The threat of recession this year has caused 50% of UK c-suites to stop innovating
Half of UK C-suites (50%) say that the threat of economic disruption has meant innovation has ceased in their business, according to brand new research from independent consultancy Magnetic. Just 22% disagree, with 28% undecided. This corroborates the 56% who say they’re prioritising the survival of their business above all else; an especially concerning figure when two-thirds of the sample are large businesses with more than 250 employees.
However, despite a gruelling economic environment, growth and innovation is the top priority for C-suites in 2024. 37% of the senior leaders in UK businesses said that growth and innovation was a top priority over the next six months, especially for firms with fewer than 100 employees (45%, versus 34% with 100+) and publicly listed businesses (42%).
The next highest-ranking priorities include upskilling staff (32%), managing rising overheads (32%) and staff retention (30%), which outranked staff recruitment by 3 percentage points.
| Biggest priorities for c-suite executives in the UK over the next six months | |
| Growth and innovation | 37% |
| Upskilling staff | 32% |
| Managing rising overheads | 32% |
| Staff retention | 30% |
| Staff recruitment | 27% |
| Upgrading cyber-security | 27% |
| Developing sustainability strategies | 27% |
| Investing in IT infrastructure | 26% |
| Adapting to evolving customer needs | 25% |
| Shifting towards long-term thinking | 24% |
| Securing our supply chain | 22% |
| Staying solvent | 22% |
| Streamlining our change process | 17% |
| N/A – I don’t have any priorities for my business over the next 6 months | 2% |
This focus on growth and innovation brings with it an appetite for spending in UK firms. C-suites are prepared to put their money where their mouth is, with 84% set to train their teams in innovation skills over the next year, 81% pledging to invest in upskilling their employees in technical skills, and 89% planning to update their technology. In terms of set projects, 78% plan to invest in developing a new product, with 34% committing ‘significant investment’; this plan is more likely in publicly listed firms (85%) than in their privately owned counterparts (74%).
Of course, nobody expects the future to be smooth sailing, and UK c-suites are aware of the hurdles in the road ahead. The economy tops the list of concerns, with 38% identifying rising interest rates as a big challenge, 36% saying inflation, and 33% saying economic uncertainty in general. Beyond the economy, 26% are concerned about access to talent, and many are worried by the pace of change; 19% name the pace of technological development as a key challenge, and the same number (19%) highlight both changing consumer needs and shifting employee expectations.
Jenny Burns, CEO of independent consultancy Magnetic, comments: “It’s become the cliché of the 2020s; ‘change is the new normal’. But we cannot become complacent – it being trite doesn’t mean it isn’t true. The volatile economic landscape combined with geo-political tensions and a dramatically evolving consumer outlook has hurtled business leaders in the UK from challenge to challenge; the pace and enormity of change is unfathomable. Companies need to do more than just survive – they need to maintain a sense of consistent direction, while also adapting and evolving to uncertainty.
“The solution here is not to batten down the hatches. The best leaders are investing in their teams to help them become more flexible to uncertain change, demonstrate enthusiasm for growth and learning, and feel emboldened to think creatively beyond the status quo. From the top down, it means embedding an innovation culture of experimentation and agility, to test quickly and fail cheaply, embracing uncertainty at low risk.”
“For leaders looking to embed innovation in their teams, Magnetic offers The Innovation Academy. With training designed and delivered by active innovation practitioners, who solve big business challenges every day for all types of organisations across the globe, the Academy offers everything from individual training programs to team workshops to coaching and facilitation. It starts with human-led design and is designed to help people learn real skills.”
