THE FUTURE OF EU BUSINESS ENVIRONMENT

IN THE ERA OF DIGITAL TRANSFORMATION

C A T A L I N P L O A E , PH.D .

F A C U L T Y O F I N T E R N A T I O N A L B U S I N E S S A N D E C O N O M I C S , A S E B U C H A R E S T

Innovation accelerations in the global business environment

2 moments of Singularity

2007

Cost of information storage drop. No need for server investment

2006

Digital is becoming ATAWAD (AnyTime, AnyWhere, AnyDevice)

Innovations is becoming exponential

Computing power

Affordable sensors

New industrial means

Digital Transformation

It helps businesses work better by relying on

technological solutions for traditional problems

It integrates digital technology into the business and

creates fundamental changes to how that

business operates and delivers its product to

customers

Main source for competitive advantage currently

It leads to increased productivity internally.

The IMD World Digital Competitiveness

Ranking 2018

The IMD World Digital Competitiveness Ranking 2018

studies 63 economies. The objective of the digital competitiveness ranking is to

assess the extent to which a country adopts and explores digital technologies leading to transformation in government practices, business models and society in general.

The majority of countries in the study experienced an improvement in their level of digital competitiveness. About 40% shows a decline while only eight economies remain in the same position. These changes are not geographically focused. Improvements and declines occur across continents.

Digital performance at sub-regional level in 2018

Digital Europe at a glance (IMDWDCR2018) (1)

Western Europe: Nordic “dominance” in the ranking, with Sweden, Denmark, Norway

and Finland all in the top ten (these countries excel in the quality of their technological framework and in the widespread adoption of technologies in society)

Within the top half of the ranking, Austria, Ireland and Iceland experience improvements showing progress in their scientific concentration.

In contrast, Germany (18th), Belgium (23rd), Luxembourg (24th) and France (26th) slightly decline. In the bottom half, Portugal (32nd) improves; Greece (53rd), Spain (31st), Italy (41st) and Cyprus (54th) drop because of a decline in indicators related to training and education under the knowledge factor.

Digital Europe at a glance (IMDWDCR2018) (2)

Eastern Europe: Estonia ranks the highest (25th) followed by Lithuania (29th)

and the Czech Republic (33rd) (as they share high-level communication and connectivity systems, which result from key investments in their technological infrastructure);

Poland and Bulgaria slightly improve thanks to marked progress in the adoption of digital technologies (future readiness factor);

Croatia moves up four places to 44th and Romania increases to 47th (from 54th);

Hungary drops from 44th to 46th and the Slovak Republic experiences one of the largest declines in the ranking, from 43rd to 50th.

Integration of digital technology covers (a) ‘business digitisation’ and (b) ‘e-commerce’. ‘Business digitisation’ has five indicators (as % of firms using): electronic

information sharing, Radio Frequency Identification (RFID), social media, eInvoices and cloud solutions. E-commerce has three indicators: the percentage SMEs selling online, e-

commerce turnover as a percentage of total turnover of SMEs; and the percentage of SMEs selling online cross-border.

Share of businesses that consider the digital economy an opportunity (by industry) – EU level

Technology Disruption, Digital Transformation, and Business Performance (Futurum research Report)

Importance of digital transformation for companies in the CEE region

Main findings of “A Guide to the Future” Report (Microsoft)

For most companies, digital transformation spells growth

Customer satisfaction and product quality is driving digital transformation

Businesses expect digital transformation to improve efficiency, productivity, and collaboration

To exploit digital solutions, companies need more skilled personnel

1 in 4 companies see themselves as industry disruptors

The case of ROMANIA

Presentation title - 15/05/2019 – P 16

CAN NOT have employee of the

past and employee of the future

Presentation title - 15/05/2019 – P 17

Education and training

Continuous education is at the

heart of success…

Presentation title - 15/05/2019 – P 18

Start with use cases

Not technology

Start with use cases, not technology

Presentation title - 15/05/2019 – P 19

New ecosystem

Build the appropriate ecosystem with

startups…

Main findings of “A Guide to the Future” Report (Microsoft)

For most companies, digital transformation spells growth

Customer satisfaction and product quality is driving digital transformation

Businesses expect digital transformation to improve efficiency, productivity, and collaboration

To exploit digital solutions, companies need more skilled personnel

1 in 4 companies see themselves as industry disruptors

Crimson Education – The skills of the future employee

flexibility

Critical thinking

Creativity

Sociability

STEM (Science, Tech.,Eng., Math,)

SMAC (social, mobile, analytic, cloud)

Interdisciplinary

The 8 major needs of labor market of the future (Deloitte)

Reducing time spent at workplace

Workload flexibility

Increasing satisfaction at work

Cost reduction

Faster production

Easy usage of products

Safety and efficiency of products

Protecting environment

Conclusions (1)

Technological innovation is both disruptive and

creative. It’s disruptive because it makes what came

before it look outdated. And it’s creative because it

encourages new attitudes and solutions. In other

words, it’s always both a challenge and an opportunity.

Conclusions (2)

Currently, EU businesses are not taking full advantage of these advanced technologies or the innovative business models offered by the collaborative economy.

The state of the digitalization of industry varies across sectors, particularly between high-tech and more traditional areas, and also between EU countries and regions. There are also large disparities between large companies and SMEs.

Conclusions (3)

Faced with digital disruption, EU organizations are creatively adapting how they operate internally while dedicated digital transformation teams are sprouting up in companies all over the region.

Yet these efforts are not only being fueled by a desire to survive market upheaval. The digital transformation also points to increased business growth and a stronger relationship with consumers.

The future may be uncertain. But in many respects, it’s undeniably bright.