Encouragingly, 55% of businesses surveyed are optimistic, believing the UK has overcome the worst of the macro-economic factors affecting businesses. Nonetheless, with inflation at 4.6%, exceeding the government’s 2% target, 45% of UK businesses remain apprehensive about the economic climate.
Inflation’s impact is evident, with 68% of businesses curtailing technology investment this year due to the Bank of England’s increasing interest rates. Still, businesses plan to channel investments into key areas like customer experience, employee experience, AI, and data privacy.
Businesses are reassessing their priorities during recovery, seeing the value in technology investments that promise a strong return. For instance, 67% of respondents are either already using AI or planning significant investments in it.
Amidst this technological focus, 30% of businesses prioritise data privacy and protection, emphasising the safe use of technology.
Sachin Agrawal, Managing Director of Zoho UK, remarked: “Business confidence has taken a beating over the past few years, so it is no surprise that many are still concerned about the stability of the UK economy. Quite rightly many are looking to future proof their businesses against the economic permacrisis which continues to create turbulence. It is interesting to see priorities shifting around technology and data privacy as businesses focus on becoming more resilient. Companies that invest in the right technology will enjoy a strong return on investment while those who ignore the importance of digital transformations will risk becoming stagnant.
“A data-driven business can use real-time and extensive insights to make the right decisions to take advantage of opportunities and to reduce risk. However, for technology such as AI to be adopted successfully, businesses need to adopt it with customer trust in mind to deliver benefits such as automation, forecasting, or improved customer service, to name just a few examples.”
The right digital tools, leadership, culture, and focus on customers and employees can enhance a company’s flexibility, agility, and adaptability, driving resilience and innovation.
With only 19% of UK companies exhibiting good digital health, it’s a wake-up call for the transformative impact of digitisation on business performance.
In today’s challenging market, with increasing competition and external economic pressures, digitisation is crucial. The stakes are too high for neglect.
Amid the UK’s ambition to become a Tech Superpower, 57% of businesses call for more government funding for innovative technology development, underscoring the need for greater business support.
This update follows the latest economic report from the Office for National Statistics, indicating a 0.3% economic contraction in October.
