A technology explosion is underway and some countries are riding this new digital wave better than others. Ramesh Shanmuganathan weighs the significance of what’s happening and discusses how Sri Lanka can avoid being left behind
The technology explosion in many counties is digitizing services and helping build an astonishing array of new products that are transforming economies and the lives of people. Some cities have taken a lead in this transformation from San Francisco in the US to Tallinn in Estonia and Tel Aviv in Israel, the technology leaders come from countries in varied stages of development.
The internet has made technology products and services to be delivered and used almost anywhere in the world. It’s also now cheaper and easier for launch tech products and scale due to the availability of open source software, the cloud and easy to learn programming frameworks. Almost no technology needs to be built from scratch and successful products now use information from the big platforms or piggyback on them to success.
The digital frenzy has transformed countries and cities. However, success isn’t automatic says Ramesh Shanmuganathan, one of Sri Lanka’s top tech though leaders. Shanmuganathan is an Executive Vice President and Group CIO at John Keells Holdings (JKH), Sri Lanka’s largest company, founded 150 years ago. He is also Chief Executive of John Keells IT, a boutique consultancy and services organization which is well poised to simplify and transform businesses for the digital era.
In an interview, Shanmuganathan discussed how Sri Lanka can be positioned to as an attractive destination in the region for technology investment.
Why should Sri Lanka focus on positioning itself as an investment destination for technology, similar to Singapore or Dubai? In your view, what is the opportunity cost for not doing so?
Sri Lanka’s ‘Vision 2025’ seeks to boost economic growth and position the island as a hub in the Indian Ocean. The cornerstones of this vision are a knowledge-based, highly competitive, social market economy. It’s identified several targets including raising per capita income to $5,000, creating one million new jobs, increasing foreign direct investment to $5 billion a year, and doubling exports to $20 billion per year during the next five years.
Currently, almost 60% of Sri Lanka’s GDP is generated by services, 27% in industries and 7% in agriculture. Given that our domestic market size is limited, we need to be clear about how we are going to grow to realize our Vision 2025. So, the only way to grow our market and the reach for our products and services is to go beyond the shores of Sri Lanka.
There is a second aspect to this, and that’s what’s happening in today’s global digital landscape. When you consider the two it becomes obvious that to realize her Vision 2025, Sri Lanka has to advance her technology and digital maturity in all her areas of economic activity to be competitive and to grow global market share. This means, what we call, Sri Lanka’s technology or digital quotient must be on trajectory to be on par with those we compete against, like India, Singapore, Dubai, Malaysia, Thailand, Indonesia or the Philippines, to attract investment and grow.
The best and fastest way to accelerate our technology and digital maturity is to attract investment from multinational corporations (MNCs) as well as other global players to setup their innovation, incubation, R&D and off-shore facilities here. We should aggressively market our advantages like,
- The excellent enabling environment including, geographic location, investor neutrality or friendliness, good infrastructure both physical and ICT from a regional context, great healthcare facilities from a regional context, stable economic outlook, low corporate tax as well as incentives for FDIs
- Our human capital like the high literacy rate, language competency, cosmopolitan culture in the cities, diverse skills, trainable, young and highly motivated workforce.
- Access to markets as we are well positioned both physically and digitally
- Our ability to leverage the eco-systems due to where it’s positioned geographically between India and China as well as digitally across the globe.
Today, technology is a major enabler for any country’s growth. If we are serious about realising our Vision 2025, then we must get our technology strategy for the country right else we run the risk of our vision being just a pipe dream.
How does Sri Lanka build itself as a technology hub? Sri Lanka is home to some world-beating tech companies (Virtusa, MIT now part of LSEG, and others). But what are the gaps inhibiting the country from becoming a regional tech powerhouse?
Sri Lanka must understand her strengths and weaknesses and the role technology can play to bridge any gaps. We can always boast of having successful global companies with links to Sri Lanka or Sri Lankans. But the reality is, that success does not truly reflect how well we have executed a structured and cohesive strategy to position Sri Lanka as a technology hub. In a way, the success of these companies amplifies the opportunity and potential that we have. A more cohesive and structured approach involving all stakeholders can broad base this success.
First, Sri Lanka must have a five-year program with the buy-in of all stakeholders. It must include all key stakeholders such as government, institutions of policy makers and regulators, business chambers, educational institutions, private sector, industry associations, and investors.
Secondly, we must establish a framework to build a sustainable, unique value proposition for Sri Lanka as a technology hub. That should include clarity about the areas we choose to focus on to build a sustainable strategy and talent pool.
Third, we must be very clear of the core areas of our investments. Our big bets should be on building products and services around what’s called the 3rd platform (social media, mobility, advanced analytics, artificial intelligence, internet of things, big data, augmented reality, blockchain, robotic process automation) as well as in a Anything as a Services (XaaS) proposition focused on emerging needs on security, automation, infrastructure, identity, data analytics, etcetera. There are plentiful opportunities to reach any market with a go-to-market (GTM) strategy, in these areas.
Forth, we must attract MNC, GTM partners as well as other global players to boost Sri Lanka’s brand as well as to extend our products and services to markets they already operate in. We must launch a comprehensive co-innovation program in areas that we want them to invest in and in line with Sri Lanka’s digital vision.
SLAASCOM visions to position Sri Lanka as the ‘Island of Ingenuity’ envisions a $5B industry by 2025, creating 200,000 high-skilled jobs, and 1,000 tech startups. Can you comment on this? And in your view, what needs to be done to realise these goals, or even do better?
Every other country in the region and globally is competing with us to establish themselves as a technology or digital hub, and most are ahead by significant strides. So our strategy must be somewhat nuanced. I think we must position ourselves understanding our strengths, weaknesses and limitations, and then back a sustainable program to achieve what we want.
It’s my view that we should position ourselves as a Tier-2 Hub for innovation, R&D, as well as business continuity centres for global players and MNCs whilst chartering our way forward as product/services providers in the 3rd Platform as well as XaaS. This needs a very coherent and coordinated strategy and execution from stakeholders.
SLASSCOM has done great with the ‘Island of Ingenuity’ positioning and slogan for Sri Lanka. But a country’s positioning strategy is only a hygiene factor. By itself it’s not a differentiator. To achieve that we may have to step up our efforts to establish brand attributes that are consistent and coherent in how others perceive the brand, ‘Sri Lanka’. It must unify the ‘Sri Lanka’ brand first, and then, differentiate our value propositions for the various industries.
That’s all easier said than done and that’s why we need a broader buy-in of the vision, strategy and objectives and a critical mass of stakeholder participation. That’s currently lacking for us to achieve the grandiose vision we’ve set for ourselves. SLASSCOM alone will not be able or expected to achieve the goal by itself of putting Sri Lanka on the map as a technology powerhouse. We must learn from countries that have gone beyond their vision and branding slogans to realise the greater potential of being such a technology hub. Good examples are Singapore, Dubai, Malaysia, Ireland, Israel, Canada and Estonia.
Consider how Dubai has established itself as a powerhouse in tech within a short span. They have a very top down approach for driving the growth polar opposite to the Silicon Valley approach, which was bottom up. Sri Lanka needs a hybrid given where we are at this juncture. Dubai has embraced a program fueling tech adoption and to attract investments. One of the components of that programme is Smart Dubai 2021 which had a clear vision and the following objectives…
- A smart, livable and resilient digital city
- Connected, lean government.
- A globally competitive economy powered by disruptive technologies
- An interconnected society with easily accessible social services.
- Smooth transport provided by autonomous and shared mobility solutions.
- A clean environment via cutting-edge ICT Innovations.
The program helped them to attract investment, talent, resources and helped them build the eco-system to establish themselves as a tech hub. This program was driven by the Smart Dubai Office (SDO) under the guidance of his Highness Sheikh Mohammed bin Rashid Al Maktoum and staffed by experts.
The SDO was mandated to work with various stakeholders in an inclusive and collaborative way to steer the program through targeted strategy, policy, technology, and data interventions. They had identified 42 strategic and 58 additional globally benchmarked KPIs which helped them track progress. That’s what it takes, and nothing less.
Sri Lanka must unify all its stakeholders under single, coordinated program with clearly identified objectives, strategies and KPIs with clear accountability to achieve them as well if want to put the island on the digital map.
What are the next steps needed to attract global tech firms to operate from Sri Lanka, and also to help startups thrive and reach global markets?
Firstly, as I had mentioned, it’s important to brand Sri Lanka as a digital, tech and startup destination. This also means that you need to have the thought-leadership as well as investments in research and development in emerging areas of the 3rd platform and products and services around it.
One way to attract investments would be to setup technology parks with attractive investment packages to attract global companies to locate their Innovation centres and R&D facilities here and, in the process, nurture the extended eco-systems of education and training to build a sustainable program for the country similar to Dubai, Singapore, Barcelona or Malaysia.
Secondly, this needs to be augmented by the ability to attract the extended eco-system of customers, suppliers, partners through forward thinking themed events similar to what Singapore, Dubai and Barcelona are now doing with CommunicAsia, Gitex and Mobile World respectively. But these need to be consistent with how we want to position ourselves and whom we want to attract.
Thirdly, we need to have consistent policy on FDIs so that companies feel comfortable to invest here for the long term. Today, this remains one of the biggest stigmas for any investor.
Fourthly, we must propel a SMART Sri Lanka strategy similar to Singapore, Dubai and Barcelona to create a sustainable eco-system, so anyone be they an investor, an entrepreneur, an employee, a supplier or a developer sees the potential here.
If everything falls into place then whether you are a start-up or a mature player, you will have a ready, eco-system here to plug into.
How do you develop enough talent and upscale skills? Is there a case for easy migration policies to attract foreign professionals?
This will always be a challenge, if we don’t look beyond the horizon and decide for ourselves – what is it that we really want for Sri Lanka? We can’t be a populist and make that shift. We need to acknowledge facts as they are. If we really want to position Sri Lanka as a global tech hub we need to attract the best people. That’s critical for success.
Clearly places like Singapore, Dubai, Malaysia, and Barcelona have succeeded in positioning themselves as global tech hubs because they attracted the best people. Further, we must encourage investments in private universities and research facilities to better access talent and, in the process, attract the best students from across the region to the country to create the talent pool we need.
We must apricate the global context and act in a manner to solve evolving challenges. Dubai’s recent announcement of a five-year visa for anyone with employment with minimum US$ 5,000 a monthly salary from anywhere in the world is one such step we can implement ourselves. We have to be confident about ourselves to compete in an open world and an open economy. Protectionism will never fuel competitiveness nor create sustainable value for any nation.
CLEARLY PLACES LIKE SINGAPORE, DUBAI, MALAYSIA AND BARCELONA HAVE SUCCEEDED IN POSITIONING THEMSELVES AS GLOBAL TECH HUBS BECAUSE THEY ATTRACTED THE BEST PEOPLE