Industry news

High street retailer, John Lewis Partnership (JLP) will continue to invest despite a fall in profits. Profits for the first half of the year fell by almost 15% though revenue was slightly up. JLP will prioritise investment in IT and its distribution network as “Both are critical to improving service and convenience,” said the company. The results follow the opening of two national distribution centres in Milton Keynes as part of JLP’s “omnichannel strategy”. However, chairman Sir Charlie Mayfield was adamant the results were “not as a consequence of the EU referendum result, which has had little quantifiable impact on sales so far”.

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Over 40% of law firms are looking to merge with or buy another business in the next year to defend against competition according to information released yesterday. This is a striking increase from last year, brought on by increasing competition and firms wanting to increase their service offering to customers to distinguish themselves from competitors. “The right acquisition combined with an effective strategy can help firms to scale up and develop market presence” said Giles Murphey, head of professional practices at Smith & Weston. Noticeably, 93% of firms were confident about the year ahead suggesting Brexit is not damaging confidence in the legal profession as much as feared.

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British Bank RBS has suffered a setback in an attempt to offload over 300 branches as part of an agreement for its bailout in 2008 after one of the key bidders has dropped out. Santander has distanced itself from the deal as low interest rates cut into bank profits, reducing the attractiveness of any expansive purchases. Previously RBS had tried to spin the branches off under the name Williams and Glyn but this failed after rising costs left the bank £345 million out of pocket for the attempt. The prospect of a fire sale will worry the government which still owns 73% of the bank as the branches must go to satisfy EU rules on state aid by the end of 2017.

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Related news: UK retail banking has been criticised as not going far enough

Microsoft, the software titan is planning to buy back $40 billion of its shares as its previous buy back scheme comes to a close at the end of 2016. Microsoft also increased its dividend in a move that many investors cheered. The US software giant bought LinkedIn earlier this year for $26 billion which many analysts feared was too much. A cynical view of the move may suggest that the buybacks are to cover for struggling innovation and market share in many emerging tech sectors as Microsoft finds itself swamped and outpaced by rivals in a more niche digital economy.

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Broxbourne Borough Council has joined Hatfield Borough Council on the Hertfordshire Shared Service to improve quality and service while keeping costs down. The service will help with the provision of revenues and benefits alongside IT services. Sopra Steria will be supporting the two councils with experts in IT and business process who can be deployed where needed. Sandra Beck, Director of Finance at Broxbourne Council, comments: “This is an important move for Broxbourne Borough Council. We were impressed by the consistently high level of services delivered by Sopra Steria for Welwyn Hatfield Borough Council”.

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There has little effect of Brexit on the UK economy according to the Office of National Statistics (ONS). Chief economist, Joe Grice, says that “The referendum result appears, so far, not to have had a major effect”. The statistics would suggest the UK economy has been like a yo-yo in the past few months with sectors growing one month before falling the next. With encouraging news across the board, Phillip Hammond, the chancellor, said “I am confident that we have the tools necessary to support the economy." However, it is worth reminding everyone that Brexit has not yet occurred and many of the details are yet to be worked out.

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Aecus Innovation Showcase will now be a Webinar, embracing the impact of the digital age upon the outsourcing community. The Webinar will be a chance to discover some of the great success stories innovations has created a competitive advantage and will offer the opportunity to acquire transferable ideas to develop your own strategy. To register for the event and to learn more about the Aecus Innovation Webinar, please click here.

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The PM, Theresa May, has held a summit in New York last night to reassure US banks about the British economy after the Brexit vote. She also met other giants of different sectors such as Amazon and Sony Pictures in a plea to maintain large investment flows into the UK. There had been concerns that after the vote to leave the EU, some companies could move UK headquarters to the continent. Meanwhile, ratings agency Moody’s has played down the loss of the EU passport, suggesting that any effect would be limited and lead to only short term internal restructuring and divisions in management resources.

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Today the Cyber Highway scheme will be launched in the UK in an attempt to help UK business defend themselves against cyber threats. New research suggests that over 90% of UK firms have suffered a cyber-attack in the past 5 years. Companies can now track how suppliers are being approved for the official government stamp of approval for security standards, and businesses can also improve their own compliance through the platform. Lord Blunkett, former home secretary and now chairman of the company behind the scheme Cyber Essentials Direct said “Government departments now require suppliers bidding for particular contracts to be cyber essentials certified”.

For more information on Cyber Highway, click here.

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The Ministry of Defence may be about to complete a £30 million deal to develop a prototype laser weapon. The prototype that would will be assessed before a decision as to whether it would be useful in the UK’s arsenal. This project is part of a larger £800 million Defence Innovation Initiative which over the next ten years hopes to encourage new technology being incorporated into the UK’s defence. The initiative “will put the UK at the fore front of high energy laser systems”, said Dave Armstrong, executive group director technical and UK managing director of MBDA, a missile manufacturer.

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