The Celtic tiger’s secret IT struggles

DUBLIN – Conflicts over IT procurement, commercialization challenges, spotty broadband coverage – it may sound like Canada, but Ireland is going through similar growing pains as its local industry tries to keep up with the big companies setting up shop around them.

Thanks in part to a tax-friendly policies toward business and government investment in higher education, Ireland has become known as the “Celtic tiger” in the last 10 years, with Dublin, its capital city, called the Silicon Valley of Europe. Google’s European headquarters are here, as is Microsoft’s European operations centre. This past summer, IBM marks its 50th anniversary in the country by announcing it would create 300 new jobs by expandings its software lab here. More recently, Ottawa’s Cryptologic said it would move its headquarters to Dublin.

The next step, according to local industry watchers, is to match Ireland’s reputation as a home for high-tech heavyweights with some more home-grown success stories.

“They’re not really scaling up, really going international,” said Michelle Quinn, director of the Irish Software Association (ISA), which promotes and supports indigenous application developers much like the Canadian Advanced Technology Alliance (CATA) or the Information Technology Association of Canada (CATA). “They also face the challenge of getting the requisite amount of funding without signing away half of the company.”

Much like ITAC and Canada, the ISA earlier this year formed a partnership with India’s largest IT trade group, the National Association of Software and Service Companies, to learn best practices. Quinn said she is hoping to do the same thing with a group in Washington D.C. This past Tuesday, meanwhile, the ISA launched a new program whereby Irish software CEOs will be able to attend a corporate leadership program at Stanford University in the United States.

“They’ll have coaches on the American side, who will act as mentors to them,” she said. “We’re trying to help them bring that vision and leadership at the strategic level.”

Even the best-run companies may have a hard time getting exposure to one of Ireland’s biggest IT customers: the government. Quinn said that unlike Canada, there is little centralization of technology purchasing a la Public Works. Instead, decision-making tends to happen at the departmental level, where local Irish software companies often don’t make the cut, she said.

“One of the long-term strategies is to try and change the mindset of that culture by showing that these companies have had great success selling to other governments like the States, Australia or the Netherlands,” she said. “The short term goal is to change the standing criteria (for projects) and break them into smaller lots.”

Ireland last year went through an IT spending scandal when a public health payroll system’s costs spiralled out of control, reaching

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