Business Blockbuster - Helpng business to be more visible on Google

Daily Bulletin

Broadband won't make businesses more productive if they lack software savvy

  • Written by: The Conversation
imageThe missing piece of the puzzle.erp by Mathias Rosenthal/shutterstock.com

One of the great promises of technology ever since the invention of the spinning wheel is that it can increase productivity. The use of business computing has grown exponentially in the last 20 years and exploded into the colossal consumer business it is today, with many people having not just one but several computers or similar devices such as smartphones at their disposal.

With this amount of technology in use and the rate of innovation you might expect that this would improve productivity. But this appears not to be the case, according to latest figures from the OECD.

As far back as 1987, economist Robert Solow said: “You can see the computer age everywhere but in the productivity statistics.” It appears to be a long-standing problem. More recently a study by John Fernald of the Federal Reserve Bank of San Francisco noted that although technology had led to substantial increases in productivity, its impact was felt primarily in those industries that were information technology-intensive, and much more limited across the rest of the economy.

Herein lies the true challenge of the growing digital economy: how do we spread the growth and productivity gains experienced by the IT sector to other economic fields? This year’s OECD Digital Economy Outlook provides some interesting statistics that illuminate the issue.

One aspect of the problem was noted by novelist William Gibson when he said: “The future is already here – it’s just not evenly distributed”. With that in mind the recently published UK government productivity plan reiterated the need for a world-class digital infrastructure in the UK, with a broadband strategy that seeks to achieve, among other goals, basic broadband (2Mbps) for all, and superfast broadband coverage to 95% of UK households by 2017. While this is laudable, the OECD report notes that 95% of all UK enterprises already have broadband, albeit with a voracious appetite for more bandwidth. Clearly, fast internet connectivity may be necessary but it’s not sufficient for improved productivity and competitiveness. We need to understand what, once businesses have broadband, they use it for.

Subhead? All about the software

The OECD report considered the uses of certain software including websites, online purchasing, social networking, enterprise resource planning (a suite of applications that help manage a business), online sales, supply chain management and radio frequency ID tags (RFID) for purposes such as stock control.

imageUse of software in the enterprise is surprisingly low.OECD

Corporate websites are popular; across OECD countries 76% of businesses have a website. The UK is slightly ahead of the average at 80%, but far behind Switzerland and Finland with 95% of all business having a web presence.

One telling statistic for the UK is the low adoption of enterprise resource planning software. Enterprise resource planning software emerged in the 1990s from its background in manufacturing to become more widely applicable across all business sectors. It provides a suite of software applications to manage a business and integrates all aspects of the operation, including planning, accounting, supply chain, sales and marketing. Estimates vary but best-in-class companies find they can reduce operational and administrative costs by between 10-20% within three years of implementation.

imageUse of enterprise software is not evenly spread, and the UK doesn’t figure highly.OECD

The UK trails far behind most of the EU with only 11% of firms using this type of software and the problem is particularly prevalent in small (10-49 employees) and medium-sized (50-249 employees) UK businesses. This ranks the UK alongside Latvia and Turkey, while most other EU countries are well above 30%, led by Belgium (47%) and Austria (45%). The low adoption rates in the UK would go some way to explaining the UK’s lagging productivity figures.

As long ago as 1999, research showed that preparation for the introduction of the euro currency across the eurozone would require significant changes to IT used in businesses. One solution adopted by many companies affected was wholesale replacement of older legacy systems with new enterprise resource planning software.

The UK government might like to reflect on the policies and incentives it might put in place that would encourage British businesses to catch up with our eurozone partners who have benefited from this investment in productivity for the last ten years as an unexpected side effect of European monetary union.

Derek McAuley receives funding from Research Councils UK.

Authors: The Conversation

Read more http://theconversation.com/broadband-wont-make-businesses-more-productive-if-they-lack-software-savvy-44738

Business News

The Growing Demand for Durable Plastic Packaging Supplies Across Australia

Why Do Australian Businesses Need Reliable Plastic Packaging Supplies? Businesses need packaging that can withstand everyday handling, storage, and distribution without creating avoidable delays. Pla...

Daily Bulletin - avatar Daily Bulletin

Office Cleaning Melbourne: Choosing the Right Scope for Your Office

A well-planned office cleaning Melbourne arrangement starts with a clear understanding of the premises and the people who use it. An office may include private work areas, shared desks, reception, mee...

Daily Bulletin - avatar Daily Bulletin

How Businesses Can Prepare for Unexpected Power Outages

Power failures can occur quickly. The supply may be interrupted by bad weather, issues with the electricity network, damaged equipment or local construction work. This can be just a hassle for a fam...

Daily Bulletin - avatar Daily Bulletin

How Chatswood Tutoring Can Fit Into a Student’s Weekly Routine

Create a Predictable Weekly Structure A consistent weekly routine can make study easier to manage when students are balancing several subjects. Chatswood tutoring can provide a fixed learning point a...

Daily Bulletin - avatar Daily Bulletin

The Rise of Digital Marketplaces in the Australian Trade Sector

For decades, the Australian trade and construction sector operated almost entirely on word-of-mouth recommendations and local community networks. Small business owners typically relied on local newspa...

Daily Bulletin - avatar Daily Bulletin

How Immigration Lawyers Can Help

Introduction Visa decisions can shape employment, family life, study plans, travel, and future residence. A small omission can lead to delay, added expense, or refusal. Immigration lawyers assess l...

Daily Bulletin - avatar Daily Bulletin

How Industrial Drying Equipment Supports Efficient Processing

Many industrial processes require moisture to be removed from compressed air, products or process materials before they move to the next stage. Excess moisture can affect equipment performance, produc...

Daily Bulletin - avatar Daily Bulletin

Practical Ways a Whiteboard Can Improve Workplace Communication

Effective communication helps teams stay organised, share ideas and keep track of important information. While digital tools are now common in many workplaces, a whiteboard continues to provide a simp...

Daily Bulletin - avatar Daily Bulletin

Designing Eco-Friendly Custom Water Bottles for Your Next Event

The Evolution of Sustainable Event Merchandise Event planning has undergone a massive transformation over the last decade. Gone are the days when organizers could hand out cheap, single use plastic...

Daily Bulletin - avatar Daily Bulletin

The Daily Magazine

What Australian Entrepreneurs Should Know About Streamlining Their Financial Processes

Running a small business in Australia demands much more than just delivering a great product or serv...

Supporting Joint Health in Young and Growing Horses

Anyone who has raised a foal through to a rising three-year-old knows how deceptively fast the gro...

Why Is My Switchboard Buzzing? What a Humming Breaker Is Telling You

Most people never hear their switchboard. It sits quietly in a cupboard, a hallway or a meter box ou...

Solar Panels Geelong: Key Factors to Consider Before Installation

Solar power can help households and businesses generate electricity on site, but the value of a syst...

How Rats and Mice Get Into Homes Through Gaps Most People Miss

Rats and mice do not need an open door to get inside a home. They can squeeze through small openings...

Why a Safety Certified I/O Module Matters in Machine Design

Understanding Safety-Related I/O A safety certified I/O module is designed for use within an arch...

How to Compare Ceiling Fans online before Buying

Comparing ceiling fans online before making a purchase helps you understand how each model will su...

How Does a Portable Power Station for Carvan Adventures Support Smarter Camping?

Why Does Off-Grid Camping Need a Reliable Portable Power Station for Carvan Travel?  People often...

How Ecommerce Order Retail Fulfillment Services Improve Order Accuracy?

Why Order Accuracy Matters in Ecommerce Order Retail Fulfillment Services?  Order accuracy is one...