More needs to be done on opportunities in digital innovation
RECENTLY, I was pleased to attend the launch of the report of the Review of Digital Innovation for the Economy and the Future of Work in Wales, led by Professor Phil Brown from Cardiff University.
I was pleased that SMEs played a role in the shaping of the review, with representation from smaller businesses on the expert panel.
Digital innovation and technological advancements on the whole provide an opportunity to the SME community in Wales.
Undoubtedly, there will be some companies that will see their sector disrupted by new technology, indeed this is already the case across sectors such as transport and professional services.
However, those that adapt will be more productive and efficient, providing greater value to the Welsh economy and the people of Wales.
The key for FSB Wales is that Welsh government must play a strong role as a facilitator of change – helping to diffuse the opportunities of Artificial Intelligence across the entire Welsh economy.
It is important that the Digital Innovation Review group and Welsh Government understands how SMEs approach innovation as an activity and the process by which this diffusion takes place.
We were pleased to see the report highlight the need to establish a lifelong learning approach to Welsh education and training in this field, in order to empower people with the skills and capabilities adapt to technological change.
This approach will ensure that the entrepreneurs of the future are equipped with the tools that they need to really exploit the opportunities offered by the rise of digital innovation and AI.
We know that there may well be an educational deficit arising from the sheer pace of change, and so a commitment to education being a lifelong process will ensure that we are equipped with the knowledge and confidence to upskill the workforce.
The report also called for the creation of six industrial innovation clusters (IICs) – whilst we welcome this ambition Welsh Government would need to look closely at capacity issues, and how these would need to be resolved in order to make IICs most effective.
Also, the recommendation that there be a boost for the Foundational Economy Challenge Fund in order to support Smart Places Wales demonstrator sites with the aim of researching digitalbased solutions for a better working and community life is a thought provoking and interesting idea.
Digital innovation needs to help answer the questions that are being tussled with in our communities across Wales, and smaller businesses are already at the forefront of this.
It is crucial that there is an understanding of how digital innovation and technological change will impact upon the Welsh economy.
In our research we found that innovating firms fall in to two camps with those innovating by introducing new innovations to their business on the one side and those bringing new product innovations to market on the other.
On the one hand, there will be a smaller number of firms that are at the cutting edge of innovation, developing and delivering new products to market.
For these firms, government needs to provide a strong environment to allow them to commercialise any potentially expensive research and innovation activities.
SMEs are already exploiting new opportunities; FSB research has found that 76% of businesses have introduced an innovation in the past three years, although just 10% of innovating smaller firms have accessed financial support from government.
This demonstrates that there is a need to marry up those firms that are innovating or wish to do so with relevant support and advice from Welsh Government, this report is just the beginning of new opportunities for SMEs and Welsh Government to work together and exploit these new opportunities.