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.
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.