Digital Roulette: UK Businesses Admit to Gambling with Digital Investment

London - 19 January 2016

Fujitsu-commissioned study reveals complexity, conflicting digital priorities and a lack of confidence are hindering digital success

An independent study commissioned by Fujitsu has revealed that for 71% of businesses, the success of digital projects is a gamble. Almost a quarter (21%) of IT decision-makers are confident in advising the business on digital, while over half (59%) admit it’s difficult to know the right choices to make when it comes to digital adoption and 62% state that their organisation is playing digital catch-up.

The research assessed digital maturity within organisations across Europe, with the results highlighting a worrying lack of direction which is hindering the success of digital in the UK. Compared to their counterparts in Germany, Spain and Sweden, UK organisations are far less clear and confident on their digital strategy with almost half (41%) believing their organisation is not a digital leader. 

Organisations pointed to a number of benefits to digitisation, with workforce productivity (38%), market responsiveness (30%) and the creation of new revenue opportunities (30%) the top three identified. However the ability to achieve these is obstructed. Almost a third (32%) state that their business’s digital strategy is unclear and confused and a mere 16% say their business is always aligned on digital priorities. Similarly a quarter (25%) admit a “failure to prioritise digital projects” is a main barrier to digital project success within their business.

“Across Europe, this study highlights a lack of direction and business alignment. But the findings coming from the UK were especially worrying. While we know digital brings many benefits, we are the least confident in our digital decision making and the least aligned in priorities,” commented Regina Moran, CEO of UK & Ireland, Fujitsu. “The UK is seen as a digital leader; we have a government which invests in the sector and a burgeoning digital economy - 15% of all new companies formed in 2013-14 were digital[1]. Digital Transformation has also been highlighted as key to addressing the productivity gap. But this study shows there is a big job to do in helping organisations, and the IT decision-makers within them, realise this potential.”

Exploring the reasons for the lack of clarity, the study revealed the pressure is on to digitise but there is a lack of ownership in UK businesses and IT investment is unclear. Over two-thirds (65%) of IT decision-makers said there was an appetite to move faster towards digital adoption. Most of this pressure is coming from the CEO (26%) and other board leaders (19%). However, highlighting a reason for conflicting digital priorities, when asked who manages digital projects, businesses were unsure. Almost half (49%) pointed to the IT department but in 45% of organisations, digital is managed by the business unit involved in the project (21%) by a separate digital team (17%) or by a blended team from across the business (7%).

When looking at how budget is allocated, in the majority of businesses (47%), IT budget has been split between digital innovation and day-to-day IT management, with digital getting the bulk of funding. However the UK also had the highest potion of organisations which split IT budget in favour of day-to-day IT costs (20%). Legacy IT is a clear problem – with “Existing technology solutions hindering innovation” being cited by almost a third (32%) of IT decision-makers as the number one barrier to digital projects being implemented successfully. In fact, over two-thirds (68%) stating they would benefit from a more balanced approach to digital adoption.

“A lot of our customers speak to us about the challenge of managing legacy systems and the difficulty in building digital capabilities into them. But it cannot be allowed to fester and become a blocker,” added Moran. “There is no doubt that digital technology will improve efficiency, productivity and overall service – and therefore revenues. Businesses must therefore continue to push forward and innovate. The key is aligning the various digital priorities across the business and striking the balance between keeping the IT lights on and building for the future.”

 

 

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