The United Kingdom may have voted to leave the European Union; however, it remains uncertain what the journey to Brexit will actually mean. How can the United Kingdom effectively disentangle itself from the European Union? What are the legal, tax, funding and business implications?
Brexit is likely to have a big impact on start-ups, data privacy and telecoms, and will affect many aspects of work. It may provide growth opportunities — or hinder them. It is unclear whether businesses will be able to continue holding and transferring data and personal information without any interruptions after 29 March 2019. It is also uncertain whether businesses will have to pay mobile roaming charges in the EU.
The immediate post-vote reaction was mixed. Berlin is seeking to attract digital start-ups from London, and the security company G4S warned the United Kingdom’s workforce that economic growth might shrink. Lloyds Bank accelerated job cuts, axing 3,000 posts — although claiming this decision had been made before the vote. On the other hand, Japan’s SoftBank announced it was buying the UK microchip-maker ARM Holdings and doubling the staff in 5 years. Pharmaceuticals firm GlaxoSmithKline was investing £275M in the United Kingdom, and McDonald’s was creating 5,000 new jobs. Dyson said it would create 3,000 new research and development (R&D) jobs by 2020, more than doubling the present number. However, Dyson is now moving its headquarters to Singapore.
Some businesses, particularly service-related ones, were initially cautious as they decreased discretionary spending. The drop in the value of the pound caused some businesses to blame Brexit for a drop in their results, including Indian IT services players such as Wipro. The UK economy appears to be stalling, there is a wider slowdown in the global economy and with a “no deal” looming, uncertainty continues to escalate.
Uncertainty can mean opportunity
While business does not like uncertainty, business fundamentals remain the same. Will my business model continue to create value for stakeholders and customers? Will the supply chain efficiently enable the business? What are my competitors doing to disrupt my business? What impact is digital having on my business? And so forth.
Businesses are re-examining everything — their business plans, operating models/supply chains, regulatory and compliance requirements, growth opportunities, customer interactions, talent pipelines, funding and tax positions. They may also need to re-think possible mergers and acquisitions (M&As) to manage risk, optimise performance, reduce cost and enhance competitiveness. They will be seeking to minimise disruption to the business and their customers, but at the same time thinking: How can I use this uncertainty to my advantage?
Use Brexit to catalyse your digital transformation journey
We’re now living in an idea economy where success is defined by the ability to turn ideas into value faster than the competition can. Businesses can succeed only if they have both the vision and the technological agility to respond to market opportunities and quickly turn ideas into reality. In my view, the uncertainty caused by Brexit is the catalyst, and digital thinking is a key enabler to gaining this advantage.
Improving customer engagement is the driver in nearly every digital transformation. But we need to be aware of what Brexit means and the impact of cross-border challenges. How will a “no deal” affect UK businesses transferring personal data to and from the European Economic Area? Can we re-imagine the customer journey post-Brexit enabled within a digital road map?
How will data, compliance and regulatory requirements affect the supply chain landscape? Can we re-imagine the supply chain in a “no deal” environment? How will possible restrictions in the free movement of people and goods affect the supply chain? Will M&A be required to enhance the supply chain? What effect will the supply chain have on the rest of the business and on customers, particularly if there is no deal?
Businesses need to be able to respond to these questions, and the stark fact is that the majority of organisations aren’t ready — particularly for a “no deal”. It is not just a case of assessing business risks or creating contingency plans, it is about reimagining the business and harnessing digital.
Brexit and digital must be used as an opportunity to help shape your business for the future — to enable you to gain agility and the ability to sense and respond quickly to changing markets and disruptive competitors.