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Connectivity funding ‘key to successful business growth’
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Many UK businesses are in danger of suffering stunted growth due to a lack of investment in core IT connectivity systems. A new report has found that four in every five UK firms are unable to scale plans to their fullest potential with current connectivity arrangements. Just 20% of UK businesses state they are in a position to undertake digital transformation plans.

This comes as 84% of enterprise organisations state their digital transformation plans have accelerated due to Covid-19. For almost half (49%) of the firms surveyed, these plans have been accelerated by a year or more. Almost every firm (98%) said they consider digital transformation to be important to their future strategy, underlining just how integral digital plans are to the growth of UK business.

The report found that 81% of companies saw a ‘highly successful’ digital transformation success rate when up to 20% or more of the digital transformation budget was devoted to connectivity or networking. For companies allocating 10% or less of their budget to connectivity or networking, the success rate dropped to 19% and the number of unsuccessful initiatives rose to 62%. This illustrates the fundamental role that connectivity plays in digital development.

Conducted by business connectivity provider Neos Networks, the report gathered results from 247 medium-to-large UK organisations, and data, cloud and network infrastructure service providers. The findings highlight challenges businesses face in ‘building back better’, what’s needed to ensure UK business has future-ready systems and just how many companies need connectivity investment to grow.

Full report available here: https://neosnetworks.com/resources/ebooks/core-connectivity-the-key-enabler-of-digital-transformation/

The factors that influence digital transformation success

The report highlighted 14 ‘keys to success’ surrounding digital transformation. The following factors are those most common to highly successful firms:

  • 90% of highly successful firms — recognition of significant benefits conferred by SD-WAN (which include proactive management, better performance information and control of applications)

  • 74% — IT department is always involved in specifying and implementing connectivity solutions used in digital transformation

  • 72% — connectivity and networking budget is 10% or more of the overall digital transformation budget

  • 72% — have a ‘very supportive’ telecoms partner

  • 63% — seeing securing remote internet connections as very important

Industries that embraced these digital transformation indicators are more likely to enjoy ‘highly successful’ digital transformation outcomes. Energy & utility firms are best positioned, holding seven ‘keys to success’, on average. They are closely followed by the transport sector, which has just under seven keys.

The industry with the lowest score was the government & public sector, with just over five indicators met.

However, the reality is that organisations from all sectors have work to do, with none demonstrating more than half of the 14 ‘keys to success’ identified.

Pete Asman, Managing Director for Public Sector and Enterprise at Neos Networks, said: “It’s clear that UK business needs greater investment, particularly after all the commercial challenges and changes the pandemic brought. This report only serves to highlight how integral connectivity and smart technology is to firms hoping to enact digital transformation – and the success of digital initiatives.

“The pandemic has acted as a catalyst in some ways, moving digital ever closer to the heart of businesses. It’s only natural that some industries have more catching up to do than others. What’s important now, however, is that we see investment in connectivity, especially if we want to see real economic growth in the post-pandemic landscape.”

Lyall Creswell, founder & CEO of Transport Exchange Group, said: “There’s no doubt that Covid-19 has accelerated digital transformation initiatives. In our industry, this has been driven primarily by changes to consumer behaviour and the huge increase in online purchases and more deliveries. Consumers have warmed to the idea of using ecommerce for everything from grocery shopping to financial transactions, and this has had a massive impact on the logistics industry.

“One of the biggest issues in our sector is a skills shortage – most courier and haulage businesses don’t have dedicated IT resource to map out a proper digital transformation strategy and implement the right tech. Sometimes, there’s also a reluctance to fully support digitalisation. But there’s been a sharp contrast around the acceptance of digital workflow pre and during the pandemic.

Pete Hanlon, CTO at Moneypenny, said: “It’s easy to be consumed by the day to day work and put off large projects like digital transformation until next year. It’s also easy to think that it’s just a technology project rather than business change. Without the right level of focus and buy-in from across all areas of the business, digital transformation will never happen.

Companies that are more agile and take a digital first approach have been best placed to ride out the challenges over the past two years. I believe we will see an unprecedented level of investment in digital transformation over the next few years as more and more companies adopt a similar digital first approach. This investment can only be a good thing for the post-pandemic recovery.”

83% of organisations have increased supply chain investments
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New research from Blue Yonder found that 97% of organisations faced disruption over the last 12 months. Factors outside of company control and the resulting consequences varied from company to company, with organisations facing customer delays (59%), stalled production (44%) and staff shortages (40%). As a result of this disruption, the supply chain has become a priority for nearly two thirds of businesses (63%).

The research, conducted by 3Gem, gathered insights from 250 supply chain decision-makers from the UK. It found that they are unsure about what the future holds, with 37% of organisations concerned about the long-term implications of the COVID-19 pandemic on the supply chain. This is followed by Brexit (24%), a pressure to be more sustainable (19%), the changing regulatory landscape (12%) and a lack of investment (7%).

“Businesses are right to feel concerned when it comes to their supply chain,” said Wayne Snyder, Vice President, Retail Industry Strategy, EMEA, Blue Yonder. “In 2021 we saw unprecedented disruption, and as we look ahead, several macro factors on the horizon are likely to drive further interference.

“To stay ahead of today’s supply chain complexities, organisations need to be able to plan intelligently, while having the visibility and flexibility to respond at pace. This can only be achieved by having a real-time, end-to-end view of the supply chain that leverages technologies such as artificial intelligence (AI) to recommend and optimise actions.”

The positive news is that organisations clearly understand the impact of disruption and are proactively managing concerns by investing time and resource in the supply chain. Blue Yonder’s research found an overwhelming majority (83%) of organisations have increased investment in the supply chain over the last 12 months, with 1 in 10 organisations (11%) investing more than $25 million.

Technology is the common factor when it comes to spending this investment. When asked about how they invested budgets, 86% of organisations invested in technology, followed by developing new skills and defining a new supply chain strategy (60%).

Interestingly, over half of organisations (58%) also invested in the sustainability of the supply chain. This is an encouraging move, given that 2021 research from the MIT Center for Transportation & Logistics, sponsored by Blue Yonder, found that nearly one in ten (9%) businesses had decreased their commitment to sustainability last year, while 55% thought it remained the same or were unsure as to the status.

When asked about the technology that would have the most significant impact in reducing disruption,  two thirds (67%) of organisations believe that having the ability to view and manage the supply chain from end-to-end will help them manage disruption better. This is followed by advancements in AI technology (53%), new types of delivery options powered by the likes of robots and drones (43%), and the use of technology to better manage their workforce (42%).

“These stats highlight just how vital new technology is in reducing risk across the entire supply chain,” said Michael Feindt, Strategic Advisor, Blue Yonder.  “Especially considering the fact that 71% of organisations have implemented new technology over the last 12 months to reduce disruption in the future.

“The study also showed that more than two-thirds (68%) of companies state that planning, forecasting, and inventory management were their most important areas for technology investment, with end-to-end supply chain management and AI technology deemed critical by more than half (53%).

“Of course, disruption isn’t always avoidable, but having the technology in place to support change and empower organisations to make decisions in real-time will go a long way in minimising risk and improving overall business resilience.”

Britishvolt’s supply chain jobs boost
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Britishvolt has selected a site in the North East of England to build the UK’s first battery gigaplant, which it says will create 3,000 jobs and a further 5,000 in the wider supply chain.

The company has acquired exclusive rights to a site in Blyth Northumberland and intends to begin construction in Summer 2021, with lithium-ion batteries will be in production by the end of 2023.

Total investment for Britishvolt’s gigaplant is £2.6bn, which it says makes it the largest industrial investment in the North East since Nissan’s arrival in 1984 and one of the largest-ever industrial investments in the UK. By the final phase of the project in 2027 it will be employing up to 3,000 highly skilled people, producing over 300,000 lithium-ion batteries for the UK automotive industry. It will further provide up to 5000 jobs in the wider supply chain.

Britishvolt’s gigaplant is widely regarded as being strategically important for the UK automotive industry in order for it to maintain competitive advantage as we accelerate towards an increasingly electrified future. The building of a battery gigaplant is also one of the key pillars of the British Prime Minister, Boris Johnson’s, ten-point plan for the UK’s green recovery and an important step to a Net Zero economy by 2050.

Britishvolt CEO Orral Nadjari said: “We are delighted to have secured this site in Blyth. This is a tremendous moment both for Britishvolt and UK industry. Now we can really start the hard work and begin producing lithium-ion batteries for future electrified vehicles in just three years. It is crucial for the UK automotive industry and for the entire economy that we are able to power the future. The sooner we start, the better.

“Blyth meets all of our exacting requirements and could be tailor made. It is on the doorstep of major transport links, easily accessible renewable energy and the opportunity for a co-located supply chain, meets our target to make our gigaplant the world’s cleanest and greenest battery facility.  We have had an extremely warm welcome from Ian Levy MP and Northumberland County Council and are looking forward to working with them closely on this project.”

The Britishvolt gigaplant will be built on a 95-hectare site, formerly the site of the Blyth Power Station. It will use renewable energy, including the potential to use hydro-electric power generated in Norway and transmitted 447 miles under the North Sea via the world’s longest inter-connector from the North Sea Link project.

Survey reveals contrasting digital supply chain transformation strategies
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A joint survey of supply chain executives carried out by JDA Software and KPMG has revealed that customer expectations are driving retailer supply chain investment.

Meanwhile, agility and innovation are driving manufacturers’ investment in their supply chains.

The 2018 Digital Supply Chain Executive Survey, conducted by Incisiv, found that more than half of respondents identified the need for real-time product visibility as the leading driver in digital supply chain investment.

The survey found that both retailers (57 per cent) and manufacturers (50 per cent) include real-time product visibility as a top driver of investment. Retailers express the need for end-to-end traceability (53 per cent) with the ability to manage new fulfillment nodes (50 per cent), where manufacturers are driven by the need to innovate faster (40 per cent), with lower cost to serve (33 per cent) through improved planning.

Cognitive/predictive analytics is overwhelmingly viewed as the most disruptive technology by executives for its ability to impact all parts of the supply chain, including forecasting, fleet routing and inventory optimization.

Interesting, manufacturers view blockchain and autonomous vehicles as the most disruptive technologies, with half of the companies surveyed planning to test these in the next 24 months.

“As Amazon extends from retail into manufacturing and logistics, these industries recognize that the status quo for supply chains is no longer an option for success,” said Kevin Sterneckert, group vice president, innovation strategy and solution marketing at JDA. “The 2018 Digital Supply Chain Executive Survey outlines how retailers and manufacturers are leveraging innovative technologies and strategic alliances to improve speed to market and deliver a superior customer experience profitably.”

 

“Companies that offer the best customer experiences and service have raised the bar on expectations, and now many business-to-business companies are expecting the same service levels as today’s consumers,” said Brian Higgins, U.S. supply chain practice leader at KPMG. “How retailers and manufacturers are responding is a prevalent theme in our survey findings, and it should come as no surprise that companies are investing in innovative technologies to remain relevant.”