The Abbott ministry has been unveiled and while Malcolm Turnbull and his comrade in arms Paul Fletcher will have their hands full with the National Broadband Network (NBN). But, they also need to ensure that the conversation on the digital transformation of the Australian economy doesn’t get lost in the noise.
Malcolm Turnbull spent most of his time in the shadow ministry railing against the Labor NBN and its acolytes. Recent evidence would suggest that a certain level of antagonism will continue to persist as he goes about bringing the Coalition’s broadband plan to fruition. He will be assisted in his task by Paul Fletcher, who takes the mantle of the parliamentary secretary for the Communications portfolio.
There was a brief moment in time when Fletcher was seen as a possible replacement for Turnbull, but after managing to put forward a cogent, albeit unpopular, NBN policy Malcolm Turnbull deserves the chance to put his money where his mouth is.
While the NBN will undoubtedly be the big ticket item for the Coalition, the Abbott government also needs to deliver on the aspirations laid out in its ICT policy document.
Launching the policy document on the eve of the federal election, Malcolm Turnbull and the then Shadow Minister for Finance, Andrew Robb, were both ready to point out that the Coalition’s reform agenda will encompass cutting waste in government ICT procurement, increased transparency of expenditure and giving government services a digital makeover by 2017.
Building on the Gershon Review
All undoubtedly worthy goals, however, bringing these ideas to fruition requires a strategic shift in thinking; one that ensures that the foundations put in place by the Labor government aren’t washed away.
There might be little appetite for another Gershon review type exercise, but Ovum’s research director for the public sector, Kevin Noonan, says it might be a good time to dust off old copies of the 2008 review, as the Coalition government will use it as a baseline for future action.
According to Noonan, any conversation on the digital economy needs to look past the continued emphasis on commodity cost cutting and focus on productivity outcomes.
With balancing the budget books primed to become a favourite pastime in Canberra, the Abbott government will clearly push for cost savings.
The Coalition policy document states a desired objective to target costs at a structural level, through the elimination of duplication and fragmentation “of vendors, strategies and priorities”. However, simple cost cutting won’t work on its own, with much of the low-hanging fruit already gone.
Despite the Gershon Review’s push to propagate a productivity agenda, Noonan says that the calls to install structures that start to look at productivity haven’t gained the necessary traction.
“We can see the beginnings of this in AGIMO’s ICT strategy for government, where they push the question of productivity, but the issue hasn’t really taken off,” Noonan says.
The seeding agent
The cloud, mobile, analytics trinity has moved from the periphery to take a far more central role in the overall economy and it’s not just the jobs of the future that are at stake.
Deloitte partner and Australian technology practice lead, Robert Hillard, says that there is a false assumption that a discussion on technology needs to be solely about innovation or future jobs.
With half a million Australians involved in the Australian ICT sector, Hillard says that every change in policy needs to consider the implication it has on the existing workforce.
Australia’s global ranking when it comes to digital competitiveness is a sore spot for the industry. Hillard says that the Coalition now has an opportunity to play a critical role as an enabler.
“One of the biggest worries we have had is the low level of public engagement with the government through digital channels, and the incoming government has an important role in fixing that,” Hillard says
“If you want to cut costs but increase services, this is one way of doing it.”
Australian Information Industry Association’s Suzanne Campbell says that while we have been debating the NBN the small to medium businesses have been left to their own devices when it comes to tackling the Cloud and Big Data.
Campbell says that the federal government can do a lot in addressing the trust environment and its own use of ICT can set a positive tone.
“They are a major part of the economy from a purchasing perspective and their conduct sets the parameters on how [vendors] engage and change the way they do business.”
It’s a sentiment echoed by Ovum’s Noonan who says that government has four distinct roles when it comes to ICT, but the focus is usually just on its role as a purchaser of services. The ‘how do we save money on the contract’ dynamic is one that ICT vendors understand and exploit quite well.
But government also serves as a provider of services to a community; a regulator and a policy maker. Noonan adds that leveraging the purchasing power to drive local ICT industry growth needs to become an important consideration.
“The Australian cloud industry has struggled because it needs critical mass of customers to be able to offer services that compete on price with overseas providers. If the government starts to look more favourably on onshore cloud services then that provides leadership for industry growth.”
The Coalition’s aggressive approach to the three pillars of the digital economy narrative – cloud, mobile and analytics – holds promise but the key challenge will be making that transition from not just coming up with good ideas but actually making it happen. It’s an affliction that hurt Labor to some extent and it’s the pitfall that Turnbull and his cohorts need to avoid.