The Financial Express

Innovation myth and loss of opportunity for policy delay

| Updated: December 09, 2019 20:50:58

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Innovation myth and loss of opportunity for policy delay

It's been a decade since Digital Bangladesh was proclaimed and the government adopted policies to transform our manual world into an automated one. The government has repeatedly laid emphasis on development of the industry as a priority in achieving Digital Bangladesh. Multiple interventions were made and initiatives taken in order to improve quality and capacity of the industry and services.

Information and communications development (ICT) infrastructure development programmes are being pushed forward - from countrywide fibre backbone and redundant submarine internet cable installations to boosting of terrestrial connectivity through a bevy of new projects. Students are being connected to their schools, colleges and universities and they are being provided with enhanced opportunity of learning experience within school and college computer labs. Citizens are being connected to government facilities at all levels, through hosting of government application infrastructure at National Data Centres. Digital Security Act and platforms, departmental data handling, and voice-and-video-conference facilities are being implemented. These and many more have created enormous potential for service industries. In both public and private sectors, these initiatives have driven service innovation, process automation, resource optimisation, service optimisation, and service outsourcing.

Outcomes of the Digital Bangladesh concept are being closely monitored by bodies operating at the highest level of the government. Digital Bangladesh is such a massive transformation that various outcomes of it often cannot be identified by common eyes; significant research and analysis are required to assess the outcomes and make recommendations.

Certain indicators may be developed by such 'research and analysis' and they include knowledge process improvement; culture of innovation nurturing; industry growth and sustainability; role of research and academia; intellectual property and national wealth creation; employment generation in the ICT industry; startups and sustainability.

To truly improve in these areas, we need to analyse existing public sector projects focussed on digital transformation. What is the source and nature of funding? How is budget being utilised? What is shaping procurement policies? We must streamline the way these projects operate to cater to specific needs of this very specific industry.

However, we will not be considering ICT Infrastructure projects since 100 per cent  of the ICT solutions are imported [foreign] products, hence, there is a reduced scope of value added services and many of the research parameters are unidentifiable. There are exceptions as well.

In terms of funding and budget allocation, we can see, 80 per cent of funding comes from international development partners, and these are earmarked for a few large-scale projects for Digital Bangladesh. These projects are by and large taken up by international companies, not operating within Bangladesh. This means that the numerous small-scale projects that make up the bulk of the Digital Bangladesh initiatives are being locally funded. Local companies are being afforded only 20 per cent of the budget. For an ICT industry of this size - more than a 1,000 companies - this meagre funding has resulted in severely stunted growth. We can see that local companies are working at rates and generating revenues at one-fifth of that of these foreign companies within Bangladesh. As a result, the average local company is employing only 25-30 employees. It is glaringly obvious that the local industry does not have financial or human resource strength to grow, innovate and achieve excellence.

A number of complex and distinct projects on G2G, G2B, and G2C applications have been taken under the procurement plan. These projects are new to the Bangladesh ICT industry. However, the Bangladeshi companies have the skills and qualifications to successfully implement and integrate these into the national ICT framework.

Still, we are held back by strict regulations of procurement of international development partners. They require that companies must meet prequalification criteria of having completed at least two similar projects in the past. In an ICT industry as young as ours, this immediately disqualifies all local companies. We are systematically being prevented from working on these projects and the Bangladesh ICT industry is missing the opportunity to use its talents for development of the country. A policy on how to include local resources in international development partner-funded projects is key to nurturing innovation, creating national wealth, and building capability and track record of our ICT industry. If we continue to only be engaged in dealership/agency and monotonous low tech replications, the nation will miss the opportunity to create a knowledge-based industry, and compete on a global scale.

It is no secret that companies from India, Vietnam, and Sri Lanka are deploying solutions in Bangladesh whereas local companies are kept out of the procurement process due to absence of procurement policies guiding local industry involvement. Despite many efforts of the industry body, there has been no policy change to protect the local industry.

Now we are observing some issues involving those projects: vulnerabilities associated with transferring knowledge management, technology ownership, and domains (IP) from foreign to local bodies. Yet the most critical issue is the low employment and utilisation of local talents.

Despite political will giving highest priority to developing the sector, the industry is not growing at a rate compatible with graduation of students who enter the job market, due to delays in bureaucratic processes in policy formulation, lack of understanding and confidence. Hence the potential of local talents remain largely unutilised and we are limiting the expectations of the current and future digital generations. This all is contributing to brain drain, which is further stunting the industry.

Another more deep-rooted cyclical issue is holding us back: a low applicability of current research and short-sightedness of the industry stakeholders. Much of the industry research carried out has become purely academic virtues. However, if the research does not yield any applicable solutions to contemporary problems, it does not attract necessary grants and stakeholders. Similarly, if stakeholders cannot (or do not) assess the industry problems that can be corrected by research, we have a persisting issue. This persisting issue drives policymakers away from a local industry mired by local problems into the arms of readymade global solutions.

It takes a significant amount of time to implement a project, at times much more than anticipated, be it a local or global solution. In Bangladesh, current heads of tech companies and policymakers are more than likely first generation tech users. This makes it difficult for those within planning committees and decision makers to foresee issues that can arise during implementation. These issues remain in the dark and hardly discussed - a hallmark of our lack of applicable research and track record. This leads us to employing global consultants to identify potential problems and design a plan of action.

However, this is a blanket approach as one country's issues are not identical to another's and, therefore, its planned solutions are not transferable as is. When local consultants and workers are employed, their terms of reference are to replicate global ready solutions. To compound the issue, many of these local consultants are not even from the relevant field or do not have required expertise. This compromises outcomes in solving short-term problems as well as furthering long-term national interests.

When it comes to engagement of local talent and graduating students entering the ICT workforce, the onus is on both educational institutes and procurement entities. Scholars and research/consultancy firms are generally too academic to offer applicable knowledge to students. Educational institutes need to connect students directly to the industry and develop transferable skills in students. Also, there is a cookie cutter approach to project procurement and planning, i.e. we employ the shiny first world solutions with the hope of achieving the same outcomes as those nations did. And hindrances to project implementation in our country are not either the same as in the developed world.

Such approach is slowing down local employment, IP wealth creation, country branding, customisation, localisation, and maintenance, ultimately affecting sustenance of the project. So, not only are we depriving local talents of meaningful employment in these projects, we are also slowing our Digital Bangladesh aspirations down.

It is imperative that procurement entities begin to rely on local companies and workforce. It is young countries and industries like ours that reinvent wheels, and create excellence from there on. In future, these local companies and youth will not only drive national development but raise our flag onto the international ICT platform.

Our country is at a crossroads. As we are growing, our country is reaching digitisation at a stratospheric rate. However, no matter how fast we grow using the best breed solutions without integration of local resources, there is an asymptote that affects the growth of the ICT industry. The impetus for this scary reality is the lack of applicable research for national solutions, protection of local company interests, and the tunnel vision of procurement entities.

We need to create opportunities for local entrepreneurs and new graduates by instilling applicable skills at the educational level, fighting unfair international policies via lobbying, and protecting industry profits and IP wealth from foreign bodies. We need to re-allocate our resources to boost the local industry and the economy, not to help swell the pockets of already wealthy foreign companies. To fully realise the potential of industry growth, realistic research and analysis are required via a strong connection between policymakers, industry experts, and academia. We cannot either forgo the interests of "Bangladesh" to feed the wiles of the alluring "Digital" world. Believing so all stakeholders should show a sense of urgency to focus on right policy formulation and its faster implementation.

Forkan Bin Quasem is Managing Director at Spectrum and ex-Secretary General of BASIS

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