High time for high growth

It appears to have gone largely unnoticed that the government's ICT taskforce released its final report three months ago. Perhaps that's because nothing notable following on from the report has happened yet.

It appears to have gone largely unnoticed that the government’s ICT taskforce released its final report three months ago. Perhaps that’s because nothing notable following on from the report has happened yet.

That’s not strictly true. A recommendation of the taskforce was the initiation of the HiGrowth Project, described as an entity to “engage in the delivery process”; that is, to set about helping meet the taskforce goal of creating 100 x $100 million New Zealand ICT companies by 2012. A lofty goal like that might be enough to make anyone duck for cover. But in fact a trust has been formed to steer the project, an advisory council assembled and executive director appointed to manage the process.

When the taskforce first spelt out that target last November, it apparently provoked mostly positive submissions. (That’s according to a document we’ve seen which provides an overview of the HiGrowth Project.) Computerworld’s reporting on the draft was in the main positive, although one voice suggested emphasising creation of large companies – not that $100 million will seem so large in 10 years – overlooked the fact that much innovation happens on a very small scale. True enough – making that point was David Harris, creator of hugely popular email package Pegasus Mail, which boasted six million users at its peak. Harris operates from an office at his home in Dunedin.

The further point might be made that companies can outgrow themselves, with sometimes disastrous consequences, as in the case of The PC Company. It was well on the way to the mythical $100 million revenue figure when it all came crashing down earlier this month. Who knows what went wrong there; on the one hand, it collected numerous accolades from customers in the PC World Awards, while on the other, the magazine’s PressF1 online forurm records plenty of invective directed at the company.

It’s safe to say, though, that the bigger the company, the harder it is to turn things around when they go bad.

The HiGrowth Project looks to be all about encouraging success by helping companies to help themselves. Networks are being established so answers to common problems need only be found once. A website – or knowledge centre, as it’s being called -- (www.higrowth.co.nz) will go live next month. Government funding to the tune of $450,000 a year for three years is also expected to be announced soon, to keep the project ticking over.

The taskforce report acknowledges that neither government nor business can reach the goal by themselves. A healthy pragmatism seems to be at work, visible in schemes such as the proposed creation of a public sector application development centre. With government agencies as the customer, local ICT companies will have the opportunity to create innovative applications which well-connected multinational ICT vendors will find markets for overseas. Don’t imagine the IBMs and Microsofts and Hewlett-Packards are in it for charitable reasons, however: they didn’t get to be among the biggest companies in the world by giving without counting the cost.

The electronics industry might provide a shining light for ICT to follow, in particular, that clustered around Christchurch. A New Zealand Trade and Enterprise report out last week shows export earnings of Canterbury electronics businesses -- $481 million in 2002 to 2003 -- were worth nearly twice as much as the New Zealand wine industry. One of the people who helped create that industry, Sir Angus Tait, of Tait Electronics, is a HiGrowth Project trustee. Let’s hope some of that success rubs off on the ICT sector.

  • Disclosure of interest: the managing director of Computerworld publisher IDG Communications, Bob Pinchin, is on the HiGrowth Project advisory council.
Doesburg is Computerworld’s editor. Send letters for publication to Computerworld Letters.

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