Digital tsar urged to make Scotland world leader

It has been estimated that if Scotland became a digital world leader, GDP would increase by Â£13 billion by 2030.

The creation of Scotland’s first “chief digital officer” is among a raft of recommendations on how to harness digital transformation to kick-start higher growth. It has been estimated that if Scotland became a digital world leader, GDP would increase by £13 billion by 2030, compared to a rise of just £4bn if only incremental improvements are achieved.

“Digital Solutions to the Productivity Puzzle” is a joint work from the Scottish Council for Development and Industry (SCDI), ScotlandIS, The Royal Society of Edinburgh and BT Scotland. Its findings are based on research commissioned from economist John McLaren, honorary professor at the Adam Smith business school at Glasgow University, as well as input from senior representatives from the public and private sectors.

It comes just days after latest figures confirmed that Scotland’s economy is growing just a quarter as fast as that of the UK as a whole. Scottish gross domestic product (GDP) inched 0.1 per cent higher in the third quarter against a rise in UK GDP of 0.4 per cent.

Ross Martin, chief executive of SCDI, said poor productivity has “bedevilled” Scotland’s economy since the recession, holding back growth and prosperity. “Substantial leaps in productivity are difficult for a developed economy to make, so it will be key to seize this opportunity to work smarter, innovate and internationalise by transforming Scotland into a fully digital nation,” Martin said.

“There is a range of positive work in progress on digitalisation and some great examples of businesses using digital technologies to better meet the needs of their customers. However, with economic headwinds strengthening, becoming a digital world-leader is essential if Scotland is to transform from a fragile to an agile economy.”

The report calls for clear targets based on the Digital Economy Maturity Index, which measures the distribution of Scottish firms across six levels from “disconnected doubters” to “digital pioneers”.

The aim should be to get all businesses into the upper end of the index – “enthusiastic explorer”, “digital champions” or “digital pioneers”. More than three-quarters of firms currently fail this test, with only 15 per cent at explorer level, 3 per cent at champion and 0.2 per cent at pioneer level.

The chief digital officer would lead the shift in focus from infrastructure to implementation. About 85 per cent of premises in Scotland have next-generation broadband, with that figure set to rise to 95 per cent by March 2018.

Martin said firms and public sector bodies should appoint their own digital officers as well so “all sectors can bring the same focus to realising the potential economic growth and public service improvements of digitalisation in the next five years as there is on digital infrastructure”.

The report additionally recommends the creation of a Scottish Productivity Commission modelled on best practice such as that in Australia and New Zealand. This would provide independent research, advice and performance monitoring to the Government under the direction of the Council of Economic Advisers.

Gaps in digital literacy need to be addressed through recruiting additional computer science teachers, and developing digital literacy should be “integral throughout” the Curriculum for Excellence.

The report says work-based skills development should also be strengthened.