Almost all (91%) of UK business leaders have had a software investment fail to meet expectations, according to new research.

The new 2023 State of Digital Adoption report from technology company, Userlane, reveals that the average UK enterprise (1,000+ employees) has spent almost £1.8 million on new software investments in the last year.

UK businesses are grappling with technology adoption challenges
he most common reasons for failed software investments are resistance from employees, poor planning, and a failure to properly integrate software with existing processes and systems (all cited by 22%).

Overall, most companies (56%) rate themselves as only ‘somewhat effective’ at making investments in software, with Userlane’s report highlighting the scale of poor digital adoption – the process of accepting, using and maximising technology. What’s more, two-thirds of business leaders feel their organisation has a digital skills gap.

According to the research, the most common software adoption challenges are:

• Increase in IT support queries (32%)
• Higher training costs (31%)
• Higher costs associated with maintaining old/outdated technologies (27%)
• Poor return on investment or value attained from technology purchases (26%)
• Resistance from employees towards adopting new technologies (25%)

IT teams are held responsible for digital success – but struggle to measure it
While the majority of business leaders (85%) see digital adoption as a priority, almost all (94%) say they are struggling to improve it. Interestingly, Userlane found that IT (52%) are more likely to be held responsible for improving digital adoption than any other team, including executive leadership, HR, and learning and development.

While 96% businesses say they currently measure success of their digital transformation projects, the research found there is no dominant approach.

Around a quarter (26%) track efficiency gains, cost savings, or revenue growth, while a similar number also look at improvements in employee productivity and output (24%). Only one in five assess how well employees are actually adopting new digital solutions.

Poor software adoption is hurting employee wellbeing and productivity
The report found that two-thirds (68%) of employees see stress-free software usage as important to their overall happiness at work, with a further 90% linking it to productivity.

Despite this, the vast majority (90%) of employees reported difficulties using software, with the average employee losing 2.33 hours per week to software-related challenges. For a business of 5,000 employees, this equates to more than 600,000 hours of wasted working time every year.

Businesses remain bullish on digital transformation
Six in ten UK businesses are planning to increase their digital transformation budget in the next 12 months, with one in five anticipating a boost of more than 20%. On average, budgets will increase by 8%.
At the same time, average software training budgets per employee have dropped by half since last year.

Hartmut Hahn, CEO of Userlane, commented: “Many business leaders simply purchase new technology and assume people will know how to use it – and are surprised if that doesn’t lead to the expected results.

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“If businesses ignore employee needs when it comes to software adoption, they will not only damage employee experience and productivity, but reduce their return on their technology investments and fail with their digital transformation initiatives.”

“Our research shows that employees are highly motivated to develop new digital skills – and this is great news. Making digital adoption easier is key to helping them meet their learning and development goals.

“A great way to achieve this is by implementing a Digital Adoption Platform (DAP). DAPs not only integrate seamlessly with any software employees are using, but they can also be combined with analytics tools that track and measure digital adoption progress across hundreds of different applications.”