Time to double down on cloud services
What’s happening to the national average house price has never been more irrelevant.
One of the fascinating things about the Facebook Live sessions held by the prime minister over the past month has been the text messages from the audience, scrolling down the screen.
Messages on topics that reflect both our national identity and the little things, which are actually big things, that make up everyday life.
Topics here have included sourcing custard squares, the opening of duck-shooting season and the ability to get a haircut.
To hundreds of thousands of people these are vital issues, and the PM’s handlers know this to be true. So it was no surprise both duckshooting and haircuts got a hat tip from Jacinda Ardern when she announced the move to alert level 2.
And it’s no laughing matter for ACT leader David Seymour, who’s been nicknamed ‘‘Disco Dave’’ on account of the voluminous natural wave he’s sporting these days. He’s in good company – 1200 haircuts were booked within 30 minutes of the all-clear for hairdressers.
They joined 60,000 other people who had pre-booked hair and beauty appointments through cloud-based booking platform Timely. The same platform also allowed hairdressers to carry out online consultations and customer education workshops.
Cloud-based systems like Timely have become the unsung heroes of New Zealand’s Covid-19 experience.
Most business people start their day checking their email via a cloudbased application like Gmail.
They then do business via cloudbased video services like Microsoft Teams and Zoom, they consume information via cloud-based news services such as Stuff and Radio NZ, and then buy food and retail items on websites powered by Shopify, the cloud-based e-commerce platform.
In a similar vein to the way cloudbased services sped the recovery to the 2016 earthquake, it’s also helped keep the economic and social motor running. And now we’ve got the opportunity to open the throttle on that motor to speed our recovery.
Last year, Xero commissioned NZIER to study the potential for cloud-based technology to improve national economic productivity.
Modelled on normal economic conditions, the report found a 20 per cent uptake in cloud-based technology could increase GDP by between 1.2 per cent and 2.1 per cent, adding up to $6.2 billion per year to our economy. The report also found increased cloud uptake could lift household spending by up to
$4.6 billion, increase business output by $7.3 billion and increase wages by $1.9 billion.
As we architect our nation’s recovery we have an opportunity to accelerate the digitisation and productivity of the economy, by encouraging business to double down on cloud services.
Other countries are already doing this. In Singapore the government directly invests in the digital transformation of SMEs by providing services and grants.
The government launched its ‘‘Go Digital’’ programme in 2017 to encourage SMEs to move to cloud solutions to speed growth and better ensure security of supply.
SMEs in Singapore are provided with a 70 per cent government grant to help them adopt a range of cloudbased business solutions. I think it’s worth considering whether a similar scheme here could help speed economic recovery. There would need to be a funding cap and enablement assistance. But it feels to me that business.govt.nz is already a
Janine Starks is a financial commentator with expertise in banking, personal finance and funds management. Opinions in this column represent her personal views. They are general in nature and are not a recommendation, opinion or guidance to any individuals in relation to acquiring or disposing of a financial product. Readers should not rely on these opinions and should always seek specific independent financial advice appropriate to their own individual circumstances. strong base to start such a program from. Enabling the smaller businesses would be key and would also be consistent with the Government’s stated intention about extending digital inclusion.
A scheme with really strong enablement service could allow some non-digital businesses to leapfrog the pain of desktop storage and associated security risks.
In the current climate, the size of the investment wouldn’t be huge. If it was delivered in the form of a rebate it might cost as little as $3000 per small business to allow it to implement cloud-based services. You’d expect the productivity gains would offset the Government’s investment, quickly becoming fiscally positive at a GDP level.
This might see a 20-person plumbing firm suddenly having Microsoft 365 across its machines, vWork mobile worker software across all its field workers, integrated billing through Xero and a Shopify-powered webstore for tapware and fittings.
That allows better information, swifter payments, increased worker safety and a new passive income stream.
From the consumer point of view, it means clearer communication and swifter fulfilment. It also gives the business the ability to scale. To have systems in place that means in the wake of Covid-19, they aren’t pulling their hair out trying to catch up. It also means those business wouldn’t have to take a financial haircut as the recovery kicks in.
Mike ‘‘MOD’’ O’Donnell is a professional director, writer and strategic adviser. This column is his personal opinion, but O’Donnell also is a director of Radio NZ, chairman of Timely and a past chief operating officer of vWork.