Connectivity deficit costs UK £30bn a year

The UK economy is missing out on growth to the tune of £30bn due to a connectivity deficit in Britain’s biggest businesses and public sector organisations, according to a new study released today by O2 and the Centre for Economic and Business Research (Cebr). Smarter Working Britain is the UK’s first ever in-depth analysis of the value of connectivity in large organisations to the UK economy[1].

The study examines some of the long-term inefficiencies in British businesses. If tackled now, this could deliver multi-billion pound productivity gains to UK PLC in a period of crucial economic growth.

While employment rates are improving, productivity in our businesses has been declining since the onset of the recession. The average output per hour worked is now nearly 5% lower in Q4 2013 compared to pre-2007/8. However despite many organisations endorsing the benefits of smart, connected technology, 80% admit staff still don’t have full access to key business systems such as apps and instant messaging tools, which allow them to work effectively away from the office.[2]

The report reveals UK companies and public sector organisations could significantly boost the productivity of their workforce with immediate tangible impact, by using technology to:

• Eradicate needless journeys – reducing the annual number of trips to and from the office by 121 per employee[3] by connecting them with the technology that allows them to get work completed at the point of need. This would save each employee up to 127 hours a year.

• Make better use of precious time – allowing people to make 178 (9%) of their annual working hours more productive through technology, giving them better access to the information they need wherever they are. If every large organisation increased connectivity, over two million hours would be made more productive each year.

• Improve meeting efficiencies – better connectivity during external meetings could save each worker up to 54 hours a year in wasted follow up activities.

However, when it comes to embracing new technology, the report suggests that the risk-averse culture of Britain’s biggest organisations could be a major barrier to early adoption –one in four cites issues around trust, responsibility and readiness for change as barriers to adoption.

The report also highlights the impact that access to better, real-time information could have on improving day to day delivery of customer services. Businesses believe improved connectivity could boost sales by up to 43%.

Ben Dowd, O2 Business Director, commented:

“We’re entering a crucial period when it comes to growth. There’s lots of talk about the agile tech start-up, but we need to create the same level of dynamism in our large organisations if we’re to reach our full potential and compete on a global stage. The staggering cost of long-term inefficiencies in larger British businesses laid bare in our report is a wake-up call for employers.

He continued: “Too many pay lip service to technology. But the reality is that our businesses and public sector organisations are yet to get the best that technology has to bring. Every employer should try to understand their own connectivity deficit. Even small improvements will help businesses grow and in turn provide more jobs and increased wages, as well as improve the lives for their hard-working employees.”

Ed Vaizey, UK Minister for Culture, Communications and Creative Industries, commented:

“Government is transforming broadband across the UK and is on track to deliver superfast broadband coverage to 95% of the country by 2017. This investment in connectivity across the country is providing opportunities for a more flexible and efficient business environment which this report highlights. A better connected Britain is essential for driving growth and boosting local economies, ultimately helping us to win in the global race.”

Graham Brough, Chief Executive, Centre for Economic and Business Research commented:

“ICT technologies such as smartphones, mobile apps and cloud computing are starting to drive business productivity and restore the competitiveness of UK workers. We expect to see the economic benefits from better connectivity increase as these technologies penetrate all aspects of the work environment whether this be working from home, whilst travelling or from remote locations.”