You’re productive. Perhaps you were already aware, but for those of us living in the UK the annual Office of National Statistics (ONS) report could have us believing otherwise. Fortunately, recent reviews into this data have determined that telecoms have been regularly saving the day.
The ONS publishes data on, among other things, the UK’s level of productivity in relation to other industrialised nations. For nearly a decade these have been depressing numbers; the UK has continually been lagging behind the likes of Germany, France and the United States. Having previously lived and worked in the United States this disparity surprises me.
Last month the ONS published a statement that highlighted a flaw in their accounting and could be down to inaccurate statistical models on their part. In fact, the disparity between the UK’s productivity and the rest of the industrialised world may not even be a real thing. You can read an article from The Economist on the recent statement here.
It turns out telecommunications have made a bigger impact than anticipated and this is where the inaccurate measurements come in. In 20 years we’ve moved from dial-up modems and unbearably slow internet to blasting through gaming and video on 5G smartphones and, unfortunately, productivity models used by the ONS severely underestimated two factors:
- Businesses who have regularly invested in their telecommunications and IT are far more efficient than predicted
- the cost of this efficiency is far lower than predicted.
The ONS has been estimating a reduction of approximately 50% in telecoms prices since 1997, but a more accurate estimate has been calculated at 95%. This reduction is significant enough to prompt the ONS to recalculate their productivity figures which will be published in October.
In most areas of IT and telecoms the trend has been to minimise or reduce costs. With the exception of cyber security, we would say this has been and will continue to be the case.
As an example of those cost reductions, in the last 5 years we’ve seen a significant price drop across the UK for fibre broadband and leased line services. At some points these prices were moving by 30% in a 12-month period. Deploying cloud services has also significantly helped with costings for services; cloud-based telecoms platforms are regularly demonstrating cost reductions against the purchasing and maintaining of on-premise solutions. You can see more on cloud voice offerings here.
To find an example of increased efficiency we don’t need to look any further than the recent working from home scramble due to lockdown. There are still various studies calculating the full impact of lockdown on business, on employees and on efficiencies with one study suggesting a 10% increase in worker output from homeworking. Regardless of whether there has been an increase in productivity the fact that a business can have any level of activity in such circumstances would have been unheard of 20 years ago. The many businesses that have equipped themselves with advanced solutions that allowed for easy transitions to home working will have a significant advantage over those that haven’t.
Not that we should be hard on the ONS; worker productivity is a difficult figure to calculate. Also, it’s easy not to believe telecoms companies when they start jabbering away about how they can bring in this efficiency or that, but the fact remains, telecommunications and IT advancements have achieved more than most of us realise.
Now may be the best time to consider if more could be achieved for your business by reviewing your IT and telecoms solutions.