In association with 8×8 Solutions UK, eight SME leaders joined IoD director general Simon Walker to discuss how companies can choose the right technology for their customers
Director general, IoD
Chief executive, 8×8 Solutions UK
Owner director, Bartlett Mitchell
Chairman and co-founder, Omobono
Managing director, Qbic Hotels
Chief executive, Simply Business
Client services director, The Delta Group
Chairman and chief executive, YourCash
Technical and compliance manager, Commercial Maintenance Services UK
SIMON WALKER Welcome everybody. The Institute of Directors was founded more than 100 years ago with a royal charter that commits us to ‘promote the conditions favourable to entrepreneurialism and wealth creation’.
Since then entrepreneurialism has come in many guises and entrepreneurs have had plenty of very different ideas, but the pace of change and the types of business that we see in here have taken on a whole lease of life over the last few years. We know about how quickly the digital revolution took hold, but what we might not always appreciate is that Britain is really leading the world in this area.
Next year the internet economy will account for 12 per cent of British GDP; £1 in every £4 that we spend is spent online in retail – well ahead not just of our European competitors, but also tech giants like the United States, South Korea and Japan, and the impact that’s having on entrepreneurial activities is quite clear. In 2014 there were more than half a million businesses started in Britain. Half of those had start-up capital of less than £2,000. That would have been unimaginable a generation ago. Now starting a business, developing an idea, launching a product is a viable option for millions of people.
But while Britain leads on start-ups, where we can learn from other countries is on scale-ups. America, Canada and Australia are all better at supporting companies as they grow from small to medium to large and create world-leading companies in the process. I don’t particularly want to dwell on what Britain’s doing wrong, but what challenges have you encountered along the way and where do the answers lie in terms of technology and technological strengths?
I’ll now hand over to our co-host, the UK chief executive of 8×8, Kevin Scott-Cowell…
KEVIN SCOTT-COWELL Thank you. 8×8 Solutions UK is a cloud-based unified communications service business operating globally. We see ourselves as the enabler of collaboration across businesses.
Our headquarters are in San Jose [California] but we’re very British in terms of resource and people with teams in Aylesbury and London, having been acquired by what is the market leader in 2013. We have an enterprise-level suite of products that allow businesses to be mobile, agile and connected on a local or global scale, something that’s really important in the developing world of business. It means that anybody can do their work in any place at any time with a common set of tools, and through that build better working relationships, be more effective, [build] better partner relationships, better customer relationships. So we’re all about enabling that way of working.
In terms of the specifics, we have voice over IP tools, video conferencing, collaboration, and document sharing – all as part of an integrated suite. We’re building analytics tools to help businesses be more effective. In terms of disaster scenarios, our cloud-based communications provide a very resilient backbone infrastructure for mid-size through to large businesses.
I’m interested in how this technology gets taken up because there are still some barriers such as cultural issues to consider. The concept of mobility and flexible working is a major change to working practices for many businesses. Last but not least, as we develop our own IP – we’ve got over 100 patents – I’m interested in how technology is maybe holding back or enabling businesses as they seek to grow.
I’m keen to hear your views, which I can take back to the business and improve the way we do things and support businesses as a whole.
WALKER Can I start by asking: How important is technology to your business?
JENNY CAMPBELL I run a cash-machine business servicing thousands of users a day. It requires a huge infrastructure programme. When I talk to my head of IT about the cloud, he says that it has a place for businesses but the big challenge for us is we have legacy systems that go back 14 years. It would be a huge leap [to join the cloud].
WENDY BARTLETT I’m the chief executive of a contract-catering boutique company in the south-east and an events company in the London area. We interact with a lot of small, local suppliers who don’t have the ability to do what we need IT infrastructure-wise. A butcher isn’t necessarily going to be interested in IT systems and processes that I, as a provider of a service, would want to buy into. If you’re a business that wants to go into the cloud, you can’t necessarily take everyone along with you. For us, that becomes an issue.
FRAN BROSAN As does infrastructure out of the major conurbations. We’re a digital agency for brands based in Cambridge, where we’ve waited for super-fast broadband for many years. It becomes a real issue because file sizes get bigger and bigger. Sitting around waiting for downloads holds businesses back.
JULIE FAWCETT Taking Wendy’s example of the butcher, is the cloud not a way that you can actually provide them with the interface you want them to use? Everyone’s got
a terminal – whereas if you’ve got a big, server-based system where you need to start doing data transfers and paying goodness knows what to, that really is a requirement for them.
BARTLETT Somebody who’s interested in their product isn’t necessarily going to want to sit at a PC and input that data. When building strategies you have to accept that not everyone will be on that journey and you have to build an amount of flexibility within that system to account for those.
JASON STOCKWOOD In the last 20 years we’ve lived through exponential times in terms of the acceleration and adoption of technology. New technology comes and goes – mobile, SEO, big data, cloud, all have their moment in time and [then] they’re just part of the whole ecosystem. Some cloud technologies work better for businesses and some don’t. I completely re-platformed the business I bought into five years ago [business insurance broker Simply Business] from a legacy mainframe system. We’re running the business on technology that didn’t exist five years ago and won’t exist in five years. It has to be what suits your customer and end goal.
BROSAN At Omobono we talk about people and platforms because it’s about the people using the technology. I suspect that your butcher will be held up as much by the skills and time that he has within his business. Even for companies that are innovating all the time, keeping your skills up to date is a real challenge.
STOCKWOOD I think we demystify. The conversation today got straight into cloud technology. None of us would think about shop checkouts, automated phone systems, apps… it’s pervasive. But cloud technology is all around us [too]. Everyone who uses email on a smartphone – including the butcher – is using cloud technology, but we try to make it more complex.
CAMPBELL But then I think that’s how it’s promoted. You see the billboards that say, ‘Are you in the cloud?’ and you think, ‘No, I’m not’.
WALKER The government does seem to be sponsoring and urging an awful lot of stuff, otherwise you wouldn’t have SEIS [seed enterprise investment schemes] that were designed for really quite micro companies – most of which are bound to fail aren’t they?
WALKER Is it government that gets it wrong, in thinking it should foster everything and it should be left to the market – that’s an IoD position, but is it right?
STOCKWOOD I think the position of government is to set the conditions of success. There are some positive things around SEIS – the tax relief and encouragement of Tech City. What’s not being addressed is: that’s not the whole economy. It’s going to be wealth creation for a small elite that creates technology, fortunate to be around businesses that have done very well financially, but that’s not where job creation comes from.
WALKER Skyscanner [on which until recently Stockwood was on the board] must have destroyed jobs in vast quantities.
STOCKWOOD Before that I was involved in Lastminute.com, which displaced the high-street travel agent, but the technology has to serve the customer and they wanted convenience and transparency to choose products that suited them. The travel agent has a place on the high street – Trailfinders offers a quality service because it differentiated itself through what the customer wanted. The internet has just put the power in the hands of customers… [and] created hi-tech growth, but 43 per cent of GDP in the UK is [from] sole traders and small and micro businesses.
FAWCETT We’ve got to stop the tail wagging the consumer. Technology has to start with what’s right for the consumer, not what’s right for the technology. Airline and hotel self check-ins are awful. You always have somebody standing next to you to show you how to do it. How ridiculous.
KATE REGAN As a visual communications business, we work heavily with retailers. A few years ago everyone thought there would be virtual customer service people in stores with digital screens all over the place. That hasn’t happened. Some of the big retailers cut back the people in store and it’s had quite a disastrous impact. They’re now reverting back again.
FAWCETT The other trend is personalisation – offering choices such as: ‘Would you like to check in with a piece of paper or a smartphone? We can offer you both.’
STEPHEN DUNN It’s like filling up your car at Tesco. You can stick your card in the machine or you can go to the kiosk and interact with somebody.
WALKER Is part of the community marginalised because it can’t operate technology at all? We’ve about 10 per cent of IoD members who don’t have any internet access.
STOCKWOOD Ten per cent of the UK population isn’t online. But again this is new technology; Google and Facebook didn’t exist 15 years ago, AltaVista and CompuServe are ancient history to our kids. I talk to people at work about not having a telephone growing up and I sound like I am 200 years old. The pace of change is accelerating.
CAMPBELL But don’t you think we should always give consumers choice and we should never just limit them to one technology-driven route, like only paying by card on buses?
STOCKWOOD I used to be an evangelist around how technology will be pervasive and change our lives for the good. I’m the opposite now: it has a place in society but it has to serve us and enrich our lives. In the business I am trying to build, it’s how do we get that balance between technology being useful for us and at the same time allowing us freedoms and better choices in our daily lives?
REGAN You have to choose the bits that benefit you. It is the same theory when selling it to a business as well. There’s no point in selling something that isn’t going to benefit them. You can’t just push it at people, you’ve got to sell it as a solution.
DUNN That’s where we use the cloud. As a commercial building maintenance and supply business, we’ve grown over the last 18 months from being a local, Newcastle-based company to a national company. We went from a legacy server in our office to a cloud-based server, to SIP [session initiation protocol] telephony. It has allowed us to put a man in a van anywhere in the country (as long as they’ve got 4G or broadband) and for them to be inclusive within our office – to actually have video, have voice, to log in and see the same desktop as if they were in the office.
That was huge. If we’d looked at that 10 years ago, the amount of money that we would have needed to spend on updating a legacy system and putting hub offices around the country would have meant it was far more expensive. It also gives us a good disaster recovery scenario because we can have two tier-one data centres – one in Docklands, one in Manchester – and if one falls over, the other one’s there, rather than having to worry that somebody’s going to come into my office and steal my server.
BROSAN We just opened an office in Chicago. We looked at cloud when we were working out how to link the offices, but we’re actually server-based with virtual private network connections. The main reason is because we’re a creative business and file sizes are huge, and the upload or download time, to transfer files between offices of the types of files that we use, is just a bit slow.WALKER Let me ask about confidentiality and security…
SCOTT-COWELL We take security very seriously. We’re accredited to international and government standards, with firewalls and session border controllers that protect data. We’re protecting mainly voice rather than huge amounts of data.. The calls are encrypted; the systems are in place and are worked at very hard in order to keep that level of data secure, so it’s not a major issue. There are things like PCI compliance for credit cards, which are built into the systems and are compliant. It’s an area that people are concerned about but the reality, certainly for us with our unified communications, is it’s a secure setting and people shouldn’t be worried.
WALKER Does it leave the economy vulnerable to cyber terrorism?
SCOTT-COWELL There’s a huge amount of people trying to break into internet servers around the world every day and the security systems are man enough to deal with that. They are constantly being reviewed and, while there is a threat, the threat is balanced by the amount of effort that’s countering that threat.
CAMPBELL But there have been some big customer data breach issues.
SCOTT-COWELL You’ve got to look at your suppliers and who is putting the systems in. If you go to a voice over IP supplier in the UK who is running his own software out of his garage, it will not have the development around the security systems and the right networking of structure and safety… Most attempts of fraud are when people share their passwords.
DUNN We had people sticking passwords on bottom of keyboards. We’ve brought in fobs with two-part encryption and randomised password encryption. Bigger data centres have bigger amounts of data, but they’ve got more money to spend on security because, if you do get in, there’s more data that can be stolen. My opinion is: spend as much as you can on security to keep data safe in a tier-one data centre.
BARTLETT Isn’t that the point: if you put it in the cloud… you’re putting it with everybody else [instead of having] it on your own individual server. I suppose that’s the fear of some people who don’t really get it – that I’d rather be in control of my own server than having it out there.
REGAN There’s a job to do to prove the benefit of having it elsewhere but it’s amazing how many large businesses run their data on very simple – even Excel database-type – packages, with price-sensitive information that anyone can get hold of. You’ve got the job to absolutely prove the benefit of moving over.
SCOTT-COWELL I think if you ask a best-of-breed supplier they will prove that to you.
WALKER Where do you think your business will be in five years’ time and [with what] emphasis of technology?
CAMPBELL I constantly get asked: ‘Isn’t cash going to be gone in a certain time?’ Yet again it’s perception versus reality. There is more cash in distribution in the UK
than there ever was… It comes back to providing consumers with choice: such as deposit taking and currency conversion at the ATM screen.
BARTLETT People will want to know more about the provenance of what they’re eating – the calories, the allergens – so they’ll want more data.
FAWCETT Hotels are behind the curve. Put your hand over the logo of a business-class hotel and you can’t really tell which hotel you’re in. To innovate isn’t just about changing the physical environment but to change the whole way you experience the hotel. The smartphone has opened up the travellers’ world – they can see where to go, what to do – so instead of hotels becoming this sheltered environment, which feels comfortably familiar but terribly bland, we now need to open our doors and say: ‘Here is the world that you’re in, how can we help you experience it?’
STOCKWOOD I’m really interested in the way that the technology enables change for consumers and transparency. Financial services is vastly underserved in terms of customer orientation, transparency, [being] technology-led… so there’s a huge opportunity and challenge. I’m fascinated about how over the next 10 years we can create a more interesting, useful and enriching place for people to work.
REGAN We’re a naturally innovative business. We’ll continue to use technology so we can run as efficiently as we can but also to benefit our customers… future-gazing and making sure that we tailor technology and physical solutions around meeting those needs and never getting complacent. We focus on what the next five and 10 years look like for our customer base.
WALKER Fran, your clients must cover a wide range of sectors. Are there any you’d pick out as the real growth areas?
BROSAN I think there’s too much emphasis on getting new customers versus retaining customers, which is a much more efficient strategy. Some big professional services firms recognise they need talent all over the world to succeed. They help people talk to each other effectively using technologies like social networks within the enterprise. This will really take off over the next five years. It’s a challenge for our industry because agencies tend to be siloed but we’re being challenged to bring all of the elements of the organisation together.
BARTLETT We’ve rebuilt our intranet system to allow our team to add pictures of what they’re doing in a Facebook style. That’s encouraged best practice, competition and sharing because they’re all quite competitive chefs from 80 restaurants, showing what they’ve made today.
WALKER Kevin, a lot has been said about people. Can I ask, is that where it’ll end up – and for your thoughts on the discussion?