Australian research confirms the link between business investment in new technology and productivity growth.
It's well understood that optimising technology in your business can lead to improved productivity, efficiency and profits. So it's nice to hear that Australian research confirms the link between business investment in new technology and productivity growth.
A nationwide cross-sector survey of CEOs found more than a third of businesses that invested in new technologies in 2012 reported improved labour productivity, compared to just 16 per cent of businesses that did not invest.
That’s consistent with long-term trends, with Australia’s ICT-intensive businesses showing labour productivity gains of around 45 per cent in the last decade, compared to the average across industry sectors of 13 per cent.
How the productivity gains were realized
Employee knowledge and skills had the most significant influence on the productivity gains that businesses realised from investment in technology, according to the Australian Industry Group National CEO Survey.
Of businesses that reported productivity growth, “40 percent said the main contributing factor was increased staff skills and capabilities, followed by process improvements (29 percent) and capital investment (17 percent). These findings suggest that skills, innovation and technology investment will be critical to lifting business productivity over coming years.”
Supply chains were the most common source of information on new technologies. Over 50 percent of businesses learn about a new technology from a client or supplier, with demands from supply chain partners and customers providing the impetus to invest in technology.
High-speed broadband network gap
Despite bipartisan support for high-speed broadband in some form, less than half the companies surveyed were ready to take advantage of the opportunities broadband will provide.
Most businesses cited improved collaboration as the key benefit of access to high-speed broadband, with other advantages including lower transaction and communications costs.
Businesses also expect broadband to provide better support for cloud computing, video conferencing, remote monitoring and sending and receiving large files.
Technology investment has flattened since 2008, with the outlook for business conditions still the biggest influence on decisions to invest in technology. However, for Australian businesses to grow and remain globally competitive, investment in technology and staff training will be essential.