Since the first mechanical device was invented in the 19th century the rapid innovation and progress that IT and computers have made has been unimaginable. And it has all stemmed from the first industry pioneers, who wanted to perform complicated mathematical calculations. Today IT and computing connects on a human, business, industry and national level, forming an interconnected global economy, completely changing social norms and the way which we do business.
See how IT has grown through innovation in our brief timeline below:
19th Century: English engineer Charles Babbage, the “father of the computer”, creates the first mechanical device used to compute numbers.
1901: Herman Hollerith patents his mechanical card punch. It is the first card punch which can punch digits 0-9 by typing on a keyboard.
1943: The Colossus Mark 1 machine is delivered to Bletchley Park in order to decipher the German Enigma code. It was considered to be the world’s first semi programmable, electronic digital computer.
1947: The transistor was successfully demonstrated at Bell laboratories, New Jersey, USA. It meant computers could process information 1000 times faster and be greatly reduced in size.
1948: The Manchester Baby, developed at Manchester University, is the first stored program computer and was able to run its first program.
1972: Microprocessors are developed. This increased the power of computers and once again significantly reduced the size and weight, which meant they could start being made regularly available to the public.
1975: The first personal computer (PC) is introduced. The Altair 8800 was seen as the start of the microcomputer revolution.
1976: Steve Jobs and Steve Wozniak start Apple Computers and with the Apple 1, developing the first computer with a single circuit board.
1980’s/90’s: Focus turned to software development. Including the first user-friendly computer platform, Microsoft Windows, which made computers even more accessible in business environments.
1990: Tim Berners- Lee, as a researcher in Switzerland, develops HTML. Starting the rise of the World Wide Web.
1990’s: The widespread use of the internet means businesses benefited from efficiency gains and the ability to communicate to all areas of the business around the globe instantly.
1999: Users begin connecting to the internet without wires connecting to their computers. The term WI-FI is coined.
2000- Present: Innovation has become almost untraceable, with new developments coming about daily all over the globe. Highlights include the IPhone, which brought computer functions to the smartphone, and the first re-programmable quantum computer, which can run complex scientific simulations.
As previously mentioned IT has now become a driver for many businesses today. And it is unlikely to find one which has no use of computing at all.
How has IT connected businesses?
The ability to organise and manage a business through IT activities has changed the way businesses operate. The data software being developed is being used in various industries by both large and small businesses.
This has created partnerships which would have looked unusual years ago, including businesses which you wouldn’t necessarily see as being particularly IT focused. With the digital age well and truly in motion. The differentiation in industries and businesses means innovation is required to overcome the individual IT problems they face.
For example, the relationship between sports and the IT industry has completely changed the way we look at athletes and sports in general. It has changed from seeing athletes as people with physically superior genetics, to being data driven, almost manufactured sportspeople.
By taking a look at the German national football team we can see how the use of IT can enhance an organisation’s success. They worked with SAP to develop a match insight software system which was then used to analyse opposing team tactics and increase German player’s game related activity output. The data analysis method was successful. Aiding the team in becoming World Cup winners in 2014, making it to the semi-finals of the 2016 European Championships, and being widely regarded as the best national team in world football.
Why should businesses work with IT companies?
Collaboration between businesses is important in developing your company’s required IT presence. And may result in game changing innovations. By working in partnership with IT companies a business can experience various benefits for development. Including:
- A larger workforce, with additional skills and knowledge to overcome problems. By having a different perspective on the problems your business is facing, there’s a greater possibility of overcoming the barriers to innovation. “Two heads are better than one”.
- The lack of emotional attachment to the development project, can provide an honest outside opinion to give positive feedback.
- When working in partnership with an IT company, a large benefit will be the increased capital to invest in the R&D project. This is a big benefit to start-ups and businesses who may be struggling for investment.
- Gaining entry into distinguished networking groups. The IT industry speaks in a specific, technically focused language. Being able to network with them is often hard for professionals in other industries. But by working with one company, it can then open up a large network of businesses with different IT specialisms to potentially work with in the future.
It has become much more common for businesses in the manufacturing or engineering sectors to subcontract out any software developing that the company needs to an IT specialist. This is an effective way of getting fully functional, trustworthy software for your business without having to be too involved.
This can be done in two ways. If you are a smaller business without the need for complicated software looking for a standard set up, using a freelance developer could be beneficial. But you will have to hire someone within your business to help organise the project.
However, if your company is more than just a few employees and has medium to high activity, using an IT agency will take a lot of the pressure off. They will be able to organise the project themselves and have the capability to develop large scale innovative software for their clients.
You may ask yourself, how will I know if the work being done on my software is innovative?
If the work is seemingly routine work for the agency ask yourself:
- How long is the project really taking?
- Is it taking longer than you had thought?
- Are the developers encountering problems of some sort due to the nature of the software you want developed?
- How are they overcoming the problem?
The process of overcoming is the area you should pay attention to. As this is usually where R&D is located and where you may be able to claim.
Can you claim R&D Tax Credits for subcontracting?
If a business outsources a project to a software company and R&D takes place in the project, then they can claim back 65 % of the subcontracting costs that relate to R&D.
The software company can also claim for their actual costs to carry out the R&D elements of the work, typically this is the PAYE costs.
At MPA, our industry experts submit subcontracting claims on a regular basis and with analysts across multiple industries we can understand your business, allowing us to maximise your claim. Get in contact today, and find out how you could claim back R&D Tax Credits for your research and development costs.