The Digital Powerhouse: How collaboration can turbo-charge the Northern tech economy

Author

UK Business Angels Association

16 June 2016

Here at Tech North, we know just how vibrant and rapidly growing the technology scene is in the North of England, and yet the sector is still far from reaching its potential. Today, a new report commissioned by Tech North and published by the RSA in partnership with the Impact Hub, shows just how much potential there is.

The Northern tech sector is booming. Jobs in Northern tech are increasing 10 times faster than jobs in non-digital sectors, and the productivity of digital workers is 53 percent higher than the productivity of non-digital workers. Manchester has a world-class digital marketing cluster, healthtech has become a strong suit for Leeds, and Liverpool is building a reputation for expertise in the Internet of Things.

And yet there’s much more that can be done.

Unlocking the North’s potential

Raising productivity to the national average for tech workers would result in a £5.7 billion increase in GVA (gross value added) for the Northern economy. And increasing the rate of digital self-employment to the national average would give rise to over 9,700 more tech founders.

While improvements to the talent pipeline, infrastructure, finance and culture are all being addressed by industry and the government, The Digital Powerhouse report argues that better collaboration with local businesses and public services is another essential factor for unlocking the full potential of the Northern tech sector.

Local industries in the region – including retail, logistics and manufacturing – constitute lucrative untapped markets for tech firms, as do the health, education and local government sectors. The report suggests that the North’s tech companies can play a vital role in helping the region cope with an oncoming wave of ‘digitisation’, where more industries are likely to face the same fate as the media and publishing sectors.

The report highlights several existing examples of local collaboration. In manufacturing, Manchester-based tech company 2M Automation worked with the Nissan car plant in Sunderland to improve operations on its machine conveying system. While in the field of health, Yorkshire-based company Immedicare created a telecare service that links care homes in Airedale with clinicians in the nearby hospital.

How can this can be achieved?

The report suggests numerous ways in which this can be achieved:

  • Introduce Tech Taster vouchers: The introduction of vouchers should be considered as a way of allowing businesses to get a taste of what tech could do for their operations.
  • Establish a Digital Powerhouse Contract Portal: A portal could be created that collates private and public sector contracts in one place, establishing a Northern hub of commercial opportunities.
  • Champion the tech co-operative model: Tech co-operatives should be promoted in the North as a means of helping tech firms band together and achieve economies of scale.
  • Kickstart new corporate-backed accelerators: Northern tech groups, together with Tech North, should consider identifying corporates that may be interested in backing tech startup accelerators.
  • Make the North a testbed for experimental tech: Northern tech clusters should look at ways they could become proving grounds for experimental technologies (e.g., the use of robotics in social care or blockchain technology in the welfare system).
  • Establish digital immersion events: Public service teams should consider organising events with nearby tech communities in order to share procurement knowledge and better understand local needs and strengths.
  • Move towards ‘problem-based’ commissioning: Public sector commissioners should consider the benefits of problem-based procurement, which does not define solutions from the outset.
  • Open up data on KPIs and procurement results: Local authorities and public services should consider releasing their data on procurement history and key performance indicators (KPIs), so as to help tech communities understand the opportunities available.
  • Create a ‘Procurement Powerhouse’ social enterprise: Northern entrepreneurs should consider creating a social enterprise to link public sector buyers with tech businesses in the region, providing a sustainable solution to matchmaking.
  • Encourage the use of open source software: Partners in the North should champion the use of open source software to enable collaborative innovation, opening software markets up to more local competition.
  • Organise a ‘600 that Share’ movement: The region’s 600 very large businesses could be encouraged to pledge to do more to support their local tech community.
  • Establish a ‘Founder of Founders’ award: A ‘Founder of Founders’ award could be given to business owners who do the most to support their fellow entrepreneurs.
  • Pool the resources of university outreach teams: The outreach teams of Northern universities should consider joining forces to present a single unified offer to local tech businesses.
  • Consider a ‘what works’ review of tech business support: A ‘what works’ review could be undertaken to better understand how the region’s business support offer might be improved for tech businesses.

Here on the Tech North blog we’ll be delving into the report to highlight some of the initiatives, companies and people that demonstrate what the North is already getting right. Look out for our Digital Powerhouse series in the coming days and weeks.

Read the report online. 

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