I read an interesting article this weekend about what Mike Lynch (founder and former CEO of Autonomy) is doing now. He’s continuing what one might call his life’s work – creating highly successful, big technology businesses in Europe and more specifically in the UK. His large new venture fund wants to put an end to that nagging question – why are there no Google’s (Facebook’s, Amazon’s, etc. etc. ) arising in Europe? He thinks we have the original science and the skills, both technical and entrepreneurial. However the really talented people always seem to have to move to the US – often California specifically – to make their ideas fly. It’s an old argument. I have been hearing versions of this ‘silicon valley envy’ my whole working life in IT – 30 years.
Mike Lynch believes a big part of the problem is getting the right kind of venture funding in place and that’s what he’s trying to fix. I can’t doubt him – I don’t know that much about tech venturing. You see I don’t come from the IT industry. I come from the IT industry’s customers – the kind of companies that buy and apply the fruits of technology progress, to make their own businesses more effective.
For Europe to find the economic growth revival we all need, it has to work a lot harder on productivity. Since we don’t want to lose our hard won social advances like minimum wages and good safe working conditions, we are not going to compete with the industrialising sweatshops of the emerging markets. But we must compete with their rapidly advancing knowledge economies. The first part of the answer to that is education and on that score we are doing OK. We have advanced university systems that hone many of the finest minds. Europe is not struggling or failing to produce top end intellectual talent.
However – for a knowledge economy to thrive it must also invest in the tools that will make those talented people as productive as they can possibly be. Not ‘good enough’ tools but world class tools – the very best we can get. That’s what European CEOs must attend to. Mike Lynch and people like him are setting out to improve the ‘supply side’ of the equation – they will create ever more advanced technology tools. He is putting a very large amount of his own money where is mouth is.
European CEOs should match Mike Lynch’s move – by investing to fix the demand side of the technology equation. The reason is not to make markets for the new tech vendors, but to seriously improve the quality and productivity of the knowledge work that is essential to our advanced economies. A ‘stretch and make do’ attitude to technology investment within firms is still far too prevelant – even among those that have large cash piles on their books. How many European workers, when they get to their desks each morning, can truly say they have the very best information and technology systems to work with? How many can say that their business models are keeping pace with the digital era, or that the products and services they offer are being digitally enabled?
Boards of Directors must ask – what is our company doing to invest in information and technology that can make us more effective and could we be doing more to make that go faster? CEOs who don’t have big digital business ideas and plans to invest are stuck in 20th century thought patterns that will not serve Europe well.
