Brits Mean Business

I always had my doubts about macroeconomics. Just the term “ceteris paribus” (all other things being equal) made me thoroughly suspicious. When has anything really been “ceteris paribus”? No day is like another and if I learnt one lesson in my previous industry, the insurance business – insuring big cargo and oil-platforms – it is to expect the unexpected.  

Having worked at UK Trade and Investment for almost two years now, I have to admit that the old macroeconomics truths are starting to grow on me. I don’t claim to be an expert in the field, but for example, to grow the local economy via international trade seems to make a lot of sense based on my business experience. Another economic hypothesis that works well for me is the idea that innovation leads to more attractive goods or services, which will in turn lead to increased demand and to increased trade. So it was with particular satisfaction that I participated at the Innovate UK conference in London in mid-March. 

The event was run as a joint venture by the Technology Strategy Board and UKTI. The audience consisted of business people, academics and legislators. The challenge was, and is, to encourage research and development, cooperation between universities and business and to assist the commercialisation of new ideas. In all, to make the UK more innovative and competitive and a more attractive cooperation and trading partner for all countries – not least for advanced economies like Sweden.

Companies presenting their innovative ideas included Versarien (which specialises in porous metals for heat transfer), SwiftKey (whose products make typing on smartphones easier) and Wellcow (which sells a product that monitors the health of cows – from inside the cow). It was fascinating to learn about how these and other ideas were taken from the drawing board or test tube and made into a real company. It seemed that most of the time it involved some form of research or invention or simply a good idea, some seed funding from governmental or other sources and not least some brave and stubborn entrepreneurs taking a chance on something they believe in. The stories underlined how important it is to support the interface between academia and business and how all of the abovementioned ingredients are really important for a well functioning economy.

Encouraging innovation, providing access to start-up funding and creating a society where entrepreneurship is stimulated are all important pieces of the puzzle for a country that aims to produce leading products and services that will increase trade and grow the economy.

But just like when the British scientist Alexander Fleming happened to discover penicillin by accident in 1928, we also have to be prepared for the unexpected and to be able to harness the unexpected to our advantage – ceteris paribus or not.

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This weekend I participated in a truly Nordic activity. I spent the better part of my Sunday sliding around on the ice between the small town of Sigtuna and Stockholm, the capital of Sweden. I was taking part in “Vikingarännet” (directly translated it would read the Run of the Vikings), or more specifically I participated in the shorter women’s version of the race called “Tjejrännet” (directly translated – the Run of the Women – which I guess implies Viking women). It basically meant that I tried to keep myself upright and going in the right direction for 35 kilometres on frozen Swedish inland lakes and canals. We even had to get our skates off in a couple of places and hike in the snow between the lakes – very rough indeed! 

It was a lovely day and we had a tailwind, so it was not as much an exercise effort as a balancing act involving courage, and in my case a lot of “can do” attitude.

The whole adventure made me think about the recent February 2, 2013 issue of the Economist. The feature article for this particular edition was named “The Next Supermodel – Why the world should look at the Nordic Countries” and the front cover displayed a very confident looking young bearded Viking – with horns and all. I will not try to analyse the article too much in detail, but in broad strokes the Economist praised the Nordic countries’ models and their ability to balance financial stability with a fairly large public sector and good economic growth. The Economist of course also pointed out of some of the future challenges for Sweden and its Nordic neighbours, but all in all it seemed like the “Vikings” had gotten a majority of things pretty right.

I could not help reflecting on the like-mindedness between Sweden and the UK. As appreciative as the UK’s Economist magazine is about the Nordics, the Swedes are in general similarly appreciative of the Brits. Both countries have a lot in common – from the composition of our industry and export sectors, to the joint appreciation of good comedy – and let’s not forget that Swedes are some of the best non-native English speakers in the world.

All of the above (and much more) make Sweden an attractive market for UK companies. With about 9.5 million inhabitants, Sweden is the biggest Nordic export market for the UK, with total exports of £9.5 billion in 2011. It is also the second largest Nordic supplier to the UK, on 2011 figures, only superseded by Norway with its dominant oil and gas industry. The well known phrase “a home away from home” is not farfetched as a description of the British-Swedish relationship.

Of course the old stereotype of the Viking does not apply to modern Scandinavia, even if beards seem quite “a la mode” in Sweden – especially in the more trendy parts of Stockholm – I promise there are no horned helmets in sight. Let’s not forget though that the ancient Vikings were great traders in their time, while the modern Vikings in their turn are international-relationship-building professionals with a positive attitude and a global outlook. Exporting to Sweden is more attractive than ever and I would encourage British companies to read the February 2 edition of the Economist and to look for opportunities in Sweden. 

I believe that there is an analogy to be made between exporting to new markets and skating in the Run of the Vikings – you need to combine courage and determination with a good sense of direction and a “can do” attitude, something entrepreneurs already know all too well. 

To sum up, I bid British entrepreneurs “Welcome to Sweden”, to run with the modern Vikings – with or without skates!

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So, 2013 is finally here, its arrival marked with fireworks, confetti and celebrations. 

These days, “Ringing in the New Year” certainly has a double meaning. The internet and the networked society are here to stay, but the most recent developments are not about more computers or servers being connected to the internet, or about the internet being integrated into more gadgets and solutions – at least not only about that. To me, the biggest change in 2012-13 is about the network society becoming even more wireless. So the “ringing” will not only be about big bells this year, but also about our telephones that used to “ring”. These days, many phones are smart and can make all kinds of noises – chiming, barking and riffing – while we are chatting, tweeting, paying for things and interacting over the internet. The network is drifting on to our mobile phones and tablets in a BIG way. The mobile phone – that we fantasised a couple of years ago would become a multimedia machine – did not only become this, but a smart multimedia machine integrated with the rest of the world – and basically an extension of ourselves.

During the autumn I visited the SIME London 2012 event co-founded by Ericsson and got the opportunity to get inspired by both present and future possibilities. It was lovely to participate in an event with so many British and Swedish hi-tech people, ideas and innovations. 

Jon Mew from IAB spoke about how the vast majority of people in the UK are already online. The internet is of course already an integral part of British society. As much as 81% of the UK’s population of about 63 million people are already online. So that’s around 51 million people and the number is increasing. He also talked about how online advertising spending now dominates the media spend, as advertising spend is usually targeted to where the users are. 

But most importantly he talked about how smartphones and tablets are changing our behaviour. All told, 58% of the mobile phone users in the UK are using smartphones, while only 42% still use a feature phone. And the number of smartphone users is likely to increase rapidly in 2013. Again, this of course means that the advertising spend will not only follow the users online, but also on to the smartphones.

This basically means two different things to me at the moment. Looking at the UK as an ICT investment destination, it looks very favourable indeed for foreign (i.e. Swedish) companies. Not only does it mean that the £2.6 billion online ad market is growing, changing and developing according to IAB, which is a brilliant market opportunity for Swedish companies. It also means that all supporting ICT opportunities are growing and I find the continuing (and future) collaboration between Swedish and British companies to be laced with potential.

But the UK and Sweden going wireless also means a lot of changing behaviours and interesting new solutions. Skype will celebrate 10 years in 2013 – I have a hard time even remembering the times before Skype existed. Change happens so fast and it opens all different kind of possibilities. According to a Boston Consulting Group study published in 2012, more than 80% of Americans would rather give up chocolate for a year than give up the internet, while around 70% would rather abstain from coffee than the web. The internet is getting to be a wireless, integrated necessity of life and I have great expectations for 2013.

Lets Riff in the New Year with all of its ICT possibilities.

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Tonight is the big night.

I have always been interested in business. Before going to university I had a couple of minutes of agony – thinking that I might instead attend theatre school – but I never felt confident enough in my acting ability to chose that line of work.

Having said that, I have always had great admiration for those with extraordinary talents in arts and sports. My father, a marine archaeologist, was a good example of someone who managed to turn his passion into his life’s work and who very much enjoyed his job. The arts and sports are like the cherry on life’s cake. The fun stuff professionally just meant for the bold and beautiful.

And today, one of the absolute most important sporting events in the world opens in the UK – London 2012. At 9pm BST, the Queen will open the Olympiad in London during a spectacular opening ceremony. The preparations have been long, the expectations are high and the weather – well, we are keeping our fingers crossed.

I am particularly keen on following the football. The Euro 2012 was a great start of the summer and I will most probably not miss a single game in the Olympic football – men’s or women’s. But not “only” the sports are celebrated during the coming weeks.

We are also taking the opportunity to make this global sports fete into a time where we jubilate international business and trade.

We are gathering 4,000 world leaders, policy makers and investors in London for something called the Global Investment Conference and the British Business Embassy – a series of global business summits being held in London to celebrate international trade and investments and to showcase the UK during the Olympic and Paralympic Games. We hope this will be a magnificent opportunity for people to meet, develop further expertise within their business sector, and promote increased trade and globalisation.

At the same time, we have prepared tirelessly and plan to announce £1 billion in trade and investment deals this summer, as businesses capitalise on the Olympics.

Or, as Business Secretary Vince Cable put it, “In these difficult economic times we also need to redouble global efforts to build a genuinely open and competitive international trading environment.” I would say that this is one of the best times to do so – to boost business with an incredible sports celebration.

Let the games begin!

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When I was a child I had a plan. I wanted to become an inventor. The main invention I was aiming for was to create flying French fries. I thought it would be awfully handy if fried potatoes could just come flying on demand.

Flying French fries sound quite imaginative and while we have mastered flying and can certainly make excellent French fries (do I dare to mention the national British treat – fish & chips), the achievement of making them leave the plate by themselves remains to be realised.

However, looking back at the last decade, other pretty outlandish products and new behavioural norms have developed. The internet, for example, has fundamentally changed the way we work, communicate, read news and consume entertainment. We now all have the potential to be managers and publishers of online content. We talk about the Communications Revolution and a Digital Economy. According to a McKinsey study, during the last five years, the internet has contributed to GDP growth in the G8 countries with as much as 20% of total economic growth. And the numbers seem to be increasing.

With new inventions we do not only get new behaviour, but often also a shifting of processes and business models. Change is essential for development, but the complexity of the changes presents challenges for both regulators and companies. 

In the UK, we have great focus on growing our economy and are very keen on being able to capitalise on the digital growth spurt, both within the UK and even more so in an international context. We have been looking at opportunities to strengthen our offering in the digital sector and ways to cooperate within the EU, for example. At the same time, we have realised that in order to be able to succeed, we need to wholeheartedly address the new complexity and the changes that the Digital Economy brings.

Analysing the basic needs for digital growth, we have come to the conclusion that we might need to review the use of intellectual property (IP). IP law is basically a way to safeguard a creator’s ownership of achievements and inventions and give the creator the ability to profit from his efforts. Good and well known examples of IP are copyright, trademarks and patents. However, IP is solidly based on the “old economy” and thus the question arose about whether it also was properly applicable for the Digital Economy?

In 2010, our PM David Cameron commissioned Professor Ian Hargreaves to head an independent review into how the international property framework might support growth and innovation in the Digital Economy. In 2011, Professor Hargreaves published the well received Hargreaves Review – or as it is officially called “Digital Opportunity – A Review of Intellectual Property and Growth”. The report outlined ten different suggestions to improve the IP framework, in order to tackle the new digital challenges. The suggestions included creating an efficient digital copyright licensing system, with exceptions in copyright which could encourage successful new digital technology businesses. It further recommended the government to craft a more agile patent system and to refresh the institutional governance of the UK’s IP system. The impact of all the suggestions was calculated to amount to an increase in GDP growth of 0.3-0.6%. 

UKTI in Sweden recently co-sponsored an event addressing just these issues. We invited Professor Hargreaves to Stockholm to talk about his views and recommendations in the Swedish parliament to a distinguished audience of regulators and business representatives. It was very interesting to listen to his analysis and recommendations, but what was made abundantly clear was that the issue is certainly not “British-only”, but a matter we need to address in Sweden and in other parts of Europe. Even if Sweden has fairly modern copyright regulation (by international standards), we need to join forces in the expanding network economy. Or as Professor Hargreaves put it so well: “Europe needs a united context that will grow the world economy – stimulate creativity while giving the rules for an open market.”

I can’t help hoping that Professor Hargreaves’ thoughts will get more European attention, because a networked economy with extensive trade and investments is never local and we all need growing economies and expanded horizons.

And as for the French fries – there may well come a day when even getting them flying is possible, but until then I will happily keep using my fork.

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