Cracking the digital code

Written by: Kirsten Morel Posted: 16/03/2017

Guernsey and Jersey have both nailed their colours to the digital mast – but are they focusing on the right areas or do they need to rethink their technological ambitions?

The Channel Islands have had a stop-start relationship with the global technology industry. Twenty years ago, the tiny island of Alderney (part of the Bailiwick of Guernsey) took the bold step of committing to the tech sector by creating a regulatory regime that would attract the emergent egaming sector. 

Guernsey stepped up its efforts a few years later with legislation that enabled egaming firms to locate their servers in the island. But it would be more than a decade before Jersey joined the digital fray.

Guernsey’s early foray into the tech sector proved successful and by 2012, egaming was responsible for generating 12 per cent of Alderney’s GDP and 1.1 per cent of Guernsey’s. This was also the year that Jersey committed itself to exploring the digital sector. It launched a new agency, Digital Jersey, and created a £5 million Innovation Fund that would, in its own words, help ‘foster growth in digital employment and increase the sector’s local value’. 

After its quick start with egaming, Guernsey held back from committing further until it launched its own hub, the Digital Greenhouse project, ‘to support effective collaboration, co-working, networking and learning to enable successful innovation to thrive in Guernsey’.

Both Digital Jersey and the Digital Greenhouse have chosen to focus on innovation and entrepreneurship as key routes to developing the tech sectors in the islands, an approach that could be described as the Silicon Valley model. 

Fast forward to the current day and the sectors have gained a foothold in the islands. Digital Jersey claims 2,650 people work in the digital industry (excluding teams in financial services businesses). And in Guernsey, which has better historical records on this matter, the figure is 1,054, although this has fallen by 54 since 2012.

The drive for digital has become a key factor in both governments’ economic strategies, but with slow progress and obstacles such as the skills gap set to take years to overcome, the question has to be asked – are the islands making the right choices?

Coding push

In addressing the skills gap, both islands have targeted coding as a skill they want people to learn, in the hope that it will increase local employment and help the islands achieve their aspirations. 

Coding skills are in demand and can be used to create new digital products and services, but a coding course won’t teach its graduates about the wider digital ecosystem. This is seen by some as an oversight, given the islands’ acknowledgment that much of their digital success is likely to be tied to their already existing finance industries.

“We need to train young people in the whole IT environment, not only so they can code properly but also so they’re able to choose the areas to work in which suit them best,” says Chris Langlois, Head of Professional Services at Channel Island communications company Sure. “Unless you understand the foundations as well as the interactions and environment within which the applications are operating, then it’s likely the code won’t work properly, leading to problems.” 

Whilst the islands’ digital strategies do have a strong slant towards innovation, there’s also realism about the make-up of the islands’ digital sectors.“Digital Jersey undertook a skills survey and we’re going to do another,” says Digital Jersey CEO Tony Moretta. “We’ve asked businesses what kind of courses they want us to run, and it’s important to understand that things like our coding programme aren’t about churning out coders but about showing people can be trained and taught new skills.”

In IT terms, the emphasis on coding is a focus on the top of the ‘stack’ – or level seven of the digital environment. The criticism is that the islands are failing to educate people in levels one to six.

Sure focuses on the networks and infrastructure on which businesses are built, so knowledge of coding isn’t the primary requirement when recruiting technical staff. “There are few trained network infrastructure personnel in the market, so we have to resort to bringing people in on licences from outside the islands,” says Langlois.

Drivers for growth

Another reason for looking beyond entrepreneurship and innovation as the key drivers for successful digital sector growth, is the reality that not everyone is cut out to be or wants to be an entrepreneur.

According to the Global Entrepreneurship Monitor, no more than 4.9 per cent of the UK’s adult population are entrepreneurs, similar to the US, which has 4.3 per cent. The fact that no developed nation comes in the top 25 suggests that this is the way it goes for stable, developed economies, and raises questions about how effective any drive to entrepreneurialism can be.

When it comes to growing a business sector, the authorities have to attract existing companies and encourage the creation of new ones. Given the competition between jurisdictions, the lack of existing skills and the islands’ sizes, it’s understandable that Digital Jersey and the Digital Greenhouse could choose entrepreneurship as the way to go. But even then, a successful startup will need a wider range of skills as it grows. 

First Central Group (FCG) is an excellent example of a successful homegrown business that started in Guernsey in 2008. It sells online-only insurance and today employs over 500 people in five locations. 

“Getting coding into the education system is fantastic but we have to enable choice,” says John Davison, Chief Information Officer at FCG. “I’d much rather see a rounded, holistic approach in the education system. Understanding the evolution of the internet helps people to understand where it’s likely to go.”

The fact that digitisation is transforming every aspect of the economy is a challenge for the islands’ digital agencies, making it difficult to focus on a single aspect or sector in order to stimulate growth. In an ideal world, everyone entering the workforce would have some level of digital competency and understanding, but at the moment this isn’t happening.

“We’re teaching development skills [as an island] but we’re not equipping non-technical people with enough technical knowledge to be able to make informed decisions in a technical world,” says Davison. 

“As a professional, I wonder where the business analysts, data architects and other technically aware business roles are coming from.”

At Digital Jersey, Tony Moretta is aware of the bigger picture and is trying to widen the skills training that the agency is able to provide. “We try to balance things out and are trying to offer more than just coding. We’ve been running a digital marketing course, are about to start an iOS app programming course and will be holding a data analytics course later this year. I’d like to see a greater choice of tech education courses.”

Leading by example

Naturally, resources are limited and neither Digital Jersey nor the Digital Greenhouse have education as their sole responsibility, so it falls to firms such as FCG, Sure and C5 Alliance, the Channel Islands’ largest IT company, to provide training that will meet their own business needs.

“We have a group of 10 under-30s in the business, six of whom are embarking on the first stage of their IT careers,” says Ceri Riddett, Head of HR at C5 Alliance. “It takes a leap of faith for the business to accept that junior recruits may take a period of time to have an impact on the bottom line. But it pays off, and is very important due to the limited supply of talent in the islands.”

Interestingly, the recruitment model at C5 has changed over the years, and today the firm could be characterised as being more accessible than it once was. “We’ve been maturing. We were previously very degree driven in our recruitment process, but we’ve been moving away from that and now we have a heavy weighting on attitude,” says Riddett. 

“If you’re highly motivated and can also apply logic to situations, then you’re going to be able to learn.”

In looking at C5’s approach, we can better understand the sector’s drive towards entrepreneurship, by seeing it as a way of thinking rather than just a desire to see vast numbers of people starting up businesses. 

Coding may or may not be useful in helping people achieve this. It certainly doesn’t hurt, but in the same way that we all liked different subjects at school, coding will never be for everyone.

“Digital Jersey are doing an amazing job, but there is scope for them to help people explore what the technology sector has to offer,” says Riddett. “When we visit schools, we don’t talk about coding, we get the students speaking to people from across our business.”

From an economic perspective, the Channel Islands are still feeling their way into the technology-driven world. When you look at the recent collapse of Jersey’s Innovation Fund and the fact that the islands’ tech sectors are intrinsically tied to the financial services industry, then it does become necessary to ask whether digital strategies should engage with holistic models of technology education because the sector’s needs are far wider than coding can provide for.

Whether you look at Sure as a communications company, FCG as an insurance provider or C5 Alliance as a dedicated IT firm that serves all sectors, the reality is that all business is digital. 

By acknowledging this, as Moretta and his team team at Digital Jersey are doing, and by incorporating that assumption into training, then the islands will stand a greater chance of creating the 21st century economies that they so clearly want. 

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