Inside Business: Adapt to IT or die

BRITISH companies are being urged to compare their performance in understanding the potential of technology with leading companies in their sectors as part of an attempt to overcome directors' fears about this increasingly vital aspect of business.

The "Blueprint for Business" plan has been launched by the Institute of Directors in association with Oracle, the software company, in response to a study showing that UK business leaders lag far beyond their overseas counterparts in their take-up and understanding of information technology (IT).

Tim Melville-Ross, the institute's director-general, said at the launch of the study by the Bathwick Group: "Alarmingly, too many directors simply have no idea what IT can do for them competitively. In Darwinian terms, they seem less like dinosaurs than Neanderthals: slow-witted and quite unable to compete with more adaptive, versatile competitors."

Mr Melville-Ross added that he was concerned that British businesses would lose out in the 21st century, where economics were liberalising fast and technology was developing quickly. "Despite showing inventiveness and commitment at every level - from car workers in Sunderland to brand managers at Virgin - the UK is in reality limping along at the back of the field in the race towards the electronic age," he said.

Chairmen, chief executives or board directors not responsible for IT at 100 top UK companies were asked their attitudes towards IT for the research. For comparison, the same questions were asked of their counterparts in the United States, Singapore and Germany. Every one of the US and Singaporean directors said they used personal computers at work, while 80 per cent of Germans did so. But only 64 per cent of UK directors used a PC. At home, 96 per cent of Americans and 92 per cent of Singaporeans used PCs, as did 76 per cent of Germans. However, only just over half of UK directors used a PC at home.

Asked what they used computers for, just over half of UK directors answered for e-mail, compared with scores of well over 90 per cent for Americans and Singaporeans. Only about one-third of Britons used their computers to access company information systems, for business applications and for word processing, compared with more than 90 per cent for Americans.

Oracle's senior vice-president for Britain and Ireland, Philip Crawford, said British company directors had a much more negative view of IT's potential and advantages than those working elsewhere in the world. Two-and-a-half times as many British directors as Germans or Americans said IT investments were based on achieving cost savings rather than on winning competitive advantage.

"The UK relegates IT to a question of cost control for the finance director to sort out - a necessary evil, an administrative overhead," said Mr Crawford. "They do not see that IT no longer merely supports administration, but that business strategy should be based on IT advances. IT has the potential to take the company in entirely new directions."