Opening Address to IDC Directions Conference

Thank you, it is a great pleasure to be here and to address the leaders of an industry, which I believe is absolutely crucial to New Zealand’s future.

I imagine that everyone in this room is working from a shared platform of knowledge and to some extent has a similar vision for what the future might hold. We all know that the key driver for future economic success is going to be information and communications technologies – information is the new resource, and knowing how to use it to leverage productivity and make the most of being globally connected will be the deciding factors in accumulating the wealth we need to realise the sort of country we want to live in.

But the reality is that we are still in a minority. It’s our business to know about blue skies technologies and we can envisage and look forward to our ‘digital homes’, GPS-equipped cars and being able to access whatever information we want in, whatever format we want it, wherever we need it. We’re sure it is going to happen sooner or later. But what about the rest of New Zealand? I think there is still a huge gap between what the ICT sector knows about the difference that ICT can make to productivity and what the majority of the public understands about it.

What real effort are we putting into making sure that kids can do more with the technology at their fingertips than just play games? How much time do we spend in helping our small businesses to use the technology to grow? Are our ICT systems inclusive – are they easy for people with disabilities to use, do they meet our needs in terms of language and content, and are they affordable? In other words what are we doing about making our vision for a truly knowledgeable and equitable society come true? That is what I want to talk to you about today.

I want to talk frankly because we do share a common perspective and because we do need to work together to make sure ‘IT’ happens for New Zealand, pardon the pun. So rather than go over what we already know, I’d like to indicate some of the ways in which your industry should be making a vital difference to New Zealand’s digital future.

Is there is a touch of complacency in the Industry? We’ve been aware of all these promising technologies for so long and, since we can see some of them actually happening, the natural thing to do is to sit back and relax. Things have been pretty buoyant: it’s true that exports are a little down but we expected commoditised items like hardware and cabling to drop off in the face of Asian competition, and we’ve had to contend with the strengthening dollar. But, as IDC’s Manager Graham Moeller pointed out recently, we are increasing high value exports like services and research, so we’re headed in the right direction.

Even better, the domestic market is thriving. There’s a steady stream of great new products from overseas - LCD screens, MP3 players, IPODs, all sorts of laptops, notebooks, mobile phones - that can be marketed profitably, so why bother investing in New Zealand’s small market and anyway, can we compete with the big boys overseas?

That is sometimes the attitude I encounter and I find it frustrating. There is huge potential here for us to be the first to make the “knowledge society” really happen simply because we are a small, educated society a long way from anywhere else. We have an outstanding ICT sector with a proven track record and New Zealanders are generally quick to embrace new technologies, but we’re in danger of getting stuck at the email stage – using technology to get there a little faster but being totally unaware of how it could be done better, differently, more efficiently, more profitably and more equitably.

If you’ve ever been surfing – and I mean in the water not on the Internet – you’ll know what it’s like to be with a group of people sitting out on your surfboards waiting for the great wave to happen so you can be swept up and taken along with it. Trouble is if you sit there waiting too long, the wave goes by without you. Well, I don’t want us to still be sitting there when the knowledge wave has gone past – that way you get a bumpy ride and don’t go anywhere.

I think we should paddling hard out to meet that wave and be standing ready to ride it. If we want to be at the forefront of ICT we need to be proactive, not waiting to see what everyone else does before we jump on board. In other words we should be working at innovative solutions which will ensure that all New Zealanders are aware of the benefits of ICT, can choose appropriate technologies for their needs and aspirations, and are able to use them effectively.

In a few weeks time, I will be releasing the final version of the Digital Strategy which will set out very clearly the direction that government ITC policy will be taking in the next few years. As is usual with the release of such documents, I’m sure the initial interest will focus on ‘the bottom line’ – in other worlds how much the government is going to spend to support the policy.
Well, I am not about to reveal that right now, (although it will be significant), but what I would like to do is turn that around a bit and ask you what your bottom line is. What are you prepared to do to make the aspirational vision of the strategy – that is ‘for New Zealand to be a world leader in using information technology to realise the economic, social, environmental and cultural goals of all its people’ – a reality?
And I mean all the people. Your role is absolutely crucial because you provide the interface between people and technology. The challenges and the opportunities for you lie in the way you are able to bridge the gaps between what people want and need (and what they don’t even yet know they need) and what they are able to access and use with confidence.

And as Minister of IT, I can tell you that packaged applications, overseas content, geek speak, lack of technical assistance and low speed connectivity and poor sales advice will not do that. When someone walks into your shop or rings to get a service, you have already got a foot in the door. What I want you to do is to go out and find the people that haven’t even got that far. We have a huge community of Pacific peoples, for instance, who by and large do not use ICT. Do you know why?
If you don’t you should – they are a growing percentage of the younger workforce and will be probably be contributing to supporting you as superannuitants. It is in your best interests and in the interests of your children to make sure that everyone is digitally literate, which is the real ‘bottom line’ of the strategy.
I don’t know all the reasons for a low uptake of ICT in pacific communities but here are a few simple ones that I learnt from the Pacific Community Reference Groups in consulting about the draft Digital Strategy.

Many of the older generation perceive computers as merely machines to play games on – games are not a priority with Pacific elders, but education is. The leaders were adamant that if their communities could be persuaded that computers were good for their children’s education and gave them learning and employment opportunities, they would buy them and/or use them for more than just playing games.

Another thing that they were concerned about was safety. They worried about bringing in something to the home that they could not control or supervise properly because they were not technically proficient.

And thirdly, and perhaps the most obvious obstacle, was the language. What incentive is there for an elderly Niuean, for example, to access the rich resources on the Internet? Even finding how to plug it in and connect with the internet is hugely difficult if you don’t read English.

How basic and predictable are these issues and why are they not being addressed? Fortunately there are some organisations like the Internet Safety Group which are educating parents and children, and business people too, but it is a slow process and they could do with a lot more support. I think the industry is being proactive about addressing some of the negative issues associated with the Internet, but unless that message gets through to parents either the computers won’t be bought or our children will not be protected.
Either way that’s a negative result for New Zealand. There are similar issues of course with business security, intellectual property and copyright, internet banking and web marketing – people will not take advantage of ICT while they are worried about being able to control it and use it safely and securely.

Non-profit, voluntary and community groups are continually coming up with ideas to address specific problems. To use another pacific example, there’s a technical help line on Samoan Pacific Radio for instance and for some time there were technical workshops in different pacific languages, all run by volunteers. However, in the end the latter were victims of their own success and the volunteers couldn’t keep up with the demand. That was a golden opportunity that the ICT sector missed, not only to more profitably include a huge community that they hadn’t yet tapped, but also because those contacts would inevitably have led to opportunities to develop new products, services, solutions tailored to the needs of that specific community. For example they were in the process of compiling technical manuals in a number of Pacific languages which could have had some very useful spin-offs. It can only be a win-win situation.

Exactly the same challenges apply in business. About 87% of businesses employ fewer than five people in New Zealand so we’re mainly operating at the micro end of the scale. Well, so what? you may say, there are lots of other countries like that. But there are very few countries with the same business structure that also have such a small population and are also situated so far away from large markets. The unique situation that we have here calls for unique solutions and indeed there are some outstanding examples where New Zealand firms have overcome those problems and have been able to compete in the global market.
But some of the feedback I get from the small business sector is that it is too difficult to incorporate ICT into established businesses. Not only do some firms not see the need for it, as their businesses are running well without it, they have in the past been burnt by poor sales advice that has them end up with a software package that they cannot run properly and that doesn’t do what they want it to do. Or specialist advice is too big and too expensive for them to seek. Or, and this is most important, the owner managers are too busy just keeping things running to take time out to learn how to use new processes.
We want business people to be able to use ICT as a management tool for greater efficiency, control, marketing edge etc. So you need to make it very easy for them to see how useful it is going to be and very, very easy for them to learn how to use it and incorporate it into their business.
No-one is going to sit round reading a manual about the inside secrets of the PC or learn the intricacies of the Norton’s Utilities – they just want to plug it in and get on with it. That’s your job – to make products and services for businesses so nifty, so good and so cheap that people want them, and enjoy using them to their full capacity.

Let’s make a comparison between what is the norm in business for example and what’s available for entertainment. We all have applications such as Microsoft Office on our computers which we know has literally millions of things we could use that would improve our efficiency. But for the most part they sit there untouched because we don’t know about them to use them. It is not only wasteful, it is lost productivity.
Compare that with an IPOD which you can just plug it in and use - the computer does everything. It automatically goes onto the Internet, searches for your CDs finds them wherever they are and sorts and stores them in a nice orderly fashion. It isn’t that kids are good at technology, as the ads would have us believe, it’s that IPODs have been made easy enough for kids to use and the same thing needs to happen for small businesses, for community groups, for government agencies as well as for big companies. When big package systems are as easy to use as IPODS that’s when we’ll get real growth in productivity.
It is perhaps in government that the potential for ICT for transformation has the greatest potential. There‘s obviously vast scope for improving efficiencies between departments, having interoperable systems, managing information, coordinating policies, and endless opportunities for e-Health and e-Education and e-Science – I am sure you are aware of them all.
But I would like to think of the transformation of government in broader terms. I think the challenge in utilising the latest technologies, is not only about increasing the quality and efficiency of administrative work, but it is also about shifting the orientation of information management to the ordinary person, because, as government administrations become more efficient, more responsive and people friendly, people will be able to access all the information they need, regardless of the source, and will have much greater decision-making power. That heralds a huge shift in the balance of power and responsibility, from the government to individuals and communities and it also heralds a change in the way we work.

Government is becoming more of a facilitator – setting the conditions which enable individuals, communities and business to develop and prosper. It is one of the elements of the network society and as such works in partnership with others to create the society we want. That is a model that we all need to follow in the ‘knowledge society’. More choices means just that - and you people are the ones that that must make those choices real and viable for all New Zealanders.

So my message to you is: invest in your staff, invest in research and development; go out and tailor your products to the unique needs of your clients here rather than waiting to import other countries’ solutions and consider every New Zealander your client.

The government is investing in our digital future and, since we’re on the same team, we’re expecting that you will pull your weight too. With a stable, growing economy, now’s the time to really make it all happen.

Thank you