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Political uncertainty is holding back digital transformation plans, say CIOs

UK businesses are investing in IT to help them deal with changes that could be around the corner amid geo-political uncertainty

Despite almost two-thirds of UK businesses planning for high growth, one-quarter of them have recently cancelled a digital transformation project and one-fifth have put the budget for such projects on hold because of political uncertainty.

In a survey of CIOs at UK businesses with revenue of between £200m and £5bn, carried out by Coleman-Parkes Research, 58% cited the changing political climate as their biggest challenge – and almost all (94%) said Brexit has affected their decision-making.

Despite this, 63% said they plan high growth and digital transformations could help them cope with geo-political and market changes, such as the end result of Brexit. In fact, 60% of the businesses are investing in digital transformation to stay ahead of changes, with 42% citing the modernisation of IT systems to improve operations and reduce costs as a top priority.

But more than half (52%) of the CIOs said there is a lack of consensus and direction among senior executives.

Uncertainty over the government’s approach to Brexit is probably the biggest threat to business investment. A recent survey of 100 senior IT decision-makers by Accenture spin-off Avanade showed that 41% have either slowed down or stopped their investment plans because of the uncertainties caused by the UK government’s aim to leave the EU in just under two years – but 56% have accelerated their digital transformations to prepare for Brexit. A total of 49% have no specific plans for dealing with Brexit.

The Interoute-commissioned report Transforming for success in a changing world revealed that businesses are investing in technology to ensure they are prepared to react to potential changes in the geo-political environment.

Read more about Brexit and the UK IT industry

Matthew Finnie, CTO at Interoute, said: “This requires an ICT infrastructure that enables, not inhibits, change. Rather than handcuffing an organisation to a specific supplier or inflexible infrastructure choice, it is about ensuring that the platform and provider you choose gives you the freedom to change and adapt as the market does.”

The move to cloud-based infrastructures is one of the ways in which businesses are trying to retain flexibility in the light of an uncertain future. The survey showed that 46% of businesses are planning to migrate significant proportions of their IT infrastructure to the cloud in the next 10 months.

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