Regardless of how the economy shapes up after Brexit, Britian’s decision to move out of the EU in June has undoubtedly given birth to a new-world equilibrium for all in Britain and EU.
Greyhound Research believes that despite the proposed outcomes of political and economic liberty arising out of Brexit, Britain’s reliance on the EU (and vice versa) will continue to be pivotal for their respective success.
There exists a dense underlying fabric between Britain and EU, which consists of four broad threads: Political, Economic, Social and Science & Technology. While the political, economic and social threads have been written about in fair measure, Greyhound Research would like to underscore the importance of the fourth thread – Science & Technology.
Greyhound Research believes Brexit’s impact on Science & Technology will hold a decisive influence.
Per a statement by House of Lords Science & Technology Committee, approximately 18.3% of Britain’s funding from the EU goes to scientific research and development. Separately, the committee report states, “Based on the proportional contribution to overall EU finances, Britain contributes around 11% of the EU research budget and receives around 16% of the allocated funding, making it a substantial net beneficiary under Framework Programme 7 (FP7).” The data suggests that Britain received approximately EUR 7 Billion of research income under FP7, marginally behind the top recipient, Germany.
While it is certain that business exchange between Britain and EU will continue despite Brexit, stakeholders can well expect issues specific to them.
Below are key reasons why Brexit will matter to Large Enterprises and their IT Decision Makers across both Britain and EU:
- CEOs and Boards are now faced with a new-world equilibrium
- Expect backlash from local and regional competition
- Budget for significant increase in cost of doing business
- Plan for technology to be an area of major budget and resource spend
- Anticipate additional competition from newer technology-led incumbents
“As market forces evolve post Brexit, CEOs and Boards can expect to fight an uphill battle to adapt to this new-world equilibrium. The uncertainty of the stand that the new Prime Minister of Britain (Theresa May) will take with the EU to discuss terms of split under Article 50 will undoubtedly delay (and in some cases derail) investments and deals on both sides. Furthermore, the already envisaged outcomes of the need to revisit enterprise strategy and increase in cost of doing business will hurt the competitiveness of the unified Europe story in global markets,” said Sanchit Vir Gogia, Chief Analyst and CEO of Greyhound Research.
Greyhound Research believes forward-looking CEOs and Boards can use a 5-point framework to reboot for growth in this new-world equilibrium.
To know more about this framework, read our freemium Greyhound Sprint Report titled, What Brexit Means For CEOs & IT Leaders.
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