Productivity and prosperity: how ICT will help bring growth

In the first in a series of Industry Voice segments provided by the board of the NZICT Group, Geoff Lawrie, the Group's recently-elected chairman and New Zealand Manager for Cisco, writes about the need to drive productivity growth from within the ICT industry.

Productivity, and more specifically productivity growth, is a vexing issue for governments worldwide and an area where New Zealand has traditionally performed poorly in comparison to regional neighbours. It is now firmly on the national political agenda because it is integral to lifting our country's economic performance and standard of living.

In an important speech recently, Prime Minister John Key laid out the Government's plan to drive productivity growth in New Zealand, focusing on six main elements: education and skills, innovation and business support,  a better public service, infrastructure investment, regulation and tax. Generally, this focus resonated well with the business community, although it was disappointing that the direct connection of ICT as a key enabler was not more clearly articulated.

There are many examples from economies around the world where the strong and confident use of ICT has proved to be the catalyst for national productivity growth. In New Zealand, the digital or 'weightless' economy opens up new opportunities for businesses to increase efficiency and productivity, and provides opportunities for the public sector to engage with and deliver citizen services in new and efficient ways.

The Government has promised investment in broadband infrastructure and improved ICT policies, with predictions that its broadband initiative will generate additional economic value of $2.7 to $4.4 billion to the country each year. Tourism in New Zealand, for example, is a $50 million-per-day industry, so imagine how much the ICT industry, with improved broadband and a range of innovative services and applications, could contribute to its competitiveness, improved productivity and growth.

Despite the Government's investment in ICT there is still a need for direct policies and plans, both public and private, from the ICT industry to drive this productivity growth. While there is still a lot of debate surrounding the makeup of infrastructure, we need to start thinking about what services will run over next-generation networks. Added to this, and as the Prime Minister commented, educating and motivating students to take on a  career in ICT will be essential to ensuring that we have the skills base to attain the country's economic ambitions. 

NZICT, which represents the interests of a growing number of ICT companies, plays a key role in providing leadership and direction in the aforementioned areas. Its work program is focused on the core issues of productivity and innovation and it will soon be launching an index card that measures growth spurred by the  ICT industry. Innovation comes from improved services and applications, often offered by the ICT industry. If we can work together and substantiate this, then we will be stronger as an industry moving forward and can encourage the Government and businesses to leverage the capabilities and skills of the ICT sector in the following areas: Education and skills: The education process will be revolutionised by broadband and the internet.

Innovation: There is arguably no sector where innovation is more active and effective than the ICT sector. Supporting innovation through to commercialisation and growing the level of exports based on intellectual property will be one of the factors that drive a better economic performance.

Better public service: The efficient delivery of citizen services will drive productivity in the public sector through the adoption of collaboration technologies and information sharing. Healthcare delivery, using remote patient management, video and electronic records management, is also important.

Infrastructure: Broadband is a critical investment, but ICT plays an important role in delivering the applications that leverage this. We need to move the discussion to how we use it, building the cloud services and SaaS applications that leverage it and passing on the potential productivity and cost savings to businesses.

Productivity, enabled by the smart, consistent and widespread application of ICT, can be a key driver of national economic growth and individual prosperity. The ICT industry needs to act co-operatively and decisively to ensure that this potential is realised.