Why UK economic uncertainty should not be an excuse for stagnation

As we move into the new year the current industry climate in the UK is one of deep uncertainty. In the past week I have spoken with two UK business leaders who are delaying purchasing decisions in 2019 because of Brexit speculation. But Brexit isn’t the only pressure UK industries currently face.

In 2017 the UK Government announced its Industrial Strategy—laying five foundations for productivity: ideas, people, infrastructure, places and the business environment. It promised waves of sector deals between government and industry to de-risk investment and improve workers’ skills.

Twelve months on, a widening skills gap and increasingly connected and demanding end customers mean organizations face some critical decisions in the next year. These pressures are not limited to large corporations and PLCs—uncertainty effects organizations of all sizes.

No action is not an option for the business with an eye on the future

One of the most alarming reactions to the current climate is the assumption that progress and operational investment should freeze. According to the latest ONS data, business investment was 2.2 percent lower in the third quarter of 2018 compared with the final three months of 2017.

Yet when you look further, there are clearly real opportunities for organizations of all sizes in today’s UK industrial sector. Other ONS data shows exports (goods and services) in the year to November 2018 were worth £630 billion, growing by £13.9 billion on the previous year. That means there has now been 32 consecutive months of export growth on a 12-month rolling basis.

In response to this opportunity, The Department for International Trade is encouraging industrial organizations of all sizes to expand their horizons overseas—and has pledged its full support to help business achieve that. With this market change in mind, those who freeze investment and concentrate on damage limitation are closing the door to huge opportunity. Of course, this means being ultra-critical when assessing investment options—any decision must be forward-looking and allow quick realization of new business goals.

An opportunity, not a challenge, to build a platform for the future

The only guarantee in this uncertain climate is that change is on the horizon—and kicking growth plans into 2020 is a short-term strategy. Organizations need to prioritize their investments now to make sure they build a platform for the future—reacting too slowly means fast-moving competitors will already have cornered these new markets. According to the ONS report, the geographies that present the biggest growth opportunities span established economies, such as the USA, Australia & New Zealand, and developing demand in emerging markets, including Nigeria, India & Thailand.

Yes, this means every investment in 2019 will require intense scrutiny and close collaboration between CFOs, CIOs and CTOs. These decision makers need to be pragmatic about what can help their business now—and allow them to adapt going forward, particularly with new geographies in mind. This means looking for solutions which are quick to deploy, drive efficiency and, most importantly, provide fast ROI. But this is often not the case with most industrial organizations—there is a proliferation of legacy software which is not geared for the changes ahead.

Are you ready?

In the current UK environment, repeat investment in regular, costly, upgrades or overhauls of legacy monolithic business databases is not an option. The time is now to invest in flexible and forward-looking functionality which gives organizations confidence they can capitalize on any change in the next five to 10 years.

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