UK Businesses Are ‘Gambling With Digital Investment’

With the UK Government highlighting digital transformation as key to increasing the nation’s productivity and George Osborne announcing digital tax breaks, digital transformation clearly offers an excellent means for businesses to grow in the UK.

However, recent research from Fujitsu revealed that businesses on the ground are in fact uncertain about their own digital investment. For 71 percent of businesses, the success of digital projects is a gamble. Less than a quarter (21 percent) of IT decision-makers are confident in advising the business on digital projects, while over half (59 percent) admit it’s difficult to know the right choices to make when it comes to digital adoption.

In fact, compared to their counterparts in Germany, Spain and Sweden, UK businesses are far less confident on their digital strategy with almost half (41 percent) believing their organisation is not a digital leader. It’s clear that digitalisation brings advantages, such as improved efficiency, productivity and overall service; however the survey highlighted a worrying lack of direction from within UK businesses. Ultimately this is hindering the success of digital in the UK. So, what can businesses do to overcome internal obstacles and make digital deliver?

Given the Government’s emphasis on digital transformation, it’s no surprise that businesses reported that the pressure to digitalise is on.

More than two-thirds (65 percent) of IT decision-makers said there was an appetite to move faster towards digital adoption, with most of this drive coming from the CEO (26 percent) and other board members (19 percent).

However, often this pressure is not well-directed, and conflicting digital priorities can slow progress. Businesses must identify the areas where digital can add the most value and identify priorities accordingly. This will ensure that investment matches business need and provide teams with an overarching digital strategy.

Additionally, UK businesses lack a clear sense of who should be managing digital projects. Almost half (49 percent) of survey respondents claimed this should be the IT department. However in contrast, in 45 percent of organisations, digital is managed by the business unit involved in the project, by a separate digital team or by a blended team from across the business.

In order for digital to succeed, teams and responsibilities need to be well-defined, with the backing of the C-suite. Businesses need to devise a strategy for how digital projects are delivered, to ensure that they are implemented as effective as possible.

However, in the UK, implementation is also hindered by old IT systems that lack the maturity required to deliver an effective project. “Existing technology solutions hindering innovation” is cited by almost a third (32 percent) of IT decision-makers as the number one barrier to digital projects being implemented successfully. IT departments are frequently focused on ‘keeping the lights on’, rather than growing the business through digital projects – a mindset that needs to change if they are to take advantages of the benefits that digitalisation brings.

Digital innovation can only be successful if it’s supported by day to day IT, and here the assignment of budget is important. In the majority of businesses (47 percent), IT budget has been split between digital innovation and day-to-day IT management, with digital getting the bulk of funding.

To ensure long term digital success, however, businesses must balance their investment between digital and more routine IT costs. Digital projects can only succeed when support by a robust and well-resourced back-end architecture.

By defining objectives and linking them to further budget, businesses can instigate a cycle of digital success. The UK is leading the way in this, with 20 percent of organisations favouring day-to-day investment, but there is still a way to go in finding the perfect balance.

Digital is opening up a host of opportunities, and every organisation must look to take full advantage of the possibilities or be left behind. Businesses must ensure that digital forms a central part of overall strategy, by identifying how and where it can add the most value, and then aligning digital priorities across the organisation.

With a clear plan, businesses can ensure that they use digital in the most effective way, increasing their productivity and service offering – and reducing the element of gamble.

Regina Moran is CEO of Fujitsu UK & Ireland.

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