Fail to innovate and embrace IT, prepare to fail

4 May 2005

Failure to innovate has been identified as one of the top three risks facing businesses over the next three years, claims a survey from the Economist Intelligence Unit (EIU).

Advances in technology are cited by almost 60pc of executives as the single most critical force changing the global marketplace over the next three years, according to the survey.

The EIU’s CEO briefing white paper, co-sponsored by Oracle, highlights the key issues and trends shaping the corporate agenda over the next three years. The unit interviewed 500 business leaders from across the globe for the survey.

The executives questioned are optimistic about global business prospects but they recognise that driving innovation, customer satisfaction and cost efficiencies, as well as harnessing advances in technology, will be paramount if they are to survive 2005’s increasingly competitive market conditions.

Technology and innovation go hand in hand in generating the flow of new ideas that look set to fuel growth in industries ranging from biotechnology and healthcare to telecoms and software. Of those questioned, more than 75pc believe healthcare, pharmaceuticals and biotechnology hold the most promising growth prospects, while nearly 49pc view telecoms, software and computers as the fastest-growing industries.

The IT industry, the survey notes, will increasingly play a vital role in managing the complex, globalised operations of today’s companies. As the emerging markets of China, India and eastern Europe place mounting pressure on traditional market forces, IT will be critical in helping these companies control their global operations and compete with their new rivals.

Two thirds of CEOs questioned believe the quality of IT infrastructure has a strong to medium impact on a country’s competitiveness.

Nicky Sheridan, vice-president and managing director of Oracle Ireland says: “Every CEO knows that in today’s intensively competitive marketplace, innovation is critical for survival. Successful CEOs with growing businesses are those that have placed IT at the core of their management strategy.

“By harnessing the latest in emerging technologies, such as grid computing, mobile computing and radio frequency ID, businesses can improve productivity and accelerate growth,” Sheridan said.

Daniel Franklin, editorial director of the EIU, added: “Executives now see technology as one of the most critical forces of change in the global marketplace. Companies rely on IT to connect and manage their global operations, but are also scanning the horizon to see how emerging technologies could affect their business in the future.”

By John Kennedy