Why Demand Led Recovery is the key to our future success
COVID-19 has created unprecedented challenges for digital and non-digital companies alike; demand led recovery will be how we best move our economy forward across all sectors.
As we move to the next phase of the Covid-19 pandemic plan I think it’s appropriate I share some observations and thoughts about how the digital sector has fared and what recovery might look like.
I’m writing based on a myriad of experience of the impact of Covid-19 on the digital sector, and wider digital adoption. I’ve garnered this as CEO of Sunderland Software City, the Chair of the UK Tech Cluster Group and trustee of Citizens Advice Scotland.
The digital sector, in the majority, has coped perhaps better than any other sector. I’m not belittling any struggles digital companies have faced; to own and run a business during this situation has been unprecedented, throwing forward economic and moral challenges we are probably never likely to see again in this generation.
However, many companies I’ve spoken to or heard stories of have either maintained customer numbers or gained new ones. This is of course, not uniform. Those companies which can support digital adoption in other sectors have seen an acceleration of demand that, I believe, might have taken them 3 to 4 years of hard messaging and sales visits. Others in the digital sector that, for example have a software-as-a-service offering to increase sales or provide market intelligence, have seen a stagnation in their orderbook.
The current government initiatives to support businesses through this period are openly acknowledged as largely generic, there to help the widest range of businesses across all sectors. Some I’ve seen put to use with digital sector businesses. I’ve seen staff furloughed, although in the digital sector this tends to be either administrative staff or a cost-saving exercise by microbusinesses to ensure at least some revenue income.
At the time of writing this, the Future Fund still has unclear criteria which until sorted could make it incredibly useful or utterly pointless. InnovateUK funds have the ambition to maintain an upward curve of R&D spend but unless they can overcome the challenge of processing capacity and outreach to those that don’t normally access their funds, I feel a big amount of funding could have only a small positive effect across the UK.
It’s on this point, i.e. how we recover, I’d like to posit some thoughts. We entered this pandemic with a few points on the Government’s agenda but perhaps most significantly the ambition of “levelling-up”. We must not forget this ambition as we move into an economic, social and environmental recovery phase.
Whilst immensely important, the purpose of this blog isn’t to highlight the relationship between deprived UK areas and the health outcomes of those who’ve had CoronaVirus. Just looking at CoronaVirus Dashboard should be enough to instigate another incredibly essential conversation on this. Nor is this blog an advocacy on the effects of lockdown on our natural environment and the lessons we can take forward towards a net-zero carbon future. This blog is about our economic recovery.
I believe taking a demand led recovery stance will provide an immensely positive outcome, not only for the digital sector, but for all sectors across the whole of the UK. Importantly, this demand led recovery can be nuanced in different areas to meet local demand and thus underpin the levelling-up ambition that we must not cast aside.
Demand Led Recovery
Demand led recovery is about supporting all sectors to understand the new challenges they face as we adjust to the much mentioned ‘new-normal’. Some of these new challenges will be truly new, never before seen as challenges. Some will be existing challenges transformed by this new paradigm in which we now live. Importantly – and perhaps obviously given how I started this blog – there should be a huge emphasis on, and support for, how these challenges can be overcome through digital adoption and innovation.
Let me be clear, digital adoption is not a panacea for every challenge faced by every sector but in many cases, well planned and well executed digital adoption will help. We have an opportunity to maintain a vastly accelerated rate of digital adoption in this country if we provide ongoing support. This should include support to all industries to help them clarify and articulate their challenges. It should include funding to allow businesses to pilot and normalise digital adoption.
In doing this we will support digital demand sectors to become more productive and efficient whilst helping them innovate new products and services. This approach will also support the digital sector to refill its orderbook and develop new innovative offerings thus providing growth and employment.
Ultimately, I wholeheartedly believe this approach will advance the recovery of the UK economy at an expedited pace. I also imagine, if done right – with appropriate government support – this demand led digital adoption will truly underpin the levelling-up agenda.