The past few years have been marked by unique events, constant changes and challenging economic conditions. As companies have become accustomed to operating in an ever-evolving landscape, the start of a new year offers an opportunity to reflect and look ahead.
Meanwhile, technology continues to dominate headlines. AI is changing the way we interact with the world and at the same time requires more attention and investment. According to Capterra it is more than three-quarters of UK companies plan to increase their software budgets by 2025, including a focus on AI.
As we enter the new year, companies will also look to allocate resources to improve efficiency and support compliance – such as with new environmental, social and governance (ESG) reporting requirements – while adapting to a new era of technological advancement.
Nicky Tozer, SVP EMEA, Oracle NetSuite looks at the trends that will impact the UK business landscape in 2025.
The barriers to AI adoption are decreasing
AI is still considered by some to be an emerging technology, but it is no longer in its infancy. Data from the Federation of Small Businesses (FSB) in March 2024, it was suggested that only 20 percent of small businesses in the UK are using AI, yet 55 percent believe it could bring benefits – suggesting businesses are experiencing barriers to AI adoption or are simply unsure where to start their AI journey. But looking ahead to 2025, Capterra data shows AI adoption is on the rise priorityalong with IT security, because the fear of missing out is the driving force behind action and adoption.
What is changing? The concept of ‘garbage in, garbage out’ has gone mainstream and companies now have a better understanding of how to maximize the value of data and AI. Likewise according to ForresterWhile 2024 was marked by AI experimentation, 2025 will see business leaders focus on profits and return on investment. As the AI market matures, decision makers will look to connect and standardize data from across industries to ensure it improves AI performance and relevance.
There is also a growing awareness of where AI can be used. Forrester identifies Enterprise Resource Planning (ERP) solutions as an optimal destination for leveraging generative AI, while leading ERP vendors have rolled out new AI features embedded in existing workflows to help businesses leverage the technology and accelerate adoption.
Effectively adopting new technology is critical to productivity
As AI adoption continues to grow, business leaders must ensure that employees from all departments are included in the journey to truly reap the benefits. Certain business functions and departments are more likely to adopt AI than others, while the benefits may vary based on role, personal interest and enthusiasm for new technologies.
According to Capterra, it is remarkable that 57 percent of British companies which implemented software solutions over the past year, also introduced a learning management system (LMS) to support employee onboarding, indicating that business leaders are increasingly aware of the need to bring employees along on the journey to adopt new technologies . Organizations will adopt AI and software solutions that prioritize this user-centric approach, valuing intuitive design and adaptability.
In the future, we can also expect Natural Language Processing (NLP) to enable more intuitive interactions with AI systems, allowing employees at all levels to leverage AI capabilities without specialized training. Transparency and adaptability are also crucial. AI systems are only useful if we understand their decisions. Organizations will therefore increasingly adopt software solutions that provide explainable results to ensure the confidence and usefulness of the results.
The need to meet impending ESG requirements
The coming ESG regulations will reshape business practices as the EU Corporate Sustainability Reporting (CSRD) Directive requires some companies to report on their environmental and social impact from 2025. And beyond regulatory mandates, stakeholders – including investors, customers and employees – have increasingly sought greater transparency and accountability in the companies they partner with.
Technology will play a crucial role in meeting ESG requirements. Data from Deloitte July 2024 found that 74 percent of publicly traded companies plan to invest in reporting tools in the coming year to streamline the collection, analysis and reporting of ESG data. For many companies, this responsibility will span multiple departments, including finance, legal and operations.
More robust regulations increase the need for more tools and measures to support compliance. Systems that go beyond basic financial and management reporting to include specific and non-financial metrics, such as recording CO2 emissions and plastic use, will be particularly relevant from 2025 onwards.
The top priority areas for businesses in 2025 reflect a convergence of technological innovation, economic opportunity and regulatory responsibility. As business leaders look to improve the efficiency of their organizations with AI, they will be especially aware of how their employees can adapt to interacting with technology. This drive for efficiency will enable decision makers to allocate resources strategically, addressing both current operational demands and the increasingly demanding challenges of regulatory compliance. By embracing and responding to these priorities, companies will position themselves to thrive in a competitive and evolving landscape.