entrepreneurs are taking to their business.
Traditionally people considered the country they were based in as the initial target market – maybe, with the right capital, in a decade or two, they would go to the UK. Now, our start-up companies see the world as their market. And cloud is making this a reality – you can sell your service via the cloud anywhere in the world from day one – and limited capital investment is required.
This is changing the profile of the start-ups and strengthens their chances for survival. There is no shortage of ideas, of technical skills and capability or of ambition but some with a tech idea don't have the marketing and sales experience or acumen to actually sell the service or offering. We're actively looking at how we can offer ways to match organisations with individuals with the skills that they need or to help them acquire the skills themselves.
Helping our start-ups to flourish is a passion of mine and something that we are committed to getting right over the next few years. I believe it can have a profound impact on the economy.
Skills and Unemployment
Finally, we need to get the strategy for skills right. It is inconceivable that at a time of record unemployment rates, there is a skills shortage within a sector of the economy. Depending on what figures you look at, there are up to 4,000 open roles in the technology sector. And these are not all just tech jobs, these are across the board – sales, professional services, marketing and finance as well as core tech skills.
In addition to addressing the unemployment problem and this gap in the short term, a long-term approach is also required from industry, the Government and the academic community. We all need to work together to ensure that students – from when they start in school – are being prepared for the economy and society of the future. For those starting out in the educational system we don't know what kinds of jobs or careers might be open to them but we do know that having the ability to reason, being an independent thinker and having the opportunity to be creative is going to stand to young people regardless of whether they are a novelist, an explorer or a CEO of a large company.
In addition, being equipped with IT skills from an early age is also essential – children are using devices from an early age, we should also teach them how to develop the apps that sit on those devices. They have the capacity to learn and it will strengthen our pool of future workers as well as giving them more choices in their lives.
The government-funded conversion courses are doing a good job in helping to equip people with skills in demand from industry now.
I hope that the funding for this programme is retained. But more is needed to address the issue of youth unemployment. Some 26.3 per cent of our young people are unemployed. It is one of the most concerning legacy pieces from this recession.
There is a danger that as the economy begins to improve, the young people who have been out of work for 12 or 24 months – or longer – will find it difficult to find a role in Ireland. The chosen field of study that they entered in 2008 or 2009 may have equipped them with a degree or a diploma that is no longer in demand or relevant to the changed economy that we now find ourselves in.
A programmatic approach to addressing the youth unemployment problem is required. We are running, in partnership with FIT, a targeted Youth2Work programme – enabling 10,000 young people to get IT skills over the next three years. It is early days, but so far it is very successful. We need to continue to invest in this group within society as the economy turns as they are our future.
A recovery will not be one that can be enjoyed if we don't bring our next generation with us.