dynamo north east research project 2014 - policy findings and recommendations
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Dynamo North East research project - policy
findings & recommendations
Just get in touch. We'll work it out!
Headlines:
1. Bigger than expected enterprise IT cluster
2. Hidden gem at tipping point for fast-forward growth
3. Local IT economy actively seeks assistance with collaboration, new business
development, and recruitment
4. Dynamo North East can create real value as a rallying point to make this happen
Executive summaryNorth East England is fortunate to have an unrecognised source of future jobs and a
foundation stone for future prosperity - enterprise IT. This research and the work of Dynamo
North East aims to further test our hypothesis and provide a rallying-point for future work to
build on hard-won successes to date.
We present the results of our survey, a sample of local IT players, which creates for the first
time an understanding of the IT economy in the Region. We present various estimates for IT
and Communications jobs here, which are as high as 32,000. These numbers are set in the
context of official statistics for these segments of our national economy, along withcomparators from other high profile industries locally, and comparable professional services
sectors. We estimate 1500 job vacancies in IT, with the potential for up to 2000 opportunities.
We present an analysis of these findings, summarise with our conclusions, and suggests
pragmatic next steps to be considered by the Dynamo Board, local industry players, and
wider stakeholders. Key to this is the establishment of a Dynamo membership organisation,
run by a skeleton staff who will assist with collaboration, finding new staff, and helping
members win new business.
We propose that Dynamo will also coordinate activities in schools organise networkingevents and answer ad-hoc queries and enquiries -- whilst working closely with existing
players in adjacent markets. Further work could include providing assistance for inward
investment and business dating services to bring together providers to work on larger new
business opportunities.
When we started this research, we had 300+ contacts on our database. We have since
grown it to 800+ key contacts and we believe we're only part way through a job of work our
hunch is that there are still significant number of IT experts working as employees in
organisations whose main objectives are only supported by technology -- rather than being its
main focus.
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These people are also part of the North East IT economy: if we can successfully create a
deep and liquid pool of IT expertise and grow the IT 'pie', then we all gain. Moving from a
situation where individuals are 'cannibalised' from a limited reservoir, to one which we add to
homegrown talent and combine with those we attract from afar will help rocket-boost our
existing success stories, and provide the building blocks for new ones.
A big thank you to research sponsors, Sage
We would like to thank Sage, our Dynamo 14 Event Partner, for supporting this research to
help define the North East England IT economy.
Thank you also to our survey respondents
In God we trust, the rest must bring data - God hasnt filled out our survey [ok, He could be
spoofing someone else], but lots of other people have. Were really grateful to them.
Quotes
This document is leavened with quotes from our survey correspondents, answering ourquestions What can Dynamo NE help you with? and What else would you like to
contribute?. We hope these give you a flavour of our successes and can-do attitude.
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IndexRecruitment & Driving profile of region for new staff
Executive summary
A big thank you to research sponsors, Sage
Thank you also to our survey respondents
Quotes
Index
Contacts
Chairman
Vice Chairman
Press contact
Digital
Introduction
Why Dynamo? Thinking and backstory behind Dynamo North East
Whats Next?
Document structure
Sector overview
Evidence of a boom? Foundations for further success?
Diversity
Sector mapping a snapshot of the North East IT economy
Key research findings
Quantitative insight
Headquartered here?What kind of organisation are you?
What can Dynamo NE help you with?
Where are your Customers?
Customer Vertical sector
Top three customers
Clusters of customers
Qualitative insight
What can Dynamo help you with?
What else would you like to add?
Potential growth of the NE IT economySustainability
Code Clubs and Girl Geeks
Direct, and Indirect
Business dating
Numbers of Vacancies
Analysis
Industry-led
IT cluster-in-the-making
Skills: fixing our education pipeline
Working to fix our jobs pipelineGrowing the pie and the Boulder Hypothesis
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Conclusion / summary
Implications for regional IT cluster
Impacts/actions/conclusions for Dynamo's service/model/response
What next?
Timescales
Appendix
Methodology
Dynamo survey
ONS dataset
Social Study 2013 -- The Economic Impact of BT in the United Kingdom
Our working
North East Key Points
Across the North East...
Board Biographies
John Hunt
Charlie Hoult (Chair)
Stuart Lynn
Anthony McMenzie
Mike OBrien
Bob Paton (Vice Chair)
Paul Watson
The Boulder Thesis
Contacts
Chairman
Charlie Hoult - [email protected]| 07973 163784
Vice Chairman
Bob Paton - [email protected] | 07770 634447
Press contact
Sarah Hall - [email protected]| 07702 162704
http://twitter.com/dynamonortheast
http://www.dynamonortheast.co.uk
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Introduction
Demonstrate that there are excellent IT capabilities in the North East and that end
users don't need to look south for the best service in the UK - in fact we deliver some of
the highest quality capabilities in the market
Headlines:
1. Dynamo is an industry-led initiative to firstly, Define, and then Grow - the North Ea
IT Economy founded by local IT business people and a University academic
2. This report aims to back up our hypothesis about a hidden capability in enterprise
IT
3. This report presents the results of our recent survey, set in a wider economic
context, and offers suggestions about pragmatic next steps
Why Dynamo? Thinking and backstory behind Dynamo North East
Take the managing director of Accenture in Newcastle, Bob Paton, and combine him (if thats
possible) with Charlie Hoult -- scion of a family with a substantial property business in the
east of the city -- who had recently returned home to the Region after building a technology
marketing business in London.
Add a shared hunch that North East England was not giving itself credit for a hidden
capability in enterprise IT mix in commercial focus and add informal conversations at the1
school gate together with Bobs passion for developing the Regions future champions of IT
and you have the foundations of Dynamo North East, an IT cluster-in-the-making.
Initial activities brought together a Board (detailed in the Appendix), which has given rise to
this research and our inaugural conference on May 1st in Newcastle upon Tyne. Dynamo has
four streams of activity:
Be a focal point for regional IT growth
Promote our region externally
Develop skills and education
Support regional research and development
Why now, why this report: Defining the North East IT EconomyWe have all shared the experience of the recent economic downturn. 2014 has fortunately
brought increased economic and business confidence, and a desire to act on previous
thoughts of what next?. Dynamo seeks to capitalise on this moment, and also on the
insights gained over the last eighteen months of preparatory work by the Dynamo founders.
1Enterprise IT is hardware and software designed to meet the demands of a large organization, including
greater requirements for availability, compatibility, reliability, scalability, performance and security, among
other things. We use enterprise IT to mean a broad swathe of software and services (cloud computing,healthcare and industrial control systems) cf
http://searchcio.techtarget.com/definition/enterprise-IT-enterprise-class-IT
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The goals of this report are reflected in the strapline, Defining the North East IT Economy --
to put the flesh on the unifying vision of Dynamo, which is Growing the North East IT
Economy [our emphasis]. We encourage readers to consider afresh a quiet success story,
and what it means for prosperity, local planning, and inward investment decisions for the
Region, and further afield. Now is the time to step up to the challenge of delivering on our
streams of activity.
This report is offered as a benchmark for future activity, in the knowledge of the hard but fun
work to be done to continually define and grow the enterprise IT capability in the Region.
Whats Next?
So, what would Dynamo need to do and become, to deliver value to its membership and
wider stakeholders to make a difference to the lives of local people to build even greater
innovation so that we become recognised for excellence and become a magnet for inward
investment and high calibre people.
Even if what gets measured gets managed is an imperfect goal, our present lack of visibility
is arguably far worse with a longer-term time horizon and goals, we are confident that -- by
bringing people together around a shared vision that attracts passionate support from across
the local IT spectrum -- we can build something we can all be proud of.
Document structure
We set the wider context through a pen-portrait of the NE IT economy
Present our findings from our online survey both in graphs and in quotations
Set out our computations of growth opportunities and associated reflections
Provide an analysis of these findings, combined with insights gathered during the
survey process
Draw these strands together in a conclusion, and propose pragmatic steps forward
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Sector overview
Regional Pride - we have a very healthy IT delivery and support capability in the
region. Would be good to expose and share that.
Headlines:
1. The North East has a wide and diverse IT capability spread over IT, digital, and
University sectors, with a long-established track record. Examples are provided.
2. Increasing business is being won outside the Region and overseas
3. A 2x2 matrix is provided to give a feel to the players in our space
Many people come to consider North East England in a new light when they learn of the
sheer diversity, scope, and quiet success that characterises our IT economy. Our data tell us
there are 32,000 ICT jobs in the Region, and the potential for up to 2,000 more -- one majorglobal IT player alone contributing 2,500 heads averaging 35k p.a., on career paths of
growth and dynamic prospects. BTs regional impact study claims 4,100 staff live in the
region. Please see the Appendix for details of our methodology.
The local IT ecology has a good distribution of firms from large, medium and small
including representation from global IT firms, through stable mid-size firms (100-200
headcount), as well as small firms (20-50 headcount), and a lively start-up scene.
Undoubtedly a strength of the regions cluster which elevates it above other UK regions is the
density of government work through DWP, HMRC, NHS BSA and other agencies. These
firms have a support eco-system which has been running for 40 years and has spawned askilled workforce.
The North East is also known as a branch plant economy. Some of the manufacturing base
of old has morphed into global shared service centres including call centres which now
operate multi-channel (highly tech) comms centres. So, a tour of the business parks will
identify P&G, Tesco Bank, Balfour Beattie, RightMove, British Airways, Convergys, Sitel and
other corporates that operate significant IT teams in the region.
IT Systems Integrators serve the most successful global businesses from here, as well as
major Public Sector accounts supporting the UKs defence, healthcare, and pensions
systems. HP, Capgemini, Accenture, Fujitsu, Capita, Sapient and Atos all have fast-growingfootprints, and share our stage along with dynamic young disrupters and established
mid-market players.
Sage is a leading supplier of business software to 6.3m businesses worldwide, with more
than 13,000 employees, group turnover of 1.4bn, and UK revenues of 248.1m. Sage is a
fantastic North East startup success story of 30 years standing with its headquarters just
north of Newcastle including 1400 staff on site.
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Evidence of a boom? Foundations for further success?
Collaboration, Training and retention of staff in the North East
Why has this sector not come to the attention of policy-makers in the past? We suspect this
is because the growth in the sector has meant that many of these firms are self-financing
after start-up and this growth has been so strong that the management are focused on
delivery rather than profile-raising.
There are many examples of mid-sized firms, often owner-managed, in the region.
Mi-Cases software underpins a multi-agency/institutional approach to offender management,
correctional services, drug and alcohol abuse, policing, probation, healthcare and the court
system. Orchard Systems is the UK's leading independent provider of specialist software
solutions to the public and social housing sectors, and is one of the North-Easts
fastest-growing private businesses. Scott Logic develops software for capital markets,energy trading, e-trading, healthcare, oil & gas, and the public sector.
Smith Electric Vehicles manufactures zero-emission commercial electric vehicles,
employing 50 IT staff at Birtley, who create and maintain real-time telematics software and
infrastructure which monitors electric vehicle performance across the globe. Dontyne
Systems offers software and services aimed at the optimum production of gear components
and their use in the transmission industry.
Diversity
In the digital space, Palringo is a group chat app for desktop and mobile, whose audiencesend 50 to 60 billion messages a month to a global audience of 25 million users. Bede
Gaming, employing 50 staff, is a leading supplier of software to the online gambling and
social gaming industries the Performance Horizon Group empowers global brands,
agencies and publishers to optimize and take control of their performance marketing
campaigns. PHG was founded by the team who created, grew, and sold the buy.at Affiliate
Marketing Network to AOL in 2008.
Startups in the region cluster around Ignite100 in Newcastle, which operates accelerator
programmes for digital startups in their custom incubator space. Alumni include ScreachTV,
which allows venue owners to publish rich-media, ads and real-time experiences to screens:its a global market worth over 30bn p.a and ScreachTV have so far played over 100m
pieces of content on their network.
Our mobile developers include Gospelware, who created an app which allows US
paramedics to instantly record patient injuries and their details at the scene of an accident
and share it with doctors - thus preparing them for the patients arrival at hospital. Digital
Sparks data collection and performance monitoring platform gives UK doctors, nurses and
admin staff vital information on patients who have suffered a stroke by charting their progress
and rehabilitation needs using iPads and tablets, and generating sales of around 400k for
the year ending March 2013.
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These vibrant success stories give rise to policy issues such as talent recruitment / retention
and immigration into the Region, either through mature hires or graduate retention. Were
addressing this through an cluster-in-the-making called Dynamo North East, made up of IT
employers, technology hubs, education, local government and employer support initiatives.
Sector mapping a snapshot of the North East IT economy
Experience of world-class IT development. Experience of taking an idea, building a
product, achieving sales around the world and winning customers away from the Silicon
Valley big names.
The chart below is our best effort to create a picture of the local players we know about. It
includes services providers and end users, the colours representing different types of
players.
We have created our own ranking between digital & enterprise (vertical axis), and startup
& established. These are offered only as a rough and initial typology, and so capabilities of
these organisations will be different from our rankings.
This is offered as a basis for discussion, and to help provide a sense of the dynamics in play
here.
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Key research findings
Promote the image and capability of the North East to attract talent and investment to
help deliver future growth.
Headlines:
1. Many respondent companies are headquartered in the Region
2. We have a healthy diversity of competences across the IT spectrum
3. Respondents want to collaborate, win new business, recruit new staff, and big up
the Region
4. They serve local customers, and also work nationally and globally
5. Customers are also diverse. and vertical mini-clusters are apparent
Mindful as we are that our results are a sample, there is greater detail about our online surveyand methodology in the Appendix.
This section is split into two: we have been fortunate to receive both quantitative (numerical)
responses, and also qualitative (information / discursive) responses for our survey
correspondents.
Quantitative insight
Headquartered here?
We are fortunate that we have many senior decision makers resident in our Region. As well
as leading individuals working full time here, we have many North Easterners who live here
and work elsewhere. There is also a thriving North East diaspora to draw upon - and attract
back to the Region.
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What kind of organisation are you?
This pie chart is a representation of responses to this multiple-answer question -
percentages are of the total number of responses, giving an idea of the spread of capabilities
in the Region.
What can Dynamo NE help you with?
Our results show that there is a latent desire and need to collaborate, where at present there
is voluntary activity on a purely ad-hoc basis. Our respondents are looking for dealflow and
new business, and a very keen to develop a more coherent, visible, and dynamic local jobs
market - from apprentices and loyal company workers, through to technical specialists and IT
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leaders of the future. They want help retaining graduates in the Region and creating
opportunities for continuous learning and real-life technical problem-solving skills.
Where are your Customers?
This graph shows the organisations in our sample look for more work on nationwide basis
than local -- and over a third of firms are international in outlook. This offers the possibility that
local businesses can mentor others to succeed more cost-effectively by exporting their
wares outside of the Region.
Customer Vertical sector
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This 'word cloud' is offered to give readers a sense of the broad scope of our capability in the
Region, and to also start looking for patterns where players can collaborate at the same time
when they are competing for business.
Top three customers
Clusters of customers
From this word cloud we can see the following patterns emerging:
Financial Services
Healthcare
Leisure
Central government, Local government,
Education
Construction
Retail and distribution
Hospitality
Automotive and industrial
FMCG
Qualitative insight
This sub-section is drawn from the same pool as other quotes spread around this document.
What can Dynamo help you with?
1. Promotion of benefits of independent testing
Promotion of social enterprises/social impact/social value
2. Collaboration, Training and retention of staff in the North East
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3. News story - Innovation - our startup team's experience was gained in local IT and
web companies.
Mentors - it would be good to network with people who are ahead of us in building a
tech business.
4. Lobby and represent the sector on relevant tech related issues - e.g. roll out andavailability of super fast broadband connectivity in our region
5. Collaboration-Research projects and funding applications i.e. TSB Horizon 20:20
Graduate employment
Student Projects
Student Placements
Graduate Retention
Access to technical expertise, research outputs, training, CPD and new technology
opportunities from the University
What else would you like to add?A. I am keen to play a role in supporting Dynamo and promoting the Tech Sector in
the North East. Particularly in terms of building grass roots skills in both primary and
secondary education and enabling students based in the North East to find jobs on
Graduation.
Similarly I recognize an opportunity to tap into some of the creativity, energy and
innovation the that NE can bring to bear by creating opportunities to help individuals
with an interest in technology build those skills through both learning and being a
practitioner.
B. Have to come and talk at any occasion on what we do in the University and with local
schools with regard to Computing and supporting the changes in the nationalcurriculum
C. The event would be a success if local end users recognise that buying locally is a
great thing to do. It creates jobs here and they get great service.
D. Always happy to be part of any mentoring, networking or regionally focused PR that
highlights and attracts upper quartile jobs and careers in our region
E. Happy to share the skills and experience I/we have gained:
Experience of mass market b-b product development
Customer service, satisfaction and retention
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Potential growth of the NE IT economy
When discussing education options do not just think of University graduates, at the Digital Skills
Academy we produce fantastic talent and a workforce pipeline for employers to inform, mould, and
develop to ensure they get the employees who meet their needs. They can cherry pick from our ready to
recruit students and inform the curriculum of the future to ensure the talent does not dry up.
Headlines:
1. The local IT jobs market doesnt work as well as it needs to - so lets fix it
2. There are hundreds of excellent jobs available - lets work together to match
candidates with life-changing opportunities and grow the pie
3. Employers will work with educators and invest in skills for the future
4. We need to engage schools and encourage diversity
5. Business dating can bring together prime contractors with valued suppliers
6. We estimate 1500 vacancies for good quality, high value jobs
Jobs are understandably a priority for the North East, both individually and at the macro scale
for planning purposes. Indeed, the a recent report from the North East Local Enteprise
Partnership (NE LEP) was entitled "More and better jobs".
Based on survey feedback and anecdotal evidence from our information gathering process,
we are both very positive about the numbers of vacancies, and mindful of the work we need
to do to make our local jobs market as sustainable as possible.
Sustainability
Keep us in the loop of what youre doing, what business needs, and understand our
connections to schools as we try and fix the computing talent pipeline
Dynamo is poised to take the lead in helping match recruiter demand with available
candidates. Employers are seeking a range of skills, and also employees at different stages
in their development and with a mix of personality types.
Employers tell us that they want to work with us to train our young people, and employ them
as apprentices, interns / placement students, and graduates. They actively want to maintain
their investment in our Region by working to grow our own stars of the future, thus widening
and deepening the pool of candidates. They are looking for committed corporate employees,
as well as subject-matter experts, and welcome new thinking and the changes that staff
circulation can bring.
I cant hire enough security and information management people
They already partner with local Universities, although they tell us that they want our
Universities collectively to make it easier for them to recruit graduates. Instead of having to
engage individually with each institution (and thus increase costs and effort involved), they
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are suggesting that Universities consider making the overall process easier by collaborating
with one another (or through Dynamo) for the greater good: that idea of growing the pie
again -- replacing a competitive dynamic which has been perceived.
Code Clubs and Girl Geeks
Starting early and encouraging diversity are going to be key to our efforts. Our research
suggests we must work much harder to engage with our local schools and identify
inspirational teachers to act as our catalysts with their peers. We are exploring Code Clubs
-- a nationwide network of volunteer-led after school coding clubs for children aged 9-11.
We must also recognise that women bring balance and a different mindset to what has been
a male-dominated industry. Again, we must work much harder to nurture and include women
as technologists, whilst acknowledging their massive contribution as project managers, new
business winners, customer relationship developers, and CIOs. We are already engaging
with Girl Geeks, a local organisation which seeks to connect more women with STEM
subjects through activities, programmes and events.
Direct, and Indirect
Come work for us -- and theres an escape hatch
At the same time, employers are looking outside the Region for skills. They realise in order to
attract the right candidates, the whole package needs to work: quality of life is acknowledged
as being high, schools are great -- but the risk of making a family move can be mitigated by
pointing to a liquid market for good alternative opportunities should the one under
consideration not meet expectations on either side.
Business dating
Were using the term business dating to describe a need that larger employers have when
bidding for public sector deals. The Cabinet Office has stated Our ambition is that at least
50% of spend on new government IT flows to SMEs directly and in the supply chain.
We need to connect these large systems integrators with local SME partners to help them
win contracts which they can lead from their North East presence, and from which SMEs
benefit indirectly.
Numbers of Vacancies
We have created an estimate of the potential jobs growth in the Region, based on targets
confided in us by local players, searches of online job boards, and discussions with local IT
recruiters.
1. Global systems integrator - 400
2. Global IT outsourcer and software developer - 100
3. Financial services software developer - 120
4. CIO-level IT consultancy - 50
5. Major Government department - 2006. International digital marketing group - 160
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7. SaaS project management tool provider - 30
8. Software provider for housing sector - 20
9. UK-wide systems integrator - 50
10. Financial services trading platform provider - 20
11. Local systems integrator / software developer - 20
12. Local systems integrator - 30
13. Digital communications agency - 30
This works out at 1230 vacancies were aware of, and were rounding this up to 1500 based
on awareness of an inward investment opportunity of 300 new jobs. That said, when recently
we suggested the figure of 2000 opportunities to a key player locally, he did not demur.
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Analysis
PR and brand recognition is important as we are new in the NE having recently
relocated our head office to Newcastle.
Headlines:
1. Enterprise IT is ready to take prominence as a source of excellent jobs and future
growth for North East England
2. Cooperation, collaboration, and co-opetition is needed between providers, local en
users, schools, recruiters, and the tertiary educators to set us up to thrive
3. Dynamo is industry-led, and welcomes involvement from senior decision-makers
4. We must use our new-found awareness to influence constructively for the good of
all
Industry-led
The IT economy in North England historically has been supported through public sector
initiatives, to create greater cohesion and effectiveness in winning and delivering profitable
business.
These activities has focused mainly on the digital sector, with positive results and excellent
success stories. We are proud of our digital industry, and indeed recent business-led
initiatives indicate emerging leadership and robust customer case studies and a growing
sales funnel.
Dynamo has come together because a growing number of enterprise IT players believe that
working collaboratively will help solve their pressing business challenges. Dynamo has been
funded from their own pockets (e.g. this research), and through our generous sponsors. We
believe this is a sustainable model which can power us to achieve our goals.
IT cluster-in-the-making
Our hypothesis that there is an IT economy of note in the Region has been borne out by
first-hand reports of the hundreds of jobs being provided through global IT and business
process outsourcing deals, paying very favourable salaries and taking advantage of thegraduate skills and quality of life benefits we enjoy in the Region.
These outsourcers are often located near their customers, for example in the fast-moving
consumer goods, chemicals, and the public sectors. Other businesses provide cost-effective
services to customers based in the City of London, or else operate beyond national
boundaries via the Internet.
Skills: fixing our education pipeline
At a recent Information Economy event in London, the Chairman of Thames Valley Berkshire
LEP (TVB LEP) ventured that their 'education pipeline' is broken. This was a surprise, giventhe IT-driven powerhouse that is the M4 corridor. However, this analysis appears to mirror
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much of what has been reported through our survey about our situation here in the North
East.
At the event, we were also fortunate to be addressed by Karen Price OBE, Chief Executive of
e-Skills UK, who introduced us to the Industrial Partnership for Information Economy -
whose website tell us that Employers have developed ambitious plans to drive faster
growth. Bob Paton knows well three of the key players at e-Skills UK, and Sunderland
Software City is already working on the 'Tech Skills Hub' component of this programme.
This is an exciting, if daunting, agenda to pursue. Arguably there needs to be a Dynamo
interest group dedicated to this Develop skills and education work stream, with an agreed
programme plan, budget, governance, deliverables, and goals.
This would probably also involve other activities such as engagement with local e ducators
and different parts of our ecosystem sponsoring ambassadors and role models into schools
through Code Clubs and addressing diversity issues via Girls Geeks - as set out above..
Steve Lamb of TVB LEP expressed willingness to collaborate with Dynamo on this agenda.
There is therefore the potential to coordinate directly, or else through our local LEPs, perhaps
even via The LEP Network.
Ideally, we will therefore use what material and connections we've got, and engage with
industry-wide initiatives so we can be smart with our energies / limited resources. We can
also explore other models of skill acquisition, such as bootcamp courses at Makers Academy
in London, and online courses via platforms such as Coursera, Udacity, Udemy, Skillshare,
or even something like Discoverables.
Working to fix our jobs pipeline
Biggers players report being constrained by the inefficiences of the local job market, and are
aware of their impact on even these existing dynamics by seeking to grow their workforce
rapidly. They are concerend about being perceived as overwhelming competitors and gain an
unwelcome reputation - perhps through factors beyond their control.
Dynamo can take the lead in initiatives to attract and retain good people, and provide a
mechanism through which careers fairs and wider job-canvasing initiatives can be run.
Growing the pie and the Boulder Hypothesis
Being industry-led means we can focus on enterprise IT whilst working closely with existing
digital entrepreneurs to grow our IT economy, and work closely with those who are vital parts
of the wider ecosystem / value chain.
In turn, we can also learn a great deal from our digital brethren: Brad Feld is an entrepreneur
and investor who has played a major part in the thriving startup scene in Boulder, Colorado.
He views this community as a network, rather than a hierarchy, and arguably Dynamo should
focus on creating and nurturing our network.
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http://www.google.com/url?q=http%3A%2F%2Fwww.discoverabl.es%2F&sa=D&sntz=1&usg=AFQjCNGupHTo8QicVSdBdpYkKb2fqRM9fQhttp://www.google.com/url?q=http%3A%2F%2Fwww.skillshare.com%2F&sa=D&sntz=1&usg=AFQjCNGgseKQdrHG-AASUL5MyjS7eX2W-whttps://www.google.com/url?q=https%3A%2F%2Fwww.udemy.com%2F&sa=D&sntz=1&usg=AFQjCNF7vkDavVXgWF8o3jZQlPtIkK08gwhttps://www.google.com/url?q=https%3A%2F%2Fwww.udacity.com%2F&sa=D&sntz=1&usg=AFQjCNFie85tTLegCdahZSNmLGsG9tWGbQhttps://www.google.com/url?q=https%3A%2F%2Fwww.coursera.org%2F&sa=D&sntz=1&usg=AFQjCNHFcjGbVY9IWJEE9VeqgnZnYuOkcwhttp://www.google.com/url?q=http%3A%2F%2Fwww.makersacademy.com%2F&sa=D&sntz=1&usg=AFQjCNHQhzOyJ4OMgx0PkNuOoJDSABDnEQhttp://www.google.com/url?q=http%3A%2F%2Fwww.lepnetwork.org.uk%2F&sa=D&sntz=1&usg=AFQjCNEhruzRC1yMvjTUJKjD1mUg74MF_whttps://groups.google.com/forum/?fromgroups#!forum/northeastenglandcodeclubhttp://www.google.com/url?q=http%3A%2F%2Fwww.techskillspartnership.com%2F&sa=D&sntz=1&usg=AFQjCNHxnbDw6FPuAh4a-ZOzAvg9aaE7Jg -
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Substituting IT for startup, we can adapt Brads four key ingredients to help give us a
balanced approach to our work:
Entrepreneurs as leaders
A long-term view
A philosophy of inclusiveness
Events that engage the entire entrepreneurial stack
More information about the Boulder Thesis is is set out in the Appendix.
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Conclusion / summary
Collaboration! We can specialise in some very complex back-end stuff, and do
databases and APIs in our sleep, and would love to get more involved in taking on
sections of much larger projects. It frustrates me when I talk to people who say, "we
couldn't find anyone local, so went to and they kind of
delivered something that kind of works
Headlines:
1. We are where we are, and we must take bold and timely action to lay our route to
future prosperity
2. Regional / national decision-making needs to take into account what has been
hidden in plain sight
3. Dynamo North East is proposed as an initiative with a skeleton staff to provide a
rallying point and mechanism for the latest demand we have found
Implications for regional IT cluster
Drawing on our research, we believe there is significant capability in the Region - based in
software development infrastructure provision and management digital and taking into
account customer vertical sectors we have identified.
Players in the Region of all types are keen to come together under a common banner and
independent brand which will serve the needs of providers, end users, and the Community at
large - providing a recognisable go to partner to help with inward investment, and answer
incoming enquiries.
Our survey responses indicate that there is a requirement for activities to support the growth
and cohesion of the IT economy in the Region, through networking, new business
development, and collaborative problem-solving
By working together and creating a united story, much value can (and will) be created to
attract the right calibre staff, develop them, and retain skilled graduates in a growing and
self-sustaining pool of talent in the Region
Providers to public sector customers recognise the need to engage with the local SME
ecosystem to procure niche skills on an affordable basis, and in turn SMEs need to
understand and value the opportunities presented by larger contracts providing guidance and
practical assistance to learn from any teething issues will help everyone.
By working together, Dynamo can engage with a single voice with local and National
politicians, administrators, and those responsible for allocating resources and connecting
inward investment to the most appropriate places.
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Impacts/actions/conclusions for Dynamo's service/model/response
An ideas platform.
The networking events work really well and spark several interesting topics of conversation. If there were
'panel' organisations / companies looking for support could be steered in some shape or form.
It's all very informal at the moment which is great but some infrastructure moving forward could aid
things further.
If the HMRC want to establish a 50-strong digital centre of excellence, and global systems
integrators are seeking 50 / 100 / 120 new heads in the next six months, Dynamo should be
there to make it happen.
Calculating Return on Investment on this should be reasonably straightforward - numbers of
new jobs created, percentage retained of first rate school and college leavers / Universitygraduates - not only first rate in terms of intellect, but a balanced workforce of committed
corporate employees, apprentices, rocket scientists, and our leaders of the future.
Dynamo should work with players in the North East (and knowledgeable parties outside of it)
to establish straightforward ways for the sector to collaborate to: attract and retain the right
people to work here to develop skilled and experienced staff and win new business through
local businesses working together.
What next?
Still not quite sure what this is achieving / aiming to achieve (sorry).
We believe the time is ripe for us to recognise what we have achieved in the North East IT
economy, to give credit to the hard work and inspiration which has got us here, and take this
credit as a starting point for future fast-forward phases of growth.
That said, our initial research has shown that we need to knuckle down to make this happen.
The following are our suggestions about how to crystallise and capitalise on what our IT
economy represents.
1. Annual Conferencea. Put on Dynamo 15 etc., based on successes and lessons learned from 2014.
2. Engagement
a. Ongoing public relations activity and public affairs engagement are needed to
generate sustainable momentum, so we can build a cluster backed by
credible success stories for all participants
b. This would also involve ongoing publicity work such as newsletters, monitoring
and interaction online, and so on.
3. Interest groups
a. We will encourage and support the creation and running of interest groups
focusing on topics such as skills, business development, cyber-security, bigdata / data science etc.
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4. Regular events - networking and topic focus
a. We will run monthly events for members networking, and also to focus on
particular topics highlighted by our Interest groups.
5. Careers Fair
a. Organise regular careers fairs with players right across the Regions IT
economy taking part. Although in competition, these organisations realise that
having committed themselves to delivery here, they need to work together to
create a deep and broad jobs pool so the cluster as a whole hits critical mass
and sustainable momentum. That way, everyone wins.
6. Business dating
a. We need to have a better way to identify local service providers. There is no
easy way that we know of at present to identify all of the NE companies that
provide mobile application development services for example.
b. Our plans include evolving our careers fairs to become a showcase of firms
so they might connect partners and win new business. We will also
investigate maintaining a register of local players - perhaps with
commendations so that we can give feedback on performance and
improvement opportunities.
7. London careers outreach
a. Once this integrated approach is presented to the outside world, high-calibre
job candidates can be attracted into the Region, who can see that moving their
families here can be sustained through follow-on opportunities for growth and
other options for similar roles
b. In order to get them here in the first place, Dynamo must engage directly with
candidates on behalf of employers, who are seeking to fill hundreds of
vacancies. Having a neutral banner means that North East employers can be
seen to be working for the community, and help achieve their business goals
at the same time.
8. Dinner / Awards
a. Recognising success is important, and having a canny time doing it is always
a winner. Celebrating our successes, and giving awards to our best and
brightest means they can use it to win new business, and give our future stars
something to aim for.
b. These are also important networking events and chances to have informal
conversation, and opportunities to include loved ones -- further helping
connect together friendships and sustainable businesses
c. We will also develop a Hall of Fame and take our lead from Baseball in
"Preserving History, Honoring Excellence, Connecting Generations."
9. Show & tell
a. By pooling local expertise, insight, and knowledge, we can turn customer
headaches into case studies. We need to draw together by creating an
impartial space to create a pay it forward culture where all help others in the
agreed expectation that they will receive assistance when they need it.
b. Connections with local tech user groups can be deepened and expanded, and
corporate encouragement can be given to complement the work of SMEswhich are already involved.
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10. Research
a. Our stories need to be backed up with research, and it is research which
persuades others to view us favourably.
b. Research gives journalists and policy makers hooks on which to base their
articles and decisions - headlines shape the perceptions of busy people.
c. In 2014, we have started with a clean sheet - future research will build on initial
methodology and rigour, to broaden our coverage and expand the detail and
accuracy of our findings.
11. Advocacy / secretariat
a. Inward investment is crucial to our Region, as is exporting beyond our
borders. We will work with NewcastleGateshead Initiative, the LEPs and other
inward investment bodies to connect interested parties with the most
appropriate contacts.
b. Creating the glue holding this all together will be a Secretariat which will
administer the day-to-day running of Dynamo, and support the founders /
steering group, taking account of representations from across the Regions IT
economy.
12. Membership
a. Membership and sponsorship will provide a mechanism to get practical things
done, track progress, and report to key decision makers.
b. We will implement a cost-effective membership tracking system, which
interoperates with our communications tools, and also take further steps to
safeguard our members contact information and comply with the Data
Protection Act.
13. Measures of success
a. Continue growth of the Region as monitored in research
b. Fill all 2000 vacancies weve computed
c. Change perception of NE as backward to forward
d. Achieve National recognition
e. Develop our focus on enterprise IT
f. Sign up 50 paying members to join Dynamo in our first full year of operation,
and then double that within eighteen months
g. Establish and expand the Dynamo brand, value being delivered, and network
regionally, nationally, and internationally.
TimescalesWe encourage readers to read, mark, and absorb our findings -- and the Board of Dynamo to
work with its stakeholders to take decisive action and create Dynamo by late summer 2014.
Please refer to the document Dynamo North East - next steps, which is offered to stimulate
discussion about our proposed way forward.
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Appendix
Methodology
Our approach has been to conduct our own research, and set it in the context of publiclyavailable data.
Dynamo survey
An in-depth audit of the IT capability in North East England has not been conducted before.
Therefore, we have set out to gain an initial understanding of how things are here, with the
intention to learn from our experiences with this investigation, and review and update our
methodology in future years.
We used an online survey has sought to quantify the size of the
Regions IT economy, and to take its pulse through qualitative insight into the thinking of keyplayers. We have made strenuous efforts to reach IT players in the North East of England --
however we recognise that our responses are a sample of the whole picture.
At the time of writing, we have received 57 responses from a wide variety of service
providers, educators, and end users. The bulk of our respondents have been service
providers, primarily because they are easier to identify and contact. We have been fortunate
to make contact with many public sector IT users, as they are already organised into a trade
body, which is the local Chapter of the Society of Information Technology Management
(Socitm). We recognise that many other organisations have an IT capability, and we will seek
to gather data from them going forward.
Our hypothesis is that our research underestimates the true impact and value to the North
East for a number of reasons.
Firstly, because our survey is a sample (as already mentioned) and our respondents have
mainly been IT companies and public sector / university IT departments.
Secondly, because we believe there are many IT departments in non-tech organisations who
have not be counted -- recording these will be a key aim of future research.
Thirdly, full service delivery to customers requires a rounded capability of service desk, client
engagement, project managers, business analysts and consultants, mobile workforce
management, and so on. Quantifying this whole product will be another ongoing activity,
along with other ways to continually improve our methodology and accuracy of our results.
One financial services software provider employs 1400 people locally, only 450 are classed
at Tech headcount.
ONS dataset
As part of the 'Annual Return' which companies send to Companies House, they are asked to
classify themselves according to a Standard Industrial Classification (SIC) code -- and are
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able to choose multiple options, according to their capabilities. Sole traders are not included
in this classification, which would exclude some otherwise valuable capabilities.
Based on our focus of IT and communications businesses, we have chosen the SIC codes
62 and 63:
1. 62 - Computer programming, consultancy and related activities
2. 63 - Data processing, hosting and related activities web portals
We are fortunate to have the appropriate access to the 2012 dataset, which tells us that there
are 13,400 heads for SIC codes 62 & 63 in the North East.
It is worthwhile setting this in the context of other major sources of private sector employment
here, such as automotive (#29 - 11,200), chemicals (#20 - 7,600), and pharmaceuticals (#21
- 3,300). Comparable professional services sectors include financial services (#64 & #65 -
18,200), legal and accounting activities (#69 - 16,000), and activities of head offices
management consultancy activities (#70 - 9,400).
As a whole, the North East has a total number of jobs of 1,021,823 in a population of
2,602,300 souls.
Social Study 2013 -- The Economic Impact of BT in the United Kingdom
In their report "Social Study 2013 -- The Economic Impact of BT in the United Kingdom", the
telephone company claims that they employ 1 in every 8 employees working in the IT and
Communications sectors (and that "BTs full employment impact is larger than the regions
civil engineering sector").
http://www.btplc.com/Thegroup/BTUKandWorldwide/BTRegions/England/Factsandfigures/S
ocialStudy.htm
Our working
If 1 in 8 of employees working in North East IT & C sectors works out at 4100 people, and if 1
in 8 = 12.5% then 4100 x 12.5 = 32,800 total employees in IT and Communications in NE
England.
North East Key Points
4,100 - BT employees live in the region (FTE)
4,060 - BT employees work in the region (FTE)
125 million - Total income of BT employees working in the region
88 million - Spend with suppliers based in the region
523 million -Total GVA impact (including indirect and induced effects)
Across the North East...
BT employs 1 in every 140 employees working in the private sector, and 1 in every 8
employees working in the IT and Communications sectors
1 in every 120 of GVA is generated directly by BT
BT supports 1 in every 80 employees working in the private sector and 1 in every
80 of GVA as a result of the firms full economic impact BTs full employment impact is larger than the regions civil engineering sector
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http://www.google.com/url?q=http%3A%2F%2Fwww.btplc.com%2FThegroup%2FBTUKandWorldwide%2FBTRegions%2FEngland%2FFactsandfigures%2FSocialStudy.htm&sa=D&sntz=1&usg=AFQjCNGw_nUtOv2j73CJWW-gcY8F8J6EGghttp://www.google.com/url?q=http%3A%2F%2Fwww.btplc.com%2FThegroup%2FBTUKandWorldwide%2FBTRegions%2FEngland%2FFactsandfigures%2FSocialStudy.htm&sa=D&sntz=1&usg=AFQjCNGw_nUtOv2j73CJWW-gcY8F8J6EGg -
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Board Biographies
From http://www.dynamonortheast.co.uk/bios/
John Hunt
John is a native North Easterner who returned to Newcastle in 2011 to work in his familyssoftware business, Orchard Information Systems. Having started life working in consumer
goods in far flung places such as Nigeria, Malaysia and Indonesia John returned to the UK to
undertake an MBA at London Business School. A two year stint in the city working for
Goldman Sachs followed until the call of the North East became too strong. John is a director
at Orchard with a specific focus on Business Intelligence and Reporting, as well as exploring
international opportunities to expand Orchards geographic reach.
Charlie Hoult (Chair)
Charlie operates as an investor & entrepreneur in the IT industry. He built up his own
marketing agency, Loewy Group, which grew to 400 staff and 50m turnover. He exited in
2009 to take over his family property business in Newcastle.
He has a number of tech interests including Opencast Software
(www.opencastsoftware.com), Futureheads digital recruitment specialists
(www.wearefutureheads.co.uk), Tomorrow People (www.tomorrowpeopletoday.com) and
Hoults Yard (www.houltsyard.co.uk).
Stuart Lynn
Originally qualified as a Mechanical Engineer, Stuart moved into software engineering in 1988
and has held a number of positions across the public and private sectors. Since joining Sage,
one of the great success stories of the North East in 1998, he has held a variety of roles and
is currently the Chief Technology and Information Officer.
Stuart is a native of the North East and is proud about the success of the region. He would
like to see the North East recognised as a centre of excellence for Information technology,
and has a passion for education and skills development.
Anthony McMenzie
Recently taken up a new role with Mi-Case, a Tyneside based provider of case and asset
management software solutions across the globe. A 30 year career in technology has seen
Anthony in sales roles for the worlds largest mobile telecommunications business(Vodafone), largest insurance market (Lloyds) and largest independent integration business
(Dimension Data). Hes spent much of his working life away, including seven years in
Australia, before returning home to his native North East.
Mike OBrien
Currently MD of Opencast Software Limited, formerly Capgemini (VP Capital Markets) &
Strategic Systems Solutions (Chief Sales / Marketing Officer). As part of the Exec Board,
built SSS (specialist Capital Markets SI) from 10 to 800 staff with offices in UK, US, China,
Manila, Singapore
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Mike has a pretty credible client list including Deutsche Bank, JPMorgan, Citi, Credit Suisse,
Morgan Stanley, Nomura, Daiwa, RBS, HSBC, Barclays and Northern Rock.
Bob Paton (Vice Chair)
Bob Paton is Managing Director of the Accenture Delivery Centre in the North East, located at
the Cobalt Business Park, North Tyneside.
Bob has worked for Accenture for twenty one years, during this time he has specialised in the
implementation of large scale IT systems, including managing delivery projects for both
Government and Private Sector clients. Previously he was Operational Director for all
Accenture Outsourcing Units within Europe and South Africa. He is responsible for the
Accenture apprenticeship programme and is a NAS Apprenticeship Ambassador for the
North East.
Prior to joining Accenture Bob spent 20 years as a Civil Servant, 13 of which were spent
working in IT, again mainly on major system implementation and delivery.
Paul Watson
Paul Watson is Professor of Computer Science, and Director of the Digital Institute at
Newcastle University. He graduated with a BSc in Computer Engineering from Manchester
University, followed by a PhD. In the 80s, as a Lecturer at Manchester University, he was a
designer of the Alvey Flagship and Esprit EDS systems. From 1990-5 he worked for ICL as a
system designer of the Goldrush MegaServer parallel database server, which was released
as a product in 1994.
In August 1995 he moved to Newcastle University, where he has been an investigator onresearch projects worth over 40M, almost all in close collaboration with industry. Professor
Watson is a Chartered Engineer and a Fellow of the British Computer Society.
The Boulder Thesis
According to this blog post:
in his book, "Startup Communities," Feld outlines his "Boulder Thesis," a formula for
building what he calls a "sustainable, vibrant startup community anywhere in the
world." [...]
Feld cites four ingredients as essential to startup communities: Entrepreneurs as leaders - Feld divides a startup community into two
groups: Leaders (entrepreneurs) and feeders (everyone else). "The feeders
have very important roles," he says. "They become part of the fabric of the
startup community. But the feeders can't be leaders. The leaders have to be
entrepreneurs."
A long-term view- A successful startup community must be filled with
people who are making a long-term commitment of 20-plus years and are able
to weather the successes and failures of entrepreneurs in the community,
Feld says.
A philosophy of inclusiveness. It takes all kinds of people to make a startup
community. "If everybody contributes energy into the startup community," Feld
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http://www.google.com/url?q=http%3A%2F%2Fwww.amazon.com%2FStartup-Communities-Building-Entrepreneurial-Ecosystem%2Fdp%2F1118441540&sa=D&sntz=1&usg=AFQjCNEzwgeGstCWiDM3jvGfF6vt_Xpy0whttp://www.google.com/url?q=http%3A%2F%2Fwww.siliconprairienews.com%2F2012%2F10%2Fbrad-feld-outlines-boulder-thesis-in-kauffman-sketchbook-video&sa=D&sntz=1&usg=AFQjCNGmCXxjJ-LNhgcSN2g6Iw5Dw9HrIQ -
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says, "it will get bigger and grow faster and be more successful and be more
fun."
Events that engage the entire entrepreneurial stack- Feld cites things
like TechStars and Startup Weekend, which he notes are more substantive
than awards dinners or cocktail parties, as vital to allowing the entire
community to help startups.
"It's just this sort of network chaos of entrepreneurs doing what entrepreneurs do,
which is create things," Feld says in closing. "That force of the entrepreneurs to build
something bigger than just themselves and their company is so incredibly powerful."
http://www.google.com/url?q=http%3A%2F%2Fstartupweekend.org%2F&sa=D&sntz=1&usg=AFQjCNHp287kOYBXix0fvneERvQXFEWQeQhttp://www.google.com/url?q=http%3A%2F%2Fwww.techstars.com%2F&sa=D&sntz=1&usg=AFQjCNEuxr0F8MW_Pmr6f0X7JqgCTNNsaA