Why ICT Underpins Innovation

GITRA recent global report on information technology places New Zealand about the middle of the pack in terms of “network readiness”. But the index only accounts for part of the story about why the country is struggling to remain competitive through innovation.

The information technology report from INSEAD university and the World Economic Forum offers some very clear indications around what New Zealand has to achieve in order to boost innovation and raise competitiveness. The annual report ranks all countries in terms of ICT readiness by assessing a basket of factors that influence business, government and individuals. Quality of phone, broadband and server infrastructure, regulatory environment, quality of science education, R&D spend by firms and availability of venture capital are amongst the variables assessed to establish a “network readiness index” (NRI).

High network readiness alone does not guarantee success however. In fact highly competitive nations such as Finland, Israel and Taiwan rank slightly below New Zealand on the network readiness index. But if we consider a bunch of other factors that allude to innovative capacity, it paints a much different picture. Innovation factors (IF) include quality of scientific institutions, extent of university-industry collaboration, availability of scientists and engineers, number of patents issued per capita. These factors tell us whether or not a nation has the capacity to innovate through novel research, which is a far stronger value proposition than simple imitation. The fact that New Zealand ranks about the same as Zimbabwe is probably reason for some concern.

What we do know is that countries which rank highly on both counts, tend to be innovation powerhouses with rapidly improving GDP per capita. By this we mean nations such as Denmark, South Korea, India, Singapore and Malaysia. Unsurprisingly, all of these countries embarked some time ago on aggressive improvements to their ICT infrastructure. So exactly why does ICT appear to underpin innovation?

There are at least five good reasons why a sound ICT environment supports innovation processes:

  • Knowledge identification eg. market research, locating human resources, accessing science research, knowledge sharing platforms.
  • Developing creative capacity eg. computer aided design and 3D graphics.
  • Enhancing exploration eg. simulation and prototyping.
  • Shortening the design-test cycle eg. making failure inexpensive.
  • Improving capacity for commercialisation management eg. knowledge management, Web 2.0 e-marketing, virtual collaboration.
  • Empowering customer feedback into the design process.

The human genome project is a good example of a piece of innovation work that, a decade ago, could not have even been imagined anywhere in the world. Could such a project be done in New Zealand today? Although we now have a high speed research network and at least one homegrown firm offering suitable enabling software technology, it hasn’t happened because we are still struggling with a number of the innovation factors mentioned above. R&D spend is low, collaboration seems problematic rather the accepted norm and the education system is failing to inspire a new generation of scientists and engineers.

This shows that, as an enabler of innovation, we cannot consider ICT in isolation. There has been much debate over the need to rollout better broadband across New Zealand. But the economic case for substantial publicly funded investment in the project has yet to be properly made. Most people grasp that more and better ICT would be a good thing, but few are clear on exactly why. We need to benchmark ourselves more fully in order to better articulate the need.

2 thoughts on “Why ICT Underpins Innovation

  1. Hello Paul
    It’s so good to find a NZ Technical Blog that’s readable. (Myself only being a quasi technical person.) While I agree that ICT is critical to innovation, I disagree about why it’s important. Yes we do need bandwidth, and I applaud those who are focusing on that, but bandwidth will solve nothing regarding making NZ more innovative.

    You pointed out somewhere in your writing, Paul, that the NZ Digital Strategy was a failure. I certainly agree and I’ve been saying so for at least three years. But the reason we can’t get on with it is “in our heads”, it’s a people problem, it’s not about technology. We DON”T join, New Zealanders are NOT strong members of social networks like Facebook, or Xing, or LinkedIn. (Even the technical people who might read this are not strong there. Techno’s are however more connected than the general population, but only to each other.) When most New Zealanders do join social networks they are passive participants.

    Innovation arises best when people immerse themselves in a melting pot of ideas. The Internet allows that. You don’t have to got to Edinburgh, or Vienna, or Silicon Valley, or dare I say it Wellington. The melting pot can come to you, but YOU have to engage, to actively become part of the discussion, and part of the action that flow from the discussion. One of the Keys here is DIVERSITY of connection. The online networks of most people are both too small and they lack diversity. (Technicians and academics in particular, lack diversity in their networks.)

    Moreover, the model most people carry in their heads, or how innovation occurs is faulty. I won’t explain why here. … If you begin with a bad idea you make trying to come up with an idea that’s “good” so much harder. Since at least 80% and maybe more of the “wonderful innovations” people are working so hard on are in fact “bad ideas”, the first order of business must always be, What’s the hiding hand here?, What assumption are we making that kills our idea dead if we’re wrong? Where’s a better way to achieve what we’re trying to do?

    Rushing out to find the money is the LAST order of business.

  2. Bandwidth is only part of the solution. Just like virtual social networks can’t solve all of our problems.

    I’ve set up online communities, managed real live networks and researched both. You need both live engagement and ICT based platforms to drive collaboration and deep innovation.

    I will share more on this soon…it’s late.

Leave a Reply

Your email address will not be published. Required fields are marked *