Victoria s Digital Economy Strategy

Transcription

1 Victoria s Digital Economy Strategy AIIA Response to Consultation July Barry Drive Turner ACT 2612 Australia T E W info@aiia.com.au

2 About AIIA The Australian Information Industry Association (AIIA) is the peak national body representing Australia s information technology and communications (ICT) industry. Since establishing 35 years ago, the AIIA has pursued activities aimed to stimulate and grow the ICT industry, to create a favourable business environment for our members and to contribute to the economic imperatives of our nation. Our goal is to create a world class information, communications and technology industry delivering productivity, innovation and leadership for Australia. We represent over 400 member organisations nationally including hardware, software, telecommunications, ICT service and professional services companies. Our membership includes global brands such as Apple, EMC, Google, HP, IBM, Intel, Microsoft, PwC, Deloitte, and Oracle; international companies including Telstra; national companies including Data#3, SMS Management and Technology, Technology One and Oakton Limited; and a large number of ICT SME s. In March 2014 AIIA launched SmartICT 2014, which represents the current policy and advocacy priorities for AIIA and its members. It articulates AIIA s vision for a prosperous Australia, the critical role of digital technology and the ICT industry in achieving that vision, identifies current and potential impediments and suggests priority areas of action for government and industry. Page 2 of 8 31 July 2014

3 Comments and The AIIA appreciates the opportunity to provide comment on the development of Victoria s Digital Economy Strategy. Representing the Australian ICT industry, we believe that this a very valuable initiative to provide opportunity and growth to the Victorian Government, businesses, and citizens in the digital age. AIIA s comments are focussed on the following areas: Digital Inclusion Productive and Competitive SMEs Digital Innovation and Entrepreneurship Leadership in Government A Skilled Workforce Digital Inclusion Government s digital strategy is to engage customers first through digital channels. AIIA supports this approach and encourages the Government to ensure it undertakes the appropriate humanistic research to support adoption of online strategies by people from different demographics. For example in addition to removing tangible barriers to digital take-up of (e.g. requiring a signature), how a person feels during the transaction process is critical to maximizing take up of that digital service. This is particularly so when dealing with the aged demographic who are becoming the largest users of government services, whilst in some instances also the least familiar and comfortable with using digital channels. AIIA supports the theme that customers should access information based on their needs, rather than their understanding of which government agency provides a specific service. To be effective this must be supported by the rationalisation of duplicate information across agencies and its consolidation and access from a single, central source and in a manner that is accessible to citizens of varying levels of digital capability. Service NSW and the Queensland Government s announcement in their GoDigitalQLd Digital Economy Strategy of a customer One Stop Shop, are modelled on best practice customer service approaches where governments have transformed service delivery to match customer needs through the provision of a central government portal (for example New York city and Singapore). AIIA supports the above model of citizen engagement and encourages the Victorian Government to adopt a similar approach, building on the experience and learnings of other State Governments. To assist transitioning citizens to digital service engagement we also recommend that the Victorian Government adopt mechanisms such as the following to help educate and build the confidence of citizens: a single customer password to access a range of online services; click to chat to support citizens as they engage online; consistent service standards; optimised search capability; user friendly interfaces; contact information; the ability to complete transactions end to end online rather than only parts of a process. Page 3 of 8 31 July 2014

4 Productive and Competitive SMEs SME s are the backbone of the Australian economy, providing significant employment opportunities as well as leading the way in innovation in many areas of business, particularly ICT development and adoption. It is critical that their capacity to improve productivity and performance through adoption of ICTs is supported in the Victorian Government s digital economy strategy. In the SME sector contributed over half of Australia s private sector economic activity, employed over seven million people (more than two thirds of private sector employment), and contributed some $530 billion to the Australian economy. 1 Research conducted by the Boston Consulting Group across five countries (the US, Germany, China, India and Brazil) similarly highlights that SMEs building digital capability outperform their peers in the market. SME technology leaders across all sectors created jobs almost twice as fast as other small businesses and increased their revenue 15 percentage points faster than companies with lower levels of technology adoption. 2 One of the main opportunities that adopting digital business practices provides is the ability to accomplish more with less. This can be done in a number of ways: process optimization, reducing operations and administrative spend, improving service quality or speed of delivery, or simply being able to reach a wider target market through online engagement and sales channels. Despite this potential, digital engagement among SME s continues to be slow. Reasons for this include: 3 Privacy and security concerns, for example security related to hacking of business or customer information; Lack of awareness of the tangible benefits of high speed broadband and uncertainty of the relevance of digital engagement to their business. This includes unfamiliarity with technical terminology which fails to capture the functionality, and hence communicate the relevance and benefit of applications to business; Lack of access to ICT skills (SMEs have less capacity in terms of available skills and capabilities to take advantage of new opportunities from broadband); Time and/or resource constraints, uncertainty of risk and the potential imbalance between investment costs and returns; Perceived decrease in productivity due to distractions and interruptions through personal and junk s; Concerns regarding lack of personal contact with customers or fear that that customers will not engage in an online transaction; and Uncertainty regarding what needs to be done to transition the business to digital. To assist Victorian SME s adopt digital business practices, AIIA makes the following recommendations. The Victorian Government lead by example by demonstrating that digital practices deliver operational efficiencies and increased service quality and customer satisfaction. Adoption by the Victorian Government of a digital-first strategy for administration and delivery of government services, is critical to demonstrating this leadership. 1 Deloitte (2013) Connected Small Business. How Australian small businesses are growing in the digital economy 2 BCG (2013) Ahead of the Curve. Lessons on technology and growth from small-business leaders 3 See: BCG,(2013) Ahead of the Curve. Lessons on technology and growth from small-business leaders; Deloitte (2013) Connected Small Business. How Australian small businesses are growing in the digital economy; CSIRO,(2013) E-business use by small business in regional Australia: A preliminary qualitative study. Page 4 of 8 31 July 2014

5 Education and training be made available to support business owners build their digital capability and transition to new business models and practices. This can be enabled via online information and education support services, tools and guidance materials. There is scope to leverage materials that have been developed at a federal level and by other state jurisdictions. To demonstrate the positive transformational ability of digital technology adoption, showcase businesses that have increased performance or product/service quality through the use of digital business practices. This will create a culture of excellence and help showcase world-class Victorian businesses. Nurture the development of support networks and coalitions to promote collaboration and assist business to implement or scale their digital business practices. This could be accomplished by: o a top down, government to business training platform with information, tutorials, and instructional programs to leverage digital technologies; and/or o a collaborative peer to peer platform with crowd-sourced answers to frequently asked and user generated questions. Users and business owners can both post their problems as well as share their successes in a communal online space. Digital Innovation and Entrepreneurship Digital innovation and entrepreneurship provides business opportunities, economic growth and boosts job creation. It is estimated for example that with the right support the Australian tech startup sector has the potential to contribute $109 billion or 4% of GDP to the Australian economy and 540,000 jobs by 2033 with a concerted effort from entrepreneurs, educators, the government and corporate Australian. 4 It is estimated that entrepreneurs supplied 57% of all jobs in the EU in and 75% in China 6. Analysis in the US shows that startups and companies less than five years old account for nearly all net job creation in the last three decades 7. Many of the initiatives in the digital strategy, and wider digital economy require leadership and innovation from industry. To encourage participation from industry to support these initiatives government needs to consider new ways of doing business with the technology industry, for example by partnering in the development and commercialization of IP. The Victoria Police Blueprint is a case in point. Having identified many digital strategies to drive efficiency and productivity, they have conceded that they do not have the budget to implement these. In our view, industry partnership is key to driving these sorts of initiatives and realizing the benefits. Government also needs to create opportunities for industry to propose innovations in digital service offerings without fear of losing Intellectual Property. The Victorian Government s Framework for Unsolicited Proposals provides a robust environment to consider bids linked to infrastructure programs, within an appropriate probity environment and without undermining the IP of a business. To foster innovation and participation by the technology industry the Digital Strategy should develop a framework to receive unsolicited technology proposals. To prevent Government being overrun with such proposals the framework could include parameters for consideration of a bid including strong links between a proposal and government strategy, level of innovation, and exclusion of services that are likely to be tendered for by Government (similar to the existing Framework for Unsolicited Proposals). 4 PwC Consulting, (2013) The Startup economy. How to support tech starts and accelerate Australian innovation. 5 Ecorys, EU SMEs in 2012: at the crossroads. Annual report on small and medium sized enterprises in the EU, 2011/12 p.15 6 China Country Profile: small and medium sized enterprise, Ministry of Commerce Peoples Republic of China website, 3 July D Stangler and P Kedrosky, Neutralism and Entrepreneurship: The Structural Dynamics of Startups, Young Firms and Job Creation p 13. Page 5 of 8 31 July 2014

6 In the area of open data, AIIA strongly encourages the Victorian Government to unlock the significant economic value of the data it collects. Analysis by the McKinsey Global Institute estimates that open data has the potential to enable more than $3 trillion in additional value annually across seven key domains: education, transportation, consumer products, electricity, oil and gas, health care and consumer finance. 8 In the market, open data can foster competitiveness, enable collaboration among business, government and individuals and drive innovation. Government has a key role in setting the tone for open data both by making its own data available and shaping the policy environment. Government also has a role in educating the public about the potential benefits to the economy and to society of making data more open. Large-scale, publically accessible data allows citizens and business owners the opportunity to gather valuable knowledge to improve their current business practices, and find creative ways to leverage the data to create new opportunities for innovation and growth. To support the Victorian startup industry AIIA recommends that the Victorian Digital Economy Strategy: actively engage with the Federal Government to address impediments to innovation and entrepreneurship such as existing Employee Share Options Schemes that tax share options when they are issued rather than when income (if any) is realised; work with the Federal Government to drive increased venture capital/private equity investment in start-ups; attract new investment into Victoria s digital industry by supporting development of of business incubator initiatives that leverage the coordinated efforts of industry, universities and research bodies and government; streamline access to government business licensing information and regulatory requirements; facilitate mechanisms that enable small business to participate in government procurement processes; and provide commercialization assistance through business consulting and expert mentor network programs. Recognising the economic potential of Victorian Government data, AIIA recommends that wherever possible all non-confidential government data be made available online through platforms such as, or similar to data.gov.au. The current global economy provides Australian businesses an opportunity to grow their operations through leveraging a global customer base and supply and distribution networks. To optimise outcomes for Victorian businesses the Victorian Government should: ensure that requirements for international trade are easily accessible and red-tape removed to simplify international trading practices; further develop government/industry partnership models; develop an appropriate unsolicited proposal framework to support increased ICT innovation adoption by Government; and facilitate appropriate support networks to assist businesses transition to the international marketplace. Similar to the recommendation for SMEs above, support networks and coalitions should be established to promote collaboration and assist businesses to scale their business internationally. 8 McKinsey Global Institute (2013) Open Data: Unlocking innovation and performance with liquid information Page 6 of 8 31 July 2014

7 Increasingly first impressions of businesses are made based on their digital presence. To prepare businesses for the online marketplace, the Digital Economy Strategy should provide guidelines for online information sharing, impression management, and online sales. This could include support for website development and maintenance, search engine optimization, online advertising, sales and marketing. A Skilled Workforce Despite increased industry demand for specific ICT skills, the take-up of ICT related tertiary course over the last decade has virtually halved. 9 While Australia s education levels are recognised as comparatively high internationally, the declining number of students graduating from ICT, science, engineering and math degrees is, in an increasingly knowledge-rich world, potentially undermines Australia s longer term competitiveness. To ensure Victoria builds the capability to compete in the global digital economy it is recommended that the Victorian Government: actively promote the adoption of the ICT Curriculum in all primary and secondary schools in Victoria; improve the digital capability of the overall Victorian workforce by supporting basic ICT literacy and training programs accessible to citizens and businesses; and ensure government employees are appropriately trained and supported to execute the Government s digital strategy. Telecommuting Today s workforce is mobile and agile. Many businesses are realizing that they can increase employee performance, satisfaction, and retention rates by providing them with more flexible working options such as through telecommuting or remote working models. Co-working hubs, telework and mobile work options also achieve operational efficiencies and reduced office costs. Many Australians however, particularly in rural areas, do not have access to the digital infrastructure and broadband connectivity required to capitalize on the benefits telecommuting offers. This includes sufficient upload and download capability and technology tools. To drive take up of telecommuting and remote work options AIIA recommends the Victorian digital Economy Strategy: include an explicit Government telecommuting policy; develop and make generally available their telecommuting policy, protocols and guidelines to assist business adopt similar practices; work with NBN Co to ensure Victorian regional and remote areas are a priority focus for broadband infrastructure development. Leadership in Government Recent history is evidence that digital transformation is largely being driven by commercially focussed entrepreneurs, competitive global markets and the expectations of internet savvy consumers. 9 ICT job numbers from the ACS Statistical Compendium, 2012 (see ICT applications from the DIISRTE Higher Education reports. Page 7 of 8 31 July 2014

8 However fostering open and competitive markets; establishing and maintaining infrastructure; taxation and macro-economic frameworks; and overall economic and political stability principally the realm of government - provide the critical foundation for investment, growth and the ability to manage change effectively and equitably. More important and of direct consequence to a transformation process is the role of government in leading by example. In the case of the digital economy this means using digital technology to deliver better services more efficiently, engage with citizens more effectively and improve the performance of their internal business. Aggressive ICT and digital transformation strategies such as those adopted by the US and UK governments, and countries such as Singapore and South Korea have been core to driving digital business reform. The AIIA encourages the Victorian Government to lead by example in transitioning to a digital business environment. Budget cuts and an ongoing effort to improve the efficiency of Government provides the opportunity to demonstrate how technology can be leveraged to deliver more with less. AIIA recommends that Victoria s Digital Economy Strategy prioritise the role of Government in driving the digital transition of Victoria. This includes: adopting a digital-first approach to service delivery, including o A requirement that the business processes for all new online services is mapped and reviewed prior to development o Rationalisation of less cost effective service channels o whenever possible, services should be made available through online portals o access to services from anywhere, anytime 24/7 o developing mobile-enabled capacity for digital assets such as service websites provision of a comprehensive one-stop-shop platform, including o information and service offerings aggregated and packaged to meet the needs of citizens rather than the structure of government agencies o liquidity of information (where appropriate) between government agencies o elimination of siloed activities within government agencies o development of a whole-of-government digital services catalogue to eliminate duplication of services between agencies or varying levels of government o Resolution of online digital identity management, having regard to lessons learnt from other countries, including sharing of relevant credentials with the private sector adopting agile and transparent systems implementation, including o documenting process of transition to contemporary service delivery to showcase the process of implementation o systems architected for interoperability and data sharing o platforms and technologies that support agility and dynamic change o Ongoing feedback and service delivery improvement Given Australia s firm step into the digital age, it is crucially important that the Victorian Government s Digital Economy Strategy pave the way for world-class government service delivery, and a digitally inclusive, agile business environment to grow the Australian economy. Page 8 of 8 31 July 2014