William Hewlett, David Packard, Microsoft's Bill Gates and Steve Jobs, formerly of Apple ... Nearly half a century may separate them in age, but they are bound by one common virtue: building businesses that should stand the test of time and the ruthless competition of the computer industry. And they have done it not by Wall Street deal-making but by the old-fashioned approach of adding value, organic growth and by employing the brightest and best that America has to offer.
The contrast with Britain is all too painful. Who are our heroes of high-technology? Alan Sugar, Sir Clive Sinclair, Sir Ernest Harrison or Lord Weinstock are the names that most readily spring to mind. Yet Alan Sugar at Amstrad is little more than a very clever marketing man. Even then, Amstrad is heading for large losses while its shares languish. Sir Clive Sinclair may be a genius as an inventor but his marketing and cost controls proved hopeless in the task of building a lasting business. By contrast Lord Weinstock is a brilliant manager of financial resources and a fierce champion of his company, GEC, but his caution has often led to excessive risk aversion or a fear of entering new markets. Perhaps the nearest Britain has to a business builder is Racal's Harrison. But while Racal's Vodafone telecoms group has been a brilliant success, it is essentially a service company not a manufacturer.
Yet despite the fact that IT industries will make up some 10% of world economic activity by the next millennium, the UK seems painfully short of Hewletts or Packards. True, in BT and Cable and Wireless we have two of the most experienced telecoms operators. True, we have in companies like ICL (largely Japanese-owned), profitable niche players in key parts of the IT industry. True, we have bright, expanding software companies like Microfocus or Macro 4. But none of these will be capable of spawning a whole new industry (Apple), delighting investors (Microsoft, see p58, now worth more than General Motors) or providing a stream of new products (Hewlett Packard, see p52).
The '80s should have been the decade when Britons like Jobs et al moved decisively to the fore. Lower taxation rates, the taming of the unions, a government clearly seen as the friend of business should have been ingredients for success. In the mid-'80s, indeed, it seemed we were on the road to success. A host of computer millionaires brought their companies to the stock market.
But the deal-making culture and spivery of the '80s has been killed by a combination of recession and the ERM strait-jacket and with it much of the entrepreneurial drive has been destroyed. Many of the computer start-ups have collapsed. The hi-tech corridors (Silicon Glen apart) are now among the worst affected areas, with unemployment often doubling or trebling in the space of two years to unheard of levels of 7% or more.
It seems Britain entered the ERM too late and, perhaps, at too high a level. The medicine was not to our liking, and may kill off the patient, but finding an alternative will be a formidable task. A British Gates or Jobs is needed now more than ever. UBS Phillips and Drew's latest forecast makes depressing reading with predictions that by 1994 unemployment could, even on the Government's doctored statistics, hit four million - higher than even the worst period of the Great Depression.