Government Support is Essential for Tech Growth
Investing in Tech Businesses
There are numerous government branches across the globe set up entirely with tech development in mind – Silicon Valley itself was built on public funds. There has been international recognition that technology is the way forward in terms of economic growth. This month, for example, the Industrial Strategy Challenge Fund (ISCF) announced a new $1 billion investment in six key areas – healthcare, robotics and AI, batteries for clean energy storage, autonomous vehicles, materials for advanced manufacturing, and finally satellites and space technology. The continued interest and investment of governing organisations is largely a positive thing, however commentators have questioned the true commitment of decision makers when it comes to innovation. Former business secretary Vince Cable, for instance, has criticised the ISCF fund as too small. How have global governments contributed to technological developments, and are they really doing enough?
How are governments fuelling innovation?
Encouraging technological development is clearly in governmental interests, as it encourages competition which leads to improved products and services. We spoke to Fiona Kilkelly who runs creative and digital at the Knowledge Transfer Network (KTN) and heads up Immerse UK a network launched in November 2016 by KTN and Innovate UK. According to Fiona, it isn’t all about access to finance. Sharing expertise and data is also vital to creating a strong international presence. “There is a real passion and commitment from industry to get everybody to the starting line,” she says. So, with the help of innovation networks, the UK is setting itself up as an important global competitor – even though the $1 billion investment has been criticised as inadequate.
But what’s the situation in other countries? The US, for example, is well-established in technological development. According to a study by Brookings Institution, 18 of the 25 biggest breakthroughs in computing tech between 1946 and 1965 were funded by the federal government. However, changes in personnel alongside international competition has called into question the continuation of the US as a tech powerhouse.
Denmark, for instance, is a leader in environmental, bio and nanotechnology. The government is incredibly ambitious in terms of technological growth, and launched an innovation strategy in 2012 to enhance public research, innovative business and internationalisation. The German government is also committed to innovation, and provides funding to startups, SMEs, universities and R&D projects. Despite sometimes limited funding, there is a clear international trend emerging in which governments are recognising the importance of supporting technological growth. This mirrors the adoption trends of businesses themselves concerning digital disruption in particular.
How will government investment disrupt technological growth?
The involvement of governments within tech will contribute to an increasingly competitive sector, which will in turn encourage the development of better products and services. By supporting national businesses, governments can strengthen their political and economic position on the global stage. However, government involvement is not always viewed in a positive light. For example, governments need to formulate guidelines in order to regulate certain technologies, and researchers and scientists have criticised this as restrictive. The Organisation for Economic Co-operation and Development (OECD), founded in 1961, aims to address these kinds of issues by promoting policies which have a positive impact on economics and society. The existence of all-inclusive bodies like the OECD, teamed with government investment (not just monetary), has the potential to accelerate technological expansion.
Across the world, governments are setting up dedicated programmes to support innovation. State funding and attention provides invaluable help to businesses, allowing access to resources that would otherwise be unavailable. The question is, are governments doing enough? It’s safe to say that whilst support is available, more could be done. “In a time and space where technology is developing so quickly, we really need to work together to share expertise, insights, and knowledge to grow immersive tech as an industry,” says Fiona, talking of the UK specifically – but this approach should be universal. “A major focus for ImmerseUK over the past four months has been working with the government to help shape funding policy in this space.” Hopefully, the efforts of organisations like InnovateUK can convince governing bodies worldwide to recognise the massive opportunities in tech, and commit to investment.
Has your business benefited from government support? Are global governments offering enough support to encourage technological growth? How important is government backing for businesses? Share your thoughts and experiences.