Tech gi­ants bla­zon a trail of in­no­va­tion

We pride our­selves on in­vest­ing mil­lions in ed­u­ca­tion, from kinder­garten to ter­tiary lev­els yet we still have some way to go to solve the prob­lem of skills mis­match which hin­der us from at­tract­ing dis­rup­tive in­dus­tries.

The Malta Independent on Sunday - - DEBATE & ANALYSIS - Ge­orge M. Man­gion

Re­cently, the govern­ment had vowed to turn Malta into the next “Blockchain Mecca” in the Med. In an ad­dress to the United Na­tion’s Gen­eral Assem­bly, Prime Min­is­ter Joseph Mus­cat said that he sees blockchain tech­nolo­gies as the tool which will al­low Bit­coin and other dig­i­tal cur­ren­cies to gain wide­spread ap­peal and es­sen­tially be­come the fu­ture cur­rency. On pre­vi­ous oc­ca­sions, he was quoted as say­ing that blockchain and Bit­coin have the abil­ity to end third party ser­vice providers as it gives users more free­dom over in­for­ma­tion and money. This is an am­bi­tious vi­sion given that to suc­ceed in cham­pi­oning dis­rup­tive tech­nolo­gies, we first need to change our par­si­mo­nious ap­proach to R&D.

The ideal text­book so­lu­tion is to en­cour­age a mind-set fo­cused on in­no­va­tion, more re­search and de­vel­op­ment.

As an is­land na­tion, we are snug in our co­coon while the world ex­pe­ri­ences stel­lar growth in ar­eas such as Ar­ti­fi­cial In­tel­li­gence, Big Data, ma­chine learn­ing, biotech­nics and fin­tech in the fi­nan­cial ser­vices among oth­ers. These are the build­ing blocks of present and fu­ture tech­nol­ogy where young busi­nesses com­pete to pro­vide cut­ting-edge ser­vices and prod­ucts – hav­ing ac­cess to re­search and in­no­va­tion fa­cil­i­ties cou­pled with pro­fi­cient man­age­ment. Just take a look at the vast amount tech gi­ants spend on R & D. Ama­zon leads the pack with a bud­get of $23 bil­lion an­nu­ally. Google is cur­rently spend­ing $16 bil­lion on re­search, In­tel $13 bil­lion while Mi­crosoft de­votes $12 bil­lion and Ap­ple $11 bil­lion – that is more than $75 bil­lion an­nu­ally. This ar­se­nal of funds is be­ing spent re­search­ing ar­ti­fi­cial in­tel­li­gence, ro­bot­ics, drones, green en­ergy, driver­less cars, smart homes and the In­ter­net of Things. All this dwarfs the amount bud­geted by the EU for the com­ing three years of $1.9 bil­lion spread over three years.

Para­dox­i­cally, it pours scorn on the tech rev­o­lu­tion con­scious that the EU is se­ri­ously think­ing of tax­ing the dig­i­tal in­dus­try by im­pos­ing a three per cent tax. But slow­ing down the evo­lu­tion of new ideas is not the an­swer to com­bat free mar­ket cap­i­tal­ism. Since the dis­cov­ery of the steam en­gine which started the in­dus­trial rev­o­lu­tion, progress has helped mankind de­velop new ideas and use­ful gad­gets. This has in­creased the sum of hu­man knowl­edge even though crit­ics lament that huge sums of money are risked in the process. In­no­va­tion will keep the tech gi­ants ask­ing more ques­tions and dis­rupt­ing ex­ist­ing meth­ods of do­ing things to ar­rive at new de­signs and cre­ations. Just re­mem­ber the spinoffs from the space pro­gramme of the six­ties – the out­come of this re­search was crit­i­cised as be­ing un­pre­dictable yet the gam­ble proved suc­cess­ful.

Back home, our in­vest­ment on tech­no­log­i­cal re­search and de­vel­op­ment is mod­est reach­ing a mere 0.6 per cent of GDP. Fin­land spends three per cent; even so, one can­not blame our po­lit­i­cal lead­ers of be­ing fru­gal see­ing that spend­ing mil­lions in such a risky ven­ture needs nerves of steel and fore­sight. But with­out tak­ing risks, the fu­ture of our man­u­fac­tur­ing and ser­vices in­dus­try face an up­ward strug­gle partly due to the dou­ble in­su­lar hand­i­cap of be­ing lo­cated on the pe­riph­ery of Europe not helped with an age­ing de­mo­graph­ics and a loom­ing pen­sions time bomb. These draw­backs make us more con­scious of the drive for re­search to train a qual­i­fied work­force which, aided with ad­e­quate cap­i­tal and trans­fer of tech­nol­ogy, can com­pete to match the suc­cesses of our com­peti­tors. Ul­ti­mately driv­ing all this will be ideas and in­no­va­tion – the likes of which drove the in­dus­trial rev­o­lu­tion in Europe some 200 years ago.

This may seem like pie in the sky for some who say that Malta can never be a leader as we can­not af­ford it. With­out the nec­es­sary funds how can we seek dis­rup­tive ideas and turn them into im­proved man­u­fac­tur­ing and ser­vices out­put.

Re­al­ity tells us re­form is doable. It starts with cre­at­ing a can-do at­ti­tude, fos­ter­ing knowl­edge ex­change. This acts as a cat­a­lyst for in­ven­tion. Just pon­der on those an­cient times when our ances­tors had im­pro­vised and built mag­nif­i­cent stone tem­ples to wor­ship their gods (some of them like Ġgan­tija have been stand­ing for mil­len­nia) and this with­out ac­cess to ma­chines. Ne­olithic tem­ples are mas­ter­pieces of de­sign and an en­gi­neer­ing marvel. It goes with­out say­ing that we owe it to our ances­tors to echo their en­deav­ours – they are our torch­bear­ers and silent men­tors.

Mov­ing on, we heard it many times in pre-bud­get speeches that the govern­ment of the day will pro­vide clear lead­er­ship to lead us out of the woods and while we made good progress there is still a long way to go to be able to sur­mount fu­ture tech chal­lenges. Ide­ally, both the pub­lic and pri­vate sec­tors should join hands to work in part­ner­ship to re­po­si­tion our ex­port po­ten­tial in goods and ser­vices even though oc­ca­sion­ally they act as strange bed­fel­lows. So­lu­tions need to tran­scend the po­lit­i­cal cy­cle. The medicine is bit­ter and to thrive the driv­ers of the econ­omy need strong nerves, good lead­er­ship and weaned on proper fund­ing. The cure in­volves rein­vent­ing the way things are done, col­lab­o­rat­ing more widely with ecosys­tems of or­gan­i­sa­tions, cut­ting dead wood in bloated bu­reau­cra­cies, re­sist­ing the oc­ca­sional en­gage­ment of “Soldiers of Steel” to run govern­ment de­part­ments sur­rep­ti­tiously cho­sen as “per­sons of trust”. We need to in­cul­cate mer­i­toc­racy by in­vest­ing in peo­ple of cal­i­bre. Purg­ing crony­ism in po­lit­i­cal ap­point­ments leads to a bet­ter and more eq­ui­table co­hort of able­bod­ied peo­ple run­ning the top ech­e­lons of govern­ment. As stated ear­lier, in­no­va­tion starts with smart peo­ple, wher­ever they may be: R&D de­part­ments at start-ups, busi­nesses from small to large, busi­ness ac­cel­er­a­tors, uni­ver­si­ties and re­search in­sti­tutes. In a word – in­no­va­tors. It is a fact that sus­tain­able growth de­mands fo­cus and in­put from a wide spec­trum of con­nected par­ties. We envy the suc­cess en­joyed by tech gi­ants. They bite the bul­let; they do not shy away from prob­lems but se­lect a team made up of in­no­va­tors, de­ci­sion mak­ers, vi­sion­ar­ies and en­ablers – in short, unit­ing an ac­tive in­no­va­tion eco-sys­tem.

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