According to the research from Microsoft and Goldsmiths, 46% of UK organisations currently fall into the worst-performing of four categories for competitiveness (endangered, displaying declines of 5%-15%) as they battle pandemic and Brexit concerns, according to a new model.
However, it has been predicted that the UK economy can provide a more substantial boost than the entire furlough scheme if companies make the right incremental changes to attract appropriate skills, talent, tech and leadership.
Keys to successful recovery
15% of UK organisations currently fall under the highest performing category for competitiveness (frontrunners, displaying growth of 5%-15%).
Companies bucking the economic trend, according to the study, are succeeding with a ‘sustainable’ mix of socially-progressive leadership, inclusive talent management and investment in future agility.
30% of survey participants revealed that investment in new technologies has been actioned in order to remain competitive, while 61% are currently using collaboration tools at work, a rise of 10% on pre-pandemic levels.
Additionally, while almost half (49%) are confident that tech can support companies through Covid-19, three in five (62%) said they have no plans to hire more tech scientists, such as data analysts, system engineers and developers.
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Hollow and sustainable growth
The research from Microsoft and Goldsmiths also uncovered two kinds of strategies, which have yielded contrasting results: ‘hollow growth’, and ‘sustainable growth’.
Companies implementing a hollow growth strategy tend to extract as much value from people in order to reduce costs while providing a lack of support, as well as focusing tech investments in siloed areas to solve individual challenges, and benchmark future readiness by traditional productivity measures.
Sustainable growth practices, on the other hand, prioritise resilience and the need to adapt; adopt leadership according to empathy and decisiveness; nurture a culture of trust, empowerment and inclusivity; and consider technological impact across the business.
The frontrunner organisations in competitiveness were found to be most likely to adopt a sustainable growth strategy, while endangered companies demonstrated strong hollow growth tendencies.
“UK organisations face a unique moment. Buffeted by the headwinds of pandemic and Brexit, the nation’s collective competitiveness is being put to the test like never before,” said Clare Barclay, CEO of Microsoft UK.
“But can they thrive? Today, we are ringing the alarm bell, as our research reveals that half of organisations will struggle to adapt.
“The tech intensity that was starting to gather pace before the pandemic struck has become turbocharged – to keep up, leaders must act decisively and quickly. Small changes in approach to investment, people and technology can quickly boost the UK’s competitiveness, giving our economy the best chance of success in the post-Covid and post-Brexit era.”
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Roxanne Morison, head of digital policy at the Confederation of British Industry (CBI), commented: “The UK has a long tail of low-productivity firms which face challenging times ahead without changing their business model to suit the digital age. If we got those companies confident in using cloud, confident in using digital marketing systems, confident in using data, the positive impact on our productivity would be significant.
“But technology cannot be viewed in isolation. As the Microsoft research shows, it must be underpinned by progressive leadership, fair and inclusive talent development and adaptability for future change, in order to build a sustainable competitive advantage.”
The study from Microsoft and Goldsmiths, University of London, was aided by a model devised by Goldsmiths professor Dr Chris Brauer, and surveyed over 1,700 senior UK business leaders and almost 2,500 British employees. Additionally, interviews with competitiveness experts from Harvard University, the Tech Talent Charter, and the CBI, among other organisations, were conducted.