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UK industry is neglecting technologies “right under their nose”, CBI warns

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In a new report, the Confederation of British Industry (CBI) has called on the government to encourage adoption of existing technologies in industry as a “national priority”.

The report - From ostrich to magpie – was published today ahead of the Autumn Budget, which is due November 22. According to the report, the slow adoption of existing technologies such as cloud computing is “driving” the productivity problem in UK industry. The adoption of proven technologies and management practices could improve productivity and reduce the wage gap.

According to Carolyn Fairbairn, director-general of the CBI, many businesses are focused on the “next big thing”, and missing out on already available technologies which are “right under their nose[s]”.

“Failing to adopt the nuts and bolts technologies of today is leaving a yawning gap in productivity and pay between businesses,” she said in a statement. While the UK has highly innovative businesses using cutting-edge technologies, the CBI found, these businesses employ just five per cent of the British workforce. In terms of uptake of technology in businesses, the UK is approximately ten years behind Denmark.

According to the CBI, the new Industrial Strategy – which aims to equip the UK for a future apart from the EU – is an ideal opportunity to address this issue. Funds should be allocated, it reported, to support businesses with adopting technologies.

“The UK needs more “magpie” firms with the skill and the will to find and adopt tried and trusted technologies and management practices that the best businesses showcase, and not get stuck in their ways. The impact could be a £100bn plus uplift in the economy and a narrowing of income inequality by 5 per cent. That would mean more opportunities for people and communities in every corner of the country.”

At last week’s CBI annual conference, Prime Minister Theresa May demanded that industry increases investments in research and development in order to ensure that British businesses lead in technological developments. Fairbairn commented that the Government must create the “right backdrop” for investment in order for businesses to become technological leaders.

“The diffusion of technology and best practices has been a serial blind spot for the government in its attempts to solve the UK’s deep-seated productivity pains,” Fairbairn said. “While there is no shortage of business support programmes from the Government, the problem for companies can be seeing the wood for the trees.”

“Ultimately, getting better at diffusion of key technologies and innovation is one of the missing links in solving the UK’s productivity puzzle and should be made a national priority.”

The CBI suggested that the government makes “innovation diffusion” a theme of its next industrial strategy, with a plan put in place for widening adoption of technologies.

It also recommended running a “five technologies all companies can adopt” campaign (although these five technologies have not yet been identified) and suggested that Innovate UK could hold a competition to create a platform which functions as a “one-stop shop for firms to access technologies and technology providers”.

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