UK e-business adoption fails to keep pace

Earlier this month, the European Commission published a ‘digital scoreboard’ comparing the performance of the EU and member states and their delivery of the targets agreed in the Digital Agenda for Europe.

Although the UK generally outperformed other states in categories including internet use, e-government and e-commerce, it fared surprising badly across each of the five categories within e-business.

E-business is arguably integral to the efficient running of business processes. It uses technology to better connect the business internally and with customers. It can include collaboration tools, mobile and wireless technology, customer relationship management systems and social media.

Countries making more use of e-business than the UK include Germany, France, the Nordics, Bulgaria, Croatia, Hungary, Estonia and Latvia.

The UK is 64 per cent below the EU average on the integration of internal processes; 81 per cent below the EU average for automating the exchange of business documents; and 74 per cent below the EU average use of e-invoices.

This is despite recent research indicating that the UK tech sector remains one of Europe’s largest in terms of sales. For example, analyst firm IDATE’s annual DigiWorld Yearbook demonstrated that the UK saw average IT revenue per capita of £1,800. This compares with £1,721 in Germany and £1,086 in Spain.

And business spend in the UK represents 45 per cent of the UK’s total IT spend, compared with a 38 per cent average in the rest of Europe.

This point is supported further by a Forrester Research report, European Information and Communications Technology Market 2011 to 2012, which claims the UK IT market is the second largest in Europe, behind Germany, and worth £81bn.

And these figures demonstrate that technology spend in the UK is not a problem, but that businesses in this country choose not to spend on e-business - the question here is, why not?

Clive Longbottom, analyst at Quocirca, says that financing within the EU and functions within UK business are to blame. “The good performers tend to be made up of accession countries, where EU money has been made available for investments; smaller countries, where inward investment from outside has been high; and the Nordics, where business and IT have been well aligned historically,” said Longbottom.

“The UK is also a very conservative environment, where IT has historically been reported up through the finance function, and automation of processes outside of and across organisations has not always been a top priority for chief financial officers,” he added.

Longbottom suggests the reason Germany and France outperform the UK is that they are the economic engines of the EU, whereas the UK is right at the edge.

They have been driving the standards in areas such as ebilling and electronic data exchange, whereas the UK has been stuck with 80s and 90s electronic data inter-change and Excel spreadsheets,” he said.

Nic Archer, head of T-Systems content governance practice, agrees and hints at an anti-e-business culture in the UK.

“UK businesses are not responding well to these e-business challenges because of a basic inability to understand and process documents correctly,” said Archer. “Businesses are not seeing documents as a competitive tool, unlike data, which they do see as giving a competitive advantage.”

“Another reason might be a cultural aversion to perceived bureaucracy and unnecessary control. Other countries, such as Belgium and the Netherlands, for example, are more attuned to, and accommodating of, the level of bureaucracy needed, which many UK workers would consider a waste of time.”

Andrew Yates, CEO of Artesian Solutions, a software company that automates the search for sales intelligence from the web, describes his experience of selling e-business tools in the UK.

“It doesn’t come as a big surprise that the UK is still lagging behind our European counterparts when it comes to e-business. The UK unfortunately still holds a small island mentality, where information exchange via the telephone and face-to-face interaction prevails,” said Yates.

“When you add the fact that broadband provision is poor and bandwidth low, with the only way around this by installing expensive dedicate leased lines, it is easy to see why the UK scored below the European Commission’s digital scoreboard.”