Is there a more important industry sector nowadays than the technology sector? Arguably not.
Other sectors, such as utilities, finance and healthcare, may be seen as contributing more directly to a citizen’s standard of living. Yet, in the modern age, these and other sectors are increasingly underpinned by, and dependent upon, technology.
To think of technology as the ‘gadgets and gizmos’ industry which delivers TVs, phones and laptops is to do it a great disservice. To think of it as the industry which helps keep planes in the air, to save lives, to run modern banking systems or to make possible new forms of power generation is to give it the credit it really deserves. It is now a fundamental enabler of virtually all other industries.
Governments know this. They appreciate the importance of a vibrant technology sector in terms of growing a strong economy and being able to compete effectively on the global scene.
The UK is no different in that a successful and attractive technology sector is crucial if the country is to maintain its position as a leading economy. But why should any technology organisation choose to invest in the UK, as opposed to the numerous other countries who are all pushing the same message about being such a great place to come to?
Personally, I think there are plenty of reasons. However, there should be a balance in such discussions. It would be too easy to come across as the rose-tinted propagandist on such a topic.
And while there are plenty of positives for the UK within this debate, there are other mitigating factors that we must be mindful of – and which must be confronted.
To that end, it is worth considering some of the key questions about what the UK currently has in its favour in this global battle for technology investment. Which factors make the UK an attractive investment location – but which of those factors are coming under threat? What single thing could we do to improve the UK’s attractiveness? And when looking at our global competitors, what aspects of their “offering” do we envy the most?
For me, one of the biggest plus points is an intangible one. The UK has a long history of innovation and creativity embedded into its very core. From Isaac Newton to Formula 1, there is a commitment to innovative excellence which cannot simply be created from scratch.
Cutting edge engineering stems from this culture – but so too does our global reputation in creative areas such as fashion, music, advertising and media. This is the result of years of nurturing a careful balance between education, creativity and freedom. There is no shortcut to this point. It is an achievement which we, as a country, should guard as closely as we can.
A stable legal system where investors can rely on the rule of law and where intellectual property is properly protected; this too is an important factor which we would be well minded not to become blasé about.
The same point applies to the presence of one of the world’s great capital cities. In London, we have a city which people still aspire to come and work in – encompassing everything from arts to restaurants, a real creative culture and, not least, a melting pot of cultures. These things do matter and can make the difference in choosing a location to invest in.
London also provides access to global capital flows and that huge eco-system of financiers, lawyers and other professional services required to make everything work smoothly.
And that’s before we even begin to consider our educational establishments; the quality of which are the envy of countries the world over. The way all these elements come together in a fusion of education, creativity, culture, finance and government is what makes this country such an attractive proposition to technology investors.
As I said though, it is all about balance. There is an argument for saying that we should do a lot more to shout about our successes in the same way that, say, Holland or Ireland often do. Typical British restraint and self-deprecation have no place here.
In addition, I would like to see us talking up the successes more often of those technology businesses engaged in industrial or B2B technology development, not just those playing in the consumer space.
On the education front, there are whispers of concern about whether our educational curriculum will provide the skill-sets that modern technology firms require. This may no longer be about teaching children about how to use technology – but rather using that technology to deliver completely different learning pathways as well as developing that technology itself.
Education is not something we can afford to take a backward step on, especially when you consider quite how much is written nowadays about the global talent wars which may dominate the coming decades.
For those talented entrepreneurs who do subsequently carve out a niche for themselves in the industry, are we supporting them adequately?
That there is support for technology start-ups is beyond question. But it could be argued that such support needs to be extended longer into the new company’s life, lest we risk becoming known as a nation of start-ups who do not grow up.
Our domestic technology businesses could also help their own cause by learning exactly what makes the investor community tick. A slightly better appreciation of the need to put more effort into educating people how their organisations work and the way they generate value would likely make for an even more efficient working relationship. Helping build a strong ecosystem between technology enterprises and fund managers and analysts requires a two-way effort.
If that sounds like a depressing, possibly terminal, litany of problems, think again. None of these problems are insurmountable and, in my opinion, the cons are definitely in the minority when stacked against the pros.
Sure, we might cast envious glances across the Atlantic to where the results of a more open-minded approach to risk-taking are clear for all to see. Closer to home, we may also envy the Germanic respect for engineering professionals which must surely convince more talented individuals to plump for a career in technology.
Yet I still place the UK right up there in the upper echelons of attractive technology investment locations. For new entrants, the welcome and support they receive could not be warmer. For employees, you would be hard pressed to find a country easier to adapt to.
If I could wave some sort of magic wand to improve our attractiveness still further, I personally would want to focus on making our education and financial institutions the best possible fit they can be for the technology sector.
But we must stop being our own worst critics. We need to beat our chests a bit more proudly in order to attract the biggest private institutions. We need to cast off the typical British reserve which sees being successful as something to be embarrassed about.
Instead of asking ‘why would a technology business want to come here?’ we should actually be asking ‘why wouldn’t a technology business want to come here?’
I think there are far more positives than negatives in this particular debate – we just need to get out there and tell the world and to be relentless in our quest to make the UK the premier destination for tech companies.
Tudor Aw is Technology Partner at KPMG in the UK