The UK software industry is struggling to deal with the rise of offshoring, a 'geeky' image and the country's IT skills gap - but there's still hope.
To thrive, the industry must support innovation; improve IT's image and foster better co-operation between academia, business and government, according to a new report sponsored by the British Computer Society (BCS), Lancaster University and Microsoft.
Microsoft senior director Matthew Bishop said today at the launch of the report, Developing the Future: "The UK software industry is under threat because of its inability to keep pace with the rest of the world."
The UK must churn out 150,000 new IT workers annually to keep up with industry growth yet each year only 20,000 students graduate in IT-related fields, according to the report. Even with immigration, the jobs cannot be filled and many companies look to outsource jobs to locations such as China and India with higher numbers of qualified grads.
To combat offshoring, according to the report, the UK must focus on its strengths and develop innovative and complex projects that cannot be offshored.
Professor Edward Truch of the Lancaster University Management School said: "We need to begin to see the UK as a creative hub in the global village."
Then, though we will see the outflow of certain jobs, the country will also see an inflow of jobs related to this innovation, he explained.
The UK software industry has often been knocked for its lack of innovation - and its inability to produce a British Google.
This failing is not just a cultural issue, it's an issue of funding, according to Truch. The report called for young businesses to develop the business skills they need to win over venture capitalists, something done much better by US start-ups.
To boost the number of computer science graduates, IT needs an image overhaul - both as a profession and as an industry.
Elizabeth Sparrow, chairman of the BCS working party on offshoring, said: "The image of IT is still bad - it's the geek and the nerd." Yet, she added, this is not accurate as the bulk of IT jobs need a broader set of skills.
The silicon.com 2006 Skills Survey revealed that business skills are key to success in today's IT departments.
Sparrow also stressed the need to publicise IT project successes, as currently the industry has a bad reputation from over-emphasis on project failures.
To improve the quality of graduates, businesses must communicate to universities which skills they really need in workers, she said.
Efforts are being made to unite academia and business, such as a new degree at Lancaster University in information technology management and business, but it's easier said than done.
Lancaster University's Truch said: "It's difficult to get IT geeks and nerds to work with the business management people."
Businesses must also learn to appreciate the importance of the IT skills gap, which will affect business' ability to perform in five to 10 years, according to Truch.
He said: "IT in underrepresented on most [corporate] boards. This is a major danger," adding it is because IT is so central to future business success.
In silicon.com's 2006 Skills Survey, many IT managers said they did not feel their ideas were respected by the board.
Another barrier to close academic-business partnerships, explained Ovum senior analyst Bola Rotibi, is that businesses don't realise the value of software development in their organisation - and thus don't see the need to build up skills in this area.
She said: "Businesses view software development at an arm's length. We need a better measure of the value and ROI [return on investment] for software development."
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