It’s vital the UK improves its IT, argues Paul Hunt, managing director of Phoebus Software
Although the empire is a shadow of its former self, we Brits still like to think we’re leading the world. Our country is the birthplace of modern democracy, London is the world’s financial capital and it was here that the first computer was built to crack the enigma code. The days of heavy industry in the UK are no doubt to be consigned firmly into the past, but while we hope to replace it with a leading high-tech economy, it’s vital we stay ahead of the game.
That’s what research from the World Economic Forum (WEF) has shown this week. The WEF’s research shows the UK is lagging behind Asian economies when it comes to integration of Information Communications Technology (ICT) structures into its economy. Singapore, Taiwan and South Korea are leading the way and unlike Switzerland, the US and Canada, the UK doesn’t even appear in the top 10.
UK businesses are known globally for high-level systems development work – especially for the banks and the mortgage lending industry and we mustn’t let this advantage slip through our hands.
The fact is, if you aren’t growing your economy through big industry and exports of manufactured goods and raw materials, you face disaster in the long-term if you aren’t in a position to use technology to gain a competitive advantage. The UK runs a serious risk of squandering its many advantages as a place for high-tech industry by failing to get to grips with the newest technology available.
To put it simply, the right technology is as much a part of successful businesses in developed economies as a talented and highly-trained workforce. In the mortgage industry, having the right systems in place has become even more important as a result of the enhancement of TCF and the post-recession regulation boom. Both servicers and lenders must ensure they are able to look at customers as individuals in order to come up with alternative payment strategies and to ensure that if repossession is required, no stone has been left unturned.
This requires a modern and reliable system which is tailored to the current regulatory environment and which is sufficiently flexible to take account of any new and unexpected regulatory change. If lenders and servicers are serious about compliance, it’s not just human systems that must change, but electronic ones too.
But it would be wrong to assume getting up to date would be crushingly expensive. A mistake made by too many UK companies – and according to the WEF, not so many Asian ones – is to assume the cost of getting up to date will outweigh the long-term savings achievable once new systems are in place.
For instance, a big lender with an ageing legacy system becomes a greater hostage to their IT department every day. The language of programming has changed since many of the oldest systems were installed and younger programmers are no longer able to maintain them. This means many businesses in the UK are forced to rely on a dwindling number of ageing programmers who require larger and larger compensation packages to convince them to ward off retirement for another year. Costs can skyrocket.
Even worse, it’s not impossible that there will eventually be nobody left who can maintain an old system which could bring about catastrophic data loss. Companies who fail to take ICT updates seriously aren’t just committing themselves to escalating salary costs, but also to even more expensive systems failures.
In a global marketplace, it’s vital to differentiate yourself however you can. If UK PLC is serious about maintaining its preeminent position in the global economy, it must take action to ensure the difference isn’t antiquated ICT.
