ICT – A key source to improve Productivity

by Marco Tapia

in management-it-consulting,

August 23, 2011

ICT – A key source to improve productivity

“Productivity isn’t everything, but in the long run it’s nearly everything” Nobel Prize-winning economist Paul Krugman.

In previous postings I have described a number of arguments and sources that show:

· The decline in productivity in Australia over the last few years

· The importance of productivity to maintain and enhance our standard of living

· The importance of government policy to improve productivity, in particular work force flexibility

· The importance of ICT to improve productivity

So, close to my heart, from here on I would like to focus my attention on how ICT can improve productivity. This and future postings will elaborate much more on the options for it.

Unless I am missing something, interestingly enough, after just reading the latest CIO Insights from a global CIO Study by IBM (ibm.com/theessentialcio/au), I couldn’t find any reference to “Productivity” in the study!. Perhaps the subject is hidden behind another buzzword but it is not apparent to me.

Reading the Gartner’s CIO Agenda 2011, I can’t find either any reference to “Productivity”, again, unless it is hidden under a different buzz word or terminology.

That only demonstrates to me, that unfortunately, “Productivity” is not at the forefront of CIOs. However; it is at the forefront of most CEO’s and business leaders in the country. What a divergence!

So; where to from here?

A) Acknowledgement

To start with, I believe it is important to acknowledge and recognise all of the above, most importantly the importance of Productivity and second, that ICT can help to improve it.

Once we acknowledge this, we can find answers and options that will lead us to enhance our Productivity with ICT.

B) Using ICT

Firstly, let me say that definitely we will improve Productivity by using ICT. It has been demonstrated again and again that this is the case.

Yes, just by using it we will enhance our Productivity and therefore our standard of living. The more we use it, the more Productive we will become. However, where to stop? Using it, mean investing. So, how much you want to invest to achieve some Productivity gain? The question and the answer is complex.

I will focus a significant part of my writing in how to increase Productivity by using ICT, however a few things need to be noted now;

i) Everyone is doing it (every country, every government and every private enterprise are investing in using ICT) i.e. there is little competitive advantage to be gained just by “using ICT”,

ii) How do you measure Productivity for your company, process, department and country so that you can determine if there is any Productivity gain by the investment to be made and,

iii) How much to invest and how to measure the gains? E.g. some say that the investment on the NBN will give the country Productivity gains … how much for the $40B? Is it worth? So measurement is very important and the complexity in measuring it is something not to be underestimated when talking about Productivity.

C) Innovating ICT

I am a strong believer that the real Productivity gains will be achieved when we start seriously innovating in ICT. There are numerous reasons for this; some being:

i) Gives the country and its people an alternative to ‘digging the ground for commodities and showcasing tourist resorts’ so that when the downturn in commodity demand comes (as it will), we have alternative sources of income

ii) Gives ICT professionals opportunities to develop creative technologies and therefore advancing the mental challenge of them, demanding better educational system, better jobs, challenging opportunities rather than just ‘using’ ICT like any other country

iii) Opportunities to use the internally developed ICT to generate revenue, export it, attract investment, attract great professionals and become a nation of ‘cleaver people’ and not just ‘diggers or a tourist destination’

iv) National security will be enhanced by having people able to track intruders and help the state in protecting the nation from cyber-attacks and intrusion (the wars of the future)

By “seriously innovating in ICT” I mean doing things in a much bigger way than currently,

· Government – going well and far above its current R&D tax concession/credit and entering into significant arrangements with business, Universities and professionals for the development of serious ICT innovation programs

· Government giving serious preference to Australian ICT innovations

· ICT Industry – really allocating budgets for Innovation programs much more than just an award here or there

· Financial sector – developing strategies to support ICT innovation with more aggressive investment strategies on ICT

· Professional organisations taking on the challenge and developing marketing campaigns to attract talent, ideas and programs to sustain ICT innovation

· ICT professionals taking on the challenge

So in summary, let’s develop ICT in Australia not for the sake of it but for the sake of improving productivity, i.e. standard of living in the long run.

Marco Tapia