Research and analysis

Insights from the UK innovation diffusion and adoption survey: executive summary

Published 17 September 2025

1. Executive summary

1.1 Policy context

The UK’s Modern Industrial Strategy 2025 identifies innovation as essential to develop the UK’s growth-driving sectors. But innovation will only take us so far – the brilliant new technologies created in UK businesses, universities and the public sector are not enough to drive economic growth on their own. These technologies must be made available (diffused) and used (adopted) by business to unlock their true potential. Policymakers and economists have long championed the importance of innovation diffusion and adoption, but struggled to support these processes due to a lack of data. The Department for Science, Innovation and Technology (DSIT) commissioned this research back in 2023, recognising the importance of this evidence gap to maximising the impact of the government’s investment in research and innovation. The new government, recognising the importance of technology adoption, commissioned the Technology Adoption Review. This report provides key evidence that can help unlock the transformative power of technology to drive economic growth.

1.2 Importance of this survey

The first of its kind, this survey gives policymakers unprecedented insights into the innovation diffusion and adoption processes within UK businesses across 20 innovations (henceforth 20 technologies^{[footnote 1]}). This survey achieved a total sample of 4,595 responses from businesses across the UK, covering different business sizes, sectors and regions/nations. This survey is unique as it covers both adoption and diffusion, while most other large surveys of this kind focus solely on adoption.

For the purposes of this research and report, adoption and diffusion are defined as follows:

• Adoption: An organisation has fully adopted an innovative technology, or elements of it, into its operations.
• Diffusion: An organisation is currently selling, or has previously sold, an innovative technology to others.

1.3 Key findings on innovation adoption

More than half of businesses (56%) said they were existing adopters of at least one of the technologies covered in the survey. This headline ‘technology adoption rate’ varies by business characteristics and across technologies.

• Business size: Technology adoption increases with business size: 80% of large businesses; 71% of medium businesses; 63% of small businesses; and 48% of micro businesses.
• Region/nation: There is no overarching geographic pattern. The regions/nations with the highest overall level of technology adoption are the North East (66%) and London (65%). The regions/nations with the lowest level of technology adoption are Northern Ireland (42%) and the South West (47%).
• Sectors: There is no overarching sector pattern. Over half the sectors surveyed had similarly high levels of adoption in the range 55-62%. The top sector is Finance and Insurance (62%). 2 sectors have adoption rates below 50%: Construction (47%); and Transportation and Storage (35%).
• Internationalisation: Businesses with some overseas activity are more likely to adopt technology. 68% of businesses owned by overseas entities are adopting technology, compared to 44% of businesses with no overseas ownership or activity.
• Technologies: The 3 most commonly adopted technologies are: Remote Working Systems (24%); Future Telecoms (18%); and Sustainable Business Practices (16%). These are generally more established technologies. Meanwhile, the least adopted technologies are Quantum (6%) and Biotechnologies (5%). These are more nascent, less established technologies.

Technology adoption journeys tend to differ along one key dimension – how established the technology is. More nascent technologies, such as Quantum, tend to be more likely to require financial/ non-financial support; incur high acquisition/integration costs; take longer to adopt; and be sourced from overseas. Meanwhile, more established technologies, like Future Telecoms and Artificial Intelligence, are more likely to drive higher productivity.

Source and support

• Source country: UK businesses are sourcing most technologies from the UK (64%), followed by the rest of the world (19%) and EU/EFTA (17%). More established technologies are more likely to be sourced from the UK; such as Future Telecoms (80%), and Artificial Intelligence (63%).
• Non-financial support: 85% of tech adoption journeys required non-financial external support. The top 4 sources of non-financial support are a mix of government and industry support: namely professional and industry associations (28%); Help to Grow (24%); technical, industry or service standards (23%); and UKRI/IUK (23%). Less widely adopted technologies tend to be more reliant on UKRI/IUK for non-financial support, while more widely adopted technologies are more reliant on industry (inc. industry standards).
• Financial support: 73% of businesses accessed some form of financial support during their tech adoption journeys. The 3 most common sources of financial support were banks (27%); private investors/venture capital (23%); and UKRI/IUK (22%). More widely adopted technologies, such as Artificial Intelligence and Future Telecoms, are less likely to require financial support for adoption compared to newer technologies.

Time and costs

• Time taken: 19% of technology adoption journeys take more than a year. Biotechnology adoption journeys are most likely to take more than a year (38%); followed by Robotics, Drones and Autonomous Systems (31%). The technology least likely to take more than a year to adopt is Photonics and non-Quantum Sensors (4%).
• Acquisition/integration costs: These costs exceed 10% of annual turnover for 25% of businesses. Quantum placed a particularly large financial demand on firms, with 38% of adoption journeys incurring acquisition/integration costs over 10% of annual turnover, compared to 15% of Future Telecoms adoption journeys.

Enablers, barriers, and impact

• Enablers: The top enablers of technology adoption are mostly people related: leadership/management (41%); proven evidence of tech effectiveness (40%); employee capabilities (39%); and employee openness to change (39%). Financial factors, while still seen as important enablers by a sizeable proportion of respondents, sit in the bottom half of the list. Governmental factors are considered to be the least strong enablers.
• Barriers: The top barriers to technology adoption are: UK government regulation (19%); data privacy/security concerns (17%); and ease of integrating technologies (16%). For all factors, businesses were more likely to view them as an enabler rather than a barrier. However, the gap in scores between enablers and barriers is smallest for UK government regulation; with 28% of businesses stating this is an enabler compared to 19% who said it was a barrier.
• Impact: Technology adoption has enabled businesses to achieve several positive outcomes; including improving productivity of workforce (39%); developing new, improved or more flexible processes or operations (31%); and reducing production/operating costs (29%). More established technologies, such as Future Telecoms and Artificial Intelligence, were particularly likely to drive productivity improvements.

1.4 Key findings on innovation diffusion

Almost a quarter of businesses (24%) said they were existing diffusers of at least one of the technologies covered in the survey. This headline ‘technology diffusion rate’ varies by business characteristics, and across technologies.

• Business size: Technology diffusion increases with business size: 49% of large businesses; 42% of medium businesses; 30% of small businesses; and 17% of micro businesses.
• Region/nation: There is no overarching geographic pattern. The regions/nations with the highest level of technology diffusion are London (32%) and Scotland (31%). The regions/nations with the lowest level of technology diffusion are the South West (17%) and South East (17%).
• Sectors: There is no overarching sector pattern. Businesses in the Information and Communication sector are most likely to be diffusing technology (31%); followed by the Wholesale and Retail sector (27%); and Finance and Insurance sector (26%). Businesses in the Construction sector are the least likely at 14%; followed by the Real Estate sector (15%).
• Internationalisation: Businesses with some overseas activity were noticeably more likely to diffuse technology, ranging from 29% to 43% depending on the type of overseas activity. In comparison, only 8% of businesses with no overseas ownership or activity are diffusing technology.
• Technologies: The 4 technologies most likely to be diffused are: Artificial Intelligence (6%); Future Telecoms (6%); Recycling and Waste Technology (6%); and Remote Working Systems (6%). The order of technologies is broadly similar to that seen for adoption, with more established technologies more likely to be diffused than more nascent technologies.

Technology diffusion journeys can face several barriers and enablers that hinder businesses from successfully selling their innovations to others.

• Enablers: The top 4 enablers of diffusion are: employee capabilities (47%); demand for the technology (46%); scalability of the technology (43%); and proven evidence of technology effectiveness (43%). These enablers are a mix of behavioural, technological and economic factors; as well as being a mix of internal and external factors. Government factors – such as funding, regulation, and non-financial support – appear nearer the bottom of the list.
• Barriers: The top 3 barriers are UK government regulation/regulatory requirements (24%); intellectual property rights (20%); and non-financial government support (19%). At the technology level, the top 3 barriers are broadly consistent, with 2 noticeable exceptions. First, UK government regulation is the top barrier for all but one technology: Novel Electronics, Position, Navigation and Timing. Second, for Novel Electronics, Position, Navigation and Timing, both internal investment and external investment appear in the top 3, despite not appearing in the global top 5. Internal investment also appears in top 3 for Medical Technologies.

1.5 Key findings on innovation culture

When asked to rate how innovative they considered their businesses on a scale of 1-10, with one being ‘Not at all Innovative’, and 10 being ‘Extremely Innovative’, respondents were consistently likely to place their business towards the upper end of the scale. Some 64% of businesses ranked themselves between 7 and 10, with 26% placing themselves as a 9 or a 10 on the scale. We explored the innovation practices of businesses and asked them about the issues they faced with adoption. We uncovered the following:

• Innovation practices are widespread: Most businesses surveyed display regular innovation behaviour: 80% say that they regularly discuss across teams how they can be more innovative; while 80% also say that teams and individuals are recognised and rewarded for their contribution to innovation. Both these behaviours are more prevalent in organisations that are adopting technologies, and among larger firms.

• Non-adopters often identify as innovative: Non-adopters also tend to rank themselves as highly innovative, although less so than the total sample: 47% of non-adopters ranked their innovation level between 7 and 10 on the innovativeness scale. This suggests that innovative firms generally do not see a need to adopt the 20 technologies included in this survey. This is a surprising finding. There are different possible explanations, but all suggest information asymmetries; either in innovation or adoption.

• Innovators are not always adopters: 25% of businesses consider themselves more innovative than their competitors, but are adopting fewer technologies than the average for their sector. We see the same pattern across business sizes, regions/nations, and sectors. The only exceptions were adopters of less widely adopted technologies, such as Quantum and Biotechnologies, who were much more likely to be adopting more innovative technologies than the average firm in their sector. If businesses believe they are leading innovators in their sector, they may not be sufficiently motivated to adopt new technology.
• There are 3 big issues in technology adoption – identification, acquisition and integration. 59% of all businesses stated that it is hard to get impartial advice on the appropriate application of new technologies. 69% of all businesses said that innovative technologies that could benefit their organisation were prohibitively expensive. 60% of all businesses stated that they recognise the long-term benefits of adopting new technologies, but struggle with the short-term impact. These issues were more common among those who had adopted than those who had not.

1. Not all these innovations are technological in nature, some are explicitly non-technological, but we refer to them as the 20 technologies and use the terms tech adoption/ tech diffusion for simplicity throughout this report ↩