UK businesses need to get used to ‘failing fast’ to get out of the productivity doldrums, says Claranet

The UK will struggle to plug its productivity gap until British businesses can afford to take more risks and embrace a 'fail fast' philosophy. This is according to managed services provider Claranet, who argues that by focusing on getting the right approach to devolving, testing and deploying new applications that support the rapid rollout of new customer initiatives, businesses will be in a stronger position to kick start a period of steady growth.

The UK continues to suffer from some of the lowest rates of productivity in the developed world. Latest figures from the Office for National Statistics have shown that UK productivity was 15.1 per cent below the average for the G7 group of world's largest economies last year, and remains 15.8 per cent behind its pre-financial crisis rate. Moreover, the Office for Budget Responsibility recently recommended that the productivity growth forecast of 1.6 per cent for 2017 – made in March this year – should be revised downwards after a prolonged period of sluggish performance.

For Claranet, this negligible rate of growth can be attributed in part to restrictive IT practices that prevent organisations from meeting the needs of their customers in the new digital economy. These traditional approaches don't enable the rapid and experimental process which underpins innovation.

Michel Robert, Managing Director at Claranet UK, explained: "The UK's productivity crisis keeps rolling on, and it's becoming increasingly clear that new approaches to meeting customer demand are needed if UK businesses are going to shake themselves out of this productivity malaise. In this climate, it's critical that businesses can react quickly to changing market conditions, but the fact is that many organisations are being hamstrung by their IT.

"Driving productivity is really contingent on businesses' ability to 'fail fast' – that is, try something new, determine if it's working, and quickly move on if it's not. But this sort of philosophy is completely at odds with traditional approaches to IT, where projects typically require a lot of investment, and it can be months or years before their positive or negative impact on customers can truly be seen. Moreover, when you're paying the bills for hardware and support then of course you're going to be risk averse as, ultimately, getting it wrong often means ending up with redundant hardware and redundant people. The net result is that change slows down and productivity suffers," he continued.

Robert believes that organisations need to confront the uncomfortable nature of failure, and use it as a way to learn quickly and revolutionise the pace of product and service provision. This means embracing technology such as cloud, accelerating practices such as DevOps and implementing processes including continuous testing and evaluation, automation and an emphasis on developing innovative applications that meet the changing needs of their customers.

"The companies that are winning in their markets are those that move quickly, take risks, learn continually and they are able to do so thanks to the agility and scalability brought by technologies like public cloud. The on-demand nature of public cloud services means that businesses can test things out without making large up-front capital investments, thus reducing up-front cost and speeding up the process of innovation. This approach means that if businesses fail in their initiatives, they fail fast and move on."