Time to double down on cloud services

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 cloudbased booking platform Timely.

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 cloud-based application likeGmail.

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 has 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 cloudbased 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 a year to our economy. The report also found increased cloud uptake could lift household spending by up to $4.6 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.

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 strong base to start such a programme 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.

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.

For the consumer, 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.