Research by Curo Talent has revealed that only 4% of IT leaders are preparing for Brexit. The key objectives for tech teams in 2017 seem to relate to business growth, innovation and consolidating current IT systems and infrastructure.
We asked over 100 IT leaders at UK organisations “Which Commercial Objectives will IT need to support in 2017?”. The results can be seen in the chart below, and it appears ‘business as usual’ objectives are high on the list.
In any year, the aims of ‘increase revenue & profits’, ‘innovating new products’ or ‘improving current IT’ would feature at the top of an IT teams list – and 2017 seems to be no different, despite the looming uncertainty caused by Brexit.
The low priority of Brexit is further revealed by the second question in our survey – “What’s the big challenge to meeting your Commercial Objectives?”. Once again, Brexit and the uncertainty it has caused was last on the list, scoring just 6%.
There are a number of arguments as to why the IT team may be right not to be concerned. Firstly, even after Theresa May’s speech on 17 January, there is still little detail about the terms of Brexit. So why worry about a challenge that has not been defined?
Secondly, you could classify IT Departments as either providing ‘Technology as a Support’ or ‘Technology as a Product’. Support is the cost of keeping internal IT systems running, and Product is the development of IT as a revenue generator.
If IT teams are offering Support, and provide a function that is limited to UK borders, then Brexit has little impact.
If they are offering Support and it includes EU citizens within its data, then compliance with EU laws will be necessary. But the UK is already on a path to comply with new laws such as the General Data Protection Regulation, and existing EU regulations will be incorporated into UK law under the Great Repeal Bill.
So IT leaders may argue there is little need for any great upheaval within their department as Support will continue regardless of Brexit.
If they provide ‘Technology as a Product’ then the threat of tariffs becomes an issue. But EU citizens and organisations are buying IT products from countries outside of the EU – some of whom have no trade agreement with the EU (most notably the USA) – and tariffs are clearly not an obstacle.
It could be argued that if your product or service satisfies a customer’s needs they will buy it, regardless of tariffs.
Interestingly, the falling exchange rate means UK products are now more affordable than before. Sterling has dropped 15% against the Euro since the Brexit vote, effectively providing a 15% discount – that would pay for any tariff the EU might set, which could be as high as 5%.
Finally, it should also be stated that IT leaders may have got it wrong. Their failure to prepare or believe Brexit is a challenge could be a big mistake. For example, the impact of Brexit on attracting IT talent from the EU is very unclear at the time of writing.
We plan to conduct a series of surveys of IT leaders during 2017 to gauge the views of this critical body in our digital world. The next survey will be taken after 29 March when Article 50 is triggered and it will be interesting to see the results.
On a positive note, Curo Talent’s research also revealed that 47% of IT leaders expect their budget to increase in 2017 and that 68% are confident of meeting their commercial objectives in this year of great changes. The full results can be found in our report titled ‘IT Forecast 2017 – UK trends and challenges’.