As the world comes out of the worst financial crisis since the Great Depression, it seems that the UK, despite its long established reputation as a leading global business centre, is not faring as well in the recovery as some of its neighbours. The breakdown of certain British banks, wide spread redundancies and a new Government have left some questioning whether doing business in the UK is as rewarding as it once was, putting into doubt the standing of UK plc on the world stage.
However, while the media tend to paint a gloomy picture, recent reports tell us that the UK still ranks highly as an investment destination. Ernst & Young's European Attractiveness Survey, for example, has found that the UK, despite suffering a deep and long recession, remains the most attractive destination for foreign direct investment (FDI) into Europe. Job creation only fell by 1 per cent between 2008 and 2009 and the UK attracted 16 per cent of the jobs created by FDI across Europe.
Further, the UK’s continuing strength in financial services underpinned its receipt of 30 per cent of business services projects, 36 per cent of software projects and 27 per cent of financial services projects in Western Europe. The UK also attracted 54 per cent of all Indian FDI projects into Europe.
To gauge the views of the Criticaleye Member Community, we asked the UK based leaders from our Advisory Board about their views on the merits (and otherwise) of UK plc. The responses varied from highly encouraging to somewhat pessimistic:
Brendan Hynes, CEO, Nichols plc
- I am not too downbeat about the prospects for UK plc. I understand the real concerns that stem from the budget deficit, the pain heading our way and the impact on consumer confidence, but I also believe that when the banks have turned the corner and returned to private ownership, the capital markets have opened up more and the consumer has better visibility of the proposed tax changes, confidence will start to return.
Jeremy Small, Group Company Secretary AXA UK plc
- It’s easy to be downbeat at the moment about UK plc. However, our economy and businesses of all sizes have proved overall to be more resilient than people originally thought. While we have experienced extraordinarily difficult economic conditions, a new partnership approach has been taken by many companies and their employees to share the costs of scaling down activity and, where possible, preserve jobs. This means that we are all better placed to take advantage of the opportunities that are now becoming available.
Abbas Hussain, President, Emerging Markets, GlaxoSmithKline
- There has been a realisation in government that we need to rebalance the economy away from financial services; the life sciences sector is seen as a key sector where the UK is globally competitive and there is room for growth. We have been working with the UK Government Office of Life Sciences over the last year to develop an action plan to help the life sciences sector make a greater contribution to the UK economy as we come out of the downturn.
Steve Cooper, Managing Director, Barclays Business, UK Retail Banking, Barclays Bank
- UK plc is far from bust. Despite the tough economic conditions, the business community is starting to recover. Sure, it will be difficult for the next couple of years, but this year will be better than last and consumers and businesses are learning to survive - even prosper in this environment. I'm also seeing record number of business start-ups and business owners cautiously expanding, particularly overseas.
Ed Fitzmaurice, Chief Executive Officer, Hastings Direct
- A successful company tends to have a clear vision generally built on knowing what it is good at. If you were to look at UK plc as a company, it's difficult to see why it would succeed over its competition. Why? It is unclear where it is going and what it is good at; it has underinvested in its people and infrastructure and it lacks a degree of cohesion. But I don't think this is terminal, with strong leadership and staff that recognises the need for change, companies can be turned around.
Richard Laing, CEO, CDC Group plc
- UK plc can lead and prosper from areas such as, design, specialised engineering, the arts, media, banking, insurance and other financial services as we have an excellent education system producing good minds. Now that most basic manufacturing is carried out in places such as India and China, it is this intellectual capital that we must draw upon.
Martin Balaam, MD - BT Engage IT, BT Group
- UK plc needs to decide what ‘success’ is and who should be able to share in this success and why. The post-WW2 era has seen ‘success’ being measured by pure financial and material KPIs and an unrelenting drive to get the population to be money and possession focused. The recent financial turmoil has led many to start to question what ‘success’ is really about – UK plc should use this as a catalyst to redefine and realign expectations.
Gary Kildare, Vice President, HR, Americas, Europe & Asia Pacific, IBM
- The UK has experienced a more acute downturn than our European neighbours, US colleagues and those in the growth markets. But it's too easy to accept the doom and gloom - there are clients to be won, customers to be served and opportunities to be seized. Businesses must stay close to their customers and leaders must spend time with their teams providing a positive view. UK plc has a strong history of adapting to changes and shifts; there is high quality leadership and talent in the UK, which should allow us to be optimistic about the future.
There is no doubt that the environment in which UK plc operates has changed dramatically since the start of the recession, putting more pressure on innovation and innovative business models. However, we all have a vested interest in the advancement of UK businesses and their adaptability. Criticaleye is passionate about business here and believes that, in order to cement the country as a global business leader, UK plc has to come to terms with this change.
I hope to see you soon,