Thursday, 12 February 2015

The economic virtue of IT failure

Politicians have noticed the advantages in failing and starting again

Listening to politicians talking IT used to be amusing, as most knew so little about the subject that they were bound to put a foot in the mouth at some stage. But these days you don’t get the laughs – and it’s for the better – as more of them have a decent grasp of what’s going on in the industry.

It came across at this week’s Big Digital Debate – staged by TechUK, the BCS and Computer Weekly – at which representatives of the UK’s three main parties outlined their views in advance of the general election. It’s notable that one, Labour’s Chi Onwurah, has worked in telecoms at Ofcom, while the Conservatives’ Ed Vaizey and LibDem Julian Huppert both showed a reasonable degree of knowledge (not surprising for Vaizey as he is minister for the digital economy).

All highlighted the need for the UK to make more of its digital talent, and cheered on the start-up culture that has emerged in various hubs around the country. But they also acknowledged the gap between this and the growth into successful mid-sized businesses that make a serious contribution to the economy.

How far can a government go in providing this? There was talk from the politicians about tax breaks, focusing support on technologies in which the UK is strong, providing the broadband infrastructure and development support, and ensuring schools and universities produce people with the right basic skills. But there is a limit, and cultural factors are just as important.

Start-ups with bright new ideas for digital products and services are great, but most of them will fail. It becomes a drag on the economy when they linger and fritter away their founders’ talent. It’s best for the economy if they fail quickly, leaving their people to start again with fresh ideas or take their experience into other companies and help them grow. This is crucial in an industry where the technology advances so quickly, and the chances of success, often based on how it aligns with human behaviour, are unpredictable. 

It can still be something of a stigma to fail in a business venture, but it shouldn’t be when those trying again are looking for seed funding, technical facilities or research support. The new idea can often benefit from the failure of the old one, and deserve the backing to give it a chance.

Julian Huppert made the point that one thing that would help build the UK’s digital economy is to help small companies fail quickly and release their people to start again. That’s when failure becomes a virtue.

Mark Say is a UK based writer who covers the role of information management and technology in business. See