Richard Pamatatau: Great economies take time

COMMENT


In a culture of contingency and expedience, great ideas and the opportunities they afford can be lost in the rush to meet short-term goals.

The ardour of the dotcom bubble, a recent embarrassing example of poor thinking, hype and greed from those who were meant to know better, was a salutary example of capital markets out of control.

What was meant to be a departure to a new way of business and capital creation through harnessing technology and telecommunications became a wake-up call that eventually emptied bank balances and humbled some giant egos.

The jobs that were meant to come from this new era failed to materialise and many of those created were temporary and soon vanished.

New Zealand was not immune to this phenomenon and "hi-tech" companies rushed to ride the wave that became known as the "knowledge economy".

It's the rush that is the problem.

Haste allows scant time to reflect and allow the past to inform the present and influence the future, especially in a country which has celebrated the business exploits of people in banking, property, alcohol and construction over those in science, technology and engineering.

Last week Taiwanese computing giant Acer hosted 50 journalists at Aspire Park - the company's US$7 billion ($11 billion) technology, residential and development complex about an hour out of Taipei.

Acer is no small company. Its revenue last year was US$3.2 billion and profit was US$258 million. This year it plans to increase that figure by around US$1 billion as it builds on its position as the leading notebook supplier to Europe.

Aspire Park fits with Taiwan's desire to develop high-tech industrial businesses.

The country is already a leading producer of CD Rom, notebook computer, DVD, Ethernet card and LCD Monitor technology and according to Challenge 2008, its national economic development plan, Taiwan is working towards becoming "a green silicon island".

The almost 200ha park contains an eclectic mix of facilities which Acer co-founder, chairman and chief executive Stan Shih said enabled staff to think clearly about what they were doing.

Manufacturing was done elsewhere.

The park began life as a staff residential complex. Its buildings range from a dormitory block, which houses around 4000 workers, to "housing estates" where people from outside the company can also purchase homes.

A wander through the estate shows that high-density housing does not have to be shonky and can, with the right architectural consideration, be pleasing on the eye.

Shih said the original idea was to create an area where staff could live together but soon after construction began almost 20 years ago he realised that close association of staff in the right environment could be beneficial to the growth of the company and its products.

The most recent development at Aspire Park is the Research Centre, Taiwan's first centre for innovation, research and development established by the private sector.

The centre opened last year and has brought together the various strands of Acer's research. It provides facilities, consultation and services from across the technology sector and fosters IT partnerships and start-ups.

Shih said the investment in the centre was considerable, and while not revealing numbers, said it could only be done because the company was not in a rush and wanted to do things properly.

Acer is not without its faults and has been damaged by the aggressive US PC market. It knows failure.

"It is not for Governments to make this kind of investment, but they have to support it. Governments are very poor at this and only need to make sure the conditions are right," said Shih.

Aspire's primary facilities are a post-incubation centre for a design institute adjoined to the National Chiao Tung University which focuses on analogue and mixed signal designs, Acer Value Labs, where the company's products are researched and a secure data centre that services some of the world's largest organisations.

Shih said it was the association of minds, talent and resources which would allow the company and those associated with it to grow rather than a reliance on government.

Ireland's Shannon Development Corporation is another example of long-term thinking. This 40-year-old company is a leading "Celtic tiger".

Shih may be right. Successive governments in New Zealand have attempted to understand the needs of the high-tech sector but with pressure on them to focus on anything from shorter waiting times for hospital care to solving traffic problems, until recently the high-tech set has almost been ignored.

National's Maurice Williamson is an advocate for high-technology development but his unwavering support of market-led economics has proven the wrong way.

There is no grace or favour in market behaviour. And new National leader Don Brash showed little acumen, but great licence when this year he touted Christchurch's Jade as a fine example of a "creative economy" company.

When asked why he thought this, he said because people said it was. Shame about the bottom line.

Prime Minister Helen Clark has shown an interest in the high-tech area backed by Minister for Information Technology Paul Swain, who is pushing a vision of New Zealand as a world leader in information and communications technology.

The Government wants to help create 100 technology companies each with revenues of $100 million. But the time frame is aggressive. Can New Zealand pull this off in 10 years when some of the greatest technology companies have spent 20 or 30 years gestating?

Perhaps the guest invited to have a go by the man spinning 20 bowls atop bamboo skewers - an example of grace and physics in motion - at a banquet at the Aspire Research Centre summed it up visually when he tried to spin a solitary bowl and failed.

Building a great economy is not about economic acrobatics, or the latest fad, it is about fine thinking and processes steeped in time and nurtured by talent.


* Email Richard Pamatatau

* Richard Pamatatau travelled to Taiwan as a guest of Acer.